Hogan and Hogan
[2010] FMCAfam 1255
FEDERAL MAGISTRATES COURT OF AUSTRALIA
| HOGAN & HOGAN | [2010] FMCAfam 1255 |
| FAMILY LAW – Application to set aside property orders – undue influence – duress – unconscionable conduct – competency of legal advice – manifestly inadequate settlement. |
| Family Law Act 1975, s.79A |
| Barker v Barker (2007) 36 Fam LR 650 W. Blackstone, Commentaries on the Laws of England 1765-1769, Facsimile Edition, Volume 2, (Chicago & London: The University of Chicago Press, 1979) |
| Applicant: | MS HOGAN |
| Respondent: | MR HOGAN |
| File Number: | CAC 930 of 2009 |
| Judgment of: | Neville FM |
| Hearing date: | 30 August 2010 |
| Date of Last Submission: | 30 August 2010 |
| Delivered at: | Canberra |
| Delivered on: | 9 September 2010 |
REPRESENTATION
| Counsel for the Applicant: | Mr J Millar |
| Solicitors for the Applicant: | Peter Tierney Lawyer, Merimbula |
| Counsel for the Respondent: | Ms J Godtschalk |
| Solicitors for the Respondent: | Kennedy & Cooke Lawyers, Merimbula |
ORDERS
The Orders dated 18 March 2008 by the Local Court at Bega be set aside pursuant to section 79A of the Family Law Act1975 (Cth).
The parties attend a conciliation conference with a Registrar at 10:00am on 20th September 2010 in Canberra.
Each party or their solicitors email to the Registrar a conciliation conference document no later than 2:00pm the day before the conference.
Each party or their solicitors file and serve updated financial material 5 days before the conciliation conference.
Within 21 days, each party or their solicitors file and serve written submissions with respect to costs.
IT IS NOTED that publication of this judgment under the pseudonym Hogan & Hogan is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).
| FEDERAL MAGISTRATES COURT OF AUSTRALIA AT CANBERRA |
CAC 930 of 2009
| MS HOGAN |
Applicant
And
| MR HOGAN |
Respondent
REASONS FOR JUDGMENT
A. Introduction[1]
[1] This oral judgment was delivered on 9th September 2010. The reasons have been slightly revised from the transcript for the purposes of publication.
In the closing stages of her submissions, the experienced counsel for the Respondent Husband, Ms Godtschalk, candidly stated that she could not submit the Consent Orders that the parties to the present application signed, and which were made by the Local Court in Bega on 18th March 2008, were “fair”. Respectfully, I agree.
Rather earlier in time, but with some application to the facts and circumstances of this case to which I will refer presently, in Holland & Holland, the Full Court said:[2]
Agreement to a consent order which may not adequately reflect a party’s entitlement under section 79 does not of itself show that there has been a miscarriage of justice. There may be cases where the order consented to is so far outside the ambit of what is just and equitable that the Court may infer that a party has acted under duress, in ignorance, or as a result of incompetent advice.
[2] (1982) FLC ¶91-243 at p.77,341.
Fairness per se, however, is not the criterion by which the Court exercises its discretion under s.79A of the Family Law Act (“the Act”).[3] That section relevantly provides:
[3] Cf. the Full Court’s comment in Barker v Barker (2007) 36 Fam LR 650 at p.676 [124], thus: “... s.79A is a remedial section designed to avoid a miscarriage of justice. Where there is some intervening factor known to one party, but not the other, this may lead to a result which is unfair and unjust and can be characterised as a flaw in the judicial process by which the orders were made.” Emphasis added.
