FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 1)
Goodheart & Goodheart [2023] FedCFamC1F 715
File number MLC 4209 of 2022 Judgment of WILSON J Date of judgment 24 August 2023 Catchwords FAMILY LAW – MAJOR COMPLEX FINANCIAL PROCEEDINGS LIST – RECUSAL APPLICATION – whether disclosure in open court constitutes a waiver of privilege under the Evidence Act – whether the double might test of apprehended bias had been engaged – held, privilege waived and no evidence of apprehended bias. Legislation Evidence Act 1995 (Cth) ss 131 and 131(1)
Family Law Act 2975 (Cth) s 79
Cases cited Agricultural and Rural Finance Pty Ltd v Gardiner (2008) 238 CLR 570
Allianz Australia Insurance Ltd v Delor Vue Apartments CTS 39788 (2022) 97 ALJR 1
Cao & Trong (No. 2) [2019] FamCA 941
Charisteas v Charisteas (2021) 273 CLR 289
CNY17 v Minister for Immigration and Border Protection (2019) 268 CLR 76
Commonwealth v Verwayen (1990) 170 CLR 394
Ebner v Official Trustee in Bankruptcy (2000) 205 CLR 337
Elder’s Trustee & Executor Co Ltd v Commonwealth Homes & Investment Co Ltd (1941) 65 CLR 603
Grundt v Great Boulder Pty Gold Mines Ltd (1937) 59 CLR 641
Michael Wilson & Partners Ltd v Nicholls (2011) 244 CLR 427
O’Sullivan v Medical Tribunal of New South Wales [2009] NSWCA 374.
Sargent v ASL Developments Ltd (1974) 131 CLR 634
Smits v Roach (2006) 227 CLR 423
Vakauta v Kelly (1989) 167 CLR 568
Verdon v Verdon (2020) 62 Fam LR 573
Division Division 1 First Instance Number of paragraphs 39 Date of last submission 7 July 2023 Date of hearing 3 and 7 July 2023 Place Melbourne Counsel for the applicant Mr L. Glick KC Solicitor for the applicant Lander & Rogers Counsel for the respondent Mr T. North SC with Mr A. Barbayannis Solicitor for the respondent Sayer Jones Family Lawyers ORDERS
MLC 4209 of 2022 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)
BETWEEN MS GOODHEART
Applicant
AND MR GOODHEART
Respondent
ORDER MADE BY
WILSON J
DATE OF ORDER
24 AUGUST 2023
THE COURT ORDERS THAT –
1.The husband’s recusal application dated 27 June 2023 is dismissed.
2.The further hearing of this proceeding is adjourned to 10:00am on 18 September 2023 for mention in the Major Complex Financial Proceedings List.
Note: The form of the order is subject to the entry in the Court’s records.
Note: This copy of the Court’s Reasons for judgment may be subject to review to remedy minor typographical or grammatical errors (r 10.14(b) Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 10.13 Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth).
Section 121 of the Family Law Act 1975 (Cth) makes it an offence, except in very limited circumstances, to publish proceedings…
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CaseChat Overview and Summary
The court considered the nature of the appearance by the parties' legal representatives and the significance of the information disclosed during the mediation. It noted that the information was volunteered by junior counsel for the husband and was not prompted by the court. The court observed that the wife did not object to the information being given and that there was no suggestion that the junior counsel acted without authority. The court concluded that the parties had jointly waived the privilege conferred by section 131 of the Evidence Act, as both parties were entitled to insist upon strict observance of the privilege, and the husband's junior counsel had brought an end to the privilege by disclosing matters canvassed during the mediation.
The court held that a fair-minded lay observer would have understood the words used by the husband's junior counsel to indicate that the privilege had been waived. The court further noted that the information stated by the husband's junior counsel was recorded on transcript and had been set out in the court's reasons. The court found that the husband's case in the s 79 application was for orders dividing assets on a just and equitable basis without specifying the percentage or what assets, and that when the parties sought consent orders for a $2 million part property settlement, the court did not know what the assets that fell for division were.
The court ordered that the application for recusal be dismissed. The court held that there was no basis for the husband to contend that it was plainly on the cards that he would obtain $2 million in the s 79 application, as there was no evidence of the proportion that sum represented in the value of the total asset pool, and no balance sheet of assets was in existence.
Orders
Orders of the court
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Background
Background to the litigation
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Evidence
Evidence Before The Court
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Decision
Reasons for decision
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Ratio Decidendi
Legal Principle Established
Mr Glick KC responded. In essence Mr Glick submitted – (a)courts routinely determine claims to privilege, either ruling that a document is or is not caught by privilege, for example, without offending rules of bias; (b)Allianz, the most recent exposition by the High Court of waiver, illustrated unilateral waiver in the reasons of Edelman J at paragraph 30 yet in this case, the parties jointly waived the privilege for the purposes of s 131 of the Evidence Act; (c)the husband’s case in this s 79 application is for orders dividing assets on a just and equitable basis without saying in what percentage or what assets; and (d)when the parties sought consent orders for a $2 million part property settlement, the court did not know what the assets that fell for division were, there was no balance sheet in existence yet having no evidence of the proportion $2 million was of the total pool, the husband contended that it was plainly on the cards that the husband would obtain $2 million in the s 79 application. CONSIDERATION To my mind, on 22 March 2023 I was performing case management functions in the discharge of my judicial duties. However, the proper characterisation of the nature of the appearance by the parties’ legal representatives on 22 March may be beside the point because the more important issue was the significance of the information Mr Wotherspoon imparted during that appearance. The appearance had followed an unsuccessful mediation during which various proposals were exchanged. Information exchanged during a mediation is traditionally cloaked in privilege. Each party jointly enjoys the benefit of that privilege. It prevents the disclosure to the court in which the proceeding is pending of information exchanged at the mediation. Either party can enforce the privilege so as to compel the other to preserve the confidentiality of the information exchanged at the mediation. On 22 March 2023 junior counsel for the husband volunteered – unprompted – the revelation of a particular dollar amount. I did not ask for the disclosure of that amount. Nor did the wife’s legal representative. Who was to pay that sum was not stated. The proportion that sum represented in the value of the total asset pool was not stated. I was not provided with a balance sheet of assets. The wife did not object to the information being given. Nor did the husband’s instructing solicitor protest that information canvassed at or connected with the mediation was being imparted by junior counsel for the husband. There has been no suggestion that Mr Wotherspoon acted without authority in telling me what he did no 22 March 2023. To the contrary, the husband relied on the information his own counsel stated to me as the basis for this recusal application. In the passages below I have addressed what a fair minded lay observer may have understood by the words the husband’s junior counsel used on 22 March 2023. To my way of thinking, the parties jointly waived the privilege conferred by s 131 of the Evidence Act. Both were entitled to insist upon strict observance of the privilege. Mr Wotherspoon brought an end to the privilege by telling me about matters canvassed during the mediation. The wife said nothing by way of protest. The information stated by Mr Wotherspoon was recorded on transcript. It has been set out above at paragraph 7.