Glanton & Holden
[2007] FamCA 67
•15 February 2007
FAMILY COURT OF AUSTRALIA
| WEST & WHITE | [2007] FamCA 67 |
| FAMILY LAW – APPEALS –FROM DECISION OF FAMILY COURT JUDGE -PROPERTY – CHILD SUPPORT – COSTS Appeal allowed in relation to property and child support proceedings as exercise of discretion vitiated by material errors of fact. Costs order set aside in part as trial Judge failed to afford the husband procedural fairness in determining quantum of such costs. |
| Legislation Family Law Act 1975 CDJ v VAJ (1998( 197 CLR 172 |
| APPELLANT: | WEST |
| RESPONDENT: | WHITE |
| FILE NUMBER: | NC42 of 2005 |
| APPEAL NUMBERS: | EA93 of 2005 EA132 of 2005 EA20 of 2006 |
| DATE DELIVERED: | 15 February 2007 |
| PLACE DELIVERED: | Parramatta |
| JUDGMENT OF: | Coleman, May and Boland JJ |
| HEARING DATE: | 9 November 2006 |
| LOWER COURT JURISDICTION: | Family Court of Australia |
| LOWER COURT JUDGMENT DATE: | 27 July 2005, 31 August 2005, 1 September 2005, and 30 January 2006 |
REPRESENTATION
| FOR THE APPELLANT: | Mr West appeared on his own behalf |
| COUNSEL FOR THE RESPONDENT: |
| SOLICITOR FOR THE RESPONDENT: |
Orders
That appeal No. EA135 of 2005 is allowed in relation to property settlement and child support proceedings.
That appeal No. EA20 of 2006 is allowed in part.
That appeal No. EA93 of 2005 is dismissed.
That Orders, 1, 2, 3, 4, 5, 6, 7, 8 and 9 made on 1 September 2005 as varied under the slip rule on 9 November 2006 be and are hereby set aside.
That Orders 3 and 4 made on 30 January 2006 be and are hereby set aside.
That the property settlement and child support proceedings and the costs thereof be remitted for re-hearing by another Judge of the Family Court of Australia other than the trial Judge.
That the husband pay the wife’s costs of and incidental to the proceedings between the parties pursuant to Part VII of the Family Law Act 1975 on a party-and-party basis as agreed or assessed under Chapter 19 of the Family Law Rules 2004.
That the Court grants to the appellant wife a costs certificate pursuant to the provisions of s 9 of the Federal Proceedings (Costs) Act 1981 being a certificate that, in the opinion of the Court, it would be appropriate for the Attorney-General to authorise a payment under that Act to the appellant mother in respect of the costs incurred by the appellant mother in relation to the appeal.
That the Court grants to the respondent father a costs certificate pursuant to the provisions of s 6 of the Federal Proceedings (Costs) Act 1981 being a certificate that, in the opinion of the Court, it would be appropriate for the Attorney-General to authorise a payment under that Act to the respondent father in respect of the costs incurred by the respondent father in relation to the appeal.
That the Court grants to each party a costs certificate pursuant to the provisions of s 8 of the Federal Proceedings (Costs) Act 1981 being a certificate that, in the opinion of the Court, it would be appropriate for the Attorney-General to authorise a payment under that Act to each party in respect of such part as the Attorney-General considers appropriate of any costs incurred by each party in relation to the new trial granted by these orders.
| FAMILY COURT OF AUSTRALIA AT PARRAMATTA |
Appeal Number: EA93 of 2005, EA132 of 2005, and EA20 of 2006
File Number: NC42 of 2005
| WEST |
Appellant
And
| WHITE |
Respondent
REASONS FOR JUDGMENT
Introduction
By Notices of Appeal and/or Applications for Leave to Appeal, Mr West (“the husband”) challenged a number of orders made by the trial Judge, on 31 August and 1 September 2006 with respect to refusal to grant an adjournment, property settlement, child support, and costs. Although complaining of such order, the husband did not appeal against the trial Judge’s order under s 118 of the Family Law Act 1975 (the “Act”) declaring the husband to be a vexatious litigant. The husband also made an application in a case filed 23 October 2005 seeking leave to adduce further evidence in support of his various applications and/or appeals.
Ms White (“the wife”) resisted the husband’s appeals and/or Applications for Leave to Appeal.
The husband represented himself at the trial before the trial Judge and on the hearing of proceedings in this Court.
Procedural History
There were three appeals before the Court being EA93 of 2005, EA132 of 2005 and EA20 of 2006.
Appeal EA93 of 2005 related to challenges that the trial Judge “erred in law in failing to apply relevant guidelines re: self represented litigant”, and against an order in favour of the wife for costs in the sum of $500 made by his Honour The trial Judge on 27 July 2005. Before the Court it was agreed that instead of proceeding on EA93 of 2005, the husband would confine himself to the grounds in relation to EA132 of 2005 instead. The number and nature of the husband’s appeals and/or applications for leave to appeal, combined with the fact that he has at all material times been unrepresented, and the comparative complexity and inter-relationship between the orders challenged or sought to be challenged have led to some confusion as to the nexus between matters agitated by the husband before us and the orders he seeks to have overturned. We have therefore focused on the substance of his complaints and orders to which they relate, rather than to which matter those complaints are directed. We are confident that neither party has been thereby disadvantaged.
Appeal EA132 of 2005 grounds of appeal related to orders of the trial Judge of 1 September 2005 providing for a departure from an administrative assessment of child support in the total sum of $18,200, and asserted arithmetical errors in the judgment, errors of law, issues of weight in relation to the husband’s contributions, errors of fact asserted to have been made by the trial Judge, specifically and relevantly for the purposes of this appeal about the husband’s interest in his father’s estate, and family debts, and “that the trial Judge made an error of law as he failed to apply the relevant ‘guidelines’ as to self-represented litigants to the Husband”.
Appeal EA20 of 2006 related to the refusal by the trial Judge to grant an adjournment sought by the husband, and the ordering of costs against the husband on 30 January 2006 in the sum of $30,000.
Leave was granted by consent for the husband to amend his Notice of Appeal of 20 January 2006 in terms of the Draft Notice presented to the Court on 23 October 2006.
On the morning of the hearing of the appeal, his Honour the trial Judge amended his primary judgment of 1 September 2005 under the slip rule to correct some minor arithmetical errors. In so doing, as the husband has conceded, the trial Judge eliminated a number of the husband’s grounds of appeal. Leave was granted by the Court to the husband to amend his grounds of appeal to exclude grounds relating solely to arithmetical errors, and to include in the grounds of appeal challenges to the primary judgment as amended 9 November 2006.
The bulk of the appeals and/or applications for leave to appeal arise out of orders made by the trial Judge on 31 August 2005 and 1 September 2005, the judgment in respect of which was, somewhat unusually, delivered in two parts on two consecutive days (for the purposes of these Reasons, the Judgment of 31 August 2005 will be referred to as the ‘Judgment’ and the Judgment of 1 September 2005 as ‘Judgment Part 2’).
On 1 September 2005 his Honour made orders providing for departure from administrative assessment of child support for the children of the parties, J P A West, born August 1991, and D T West, born June 1993, for the periods February 2003 to February 2006, and February 2006 to February 2010, in the annual sums of $7,800 and $10,400 respectively.
His Honour’s orders also provided that on or before November 2005, the husband “provide child support” for the two children by the payment of a lump sum of $24,155 which was to be credited against any assessments for the period September 2005 to February 2008. Those Orders give rise to one of the husband’s applications for leave to appeal.
His Honour also made orders for settlement of property pursuant to which the former matrimonial home of the parties’ at V was to be sold and the proceeds of sale after payment out of various expenses divided as to 62.5 per cent to the wife, the balance being first applied to discharge a mortgage secured on the property to a Ms W, thence on arrears of child support payable by the husband, including moneys payable pursuant to his Honour’s orders of that date, thence, in payment of various orders for costs made against the husband, the balance then becoming payable to the husband. Those Orders are the orders for settlement of property against which the husband has appealed.
A number of other Orders (specifically Orders 10, 11 and 12) then made by the trial Judge are not relevant for present purposes.
The primary proceedings before the trial Judge were heard on 24- 27 May 2005.
On 27 July 2005 the husband, whilst judgment was reserved in the property settlement, child support and s 118 proceedings, applied to the trial Judge to re-open his case in order to adduce further evidence. That application was refused. That refusal gives rise to an application by the husband for leave to appeal.
The evidence which the husband sought to adduce on 27 July 2005 was substantially the same as the evidence which he sought to raise in his application to this Court for leave to adduce further evidence pursuant to s 93A(2) of the Act.
