Halstron & Halstron

Case [2022] FedCFamC1A 65

FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA

(DIVISION 1) APPELLATE JURISDICTION

Halstron & Halstron [2022] FedCFamC1A 65

Appeal from: Halstron & Halstron [2021] FamCA 437
Appeal number: SOA 45 of 2021
File number: SYC 2788 of 2016
Judgment of: MCCLELLAND DCJ, AUSTIN & GILL JJ
Date of judgment: 13 May 2022
Catchwords: FAMILY LAW – APPEAL – PROPERTY – Whether the primary judge erred in dismissing the appellant’s application to adduce updated valuation evidence – Where the respondent was allowed to adduce updated valuation evidence – Protracted length of proceedings – Injustice – Error in identification of parties’ property established – Error in including statute barred loan on balance sheet established – Appeal allowed – Matter remitted for rehearing – Respondent to pay appellant’s costs in a fixed sum.
Legislation:

Family Law Act 1975 (Cth) Pt VIII, ss 75, 79

Limitation Act 1969 (NSW) ss 14, 64

Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) rr 12.08, 12.17

Cases cited:

Allesch v Maunz (2000) 203 CLR 172; [2000] HCA 40

Aon Risk Services Australia Limited v Australian National University (2009) 239 CLR 175; [2009] HCA 27

Boensch v Pascoe (2019) 268 CLR 593; [2019] HCA 49

Campbell v Kuskey (1998) FLC 92-795; [1998] FamCA 10

Candle & Falkner [2021] FedCFamC1A 102

EB v CT (No. 2) [2008] QSC 306

Friend v Brooker (2009) 239 CLR 129; [2009] HCA 21

Gerlach v Clifton Bricks Pty Ltd (2002) 209 CLR 478; [2002] HCA 22

Gilligan & Addison [2018] FamCAFC 211

Hickey and Hickey and Attorney-General for the Commonwealth of Australia (Intervener) (2003) FLC 93-143; [2003] FamCA 395

House v The King (1936) 55 CLR 499; [1936] HCA 40

Hsiao v Fazarri (2020) 383 ALR 446; [2020] HCA 35

Khadem & Penk [2020] FamCAFC 211

Mallard & Mallard [2011] FamCA 876

Manifold & Alderton [2021] FamCAFC 61

Martin & Newton (2011) FLC 93-490; [2011] FamCAFC 233

Moose & Moose (2008) FLC 93-375; [2008] FamCAFC 108

Norbis v Norbis (1986) 161 CLR 513; [1986] HCA 17

R v Powch (1988) 14 NSWLR 136

Rigby & Olsen [2021] FedCFamC1A 46

Smith v New South Wales Bar Association (1992) 176 CLR 256; [1992] HCA 36

Stanford v Stanford (2012) 247 CLR 108; [2012] HCA 52

Sun Alliance Insurance Ltd v Massoud [1989] VR 8

United Pacific Finance Pty Ltd (Receivers and Managers Appointed) v Govindasamy [2020] NSWSC 128

Zubcic & Zubcic (2019) FLC 93-918; [2019] FamCAFC 168
Number of paragraphs: 106
Date of hearing: 2 February 2022
Place: Melbourne (via videolink)
Counsel for the Appellant: Mr Kearney SC
Solicitor for the Appellant: Crumpton Lawyers Pty Ltd
Counsel for the Respondent: Mr Puckey QC & Dr Smith
Solicitor for the Respondent: Lander & Rogers

ORDERS

SOA 45 of 2021
SYC 2788 of 2016

FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
DIVISION 1 APPELLATE JURISDICTION
BETWEEN:

MS HALSTRON

Appellant
AND:

MR HALSTRON

Respondent

ORDER MADE BY:

MCCLELLAND DCJ, AUSTIN & GILL JJ

DATE OF…

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Halstron & Halstron [2022] FedCFamC1A 65
Case
[2022] FedCFamC1A 65
Decision Date

CaseChat Overview and Summary

The appeal in Halstron & Halstron involves Ms Halstron, the appellant, and Mr Halstron, the respondent, in a family law matter concerning the division of property. The central issues revolve around whether the primary judge erred in dismissing the appellant's application to present updated valuation evidence for the Suburb J property, particularly in light of the respondent being permitted to adduce updated valuation evidence. The case also addresses the protracted length of the proceedings and whether this led to any injustice, as well as errors in identifying the parties' property and the inclusion of a statute-barred loan on the balance sheet.