79A Setting aside of orders altering property interests
(1) Where, on application by a person affected by an order made by a court under section 79 in property settlement proceedings, the court is satisfied that:
(a) there has been a miscarriage of justice by reason of fraud, duress, suppression of evidence (including failure to disclose relevant information), the giving of false evidence or any other circumstance; or
(b) in the circumstances that have arisen since the order was made it is impracticable for the order to be carried out or impracticable for a part of the order to be carried out; or
(c) a person has defaulted in carrying out an obligation imposed on the person by the order and, in the circumstances that have arisen as a result of that default, it is just and equitable to vary the order or to set the order aside and make another order in substitution for the order; or
(d) in the circumstances that have arisen since the making of the order, being circumstances of an exceptional nature relating to the care, welfare and development of a child of the marriage, the child or, where the applicant has caring responsibility for the child (as defined in subsection (1AA)), the applicant, will suffer hardship if the court does not vary the order or set the order aside and make another order in substitution for the order; or
(e) a proceeds of crime order has been made covering property of the parties to the marriage or either of them, or a proceeds of crime order has been made against a party to the marriage;
the court may, in its discretion, vary the order or set the order aside and, if it considers appropriate, make another order under section 79 in substitution for the order so set aside.
(1A) A court may, on application by a person affected by an order made by a court under section 79 in property settlement proceedings, and with the consent of all the parties to the proceedings in which the order was made, vary the order or set the order aside and, if it considers appropriate, make another order under section 79 in substitution for the order so set aside.
For the purposes of the current proceedings, the Applicant Wife,
Ms Hogan, relies upon section 79A(1)(a) - in particular, that there has been a miscarriage of justice on the ground of duress, as well as the more general ground of “any other circumstance” in the same section.
The following general principles may be taken as both unexceptional and, essentially, relied upon by both parties.
First, established authorities such as Prowse,[4] confirm that the Applicant (in this case Ms Hogan) bears the onus of proof to establish the grounds upon which the Court should find that the Consent Orders of March 2008 should be set aside because there has been a miscarriage of justice, and that in the exercise of its discretion, such an order should be made.
[4] In the Marriage of Prowse (1994) 118 FLR 135; (1994) 18 Fam LR 348; (1995) FLC ¶92-557.
Secondly, in Korsky & Bright (No. 2),[5] the Full Court distinguished between “miscarriage of justice” and an “inequitable order.” Such a distinction must be kept in mind in this case also. Only the former (‘miscarriage of justice’) provides a basis for relief, subject to other matters noted below.
[5] Korsky & Bright (No. 2) (2007) FLC ¶93-352.
Thirdly, Ms Hogan submitted that the Court should exercise its discretion in her favour, because (she said) there had been a miscarriage of justice for one or all of three reasons: (i) duress in the signing of the consent orders; (ii) poor or incompetent legal representation at the time of the signing of the consent orders; (iii) “any other circumstance” as envisaged by the terms of the section in the facts and circumstances of this case.
Before dealing with each of these grounds, it is also apposite to note the basic agreement between the parties’ Counsel that the process to be undertaken by the Court, in keeping with authority, is firstly to determine whether a relevant ground, such as “duress”, has been made out, noting also that one ground only is sufficient, and secondly, then to determine whether that ground constitutes a miscarriage of justice. It also seemed not to be disputed that if both bases were established and that the Court in the exercise of its discretion considered that the Consent Order of March 2008 should be set aside, in the first instance, the matter should be referred to a conciliation conference and preferably at the earliest possible time.
The following reasons proceed as follows: consideration of relevant legal principles in relation to each of the grounds asserted by
Ms Hogan, then an examination of the evidence in the light of those principles.
B. Relevant Legal Principle
Duress: The legal concept of “duress” has been recognised in the common law (in both civil and criminal matters) for centuries. In other legal systems, such as under Roman law, the history of duress, its recognition and significance, dates from an even earlier time.[6]
[6] See, for example, the discussion in J.A.C. Thomas, Textbook of Roman Law, (Amsterdam: North-Holland Publishing Company, 1976) “Metus and Dolus” pp.227-228 and Chapter XXXI, “Praetorian Delicts.” “Metus” is characteristically defined to mean “fear, dread, apprehension, anxiety.” See Lewis & Short, A Latin Dictionary (Oxford: Clarendon Press, 1879 [reprint 1987]) p.1141.
In relation to the common law, Blackstone (citing Coke) stated simply: “Persons ... who purchase or convey under duress, may affirm or avoid such transaction, whenever the duress is ceased.”[7] Later, Sir James Stephen commented at some length on what did, and what did not, constitute “compulsion” for the purposes of the criminal law. He said:[8]
A man [or woman] is under compulsion when he is reduced to a choice of evils, when he is so situated that in order to escape what he dislikes most he must do something which he dislikes less, though he may dislike extremely what he determines to do.