On 30 January 2006 the trial Judge gave leave to the wife to commence costs proceedings against the husband and then ordered that the husband pay $30,000 towards the wife’s costs of and incidental to the proceedings which he had heard and determined. That order also gives rise to an appeal.
Background
The proceedings before the trial Judge involved children’s and financial issues. There has been no appeal in relation to the children’s issues, which related to the children of the marriage identified earlier in these Reasons.
The parties married and cohabitated from mid-1973 until they separated under the one roof in late 2000. The chronology of the parties’ cohabitation is largely uncontroversial, and is comprehensively outlined in the trial Judge’s Judgment.
Extensive reference will necessarily be made later to the trial Judge’s Reasons for the decisions now challenged or sought to be challenged. Reference to aspects of his Honour’s Reasons at this stage is however, unhelpful.
The trial Judge found the net assets of the parties, after a number of disputed “add-backs” were included, to be $478,365 net (paragraph 54, Judgment Part 2 as amended by slip rule). His Honour assessed the contribution entitlements of the parties as 55 per cent to the wife and 45 per cent to the husband (paragraph 55, Judgment Part 2). Section 75(2) factors were considered to favour the wife, the trial Judge making an adjustment of 20 per cent in her favour by virtue of such factors. The wife’s overall entitlement thus became 75 per cent and that of the husband 25 per cent (paragraph 92, Judgment Part 2).
The trial Judge concluded that the husband had an earning capacity of “…not less than $600 per week” (paragraph 64, Judgment Part 2) and would, by virtue of the contribution finding in the property settlement proceedings, have net assets of $112,786 (which related to the pre “add-back” net assets of the parties) (paragraph 57, Judgment Part 2) together with an interest in the estate of his late father which the trial Judge relevantly concluded was worth “…possibly as much as $200,000” (paragraph 73, Judgment Part 2).
The reasonable weekly needs of maintaining the two children were found by the trial Judge to be “…at least $300 per week in total” (paragraph 69, Judgment Part 2).
The wife’s income was found by the trial Judge to be $85 per week from part-time work together with $430 per week by way of social security payments (paragraph 71, Judgment Part 2).
The husband’s income was found to be $182 per week Newstart Allowance from the Department of Social Security (paragraph 72, Judgment Part 2).
His Honour concluded that the husband should contribute $150 per week, increasing to $200 per week from 5 February 2006 towards the costs of raising the children (paragraphs 77-78, Judgment Part 2). In reliance upon such findings, the trial Judge concluded that the husband should pay, by way of lump sum child support from 1 September 2005 to 5 February 2008, the sum of $24,155 (Order 2).
Much of the trial Judge’s judgment relates to children’s issues which are not relevant for present purposes. It will be necessary, in the course of considering the husband’s applications for leave to appeal and/or appeals to have regard to a number of parts of his Honour’s judgment and it is preferable that, generally, we refer to those matters by reference to specific applications for leave to appeal and/or appeals. However, particularly as part of the husband’s various challenges involve the trial Judge’s conclusions with respect to the credibility of each of the parties, it is appropriate to refer at the outset to the trial Judge’s reasons in that regard.
As is apparent from his Honour’s comprehensive consideration of the issue, the trial Judge formed an adverse view of the husband’s credibility, finding that the husband’s:
…conduct in relation to these proceedings has included lies, dishonesty, fraudulent behaviour, concealment of property, and failure to make full and frank disclosure of his financial circumstances such as the detail of his interest in his father’s estate. The husband is a dishonest and unreliable witness.
His Honour so observed (paragraph 41, Judgment) after recounting, in the preceding 37 paragraphs, the facts and circumstances which led to his so concluding.
Whilst the husband disputed that it was reasonably open to the trial Judge to form as adverse view of him as he did, the only matter to which the husband specifically referred this Court in the context of his attack upon his Honour’s conclusions with respect to his credibility related to his father’s estate (paragraphs 29-31, Judgment). In reality the husband did not otherwise challenge the findings of fact of the trial Judge upon which his conclusion with respect to the husband’s credibility rested. We observe that those findings of fact provided ample foundation for his Honour’s adverse view of the husband’s credibility.
It is perhaps convenient to consider in this context the further evidence which the husband sought leave to adduce in relation to the estate of his late father. Counsel for the wife opposed the granting of leave to rely upon what appeared to be a copy of the grant of Letters of Administration with the Will of the husband’s late father annexed. At least for the purpose of these proceedings, the document can be treated as sufficiently authentic on its face to enable the Court to consider its impact in accordance with the decision of the High Court in CDJ v VAJ (1998) 197 CLR 172.
If accepted, that evidence establishes that the husband did not have any interest in the estate of his late father. It does not in any way contradict, and there is no other sufficient basis for contradicting, the trial Judge’s findings of fact in relation to the use and enjoyment of assets of the husband’s late father’s estate (paragraphs 29-32, Judgment), whoever was beneficially entitled to such assets.
The question in relation to the trial Judge’s finding with respect to the husband’s credibility is thus whether, if his Honour was in error in relation to the husband’s interest in his father’s estate, that error vitiated his conclusion with respect to the husband’s credibility, and rendered such conclusion “erroneous”.
As noted earlier in these reasons, the further evidence in relation to the husband’s late father’s estate has potential relevance to other aspects of the proceedings in this Court, and will be considered with respect to the particular applications for leave to appeal and/or appeals as is appropriate.
On behalf of the wife it was submitted that the trial Judge’s conclusion with respect to credibility was not reliant upon the trial Judge correctly finding that the husband had a beneficial interest in his late father’s estate and that the credit finding could survive his Honour’s finding in that regard having been erroneous.
The husband submitted in his Application for Leave to Adduce Further Evidence that the probate document with respect to his late father’s estate would “cast a different light” on his credibility. The husband complained that the trial Judge had a “general attitude” to him and his evidence.
The husband made a number of submissions amplifying his general complaint with respect to the trial Judge’s findings with respect to credibility. In particular the husband disputed that the facts as found by the trial Judge in paragraphs 22, 28 and 29 of his Honour’s Reasons for Judgment constituted evidence adverse to the husband’s credibility. The findings of fact themselves were not challenged. It requires only a reading of the findings of fact there recorded to realise the absence of merit in this submission.
Throughout his submissions the husband repeated that the trial Judge had “a certain attitude towards me”. It is apparent that the trial Judge indeed, at the time he came to write his judgment, did have a “certain attitude” towards the husband, and that attitude was negative. Whether the husband was asserting “bias” in the sense of an absence of impartiality, actual “bias” or some other state of mind is unclear.
Whilst the husband may not understand that it is so, the distinction of significance for present purposes is between forming an adverse view of the testimony of a party after hearing the totality of the evidence, as the trial Judge did in this case, and reaching such a conclusion at an earlier time in the proceedings, which, significantly, is not suggested by the husband to have been the case.
It is in the nature of credibility findings that a trial Judge does express an “attitude” to the evidence he or she has heard. In this case, the very many and unchallenged findings of fact made by the trial Judge led inevitably to a negative finding with respect to the husband’s credibility.
Whilst his Honour’s mistaken belief that the husband had a beneficial interest in the estate of his late father contributed to the negative view he formed with respect to the husband’s evidence, it cannot be said on a balanced reading of his reasons in relation to the topic that, without that evidence, the adverse credit finding was not open to the trial Judge. Compared with some of the findings of fact upon which his Honour relied in relation to the husband’s credit the estate matter was totally benign. Even without the finding in relation to his late father’s estate, there was an abundance of evidence supporting the trial Judge’s generally negative view of the husband’s credibility.
The challenge made by the husband to the trial Judge’s findings of credibility thus fails. As will be seen, that however is not the only significance which the terms of the Will of the husband’s late father assumed in these proceedings.
It is perhaps also convenient at this stage to deal with another comparatively discrete issue raised by the husband.
The Application for Leave to Appeal against the refusal to re-open on 27 July 2005
On 27 July 2005 the husband sought leave to re-open his case in order to adduce evidence in relation to a number of matters. The trial had concluded on 27 May 2005. Judgment was reserved at the time the husband applied to re-open his case, one month prior to judgment being ultimately delivered.
In his Outline of Submissions, albeit under the heading “Outline of Submissions regarding Costs [West – White]”, the husband addressed his grounds of appeal. Paragraphs 6 and 7 contain the substance of his complaint. They provide:
6.I have endeavoured to correct at least, the “will of estate” matter that arose on the final orders hearing on the 27/05/05 (hearing before Js. ). After obtaining the original that somehow was in the spouses [sic] possession and given to me with other documentation held by her (on the 08/06/05) via solicitor F (A) after the final hearing; knowledge of its whereabouts was previously denied by the spouse.
