Hardie & Hardie
[2024] FedCFamC1A 29
•14 March 2024
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 1) APPELLATE JURISDICTION
Hardie & Hardie [2024] FedCFamC1A 29
Appeal from: Hardie & Hardie [2023] FedCFamC2F 1577 Appeal number: NAA 340 of 2023 File number: BRC 13421 of 2021 Judgment of: AUSTIN J Date of judgment: 14 March 2024 Catchwords: FAMILY LAW – APPEAL – PROPERTY – Where the husband appeals from property settlement orders – Where the husband asserts the wife did not comply with pre-action procedures – Where the wife was exempt from complying with pre-action procedures due to allegations or risk of family violence – Where the husband’s complaint that the primary judge failed to accord proper weight to his evidence is without substance – Where the husband’s complaint of procedural unfairness is specious – Where the husband could not establish how the 15 per cent adjustment to the wife was manifestly unjust or unreasonable –Application in an Appeal – Further Evidence – Where the husband did not meet the criteria for admission in respect of each category of document – Application dismissed – Appeal dismissed – Where the wife sought costs of the appeal – Where the appeal was wholly unsuccessful – Where the husband conducted the appeal in such a disorganised way the wife’s costs was bound to increase in having to meet it – Husband to pay the wife’s costs of the appeal in a fixed amount. Legislation: Family Law Act 1975 (Cth) Pt VIII, ss 45A, 75, 102NA
Federal Circuit and Family Court of Australia Act 2021 (Cth) s 36 and s 192
Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) Sch 1, r 4.01 and r 12.17
Cases cited: CDJ v VAJ (1998) 197 CLR 172; [1998] HCA 67
Edwards v Noble (1971) 125 CLR 296; [1971] HCA 54
Gerlach v Clifton Bricks Pty Ltd (2002) 209 CLR 478; [2002] HCA 22
Gronow v Gronow (1979) 144 CLR 513; [1979] HCA 63
Hedlund & Hedlund (2021) FLC 94-065; [2021] FedCFamC1A 84
Nada & Nettle (Costs) (2014) FLC 93-612; [2014] FamCAFC 207
Number of paragraphs: 52 Date of hearing: 12 March 2024 Place: Newcastle (via Microsoft Teams) The Appellant: Litigant in person Counsel for the Respondent: Mr Taylor Solicitor for the Respondent: McInnes Wilson Lawyer ORDERS
NAA 340 of 2023
BRC 13421 of 2021FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
DIVISION 1 APPELLATE JURISDICTIONBETWEEN: MR HARDIE
Appellant
AND: MS HARDIE
Respondent
ORDER MADE BY:
AUSTIN J
DATE OF ORDER:
14 MARCH 2024
THE COURT ORDERS THAT:
1.The Amended Application in an Appeal filed on 26 February 2024 is dismissed.
2.The Amended Notice of Appeal filed on 16 February 2024 is dismissed.
3.The appellant shall pay the respondent’s party/party costs of and incidental to the appeal, assessed in the sum of $15,000.
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).
IT IS NOTED that publication of this judgment by this Court under the pseudonym Hardie & Hardie has been approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
REASONS FOR JUDGMENT
AUSTIN J:
By an Amended Notice of Appeal filed on 16 February 2024, the husband appeals from property settlement orders made between the parties on 7 December 2023 by a judge of the Federal Circuit and Family Court of Australia (Division 2).
The appeal is dismissed for the following reasons.
Background
The parties commenced cohabitation just before their marriage in 2002 and finally separated in January 2021.
The wife commenced proceedings in October 2021, seeking property settlement relief under Pt VIII of the Family Law Act 1975 (Cth) (“the Act”).
Leading up to the trial in August 2023, the husband’s position was baffling. He asserted in Case Outline documents, on the one hand, property adjustment orders should be made and he was entitled to both 82 per cent of the property and payment of spousal maintenance from the wife, but yet on the other hand, no adjustment orders should be made as the proceedings should be summarily dismissed under s 45A(4) of the Act.