The court was required to determine whether the primary judge's refusal to allow the appellant to present updated valuation evidence for the Suburb J property was erroneous, especially since the respondent was granted leave to present updated valuation evidence for their shareholdings. The court also had to assess if the prolonged duration of the proceedings resulted in any injustice, and whether the primary judge's identification of the parties' property and the inclusion of a statute-barred loan on the balance sheet were correct.

The court found that the primary judge erred in dismissing the appellant’s application to present updated valuation evidence for the Suburb J property, especially given that the respondent was allowed to present updated valuation evidence for their shareholdings. The court also determined that the protracted length of the proceedings did not result in injustice. Furthermore, the court identified errors in the primary judge's identification of the parties' property and the inclusion of a statute-barred loan on the balance sheet. Consequently, the appeal was allowed, and the matter was remitted for re-hearing. The respondent was ordered to pay the appellant’s costs of and incidental to the appeal, fixed in the sum of $30,000.

Orders

Orders of the court

SOA 45 of 2021

SYC 2788 of 2016

FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA

DIVISION 1 APPELLATE JURISDICTION

BETWEEN:

MS HALSTRON

Appellant

AND:

MR HALSTRON

Respondent

ORDER MADE BY:

MCCLELLAND DCJ, AUSTIN & GILL JJ

DATE OF ORDER:

13 MAY 2022

THE COURT ORDERS THAT:

1. The appeal is allowed.

2. The parties’ respective applications for financial relief under Pt VIII of the Family Law Act 1975 (Cth) are remitted for re-hearing.

3. The respondent shall pay the appellant’s costs of and incidental to the appeal, fixed in the sum of $30,000.

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 that identify persons, associated persons, or witnesses involved in family law proceedings.

Background

Background to the litigation

We have found there to be substance in the grounds of appeal relating to the first three areas of appeal which, in turn, impacted on his Honour’s consideration of an appropriate s 75(2) adjustment, such that a rehearing is required. In those circumstances, we have found it unnecessary to consider the grounds of appeal relating to the primary judge’s assessment of addbacks and the parties’ respective contributions: see Boensch v Pascoe (2019) 268 CLR 593 (“Boensch v Pascoe”) at [7]–[8]. BACKGROUND The appellant was born in 1964 and, at the time of the trial, was working in client service (at [8]). The respondent was born in 1956 and was found to have received income both as a company director and from share trading (at [9]). There is an issue, in respect to the appeal, as to whether the share trading income earned by the respondent and subsequently applied by him towards the payment of his legal fees, in the post separation period, included income received from shares which had been acquired during the course of the parties’ intact relationship. As a result of errors we have found in the identification of the parties’ property, it has not been necessary to consider this issue. The parties first met between 1992 and 1993, with there being a disagreement regarding the time that their relationship commenced. The appellant contended that the relationship commenced in March 1993 and the respondent contended it commenced approximately one year later. We respectfully agree with the primary judge that little turns on that difference (at [10]). The parties married on 18 October 1994 and separated on 22 April 2016. The respondent has continued to live in the Suburb J property in the period subsequent to the parties’ separation. The respondent retained the Suburb J property as part of the property adjustment effected by the orders made by the primary judge on 24 June 2021. The contention of both parties was that, subject to the capacity of the respondent to make an appropriate cash adjustment to the appellant, the respondent should retain the Suburb J property. There are three children of the marriage. Ms B, who is 27 years old, has an autism spectrum disorder and has resided with the appellant since July 2017. The parties’ two younger children, Ms C who is 21 years of age and Mr D who is 19 years of age, reside with the respondent and have spent little, if any, time with the appellant in the period subsequent to the parties’ separation (at [12]). The appellant also has a son from a previous marriage, Mr E, who is 36 years old. The primary judge observed that it had not been disputed in the proceedings that the respondent came to treat Mr E as his own child and played a significant role in raising him, including providing financial support (at [13]). From [15]–[21] of his decision, the primary judge provided background to the parties’ respective financial contributions to the marital property. In circumstances where we have not found it necessary to consider the primary judge’s findings in respect to contributions, it is unnecessary to detail that background, save to the extent that his Honour found that both parties contributed to the marital property, both directly and indirectly. These contributions were made through earned income and also through the making of indirect contributions, including as homemakers and in caring for the parties’ children and the appellant’s child from her former relationship. His Honour found that, in making those contributions, the respondent was the primary breadwinner while the appellant was the primary homemaker and, although both parties undertook parenting responsibilities, the appellant primarily carried out such duties.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