[7] W. Blackstone, Commentaries on the Laws of England 1765-1769, Facsimile Edition, Volume 2, (Chicago & London: The University of Chicago Press, 1979) p.292.
[8] Sir James Fitzjames Stephen, A History of the Criminal Law of England, Vol.II, (London: Routledge/Thoemmes Press, 1883 [reprint 1996]) p.102. A little later, Stephen discussed the forms of “compulsion”, included in which were “compulsion by a husband over a wife” and “compulsion by threats of injury to person or property.” Ibid., p.105. More recently, see the discussion and references in standard texts such as Howard’s Criminal Law, (B. Fisse) Fifth Edition (Sydney: The Law Book Company, 1990), pp.540 ff., and L. Waller & C.R. Williams, Criminal Law: Text and Cases (11th Edition) (Sydney: LexisNexis – Butterworths, 2009) Ch.11. For an earlier treatment, see Glanville Williams’ classic text Criminal Law: The General Part, (Second Edition) (London: Sweet & Maxwell, 1961) Chapter 18 “Duress and Coercion” pp.751-769.
In rather more recent times, and it must be said, somewhat more prosaically, standard practice texts provide summaries of the state of the law as to what constitutes “duress” and its effect in differing circumstances. For example, in the CCH Family Law Practice, among other citations, there is a reference to the House of Lords decision of Lynch v DPP for Northern Ireland.[9] What is somewhat curious is the fact that the editors of this regularly used practice work cite the decision of Lynch in circumstances where that decision was expressly overruled by the later House of Lords’ decision in R v Howe.[10] Doubtless Lynch is cited essentially because of the refined and simple definition of “duress” from Lord Simon of Glaisdale’s strong dissenting speech.[11] Doubtless too Lynch was cited because that case was quoted by McHugh JA, as his Honour then was, in his regularly cited exposition in Crescendo Management Pty Ltd & Westpac Banking Corporation.[12]
[9] Lynch v DPP for Northern Ireland [1975] AC 653.
[10] R v Howe [1987] AC 417.
[11] See Lynch [1975] AC at p.695.
[12] Crescendo Management Pty Ltd & Westpac Banking Corporation (1988) 19 NSWLR 40 at pp.45 – 46.
As helpful as ‘practice texts’ can be, it is as well to attend to basic principle gleaned from authority.
Thus for example, like Lynch and Howe, in a criminal context, a succinct definition of duress was provided by Hunt J (in the New South Wales Court of Criminal Appeal, with Gleeson CJ and Mahoney JA agreeing) in R v Abusafiah.[13] In that case, his Honour referred to a person having ‘lost their free choice… because they feared that the consequences of the threat (or threats) were greater than those flowing from performing the act in question.’
[13] R v Abusafiah (1991) 24 NSWLR 531 at p.541
The case law in criminal matters refers, among other things, to the following components of duress: (a) circumstances where a person of ordinary firmness would have been likely to yield to the threat, (b) the threat was present and continuing, imminent and impending, (c) the person threatened reasonably believed that the threat would be carried out, and (d) on the basis of the threat, carried out the act in question.
In my view, there is significant other jurisprudence that should also be addressed directly, as well as analogously, in the Court’s consideration of what does and what does not constitute “duress” in the context of family law litigation.
I begin simply with the observation from McHugh JA’s judgment in Crescendo Management,[14] to which I have previously referred, where his Honour preferred an approach which asked the question of whether the pressure which induced the victim to act:[15]
[14] Samuels and Mahoney JJA agreed McHugh JA.
[15] Crescendo Management Pty Ltd & Westpac Banking Corporation (1988) 19 NSWLR 40 at p.46.
…went beyond what the law is prepared to countenance as legitimate.
In the same place, his Honour went on to state:
Pressure will be illegitimate if it consists of unlawful threats or amounts to unconscionable conduct.