7.Also evidence from a W W of M, B pertaining to financial sums loaned to both parties to establish the matrimonial building projects in the main, caused me to initiate an application for leave to present the substantiating evidence for my hearing for final orders on the 27/05/05.
It is apparent from the trial Judge’s Reasons for Judgment that the husband’s application was refused on the basis that the husband had “…not established any basis for a re-opening of the hearing” (paragraph 11, Judgment, 27 July 2005).
His Honour identified the evidence which the husband sought to adduce if leave to re-open were granted, as that relating to “alleged loans by his brother” to the husband, and evidence “concerning the will and estate of his late father” (paragraphs 3 and 4, Judgment, 27 July 2005).
The affidavits, which are reproduced in the Appeal Book for EA93 of 2005, were considered by his Honour, who accurately summarised their contents and potential effect (paragraphs 3-10, Judgment, 27 July 2005).
So far as the evidence of the husband’s brother is concerned, it was the husband’s case that he owed his brother $25,500. The trial Judge had concluded (Judgment Part 2 paragraphs 4 – 5), having refused the husband’s application for leave to adduce evidence from his brother in relation to the alleged loans, that a sum of $5,000 may have been owed, and obliged the wife to pay such liability from her share of the proceeds of sale of the matrimonial home (Order 8).
As noted earlier, the evidence in relation to the husband’s father’s estate would, if accepted, have led the trial Judge to a different conclusion as to the husband having a beneficial interest in that estate.
The trial Judge recorded that:
…the husband’s application to reopen proceeds on a misconception as to the right of a litigant to obtain an order entitling them to reopen a hearing. Parties to proceedings are not entitled as of right to have the proceedings reopened if they decide that other evidence should have been provided to the Court (paragraph 6, Judgment, 27 July 2005).
He further added:
[i]t is essential to any concept of fair play that litigants not be able to run a hearing and then later reopen the hearing if they decide that they will bring before the Court evidence that was reasonably available and they could have relied upon at the hearing. It is not appropriate that the husband be able to put the other party or other parties to the surprise, inconvenience, expense and prejudice of reopening a completed hearing to introduce evidence that they knew or ought to have known was available but did not rely upon at the hearing. (paragraph 7, Judgment, 27 July 2005)
The trial Judge found that there was “…no evidence as to why Mr West’s [sic] brother did not provide an affidavit at the hearing” (paragraph 8, Judgment, 27 July 2005).
With respect to his Honour, and accepting that in form it was inadmissible, the husband did provide an explanation for his failure to file an affidavit earlier. That explanation was contained in his affidavit filed 26 July 2005 (AB 93 of 2005 at pages 48-49).
With respect to his Honour, it is also clear that the husband, who was unrepresented at trial, appreciated after the trial concluded, that he needed evidence from his brother to advance the claim with respect to loans allegedly owed to the brother, and the probate document or other evidence of similar kind in relation to the beneficial entitlements with respect to his late father’s estate. The transcript confirms that the trial Judge pointed out these deficiencies to the husband during the course of the trial.
The fact that the further evidence related to “…matters that were within the knowledge of the husband” (paragraph 8, Judgment, 27 July 2005) is not really the point, the husband’s evidence, albeit for different reasons, being insufficient proof of each of the matters the subject of the application for leave to re-open, as the trial Judge, correctly, observed in May 2005.
In relation to each of these matters, the evidence indicated that upon the husband becoming aware of the deficiencies in his case, he did seek to obtain and place before the Court relevant and potentially admissible evidence with respect to those matters.
The trial Judge observed, correctly there is little doubt, (paragraph 10, Judgment, 27 July 2005):
[t]he alleged copy of the will that is annexed to [the husband’s] affidavit is not admissible evidence because it is not verified by anyone with any knowledge of the making of the Will. It is not authenticated. But in any event, the rest of the material in that affidavit which addresses various other issues is all material that on the face of it was available to the husband at the hearing, but he did not put it into evidence.
For reasons which will become apparent, and relate to the husband’s application to adduce further evidence at the hearing of the appeal, the application for leave to appeal against the trial Judge’s refusal to allow the husband to re-open his case is largely academic.
Without expressing a concluded view, given that the husband had undoubtedly raised the issues to which the further evidence related, was unrepresented, and that agitating the matters arising from the further evidence sought to be raised by the husband would not have significantly prolonged the trial, or been likely to cause prejudice to the wife, we are less than convinced that, albeit a matter for the trial Judge’s discretion, denying the husband leave to re-open in the circumstances of this case was the preferable course to have taken.
In Cipars v Cipars (1990) FLC ¶92-122 the Court said, at 77-793:
…this Court has a discretion to admit evidence… and that in the circumstances of this case the injustice which would be suffered by the husband, if the allegations … are correct, by far outweigh any other consideration and for that reason the evidence ought to be accepted.
Applying that reasoning to the facts of this case, permitting the husband to re-open his case was not inconsistent with broad notions of natural justice and may have obviated a number of the challenges now raised by the husband.
For reasons which will become apparent, we do not need to express a concluded view with respect to this application, as no practical significance attaches to whether the Court refuses or allows this application for leave to appeal.
The husband also sought leave to appeal against the order for costs in the sum of $500 made by the trial Judge at the time he refused the application for leave to re-open his case.
As the authorities such as Penfold v Penfold (1980) 144 CLR 311 at 315, make clear, the discretion of the trial Judge in relation to the costs of that unsuccessful application is broad. Nothing to which the husband has referred this Court persuades us that the exercise of discretion by the trial Judge was other than reasonable in the circumstances as he found them, and we would accordingly not grant leave to appeal against the order for costs of 27 July 2005.
The Appeal against the Orders for Settlement of Property
A convenient starting point for an examination of the grounds which remained in relation to settlement of property is Ground 4 which provided: “[t]hat the learned trial Judge made an error of fact when he found that the husband was the benefactor to a ‘will of estate estate’ [sic].”
There can be no doubt that, on the evidence before him, the trial Judge was entitled to conclude, as he clearly did, that the husband had an unquantified interest in the estate of his late father (paragraph 91, Judgment Part 2).
The husband thus needs to succeed with his application for leave to adduce further evidence with respect to his father’s estate for his complaint about the trial Judge’s treatment of his father’s estate to have any prospect of success.
We have earlier referred to the further evidence upon which the husband seeks to rely. The further evidence, if accepted, would establish that the husband had no legal interest in his late father’s estate. The further evidence, in the form of the copy grant of Letters of Administration with the Will annexed would “render erroneous” the trial Judge’s conclusions with respect to the husband’s interest in his late father’s estate. (See CDJ v VAJ (supra) per McHugh, Gummow and Callinan JJ at paragraph 109.)
As will be seen, the more significant issue is the impact on the determination of the various applications before the trial Judge of that erroneous finding. We will again need to return to that topic later in these reasons.
Ground 5
Ground 5 relied upon by the husband provided: “[t]hat the learned trial Judge made an error of fact when he found that the husband did not owe his brother W White $25,000.00.”
We have earlier referred to the reality that, at trial, the only evidence before his Honour in relation to the alleged debts to his brother was that of the husband.
The husband cross-examined the wife in relation to the alleged loans, the wife’s answers making clear that she was neither in a position to admit nor deny the husband’s claims. As it was the husband who was asserting that he owed the money, the onus of establishing the loans rested with him.
The trial Judge, with abundant justification, did not find the husband a witness of truth. In the absence of any corroboration, and there was none, of the husband’s claims with respect to the loans from his brother, the trial Judge was entitled to find that the husband had not proved that he owed such moneys. This challenge to the trial Judge’s conclusions fails.
It is necessary however to consider the impact of the husband’s further evidence application with respect to this issue. As noted earlier, the trial Judge found that only $5,000 of an alleged $25,500 was owing to the husband’s brother. That sum his Honour took into account as a liability when determining the property of the parties, ordering the wife to indemnify the husband in respect of such liability.
It is apparent that the practical implications, if the husband’s substantive appeal against the orders for settlement of property is otherwise unsuccessful, are that the husband, if successful with respect to the “loans” claim would be $5,000 better off pursuant to the trial Judge’s orders (the husband receives 25 per cent of the net property of the parties). Increasing the debts of the parties by $20,500, as the husband would seek, would result in the wife bearing an additional debt of $15,375, and the husband an additional debt of $5,125.