Full text does not contain this section.

Ratio Decidendi

Legal Principle Established

An appeal may also succeed on the basis of an inadequacy of reasons. In that respect, in Rigby & Olsen [2021] FedCFamC1A 46, the Full Court recently stated that:38.The requirement for the giving of reasons is a fundamental requirement of the exercise of the judicial function, as it both demonstrates that justice has been done, and enables the proper challenge of a decision. The content required varies depending upon the circumstances of the case, but is that which makes apparent how the decision was arrived at (see Bennett and Bennett (1991) FLC 92-191 at 78,266). It is not required to give reasons regarding every argument, nor to perform a microscopic analysis “if, in all the circumstances, it is clear that the trial judge has considered and evaluated the relevant evidence, taken into account all relevant factors …” (A v J (1995) FLC 92-619 at 82,230).CONSIDERATION OF RELEVANT GROUNDS OF APPEALIdentification of the property of the partiesGround 1 – did the primary judge err in refusing the appellant’s application to adduce further evidence as to the value of the Suburb J property? In Manifold & Alderton (2021) FLC 94-015, Austin J at [116] (writing separately, but with whom Kent J also agreed), referring to Stanford at [37] and [50] and Hsiao v Fazarri (2020) 383 ALR 446 at [50], observed that the first task of a trial judge considering an application pursuant to Pt VIII of the Act is “to identify and value, as far as the evidence would allow, the parties’ existing legal and equitable property interests”. This necessarily involves identifying the value of the property, liabilities and financial resources of the parties as at the date of the hearing: Hickey at [39]. The difficulty that arose in this case was due to the protracted length of the hearing which, as earlier noted, extended from June 2019 until May 2021. In the context of that delay, on 28 May 2021, the respondent successfully applied for leave to tender updated evidence regarding the value of the parties’ shareholdings. At [185] of the judgment, his Honour stated that such leave was given having regard to “the time that has passed since the conclusion of the trial, the significant increase in the value of the relevant shares in the post COVID-19 share market recovery, and the difficulties presented by different cost bases, capital gains tax and realisation costs.” While taking judicial notice of “the significant increase” in the value of the respondent’s shares in the period subsequent to the immediate onset of the COVID-19 pandemic, which occurred during the lengthy period over which the matter was heard, his Honour declined to grant similar leave to the appellant to obtain an updated valuation of the Suburb J property. The appellant’s application was also rejected despite senior counsel for the respondent acknowledging that, in the period subsequent to the date of the valuation of the Suburb J property, its value had increased, albeit, as contended from the bar table, as a result of renovations undertaken by the respondent (Transcript 28 May 2021, p.31 lines 28–32).