I emphasise McHugh JA’s description or reference to “unconscionable conduct”. “Unconscionable conduct” is a well known concept from equity, which I consider later in these reasons.[16] I also emphasise a further observation of McHugh J, thus:[17]
It is not necessary for a victim to prove that the illegitimate pressure was the reason for him entering into a contract. It is sufficient that the illegitimate pressure was one of the reasons for the person entering into the agreement. Once the evidence establishes that the pressure exerted on the victim was illegitimate, the onus lies on the person applying the pressure to show that it made no contribution to the victim entering into the agreement.
[16] I note that the Full Court in Pelerman v Pelerman (2000) FLC ¶93-037 at p.87,589 approvingly referred to ‘the equitable concept of duress.’ See also the similarly approving comment of Ryan J (as her Honour now is) in SH v DH (2004) 31 Fam LR 102 at p.112 [65]. Generally, on ‘unconscionable transactions’, see Meagher, Gummow & Lehane’s Equity: Doctrines & Remedies (Fourth Edition) (R.P. Meagher, J.D. Heydon, M.J. Leeming) (Sydney: Butterworths Lexis-Nexis, 2002) Part Four.
[17] Ibid.
In addition to these unexceptionable propositions, I note the following.
The Privy Council in Barton & Armstrong had earlier defined “duress” rather straightforwardly as:[18]
In life, including the life of commerce and finance, many acts are done under pressure, sometimes overwhelming pressure, so that one can say that the actor had no choice but to act. Absence of choice in this sense does not negate consent in law. For this, the pressure must be one of a kind which the law does not regard as legitimate.
[18] Barton & Armstrong [1976] AC 104 at p.121.
This is from the dissenting joint judgment in Barton v Armstrong of Lord Wilberforce and Lord Simon of Glaisdale. A similar statement was made by Lord Cross speaking for the majority.[19] In that case, the Privy Council stressed that the “illegitimate pressure” exerted did not have to satisfy the common law definition of duress and, as I have already remarked, McHugh JA in Crescendo referred to their Lordships’ judgment in Barton v Armstrong.[20]
[19] Barton & Armstrong [1976] AC 104 at p.118.
[20] See Crescendo Management Pty Ltd & Westpac Banking Corporation (1988) 19 NSWLR 40 at p.46.
Notwithstanding some (respectfully) most helpful consideration of equitable principle in Pelerman and SH v DH, in my view there still remains significant scope for further investigation of equitable principle to ensure that s.79A continues to provide the remedial force to which the Full Court referred in Barker v Barker.
For example, in my respectful view, thus far, too little attention has been paid to this point of principle, and distinction, between satisfying a common law definition of duress, and ‘illegitimate pressure’ which does not have to satisfy that test but which otherwise qualifies for what the Privy Council, in Barton v Armstrong, and McHugh JA, in Crescendo Management, referred to as ‘unconscionable conduct.’[21]
[21] See Ryan J’s comments in SH v DH, 31 Fam LR at [98], where her Honour considered ‘robust discussion’ which was accepted in the circumstances of that case, but which is clearly to be distinguished from ‘discussion’ that has the intent and or effect to overbear another, so as to negate consent.
By these comments, I simply seek to highlight, respectfully, that there are other closely-related and proper fields of discourse which, to date, seemingly have not been addressed or addressed sufficiently in family law property litigation.
The Act requires that the ultimate result in property cases be “just and equitable.”[22] Given this statutory requirement, it is somewhat curious, therefore, that Courts of equity, for more than a century, have set aside transactions induced by illegitimate pressure which falls short of common law duress, while courts exercising jurisdiction in family law proceedings, so it would appear, have not addressed or addressed sufficiently or thoroughly, the significant jurisprudence from courts of equity. That jurisprudence, some of it to be noted shortly, would include what are described as ‘catching bargains’ and undue influence.
[22] See s.79(2).
Other relevant fields of jurisprudential discourse should include, it seems to me, the decision of Street J in Bester & Perpetual Trustee Company.[23] That decision clearly overlaps with another area to which I must attend in due course, namely the adequacy of legal advice given to Ms Hogan by her then lawyers at the time of signing the Consent Orders. I will come back to that decision shortly.