The evidence of the husband’s brother in relation to the alleged loans (EA132 of 2005 AB1, page 52) is inadmissible in its present form. Whether it could be adduced in a form that is admissible cannot be known. The husband’s brother’s affidavit gives no clues as to the dates when moneys were paid, the amounts owing at any particular time or the means by which payments were made. It is conceivable that a claim by the husband’s brother to recover any of those moneys would be statute barred (see s 14 Limitation Act 1969 (NSW)) in the absence of a novation or admission which would take the payments outside the provisions of the limitations statute. No evidence to which the husband has referred the Court establishes the possibility of such matters.
The further evidence with respect to the alleged loans to the husband’s brother does not in our view satisfy the test propounded by the majority in CDJ v VAJ (supra). It cannot, on its own terms, be found that “if accepted” the further evidence would demonstrate error on the part of the trial Judge.
Even if we are incorrect in so concluding, we would not allow the further evidence, and thus uphold this challenge having regard to the minimal implications for the husband of so doing relative to the cost to the parties, as would necessarily be the case, of re-litigating that issue unless, in which case the issue could be re-visited without the further evidence application being successful, the husband’s appeal against the orders for settlement of property were to succeed on some other basis.
Ground 7
Ground 7 of the husband’s Notice of Appeal provided:
[t]hat the learned trial Judge gave insufficient weight to the husband’s various contributions pursuant to s.79(4)(a), (b) and (c) of the Family Law Act 1975 as amended in arriving at a conclusion of the husband’s contribution based entitlement to the date of hearing May 2005 at 45%.
In support of this ground the husband submitted:
Pertaining to co-contribution to house keeping an [sic] is husband’s affidavit (5/1/05) Vol. (2:)Pge 220, pgh 82-94, due to industrial injury spans of time not in employment (as well as after hours) ws [sic] capitalised by co-contributing to the caring of children and house keeping - as well as pacing myself physically in the building project as in ‘grounds 7’. (Submission for Appeal EA 132/2005)
The husband (page 4, Submission for Appeal EA 132/2005) identified by reference to a number of passages in affidavits reproduced in the Appeal Books the value of which he asserted the trial Judge failed to “appreciate”.
It is to be remembered that the trial Judge’s findings of fact turned significantly on his conclusions with respect to the credit of each of the parties. We have earlier dealt with the husband’s unsuccessful challenge to the trial Judge’s conclusions with respect to his lack of credibility.
The trial Judge was aware of each and every one of the contributions asserted by the husband in the affidavit passages relied upon and identified by him in this appeal. It was not a case of the trial Judge failing to “appreciate the value of contributions” put by the husband, but rather, having preferred the evidence of the wife to that of the husband in relation to such contributions, giving those contributions less weight than the husband asserted to be appropriate. Passages in the husband’s affidavits were relevant in that context only if their substance was accepted. It is not insignificant that despite the credit finding, the husband’s contributions were afforded substantial weight by the trial Judge.
As with the earlier affidavit passages, the difficulty the husband has is that, for reasons which we have not found to be erroneous, the trial Judge preferred the evidence of the wife to his evidence with respect to those contributions. Nothing to which the husband has referred this Court with respect to this ground establishes a basis for appellate intervention.
The husband has not referred the Court to any relevant fact or circumstance to which the trial Judge failed to have regard, nor has he referred the Court to any irrelevant fact or circumstance to which the trial Judge did have regard. None of the findings of fact made by the trial Judge with respect to contributions has been successfully challenged by the husband.
The trial Judge gave extremely detailed reasons for concluding as he did with respect to contributions, ultimately concluding that contributions should favour the wife by 55 per cent to 45 per cent, the ten per cent disparity translating, on the adjusted asset pool of $478,365 as approximately $47,800.
In our view, on the findings of fact made by him, the trial Judge’s conclusion with respect to contributions fell comfortably within the ambit of a reasonable exercise of discretion. To the extent that, on those findings of fact, the trial Judge may have been somewhat generous, in our view the husband was more the beneficiary of such generosity than the wife. We find no substance in this ground. We note that, to the extent that the husband might have sought to advance this appeal ground by reference to the further evidence with respect to his father’s estate, such evidence could not assist the contribution challenge.
Ground 8
Ground 8 of the husband’s Notice of Appeal provided: “[t]hat the learned trial Judge made an error of law both in ‘adding back’ and ‘deducting post separation assets’ the amounts referred to in the reasons at paragraphs 53 and 54.”
In paragraphs 53 and 54 of his Reasons for Judgment (Part 2), the trial Judge referred to three items which he concluded should be “…applied to the pool of property and liabilities” of the parties as previously found. These included a number of assets and liabilities identified by his Honour in paragraph 54. Nothing emerging from the husband’s Outline of Argument document, or any submission made by him on the hearing of the appeal provides a basis for appellate intervention in relation to such findings or conclusions.
To the extent that the trial Judge’s findings of fact in relation to “add-backs” turned on credibility, for reasons which we have earlier given, challenges to those findings of fact cannot succeed. The “add-back” of “debts except debt to W” of $223,942 was explained by the trial Judge in some detail earlier in his Reasons and was, in our view, entirely justifiable on the findings of fact which he made. These relevantly included for example,
82. The husband did not vacate the home in accordance with the orders made by the Federal Magistrates Court. On 16 February 2004 there was an enforcement hearing in the Federal Magistrates Court and orders were made including orders for the issue of a warrant for possession of the home, the husband to transfer the title to the wife pending further order, and restraining the husband from disposing of or encumbering the home pending further order….
83. The husband did not vacate the home until 19 February 2004. He did not comply with the order for the transfer of the title. Indeed, in contravention of the orders made, he mortgaged the home to a private lender for $406,000 without notice to the wife. The interest rate under the mortgage was 12% per annum. The monthly payments were $4,400. In default of any payment, the interest rate was 14% per annum. The mortgage also provided that interest was payable throughout on the whole of the principal while any part of the principal remained unpaid.
84. On 20 February 2004 the Registrar of the Court executed the transfer to the wife on the husband’s behalf as a result of his failure to sign. When registration of the transfer was attempted, it was discovered that a mortgage had been registered.
85. On 2 March 2004, further interim orders were made by the Federal Magistrates Court including an order restraining the husband from encumbering or further encumbering or dealing with the title to the home and from operating any account with various financial institutions. The orders also required him to produce various documents, restrained him from receiving any funds from the mortgagee, and required him to deliver up the Certificate of title for the property, and provided for service of the orders on the mortgagee.
86. On 5 March there were orders made by the Federal Magistrates Court restraining the husband from dealing with any accounts of him at various financial institutions.
87. A warrant was issued for the arrest of the husband.
88. On 22 March 2004 another appeal by the husband to the Full Court of the Family Court of Australia was dismissed.
89. Further orders were made against the husband in relation to possible investments on 5 April 2004, and an A P order was made against him on 8 April 2004, by which time the warrant for arrest had been executed and he was remanded in custody. When the A P order was executed, the funds which were found by the wife and other persons in the husband’s premises amounted to only $12,200.
90. The husband was remanded in custody on 8 April 2004 in relation to contravention of the orders of 16 February.
91. On 29 June 2004 the husband was fined $2,000 for contempt of Court committed on 4 June 2004 when he refused to disclose the whereabouts of the $406,000 he obtained by mortgaging the home. On 20 July 2004 he was sentenced to imprisonment for 12 months for contravention of the Orders of 16 February 2004, and was ordered to pay the wife’s costs of the contravention proceedings including costs of appearances on 14 May 2004, 17 May 2004, 18 May 2004, 20 May 2004, 31 May 2004, 4 June 2004, 29 June 2004, 12 July 2004, and 20 July 2004.
92. The husband appealed against the fine and also the gaol sentence.
93. Because the payments were not being made under the mortgage, the mortgagee proposed to sell the matrimonial home and gave notice to the parties of its intention. The wife’s solicitor had correspondence with the husband pleading with him to disclose the location of the funds obtained from the mortgage. The husband persisted in claiming he had spent the whole of the funds.
94. On 22 September 2004 when the mortgagor threatened to eject the wife and children from the home, the husband finally disclosed that the mortgage funds were buried in the back yard of his father’s former home. A total of $384,000 was recovered and subsequently there were orders by the Federal Magistrates Court for those funds to be paid to the mortgagee in reduction of the mortgage. This was done.
95. Subsequently, the husband’s sentence for contravention of the orders was suspended subject to certain conditions and he was released from custody on 10 November 2004. He was ordered to pay the wife costs in respect of his application for release.