The apparent contradiction caused the primary judge to enquire about the nature of the husband’s application before commencing the trial. When interrogated, the father’s counsel said he sought a “fifty-fifty division”. Then, on the second day of trial, he tendered as an exhibit the Minute of Orders he proposed, which orders entailed an equal division of property, subject to him retaining the “trusts and companies” and having some items of personal property returned to him (at [5]). He expressly affirmed those proposed orders in final submissions.
The upshot is that the parties agreed at trial their contributions were equal. Their dispute centred on the value of their property, the extent to which expended sums should be added back to their pool of property as notional assets, and whether there should be any percentage adjustment to the wife under s 75(2) of the Act.
Judgment was reserved and delivered several months later in December 2023. The primary judge found the parties’ assets and superannuation had a net value of $1,150,716 (at [54]), their overall contributions were equal (at [67]), but the wife should have a 15 per cent adjustment by reference to the factors prescribed by s 75(2) of the Act (at [107]). The property was therefore divided in shares of 65 per cent to the wife and 35 per cent to the husband (at [108]).
As the husband wanted, the appealed orders required the wife to surrender certain items of personal property to him (Order 5) and provided for him to retain sole ownership of corporate and trust entities, subject to the immediate rectification of their regulatory compliance (Orders 4(c), 8(a)(i), 20, 22 and 23), which specific orders at to regulatory compliance were made with the parties’ consent (at [6]–[7]). However, the proportional division of property was not as the husband had hoped.
Application in an appeal
By an Amended Application in an Appeal filed on 26 February 2024, supported by two affidavits filed on 9 and 26 February 2024, the husband applied to adduce the following documents as further evidence in the appeal:
(a)a letter dated 14 September 2023, written by an accountant for use in professional disciplinary proceedings which were initiated by the husband’s complaint of malpractice (“the first document”);
(b)an affidavit sworn or affirmed on 18 December 2023 by another accountant, commenting upon historical financial documents concerning the parties’ incorporated business (“the second document”);
(c)an undated email and the attached documents sent by the husband to his solicitors, supposedly on 17 November 2021, in relation to another asset of interest to the parties (“the third documents”);
(d)an undated email and the attached document sent by the husband’s solicitors to his barrister, supposedly on 21 August 2023, concerning rent owed by the incorporated business to a third party lessor (“the fourth documents”);
(e)an undated email received by the husband, supposedly in late 2020, confirming the cancellation of his licence by the relevant New Zealand authority (“the fifth document”);
(f)a bank statement showing the balance of one of the husband’s accounts to be $79.36 as at 12 July 2023 (“the sixth document”); and
(g)a letter dated 11 March 2021 prepared by a counsellor (“the seventh document”).
The first document relates, in part, to the parties’ incorporated business and its financial affairs. The document was prepared by the accountant after the trial had finished and the husband now seeks to use it to vindicate his contention at trial about a discrepancy in the financial statements of the incorporated business. No application was made by the husband to re-open the evidence to tender the document as an exhibit before judgment was delivered in December 2023. The document would not likely survive any objection to its admissibility, then or now, as it is hearsay and the provenance of the information recited within it is unknown.
The second document was obviously prepared by the accountant at the husband’s instigation after the trial ended to try and establish how a tax deduction was not claimed by the incorporated business over the past few financial years. To the extent the evidence is intended to now enable a finding that the value of the incorporated business is different from that found by the primary judge, who found it was worth about $30,000 more than the husband conceded, the parties’ dispute over the value of the incorporated business was unrelated to the asserted tax deduction, but rather related to only a bank account balance and the value of a car. To the extent that the evidence is instead intended to enable a finding about the wife’s financial waste by not claiming the deduction for the incorporated business, all such allegations we expressly abandoned in final submissions. The new evidence is liable to be controversial in any event.
The third documents were available to be tendered at trial, but were not.
The fourth documents were not tendered in the trial when they could have been. Even if not available at the time of trial, they were not the subject of any application to re-open the evidence. The rent owed by the incorporated business was an issue at trial and was the subject of express findings made by the primary judge on the evidence adduced (at [41]–[43]). In any event, the husband misconceives the relevance of the document because even if it does prove rent arrears, the debt is owed to the third party lessor by the incorporated business, not by the parties personally.