[23] Bester v Perpetual Trustee Company (1970) 3 NSWLR 30.
Ultimately, in the light of the authorities in relation to duress, and of course in the light of the evidence that is addressed later, the questions before the Court now become (a) whether Ms Hogan’s will in signing the Consent Orders was overborne to such a degree that her consent was not a true consent; and/or (b) was Ms Hogan subject to unconscionable conduct by Mr Hogan, which had the effect that she felt she had no choice but to sign the Consent Orders, and in such circumstances, (c) was Mr Hogan’s conduct such that it could or should be characterised as illegitimate pressure?
The issue of unconscionable conduct has been the subject of extensive discussion in a significant number of High Court authorities, such as Commercial Bank ofAustralia & Amadio,[24] especially in the judgment of Deane J; Garcia v National Bank of Australia Limited;[25] and Bridgewater v Leahy.[26]
[24] Commercial Bank ofAustralia v Amadio (1983) 151 CLR 447. See especially the judgment of Deane J at pp.474 ff with which Mason J generally agreed, at p.461.
[25] Garcia v National Bank of Australia Limited (1998) 194 CLR 395.
[26] Bridgewaterv& Leahy (1998) 194 CLR 475 at pp.478 – 479 [74] – [76].
I note the following from these decisions. First, in Bridgewater v Leahy, Gaudron, Gummow & Kirby JJ said:[27]
In Commercial Bank of Australia v Amadio, Deane J said that the two doctrines are distinct, undue influence looking to “the quality of the consent or assent of the weaker party”, whilst unconscionable conduct looks to the attempted enforcement or retention of the benefit of dealing with a person under a special disability. Further, the recognition of certain special relations, the existence of any of which would itself support a presumption of undue influence, could provide a particular forensic advantage to plaintiffs.
[27] (1998) 194 CLR 457 at p.478 [74] (internal citations omitted).
Their Honours continued, at [75] (internal citations omitted):
Sir Anthony Mason, with reference to the well-developed Australian body of authority on the subject, has contrasted the two doctrines as follows:
My understanding of undue influence ... is that it denotes an ascendancy by the stronger party over the weaker party such that the relevant transaction is not the free, voluntary, and independent act of the weaker party. In other words, it is the actual or presumed impairment of the judgment of the weaker party that is the critical element in the grant of relief on the ground of undue influence.
Unconscionable conduct, as the term suggests, focuses more on the unconscientious conduct of the defendant. As a ground of relief in England, unconscionable conduct has been confined largely to ‘catching bargains’ with expectant heirs and others in particular categories of disadvantage e.g. those who are illiterate... In Australia, it has been recognised that unconscionable conduct is a ground of relief which will be available ‘whenever one party by reason of some condition or circumstance, is placed at a special disadvantage vis-à-vis another and unfair or unconscientious advantage is taken of the opportunity thereby created.
Finally, still in Bridgewater v Leahy, the joint judgment continued, at [76] (internal citations omitted):
In Commercial Bank of Australia Limited v Amadio, Deane J spoke of unconscionable conduct as occurring where, in the circumstances, it is unconscientious “to procure or accept the weaker party’s assent to the impugned transaction.”
In that same paragraph, the High Court referred to the ‘ordinary jurisdiction’ of the Court of Chancery by reference to an early decision of Torrance v Bolton.[28] The Court of Chancery dealt with instruments and transactions where the Court was of the opinion that ...
... it is unconscientious for a person to avail himself of the legal advantage which he has obtained.[29]
[28] (1872) LR 8 Ch App 118 at p.124.
[29] The High Court also referred here to the Privy Council judgment of Lord Brightman in Hart v O’Connor [1985] AC 1000 at p.1024, where his Lordship noted the Court’s intervention where there was either active extortion of a benefit or “the passive acceptance of a benefit in unconscionable circumstances.”
In the earlier High Court decision of Blomley v Ryan, Fullager J said:[30]
The circumstances adversely affecting a party, which may induce a court of equity either to refuse its aid or to set a transaction aside, are of great variety and can hardly be satisfactorily classified. Among them are poverty, or need of any kind, sickness, age, sex, infirmity of body or mind, drunkenness, illiteracy or lack of education, lack of assistance or explanation where assistance or explanation is necessary. The common characteristic seems to be that they have the effect of placing one part at a serious disadvantage vis-à-vis the other.