96. On 16 November 2004 the husband was ordered to pay the wife’s costs in respect to the Stay applications he had made. On 23 November 2004 an order was made in the Full Court of the Family Court of Australia for that the husband to pay the wife’s costs of and incidental to 3 appeals lodged against decisions of the Federal Magistrates Court. Those 3 appeals were dismissed.
97. The $384,000 recovered was not sufficient to discharge the mortgage. The mortgagee sought as a condition of any discharge that there be a release by the husband against any further claim against the mortgagee. The husband would not co-operate and would not provide any such release.
98. In December 2004, the wife arranged to borrow from her mother the funds to discharge the mortgage. The loan was subject to interest and secured by registered mortgage on the title to the home. The total amount advanced was $102,663 which comprised $87,663 for the mortgagee’s costs, and the balance of principal and interest and $15,000 for security for costs in respect of any future claim by the husband as a result of him refusing to sign a Deed of Release.
We do not find this ground to have substance.
Ground 12
Ground 12 provided: “[t]hat the learned trial Judge made a mistake of fact in assuming that the wife will pay the debt to W West when such debt is explicitly deducted from the ‘adjusted pool’” (Reasons at paragraph 54).
In his Outline of Argument document, the husband repeated this ground of appeal. The husband referred the Court to paragraph 59 (Judgment Part 2) of trial Judge’s reasons, from which it is apparent that the trial Judge visited upon the wife the sum of $5,000 being the “debt to W”. Presumably, the thrust of the husband’s argument in relation to this topic is that, earlier at paragraph 54 of his Reasons (Judgment Part 2), the trial Judge does not appear to have included as an “add-back” the $5,000 with respect to the husband’s brother, as is indeed the case.
The submission however overlooks the reality that the trial Judge had in the “property and liabilities” of the party detailed earlier in his reasons (paragraph 13 Judgment Part 2) already included the “husband’s debt to brother W” in the sum of $5,000. In those circumstances, to have again included that sum, or any additional amount having regard to the trial Judge’s findings with respect to the alleged debts to the husband’s brother would have been to err by “double counting”. No error on the part of the trial Judge has been demonstrated with respect to this topic.
Ground 15
Ground 15 provided: “[t]hat the learned trial Judge made an error of fact when he calculated the wife’s ‘present property and liabilities’.”
The husband’s written outline (Submission for Appeal EA132 of 2005) did not advance the ground, nor did any oral submission made on his behalf. To the extent that we understand this challenge, largely for the reasons we have given in relation to the preceding ground, we do not find it to have substance.
Grounds 16, 17, 19, 20 and 21
Grounds 16, 17, 19, 20 and 21 relevantly provided:
16. That the learned trial Judge made an error of law in that as part of the ‘third step’ he failed to assess, either parties’ entitlement for a ‘s.75(2) adjustment’, whether on a percentage or a monetary basis.
17. That the learned trial Judge made an error of law in that as part of the ‘fourth step’ he effected an ‘adjustment’ not pursuant to s.79(2) to arrive at orders that are ‘just and equitable’ but pursuant to s.75(2) as an adjustment for ‘s.75(2) factors’.
…
19. That the learned trial Judge made an error of fact in arriving at a final ‘ratio of 3:1 in the wife’s favour’ as such ‘ratio’ was outside the range.
20. That the learned trial Judge was an error of law [sic] in that the [sic] failed pursuant to the ‘fourth step’ to make ‘orders that were ‘just and equitable’.
21. That the learned trial Judge made an error of law in that the resulting orders were ‘manifestly unjust’.
As a reading of the husband’s Outline of Argument document makes clear, though not necessarily so expressed, these grounds challenge the s 75(2) adjustment determined by the trial Judge and the overall justice and equity of the award made by his Honour.
It is necessary to consider these challenges in two steps, first by reference to the evidence from which the trial Judge reached his conclusion with respect to s 75(2) and s 79(2), and then, in the event of none of the husband’s challenges in that regard finding favour, in the light of the further evidence sought to be adduced by the husband with respect to the estate of his late father.
As noted earlier, the trial Judge concluded that a 20 per cent adjustment in the wife’s favour pursuant to s 75(2) was appropriate. The reasons for so doing are not in doubt. There was no suggestion by the husband that the trial Judge failed to have regard to any relevant fact or circumstance. Nor is it suggested that he had regard to any irrelevant fact or circumstance.
To the extent that the findings of fact underpinning the trial Judge’s conclusions with respect to s 75(2) and s 79(2) have been challenged, such challenges have been unsuccessful, largely, but not exclusively, by reason of the failure of the husband’s challenge to the trial Judge’s conclusion with respect to the credibility of the parties.
Rather than refer to each of the matters individually in the sequence in which the husband has raised them in his written Outline of Argument document, we prefer to refer to the trial Judge’s findings as revealed by his Reasons for Judgment.
The trial Judge referred, correctly, to the ages of the parties and recorded, accurately, that the wife had “reasonable health” and that the husband was “probably suffering depression and taking anti-depressant medication for that” (paragraph 82, Judgment Part 2).
To the extent that the husband sought leave to adduce further evidence by way of medical reports, such reports being annexed to an affidavit of Dr J C Y, an orthopaedic surgeon, apparently unfiled but sworn on 26 October 2006, those notes reveal that Dr Y saw the husband in October 2003 and on occasions prior to that time.
Dr Y examined the husband and radiographs of his left ankle which was apparently injured in 1973 and again in 1978, suggesting that the options available “…include persisting with his current treatment, wearing brace, having a cortisone injection or undergoing arthroscopy and debridement followed by chondral grafting” which the doctor opined “…given his current frame of mind”, would “…not be met with a good result”.
The trial Judge referred to his earlier findings with respect to “the income earning capacity and financial resources of the parties”. These conclusions are relevantly to be found at paragraph 63 (Judgment Part 2) wherein his Honour recorded:
63. The wife relies on subparagraph 117(2)(c)(i) in that:
63.1The husband’s income is low but he has the capacity to undertake full time work as a truck driver;
63.2Under orders based upon the above findings as to contributions, he would have property to a net value of $112,786; and
63.3He has a financial resource by way of an interest in his father’s estate. Because the present administrative Assessment relies upon his taxable income and has no regard to his property or earning capacity it produces the minimum assessment.
64. He has numerous other work qualifications (See Exhibit W3 – Resume, and Exhibit W4 – Certificates of Work Qualifications). He has completed training in traffic control, occupational Health and Safety for construction work, Confined space awareness, Driver education and training, Bulk Dangerous good driving, and other vocational training. Doing the best one can on the evidence, on the balance of probabilities his earning capacity is not less than $600 per week.
With respect to the husband’s interest in his late father’s estate, nothing there recorded by the trial Judge has been shown to have been other than reasonably open to him on the findings of fact he made, such findings having not been successfully challenged.
The further evidence establishes that the husband in fact had no “financial resources by way of an interest in his father’s estate”. It does not, if accepted, establish that the husband lacked the capacity to work which the trial Judge found him to possess.
The question of the husband’s financial resources and earning capacity is however complicated by other findings made by the trial Judge, in paragraph 64 to which reference has already been made, and in paragraphs 72 and 73 (Judgment Part 2).
So far as the finding of a capacity to earn “not less than $600 per week” in paragraph 64 is concerned, the evidence, at its highest, was that:
15. For the first 2 years of the marriage the husband was in full time employment as a trades’ assistant. He was not in paid work for about a year. He then had casual work doing general light duties for 2 years and averaged about 12 hours of work per week.
16. From 1978 to 1988 he had no paid work. From 1988 for 7 years he did casual labouring work and truck driving for about 60 days each year so that he averaged about 9 hours of work per week over the 7 years.
17. In 1990 the husband had paid work for 6 months on a full time basis with Y Engineering. In 1991 he had 6 months full time work with M at V P.
18. The husband then had casual labouring work from 1992 to separation in November 2000, probably averaging 1 or 2 days per week.
19. Over the whole 27 years of the cohabitation the husband averaged only about a day and a half of such paid work per week.
20. In addition, from 1998 until separation, the husband purchased, worked on and sold about 9 motor vehicles for profit.
…
72. The husband has had employment as a truck driver and apparently is capable of working full time as a truck driver and earning the appropriate wage. The husband’s present income is $182 per week by way of Newstart allowance from the Department of Social Security.
…
75. The husband’s commitments necessary to support himself, according to his Financial Statement of 16 February 2005, amount to $185 per week. But his oral evidence is that he is also paying rent for his room.
As Counsel for the wife fairly conceded, nowhere in the evidence does a foundation for the figure of $600 per week found by the trial Judge emerge, nor has the husband, on any evidence at trial, ever earned that amount on a weekly basis.