The fifth document has no bearing at all on any finding made by the primary judge. Nor does any ground of appeal hinge upon admission of the document into evidence.
The sixth document was available to be tendered at trial, but was not. It was unnecessary because the husband’s contention of the bank account balance being $79 was unchallenged. The value of $3,000 was not ascribed to that solitary account. Instead, it was the aggregated value ascribed to three different bank account balances and accorded with the husband’s express concession in final submissions (at [19]).
The seventh document is said to contradict oral evidence given by the wife. However, the document existed at the time of trial and was available for use to try and contradict her, either by its tender as an exhibit or by her confrontation with it in cross-examination.
The application to adduce the further evidence is dismissed as, in respect of each category of document, the criteria for admission is not met (CDJ v VAJ (1998) 197 CLR 172).
The appeal
The husband was legally represented at trial, but he is self-represented in the appeal, which is liable to explain why the appeal does not expose any appealable error.
The amended grounds of appeal are pleaded as follows:
1.Errors of law
The Federal Circuit Family Court of Australia (Court) erred in its interpretation and application of Schedule 1 - pre-action procedures. The Court failed to consider whether the [wife] and her Lawyer had complied with pre-action procedures before commencing proceedings, leading to an incorrect legal conclusion.
2.Factual errors
The court’s findings of fact are flawed as evidenced by inconsistencies in testimony. The court failed to give proper weight to the [husband’s] evidence, which undermines the integrity of its factual determinations.
3.Procedural Irregularities
The [husband] was prejudiced by procedural irregularities, which included not hearing the [husband’s] 05/05/2023 application relating to incorrectly completed New Zealand financial statements and tax returns. These irregularities deprived the [husband] of a fair hearing and affected the overall fairness of the proceedings.
4.Discretionary Decisions
The court’s dismissal of the [husband’s] evidence concerning the children was a critical error, ultimately culminating in an unjust ruling favouring the [wife]. Similarly, the court’s decision to disregard the [husband’s] evidence regarding the relaunch of [the incorporated business] in [city] resulted in a flawed judgment.
5.Failure to Consider Evidence
The court overlooked crucial evidence, specifically the affidavit and supporting documents submitted by the [husband]. This evidence is central to the [husband’s] case and the Court’s failure to consider it constitutes a significant error.
6.Adverse adjustment
The court, in making an adjustment adverse to the [husband] and greater than had been contended for by the [wife], was in error and the outcome was clearly unjust.
(Emphasis in original)
Although some headings to the grounds do allege legal, factual and discretionary errors, the headings are not accurate descriptors of the articulated complaints.
Since the amended grounds of appeal do not place any question of general principle at stake, the reasons for the dismissal of the appeal are given in short form, as is permitted (s 36(2) of the Federal Circuit and Family Court of Australia Act 2021 (Cth) (“the FCFCOA Act”).
Ground 1 – Errors of law
This complaint is confined to the historic failures by both registrars and judges to identify and agree with the husband’s contention that the wife did not comply with pre-action procedures before commencing the proceedings in October 2021. Significantly, this is not a complaint of any specific legal error in the primary judge’s determination of the financial cause in December 2023.
Rule 4.01 of the Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) (“the Rules”) requires compliance with the pre-action procedures prescribed by Sch 1 to the Rules “before starting a proceeding”, but that obligation is subject to certain exceptions. One exception is when the Court is satisfied the property proceeding involves allegations of family violence or the risk of family violence (r 4.01(2)(e) and r 4.01(3)(b)).
In this instance, in mid-2021, the husband consented to a final family violence order being made by a State Court against him for the wife’s protection. The order was therefore in force at the time these proceedings were commenced in October 2021 and will remain in force until mid-2026. Consequently, there was no need for the wife to engage in pre-action procedures before commencing the proceedings. Moreover, the existence of the State family violence order meant s 102NA of the Act automatically applied at the trial to prevent personal cross-examination of one another by the parties.