I emphasise the last sentence of his Honour’s observations just quoted.
[30] (1956) 99 CLR 362 at p.405.
To similar effect are comments by Kitto J, where his Honour said:[31]
This is a well known head of equity. It applies whenever one party to a transaction is at a special disadvantage in dealing with the other party because illness, ignorance, inexperience, impaired faculties, financial need or other circumstances affect his ability to conserve his own interests, and the other party unconscientiously takes advantage of the opportunity thus placed in his hands.
[31] Blomley & Ryan (1956) 99 CLR 362 at p.415
Respectfully, given McHugh JA’s learned comments in relation to “duress” and “unconscionable conduct,” where his Honour drew from criminal law (Lynch v DPP) and equity (Barton v Armstrong), the High Court authorities to which I have referred seem to me to be relevant to the matters currently before the Court and are of a piece with this Court ensuring that s.79A applications are able properly to draw from appropriate precedent. Added appropriately to the armoury of the Court they would also assist in ensuring, as the Full Court said in Barker v Barker (quoted earlier in these reasons), that s.79A remains a “remedial section designed to avoid a miscarriage of justice.”[32] Unfortunately and somewhat curiously, it would seem that, to speak somewhat colloquially, to date these High Court authorities and the principles for which they stand concerning ‘illegitimate pressure’ ‘duress’ and ‘unconscionable conduct’ have not received much in the way of “airplay” in family law property proceedings.
[32] For the sake of completeness I note that in Crescendo Management (at p.46) McHugh JA observed that the dissenting advice from Lords Wilberforce and Simon in Barton v Armstrong had been later approved by the Privy Council in Pao On v Lau Yiu Long [1980] AC 614 at p.635, where Lord Scarman delivered the judgment of the Board.
Legal Advice: The next issue to address concerns the legal principles relevant to the Court’s consideration of the nature, extent, and quality of the legal advice received in relation to the consent orders.
Put shortly, there are two matters to consider here. First, the authorities from family law proceedings refer generally to the fact that incompetent legal advice, of itself, does not constitute a “miscarriage of justice” within the terms of s.79A.
Family law jurisprudence also says that the advice or legal representation may nonetheless constitute miscarriage of justice if it was so bad as to amount to there being no representation at all, or if it was perverse. There are many cases that confirm these principles, Oastler[33] and Patching[34] being just two such authorities.
[33] Oastler & Oastler (1993) FLC ¶92-390.
[34] Patching & Patching (1995) FLC ¶92-585.
I return, however, to the New South Wales Supreme Court decision of Street J in Bester, to which I have earlier referred. In that case, a solicitor read out the terms of a deed of settlement, word by word, to the young adult person who was to benefit under that deed, and asked her if she had any questions. She replied very simply “no.” No advice was given as to whether she should execute the deed. No alternative advice was given as to other possible options for the arrangement of her financial affairs, and she was given no opportunity to take the deed away to consider it. Nor was she provided with any explanation in lay or non-legal language as to the effect of the operation of the deed. The Court said:[35]
Another of the indicia to which reference may legitimately be made in determining the critical issue of whether the plaintiff thoroughly comprehended the transaction, and entered into it deliberately and of her own free will, is the presence or absence of independent advice having been tendered to her. Mr Emmanuel was brought into the present transaction with the intention, no doubt, of meeting this requirement. I am of the view, however, that such part as he played in connection with this settlement could not fairly be described as meeting that degree of independent advice that the plaintiff, as a person subject to a relationship of influence, was entitled to receive. Mr Emmanuel was, I accept, most careful to read the document through, and to invite questions of the plaintiff. But it was not textual advice upon the engrossment which was of prime importance in this regard: rather, it was advice upon the more general topic of whether a settlement should be entered at all and, if so, the general nature of the settlement, which in my view, ought to have been provided for the plaintiff.