The effect of the further evidence with respect to the husband’s father’s estate is that the figure of “possibly as much as $200,000” by way of financial resource to which the trial Judge referred cannot stand. In a notional asset pool of approximately $470,000, the significance of such possible resource needs to be considered.
His Honour accepted (paragraph 72, Judgment Part 2) that notwithstanding the difficulties with the credibility of the husband, he was in fact only earning $182 per week by way of Newstart Allowance. It can reasonably be inferred that the authority administering Newstart Allowance would be diligent in ensuring that a recipient of such benefits sought such work as was within his or her physical and mental capacity, and there is nothing to which we have been referred which establishes that such was not the case with respect to the husband.
The further medical evidence sought to be relied upon by the husband would not, by its nature and antiquity, render erroneous the trial Judge’s conclusions with respect to the husband’s capacity for employment.
The trial Judge then referred, in his consideration of s 75(2), to the fact that the wife has the “care and control of the two children of the marriage under 18” (paragraph 84, Judgment Part 2) which could be expected to continue for almost four years in the case of one child and almost six in the case of the other.
His Honour concluded that such obligation was:
…a particularly onerous responsibility because of the fact that the husband is unlikely to have much contact with them [the children] and unlikely to play a significant role in their care or supervision (paragraph 84, Judgment Part 2).
Nothing to which we have been referred establishes that his Honour was in error in so concluding.
The trial Judge further had regard to his findings that:
It was a marriage of 27 years and the roles the wife undertook in parenting the 5 children and homemaking for the husband and the children have prevented her undertaking full time employment and denied her the opportunity to acquire work skills and improve them by full time work (paragraph 86, Judgment Part 2)
Nothing to which we have been referred establishes that his Honour erred in so concluding.
His Honour also considered relevant, pursuant to s 75(2)(l) the “need” of the wife “to continue her parenting role, which involves her undertaking only part time work in order to be more available for the boys” (paragraph 87, Judgment Part 2).
It is apparent, but not of immediate relevance, that the trial Judge had regard to the orders he proposed by way of determination of the child support proceedings which he had heard, albeit that did not impact upon the determination of the s 75(2) entitlements of the parties.
Before concluding that 20 per cent adjustment in the wife’s favour pursuant to s 75(2) was appropriate, the trial Judge had regard to s 79(2) of the Act. He concluded in that regard:
The findings as to contributions should now be considered with the findings under subsec 75(2). The fact that orders based upon the above findings as to contributions would place the wife in a stronger position than the husband weighs in his favour. As does his additional contribution to the financial support of the boys to date and for the future as contemplated by the proposed child support departure order (paragraph 90).
And further:
But the husband’s financial resource by way of an unquantified interest in his father’s estate, his greater earning capacity, the wife’s responsibility for the future care and control of James and David, the need to protect her role as a parent, and the length of the marriage and the adverse effect on the wife’s earning capacity and income are of greater weight and justify an adjustment in her favour (paragraph 91).
Were it not for the fact that the trial Judge’s conclusions with respect to the quantum of the husband’s earning capacity, and his having an interest in his late father’s estate, and its possible quantum, were, or can now be seen as erroneous, the trial Judge’s conclusion with respect to the appropriate s 75(2) adjustment would be unassailable. Cumulatively, if established, the factors to which his Honour referred rendered a 20 per cent adjustment in favour of the wife pursuant to s 75(2) a reasonable exercise of his discretion.
Given however that his Honour’s findings with respect to the husband’s earning capacity and his interest in his late father’s estate are unsustainable, it remains to consider whether the other factors relied upon by him would render a 20 per cent adjustment pursuant to s 75(2) within the ambit of a reasonable exercise of discretion. It is to be remembered that a 20 per cent adjustment translates as a 40 per cent disparity which in turn, on the adjusted net asset pool, translates as a differential favouring the wife of approximately $170,000.
So far as the husband’s earning capacity is concerned, at its highest, as was inferentially conceded, $340 per week was sustainable having regard to the husband’s previous levels of income. That, on any view of the evidence, is a modest capacity to earn, the disparity between the capacity of the husband and the wife in that regard being marginal.
As noted earlier, an interest of “possibly as much as $200,000” in an adjusted net asset pool of approximately $470,000 was a significant financial resource. Had the trial Judge, albeit erroneously, merely referred to such interest as “unquantified” as he did at some points in his Judgment, the issue could be more readily resolved in the wife’s favour.
A balanced reading of his Honour’s Reasons however renders it difficult to reject the suggestion that his mistaken belief that the husband’s interest could be worth as much as $200,000 was not influential in his determination of the s 75(2) adjustment appropriate to be made. Expressed another way, if no regard was had to the husband’s late father’s estate, and the husband was regarded as having a capacity to earn $340 per week, it is difficult to see on what basis a 20 per cent s 75(2) adjustment in favour of the wife could be supported. Conversely, if, as seems to have been the case, an adjustment of that magnitude was significantly dependent upon those two matters then it cannot stand given that the factual underpinning of each of those matters was deficient.
We are not persuaded that, on the findings of fact which were open to him, the learned trial Judge could or would have come to the same conclusion with respect to s 75(2) as he did had those errors of fact not been made (see De Winter v De Winter (1979) FLC ¶90-605). We would thus uphold the challenge to the trial Judge’s s 75(2) adjustment agitated by this series of grounds.
Ground 22
Ground 22 provided: “[t]hat the learned trial Judge made an error of law as he failed to apply the relevant ‘guidelines’ as to self-represented litigants to the Husband”.
In support of the ground the husband submitted:
That the learned trial judge made an error or law as he failed to apply the relevant guidelines as to self-represented litigants to the husband.
Re: Matter of ‘F’ fam CA 6/2001 Guidelines as altered
Guideline 10, a judge should ensure as far as is possible that the procedural fairness is afforded whether represented or appearing in person in order to ensure a fair trial.
a It could be assumed fair and just re: affidavits in Vol. 1: pages 48-54. Application filed 26/7/05 (Vol. 1: Page 28). For crucial evidence by the husband re: matrimonial loans utilised and multiplied on in the parties building projects. Be Adduced
b. An original ‘will of estate’ of K P be adduced by his honour the trial Judge.
The matters were not adequately addressed due to the failure of an arranged solicitor, (Mr. D C, M, NSW) to appear for the husband for the trail 25/5/05
Regarding ‘will of estate’, his honour, the trial Judge maintained a copy presented was not admissible because it was not verified by anyone with any knowledge of making the will as in Vol 1: page 15, pgh 10.
The husbands endeavour was to present an original document. This leave was refused, although the judgement was not due until approx. the end of August. At the ensuing hearing to have matters addressed 27/7/06 the trial Judge indicated that the matter could create prejudice, surprise and expense to the wife Vol. 1: Page 15, pgh 7.
The matters there raised by the husband have been largely dealt with earlier in these Reasons. It is significant that the husband makes no complaint outside those particular issues, all of which involve alleged errors, of fact or discretion on the part of the trial Judge.
To the extent that, as may be the case with respect to his late father’s will, and the alleged loans by the husband’s brother, any failure to comply with the “guidelines” by the trial Judge may have arisen, which we do not accept has been demonstrated, those matters have been addressed and determined in the context of the husband’s further evidence application.
As a reading of the transcript confirms, the proceedings before the trial Judge occupied a number of hearing days. As a reading of his cross-examination also confirms, though an unrepresented litigant, the husband proved himself adept at conducting his own case.
The significance of the husband’s submissions in support of this ground lies more in what is not asserted than in what is so asserted. Given the duration of the trial, the nature and breadth of the issues at trial, the fact that the husband only raised complaints with respect to the trial Judge’s conclusions with respect to two topics is abundant confirmation that the trial Judge afforded the husband natural justice and procedural fairness. Nothing raised by the husband persuades us that the trial Judge, whether pursuant to the “guidelines” or otherwise, failed in any relevant sense to afford the husband natural justice and procedural fairness. This ground thus lacks substance.
Child Support Departure Orders
It is convenient to then consider the challenges to the child support orders made by the trial Judge. The law in relation to applications for leave to appeal is not in doubt, having been stated by the High Court in Adam P Brown Male Fashions Pty Ltd v Philip Morris Inc (1981) 148 CLR 170. The Full Court of the Family Court in Rutherford and Rutherford (1991) FLC ¶92-255 said:
As counsel for the husband rightly remarked there is not as yet any reported authority on the principles to be applied in granting leave under section 94AA(1). However, there are a number of authorities dealing with equivalent provisions in relation to the Federal Court of Australia and the Supreme Courts of the States. In our view, counsel rightly invited us to seek guidance in the remarks of the High Court in Adam P. Brown Male Fashions v Phillip Morris (1981) 148 CLR 170 at 177 per Gibbs CJ, Aickin, Wilson and Brennan JJ as follows:-
1.“An interlocutory order for an injunction is a matter of practice and procedure. See McHarg v. Universal Stock Exchange Ltd [[1895] 2 QB 81 at 82]; Minister for The Army v. Parbury Henty and Co. Pty. Ltd. [(1945) 70 CLR 459 at 489]; White v. White [[1947] VLR 434 at 438].