Even if the exception did not apply to relieve the wife of the obligation to engage in pre-action procedures, the primary judge was empowered at the trial to dispense with the wife’s former need to comply (s 192(2)(f) of the FCFCOA Act). By the time of the trial in August 2023, the litigation had been underway for nearly two years and it would have been pointless to send the parties back to the end of the trial queue just to explore settlement prospects they had already had two years to explore.
Ground 2 – Factual errors
Although the husband’s Summary of Argument seeks to attack several different findings made about the constituent elements of the balance sheet, the challenge to all finings is identical.
The ground of appeal specifies the single error to be this:
2.… The court failed to give proper weight to the [husband’s] evidence, which undermines the integrity of its factual determinations.
The husband’s Summary of Argument expands the complaint in this way:
… The court leaned heavily on evidence provided by the [wife] effectively dismissing the [husband’s] affidavit and evidence.
In oral submissions, the husband confirmed his complaint was confined to the apparent lack of weight accorded to his evidence.
The complaint is without substance. An appeal court should not interfere with findings of fact if there was evidence on which the findings could be made – that is, if they were reasonably open on the evidence (Edwards v Noble (1971) 125 CLR 296; Gronow v Gronow (1979) 144 CLR 513). Findings are not wrong merely because other conflicting evidence was adduced or alternate inferences were available. Making findings to resolve conflicts in the evidence is an inherent part of the judicial function and necessarily entails the acceptance of some and the rejection of other evidence.
Here, the primary judge expressly found the wife’s evidence to be more reliable than the husband’s evidence, at least in some respects (at [87] and [103]). The factual conflicts which the primary judge needed to resolve by findings were explained in the reasons for judgment. The findings are not erroneous merely because the wife’s evidence was preferred.
Complaints about the “weight” attributed to pieces of evidence in that evaluative process are futile, at least in the absence of an allied ground of appeal asserting the overall judgment is manifestly unreasonable or unjust (Hedlund & Hedlund (2021) FLC 94-065 at [36]–[37]). Although such an assertion is made by the husband under Ground 6, which is considered below, it is not because of any “weight” argument.
For completeness, the wife conceded the primary judge made a mistaken factual finding in one paragraph identified by the husband (at [71]), by finding the incorporated business has tax credits of about $80,000, but the mistake was immaterial because the primary judge expressly determined not to take the tax credits into account.
Ground 3 – Procedural irregularities
The totality of this ground is articulated in the husband’s Summary of Argument as follows:
The court dismissed the [husband’s] application filed on 05/05/2023, which aimed to rectify inaccurate financial statements and tax returns prepared by New Zealand accountants under the direction of the [wife] and [the wife’s solicitor]. Procedural irregularities resulted in the dismissal of the [husband’s] application without it being heard. Additional details regarding this matter can be found in the appeal book on page 147.
The interlocutory application filed by the husband on 5 May 2023 comprised an application for a series of declarations. The application was dismissed, but not until the final judgment was pronounced (Order 26). The application was made returnable on the first day of the trial, but was not separately entertained because the parties concentrated on conducting the trial to its conclusion to finalise the cause and were not distracted by the unresolved interlocutory application. They also agreed upon the final orders that should be made to rectify regulatory compliance by themselves and the entities they controlled (at [6]–[7]).
The failure to hear and determine the interlocutory application had no bearing upon the ultimate judgment and is therefore not amenable to challenge within the appeal (s 36(5) of the FCFCA Act; Gerlach v Clifton Bricks Pty Ltd (2002) 209 CLR 478 at 482–484 and 494–497). That is because it is impossible to conceive how the subject application could have succeeded. It sought 13 declarations to this effect: corporate and personal tax returns were “inaccurate, incorrect, and unusable”; that an accountant engaged by the wife to prepare financial statements acted unprofessionally, negligently and even fraudulently; and both the wife and her lawyer obstructed the proceedings and were in contempt of the Court. There was neither jurisdiction to entertain the application for such declarations in that form, nor any source of power to make them. The parties’ agreement to use named accountants in both Australia and New Zealand to rectify tax return defaults rendered the interlocutory application all but otiose in any event.