[35] Bester v Perpetual Trustee Company (1970) 3 NSWLR 30 at p.35. In passing, I note that Senior Counsel for the Plaintiff in this case was W.P. Deane QC, later Sir William Deane, quoted earlier in these reasons in Amadio.
His Honour continued (at p.37):
On the whole, it seems to me that the plaintiff’s case is well-founded, and that it is established that she did not thoroughly comprehend, and deliberately of her own free will carry out the transaction embodied in the settlement of 7 October 1949.
His Honour set aside the deed of settlement.
S.79A & ‘Any other circumstance’: The third area of consideration, still dealing with matters of principle, relates to “any other circumstance” in s.79A. The authorities here are relatively clear. This is to say that these words have been held to be read not ejusdem generis with the preceding categories of fraud, duress, suppression of evidence or the giving of false evidence, but should be given their wide natural meaning. That said, the Full Court has also confirmed that the words are not of unlimited scope.[36]
[36] See Gebert v Gebert (1990) FLC ¶92-137.
In Gebert, the Court held that the reference point had to be whether the circumstances of the case, for one reason or another, highlighted or pointed to there being a “miscarriage of justice.” The reference point also had to be to whether there had been justice according to law in the circumstances of the case.
The usual case cited in this regard, is that of Holland,[37] to which I previously referred. In that case, the Court acknowledged that there could be cases where the Consent Orders reflected a settlement that is so far outside the ambit of what is just and equitable that a Court may infer that a party has acted under duress, in ignorance or as a result of incompetent advice.
[37] Holland & Holland (1982) FLC ¶91-243 at p.77, 341.
This will suffice for a summary of relevant legal principle.
C. Summary of evidence
Very summarily stated, the evidence was as follows.
Ms Hogan contended that she was subject to various and significant acts of violence during the marriage with Mr Hogan. They involved, she said, amongst other things, guns and other menaces. Mr Hogan categorically denied any such acts, although he agreed that he did own certain guns, but not the kind to which Ms Hogan referred.
Rather more immediately relevant are allegations by Ms Hogan that she had been stalked by Mr Hogan, and that he has regularly telephoned and text-messaged her abusively. Mr Hogan denied any stalking; he acknowledged that he had called Ms Hogan, or attempted to do so, on a significant number of occasions. He denied any harassment in this regard and said that he was simply endeavouring to encourage her to finalise the property settlement. While various records were before the Court, the detail of the messages, unfortunately, was not.
It was not denied that Ms Hogan’s van had been “egged”; Mr Hogan denied any involvement in or knowledge of such an act.
Ms Hogan confirmed that for some time she had been seeking medical and related treatment for her state of anxiety and related conditions. Various medical records were tendered to support and to question (more as to time and duration) that treatment.
Ms Hogan also produced, and tendered, contemporaneous diary notes of conversations from 2008. For the most part, they are very brief. Nonetheless, accepting their brevity, they refer not infrequently to
Ms Hogan being scared following a telephone conversation with
Mr Hogan, and to various actions that Mr Hogan is alleged to have done. Notably, there is reasonably frequent reference to Mr Hogan’s ‘rage’ and/or ‘aggro.’
The completely opposed evidence of the parties, even more so than in most cases, makes the Court’s assessment even more arduous than usual. Indeed, especially in a case such as this, where duress is the principal ground of attack, in my view, the Court would need significantly clear evidence to make such a finding against Mr Hogan and his alleged conduct. In my view, the relatively contemporaneous notes are not insignificant matters.
Ms Hogan’s treating psychologist, Dr G, was briefly cross-examined. She confirmed that Ms Hogan’s presentation and treatment was consistent with someone who had undergone some trauma and the consequences of it. She also accepted that she was dependent for her assessment on what she saw in Ms Hogan’s presentation and
Ms Hogan’s account of her family and related history.
The utility of Dr G’s evidence, in my view, was essentially to confirm the treatment of Ms Hogan, and the reasons for it, namely that there was a not insignificant relevant history of anxiety that was consistent with the account of events given by Ms Hogan. In my view, however, her evidence could not be taken safely any further at this stage of the proceedings, noting too that she was cross-examined only by telephone. In a matter where duress is alleged, and in the circumstances alleged, I would require further evidence to establish whether Mr Hogan was responsible for Ms Hogan’s current and ongoing condition for which she has been seeking professional assistance, and if so, to what degree.