2.Nor is there any serious dispute between the parties that appellate courts exercise particular caution in reviewing decisions pertaining to practice and procedure. Counsel for Brown urged that specific cumulative bars operate to guide appellate courts in the discharge of that task. Not only must there be error of principle, but the decision appealed from must work a substantial injustice to one of the parties. The opposing view is that such criteria are to be expressed disjunctively. Cases can be cited in support of both views: for example, on the one hand, Niemann v. Electronic Industries Ltd [[1978] VR 431 at 440]; on the other hand, De Mestre v. A.D. Hunter Pty. Ltd. [(1952) 77 WN (NSW) 143 at 146]. For ourselves, we believe it to be unnecessary and indeed unwise to lay down rigid and exhaustive criteria. The circumstances of different cases are infinitely various. We would merely repeat, with approval, the oft-cited statement of Sir Frederick Jordan in In re the Will of F.B. Gilbert (dec.) [(1946) 46 SR (NSW) 318 at 323]:
3.‘...I am of the opinion that, ... there is a material difference between an exercise of discretion on a point of practice or procedure and an exercise of discretion which determines substantive rights. In the former class of case, if a tight rein were not kept upon interference with the orders of Judges of first instance, the result would be disastrous to the proper administration of justice. The disposal of cases could be delayed interminably, and costs heaped up indefinitely, if a litigant with a long purse or a litigious disposition could, at will, in effect transfer all exercises of discretion in interlocutory applications from a Judge in Chambers to a Court of Appeal.’” ” (at 78,715 per Ellis, Nygh and Wilczek JJ)
We approach the application for leave to appeal against the orders for child support on the basis that, if merit in the proposed appeal is demonstrated, then leave will be granted and the appeal allowed.
Having regard to the conclusions we have reached with respect to the s 75(2) adjustment ordered by the trial Judge, particularly so far as they relate to the quantum of the husband’s earning capacity and the “possible” value of his interest in his late father’s estate, a consideration of the various challenges to the child support orders made by the trial Judge, and the lump sum with respect to them is quite short.
As the passages to which we have earlier referred make clear, the trial Judge determined the level of periodic child support which the husband should pay on the basis that he had the capacity to earn $600 per week and an interest in his late father’s estate of “possibly as much as $200,000”. Each of these findings of fact was or has now been shown to be erroneous.
A reading of the trial Judge’s reasons leads inevitably to the conclusion that, had his Honour proceeded on the basis that the husband in fact had no interest in his late father’s estate, and that his earnings at their zenith had not exceeded $340 per week he would not have made the orders he did with respect to either the quantum of periodic child support or any lump sum order based thereon.
The husband having demonstrated errors of fact upon which the exercise of discretion was necessarily based, and it not having been established on behalf of the wife that no other outcome could have resulted had those errors of fact not been made, the husband’s appeal with respect to the child support orders made by the trial Judge is entitled to succeed.
The Appeal against the trial Judge’s Order for Costs
The trial Judge ordered that the husband pay $30,000 towards the wife’s costs of and incidental to the proceedings on 30 January 2006.
The husband’s Grounds of Appeal EA20 of 2006 with respect to the order for costs provided:
1.Costs as claimed by spouses [sic] legal representative considered excessive.
2.Consideration as to costs orders attached did not receive adequate consideration as to Section 117(2)(2a) [sic]
3.Costs sought by spouse’s solicitor are not representative of actual costs
Written submissions of the husband in support of the appeal asserted:
1.Cost orders did not receive adequate consideration as to Section 117(2)(2A)
(2A) In considering what order (if any) should be made under subsection 2 the court shall have regard to;
(a) the financial circumstances of each of the parties to the proceedings.
The appellant refers to the updated financial statement 28/11/05.
2.Costs sought by spouses’ solicitors are not representative of actual costs. I refer to costs listed in Exhibit ‘X2’: page 3 (footnote).
‘This item calculated at 150% of scale in accordance with costs agreement with wife and solicitor if calculated on a scale there would be aggregate reduction of $242.65.
The agreed retained rate between wife and her legal representative is not reflected in the sums for legal costs as stated at the hearing 30/1/06 page 102 (pgh 15) - Appeal book EA20/2006.It is necessary to consider the trial Judge’s reasons for making the costs orders which he did, particularly in the light of our conclusion that the challenge to the s 75(2) adjustment determined by the trial Judge succeeds, as does the challenge to the determination of the child support proceedings.
To the extent that the husband challenges the trial Judge’s decision to allow the wife to seek costs out of time, which he does not appear to, we simply record that nothing to which we have been referred demonstrates error on the part of the trial Judge in granting such leave.
The trial Judge’s reasons reveal the factors which led to the making of a costs order. Having referred to the general provisions with respect to costs (paragraph 23, Judgment, 30 January 2006), the trial Judge addressed relevant s 117(2A) factors, the first of which is “the financial circumstances of each of the parties”.
His Honour recorded that the parties were “not in strong financial circumstances” and that the “main asset” being “…the home in which the wife and children reside” will “…have to be sold to satisfy the husband’s entitlements in regard to property” as was undoubtedly the case and will presumably be as a result of the redetermination of the proceedings consequent upon the husband’s appeal to this Court being upheld (paragraph 24, Judgment, 30 January 2006).
The trial Judge concluded, in reliance upon his judgment in the property settlement and child support proceedings that the husband would have “$42,355 in net property and liabilities” (paragraph 24, Judgment, 30 January 2006).
The trial Judge concluded that the wife would be in a stronger position with “…property and liabilities to a net figure of approximately $200,000” in addition to “child support in advance” albeit such a payment was “…needed to support the children” (paragraph 24, Judgment, 30 January 2006).
His Honour referred to his earlier findings “…in relation to the parties’ income earning capacity” (paragraph 25, Judgment, 30 January 2006), and reiterated that he was “…not satisfied that he [the husband] is prevented by his depression from undertaking paid work” but was satisfied “that he is not likely to undertake paid work” for a variety of reasons (paragraph 25, Judgment, 30 January 2006).
Reference was made to the wife’s earnings of “$85 a week” from part-time employment and the receipt by her of “social welfare payments of $430 per week, together with, if she “actually receives” it, $5 a week child support from the husband (paragraph 26, Judgment, 30 January 2006).
The trial Judge referred to the wife’s obligation to care for and support the two children of the parties and to the wife’s limited capacity to obtain further or more remunerative employment which “prospects” he considered would “…not be good in this area because she would be competing with applicants for employment who were also unskilled, but who are younger and fitter than she would be”. (paragraph 27, Judgment, 30 January 2006).
The trial Judge referred to the fact that “…the husband is in receipt of Newstart Allowance which also seems to be paid on the basis that he is not able to undertake paid work” (paragraph 28, Judgment, 30 January 2006).
His Honour discussed a number of matters which do not appear to have assumed great significance (paragraph 30, Judgment, 30 January 2006) before considering the husband’s absence of success in relation to the children’s proceedings whereby, from June 2002, when he commenced such proceedings, until their determination by the trial Judge in August 2005, the husband sought “that there be orders for the parents to share equally the residence of the children” (paragraph 31, Judgment, 30 January 2006).
Reference was made to the “end result” which was “…an order for the boys to see their father for six hours once a month” (paragraph 31, Judgment, 30 January 2006). The husband has not appealed against any orders made by the trial Judge with respect to the children.
His Honour observed that:
[t]he husband could not be regarded as anything but wholly unsuccessful in his application and it did not appear at the hearing that he gained any insight from the hearing of the evidence and the discussion of it, nor from cross-examination of the witnesses, because he adhered to the same application throughout (paragraph 31, Judgment, 30 January 2006).
Reference was then made to an offer to settle the proceedings, such offer having been made on 1 August 2003. His Honour concluded that “the result of the hearing would be that the husband receives something less than” the wife thus offered (paragraph 32, Judgment, 30 January 2006).
His Honour reiterated that, had he accepted the wife’s settlement offer of 1 August 2003 the husband:
…would have resolved the proceedings without delay and expense of the hearing, and also the stress of the hearing. And he would have received a result more favourable to him (paragraph 32, Judgment, 30 January 2006).