The peripheral complaint within this ground of procedural unfairness is specious. The trial was heard over three days, during the entirety of which the husband was legally represented by a solicitor and barrister, neither of whom made any contemporaneous complaint about the manner in which the trial was conducted. Nor did they seek an adjournment of the trial to procure further evidence, as the husband asserted in the appeal should have occurred. The husband’s counsel cross-examined witnesses at will and was able to make all the final submissions he wished. In other words, the husband had every opportunity to meet the wife’s case and to prosecute his own.
Ground 4 – Discretionary decisions
This ground pleads the primary judge fell into error in two ways: firstly by “dismiss[ing]” the husband’s evidence concerning the children; and secondly, by “disregarding” the husband’s evidence concerning the management of the incorporated business.
First and foremost, none of the husband’s evidence was “dismissed” in the sense of being rejected as inadmissible. Nor was it “disregarded” in the sense of being mistakenly overlooked. The dual complaints about the husband’s evidence being “dismissed” and “disregarded” devolve to merely discontent about his evidence not being accorded the weight he thinks it deserved, which is not a competent ground of appeal.
The orders made in December 2023 concluded only a financial dispute between the parties under Pt VIII of the Act, so evidence about the parties’ two children only had limited utility. Irrespective of the reasons why, it is uncontroversial that neither child spends time with the husband (at [70]). The elder child is of majority and lives independently. The younger child lives with the mother, which fact influenced the adjustment in her favour under s 75(2) of the Act (at [107]).
The husband’s evidence about the “relaunch” of the incorporated business had no bearing upon the outcome of the financial cause because the parties ultimately agreed their contributions to their assets were equal. The husband wanted to keep the incorporated business and the appealed orders ensured that outcome. The parties only contested the value of the incorporated business, which was not influenced in any way by the husband’s evidence about its “relaunch”.
Ground 5 – Failure to consider evidence
The asserted “oversight” of evidence is untrue. The primary judge referred to the evidence upon which the husband relied (at [12]) and was therefore cognisant of it. Such evidence was not used or applied in the way the husband had hoped, but that is not an appealable error.
Ground 6 – Adverse adjustment
The premise of this ground of appeal is incorrect. The appealed orders do not furnish the wife with a greater share of the property than she sought.
In her Case Outline document, the wife advocated for a finding of her equal contribution to the identified assets and superannuation, together with an unquantified adjustment in her favour on account of her ongoing primary care of the youngest child and the husband’s non-disclosure, which latter finding was positively made against the husband (at [104]).
In final submissions, her counsel said:
[COUNSEL FOR THE WIFE]: The outcome that the wife contends for is the same outcome that she contended for in her outline …
(Transcript 23 August 2023, p. 242 lines 1–2)
The orders provide for the wife to receive a 65 per cent per cent share of the assets and superannuation, comprising her 50 per cent contribution-based entitlement and a 15 per cent adjustment in her favour.
Given the husband agreed the parties’ contribution-based entitlements should be equal, their dispute was confined to the percentage adjustment in the wife’s favour. The husband neither explained nor established in the appeal how the 15 per cent adjustment was manifestly unjust or unreasonable in the face of the published reasons.
Disposition
The appeal is dismissed.
The wife sought, and should have, her party/party costs of and incidental to the appeal, for two reasons. First, it was wholly unsuccessful and should not have been brought, and secondly, the husband conducted the appeal in such a disorganised way that it was bound to increase the wife’s costs of having to meet it.
The husband opposed any costs order on account of his financial circumstances, but that consideration does not weigh as heavily. Although the husband said he was “broke”, he received 35 per cent of the parties’ assets and he retained the incorporated business, as he wanted. He said the business was recently “shut down”, but he has an income-earning capacity regardless. Lastly, impecuniosity is not a bar to a costs order (Nada & Nettle (Costs) (2014) FLC 93-612 at [11]).
The wife’s party/party costs should be assessed at $15,000, as permitted by r 12.17(1)(a) of the Rules. Her greater quantification at nearly $20,000 resulted from a solicitor/client calculation and was not a genuine party/party estimate of her costs.
I certify that the preceding fifty-two (52) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Austin. Associate:
Dated: 14 March 2024
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