He also took into account the husband’s lack of success in relation to the wife’s application that he be declared vexatious pursuant to s 118 of the Act. The trial Judge relied upon a chronology of events attached to an affidavit of the wife’s solicitor Mr F (paragraph 35, Judgment, 30 January 2006). His Honour considered matters which were potentially favourable to the husband (paragraph 36, Judgment, 30 January 2006)).
However, the crux of his Honour’s reasoning appears in the following passage:
She finally obtained a result in the property proceedings and in the children’s proceedings which in each case will be much less than what she would have settled for and in relation to property offered to settle for in August 2003. The result in relation to the children involves less contact with the husband than she proposed at the hearing. She struggled all the way seeking orders that it transpired were more than reasonable to the husband. Now she is faced with all her costs. Those costs seriously detract from the success she has had in relation to the financial proceedings. Perhaps more so in financial proceedings where the conduct of another litigant is unreasonable and irrational; where that person rejects a settlement offer that is more than reasonable to push on to achieve a lesser result (paragraph 39, Judgment, 30 January 2006).
His Honour concluded that:
If the husband's financial circumstances were stronger, this would have been a situation where an order for costs for the whole of the costs in the children's proceedings and the whole of the costs in the financial proceedings after 1 August 2005 could be ordered against him, but his financial circumstances are limited to what appears to be, after the child support lump sum is paid, about $42,000 (paragraph 40, Judgment, 30 January 2006)
His Honour concluded that the wife’s costs “in the extent of about $90,000” did “not seem unreasonable for what has gone before” and concluded that the husband should pay $30,000 towards such costs (paragraph 41, Judgment, 30 January 2006).
As is apparent from his grounds of appeal, the husband challenges the liability for costs and the quantum of such costs. It is clear that the outcome of the financial proceedings before him influenced the trial Judge’s decision in relation to costs. Given that he will not necessarily do any better on a rehearing of the property settlement and child support proceedings, we propose allowing his appeal in so far as the trial Judge’s order related to those proceedings.
As his Honour made clear in his reasons, the husband was wholly unsuccessful with respect to children’s issues and persisted with his application notwithstanding that, on any view of it, the outcome he sought would not eventuate. Nothing to which the husband has referred suggests that the trial Judge was in error in concluding as he did with respect to the outcome of the children’s proceedings and the ramifications of the husband’s rejection of the wife’s offer of settlement of those proceedings. Nothing to which we have been referred by the husband persuades us that the trial Judge’s discretion miscarried in deciding to award the costs of the children’s proceedings to the wife.
In Penfold v Penfold (1980) 144 CLR 311 at 315 the High Court said:
Sub-section (2) requires a finding of justifying circumstances as an essential preliminary to the making of an order. Beyond this there is nothing in the subject matter or in the interrelationship of the two provisions which imposes any additional or special onus on an applicant for an order for costs. Consequently, with respect to their Honours in the Family Court, we do not agree with the suggestion made in the judgment under appeal that an order can only be made under s 117 (2) in "a clear case".
The other matter for consideration relates to the trial Judge’s decision to determine the quantum of the costs to be awarded.
The transcript, which does not appear to be complete, of the costs hearing on 30 January 2006 does not reveal that the trial Judge ever raised with the husband either the appropriateness of the trial Judge assessing the quantum of costs payable to the wife, as opposed to making an order that costs be paid on a party/party basis as agreed or assessed, or invited the husband to make submissions as to the quantum of such costs.
Whilst we are not persuaded that an order for costs in favour of the wife for one third of her properly incurred party-party costs may not have fallen within the ambit of a reasonable exercise of discretion, we have misgivings as to whether, in the circumstances, the trial Judge was entitled to assess those costs in the manner in which he did. The desirability of doing so cannot be doubted but there remain questions of natural justice and procedural fairness, particularly in the light of the “guidelines” emerging from the decision of the Full Court in Re F: Litigant in Person Guidelines (2001) FLC ¶93-072.
Whilst the husband’s financial circumstances are relevant to the issue of costs of the financial proceedings, as is their outcome, the facts as found in relation to the children’s proceedings render them of far less significance as to a determination of the costs of those proceedings. Had his Honour simply ordered that the husband pay the wife’s costs of the children’s proceedings, we would not interfere with such order. Our difficulty is that he made an order in relation to the totality of the proceedings. Part of the underpinning of that order has been removed by our decision to allow the husband’s appeals against the financial orders made by the trial Judge. There seems little alternative than to allow the appeal against the trial Judge’s costs order and remit the issue of the costs of the proceedings to be re-heard to the Judge who hears such proceedings.
We see no reason however why we should not re-exercise the trial Judge’s discretion in relation to the costs of the Part VII proceedings in which the husband was wholly unsuccessful. The findings of the trial Judge provide ample circumstances justifying an order for costs against the husband.
The husband’s grounds of appeal do not challenge the trial Judge’s order under s 118 despite the husband’s complaints in this regard. Lest we are mistaken, and the husband has appealed against the s 118 order made against him, we record the following observations.
The trial Judge’s reasons in relation to the issue are brief. His Honour’s reasons for making the orders sought by the wife are not in doubt and are encapsulated in the following sentence (paragraph 108, Judgment Part 2):
Given the husband’s controlling nature and his history of unsuccessful applications and appeals, a history of costs orders against him (all unpaid), the Court is satisfied that both applications were vexatious and part of a pattern of vindictive and abusive conduct by the husband towards the wife.
His Honour thus ordered that the husband not “…without leave of a Judge of this Court institute any further proceedings against the wife under the Family Law Act” and that “…any application for such leave is in the first instance to be listed before a Judge in chambers without appearances and unless otherwise ordered is not to be served upon any other party” (Orders 13 and 14).
As is apparent from their terms, all that the orders made by the trial Judge seek to do is to avoid the wife being put to expense and inconvenience in meeting unmeritorious applications by the husband, who is unlikely to incur any expenses in bringing such applications, unless a Judge determines that she should. All the trial Judge’s orders will thus do is prevent an abuse of the court’s processes.
Notwithstanding that the husband has achieved some success before this Court, the substantial history of prior proceedings underpinning the trial Judge’s orders remains, and is ample to support his conclusion with respect to the wife’s application pursuant to s 118. Nothing to which the husband has referred this Court persuades us that his Honour’s discretion miscarried.
Conclusion
For the reasons we have given, the husband’s challenge to the s 75(2) adjustment determined by the trial Judge succeeds. So does the challenge to the child support orders made by the trial Judge.
It follows that the substantive orders for settlement of property and the child support orders cannot stand. It is clear that the child support proceedings require a re-hearing and we will so order.
The question of the future course of the property settlement proceedings is less clear, the alternatives being that this Court re-exercise the trial Judge’s discretion, or that the matter be remitted to a single Judge for re-hearing. The issues likely to be raised in the course of re-exercising the trial Judge’s discretion render it inappropriate that this Court undertake that task.
The question of the scope of the re-hearing needs to be addressed.
Notwithstanding his conclusions with respect to the husband’s present earning ability and current financial resources, and this Court’s conclusions in that regard, nothing which the husband has raised before this Court would render it necessary or appropriate to re-visit contribution issues. Importantly, the trial Judge did not include as part of the net asset pool for determining contribution entitlements any sum with respect to any interest of the husband in his late father’s estate.
To the extent that any “adjustment” to the actual pool of assets to produce a notional pool of assets has been agitated by the husband before this Court, such challenges have been unsuccessful.
In our view, to remit the property settlement proceedings for re-hearing with respect to the s 75(2) adjustment appropriate to be made to the contribution entitlements of the parties would not only be necessary but, given that the issues relevant to that determination overlap with and may even be identical with those relevant to the re-determination of the child support proceedings, we see no potential for such limited remitter to either prolong the proceedings, and thus increase their expense, or unreasonably or unnecessarily fetter the exercise of discretion by the trial Judge before whom the proceedings are re-heard. Having thus re-heard the financial proceedings, a trial Judge would be well equipped to also re-determine the wife’s application for costs.
Costs
Each party should have a costs certificate to cover the costs of the appeal, and a certificate with respect to the rehearing.
I certify that the preceding one hundred and seventy nine (179) paragraphs are a true copy of the reasons for judgment of the Honourable Full Court.
Associate:
Date:
Key Legal Topics
Areas of Law
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Family Law
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Civil Procedure
Legal Concepts
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Appeal
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Costs
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Procedural Fairness
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Remedies
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Judicial Review
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