Ms Hogan’s Mother also gave evidence. She was nothing if not direct. Unfortunately, her directness seemed, to a significant degree, to have coloured her evidence about what she says she saw and heard
Mr Hogan say to her daughter. Regrettably, in my view, her evidence was so hostile to Mr Hogan that it would be unsafe to place much weight on it in the current, limited circumstances of the current proceedings.
Mr White, Ms Hogan’s solicitor at the time of the Consent Orders, was also cross-examined by telephone. Among other things, he confirmed that he ‘took Ms Hogan’ through the document (being the Consent Orders) and that some of the amendments to the application for consent orders were in his hand-writing.
It seemed not disputed, or not too strenuously so, that at or around the time of the signing of the Consent Orders, Mr White said to Ms Hogan that family law litigation was not his area of expertise and that she should seek out someone with that expertise.
In my view, Mr White’s actions come very close to those described by Street J in Bester to which I have referred earlier in these reasons. I will say no more on that aspect.
Finally, by way of general factual overview, the parties were married for approximately 17 years. There were three children of the relationship, two of whom now live with their Father. The remaining child lives with her Mother. The so-called offspring, if I may respectfully refer to them in that way, are now aged 20, 19, and 17.
The asset pool of the parties is modest. Various items (which I need not specifically identify, other than to note that Mr Millar highlighted them in the course of the hearing) were not included in the ‘application for consent orders’, which is annexure BB to Ms Hogan’s affidavit filed on 10th February 2010. How and why they were not included was briefly explored but little helpful or reliable evidence was obtained.
It seemed not disputed that Mr Hogan had now re-partnered, and that Ms Hogan was also now in another relationship. Mr Hogan confirmed that he had an unresolved workers’ compensation matter outstanding; otherwise, he said that he was currently unemployed.
In short, the Consent Orders provided for Ms Hogan to receive approximately $58,000 in assets out of a pool said to be worth approximately $583,000 at the time. On the various figures before the Court, it was submitted that the range of outcomes for Ms Hogan would be, according to Mr Hogan, between 10.2 and 14.6% of the asset pool. In written submissions filed on behalf of Ms Hogan, it was contended that the effect of the 2008 orders provide her with, at best, 11.4% of the asset pool, thereby leaving Mr Hogan with the balance of 88.6% of the pool.
In conclusion, amongst other cases, I refer to a relatively recent judgment of O’Reilly J in G & T.[38] In that case her Honour helpfully set out what she described as the prerequisites, or the requirements, of a s.79A application and the establishment of what she describes as a “prima facie case.”[39]
[38] G & T (2005) 32 Fam LR 101.
[39] G & T (2005) 32 Fam LR at pp.108-109 [56] – [63].
Having regard to the principles gleaned from the authorities to which I have referred, and the limited, conflicting evidence before the Court, in my view, the most telling matters in the current application are as follows:
·Mr Hogan’s persistent telephone calls and text messages. While not strictly speaking, in my view, sufficient to constitute duress, they could be taken at least to be bordering on, if not constituting, “unconscionable conduct” as that term is used and described in the High Court cases to which I have earlier referred, notably Commercial Bank of Australia v Amadio, Garcia v National Bank of Australia Limited, Bridgewater v Leahy, and Blomley v Ryan. The calls were made in circumstances where he was legally represented, as was Ms Hogan. In my view, there was no need for him to speak with his former wife. He confirmed that he knew that she did not wish to speak with him. He should have desisted. I note the following evidence that was put before the Court in G v T and which was accepted by O’Reilly J. Briefly stated, in a very short statement from an affidavit quoted by her Honour, at [59], the following is found:
We separated, yet again, in January 2000. Within a few days after we agreed to separate [Mr X] came to the home with legal documents that he insisted on me signing. He said that I had better sign them. He said that if I did, he would be out of my life. He went on to say that he had legal advice that I had no rights as his wife, or as the mother to his children, nor did I have any rights to any of the assets in the Trust. He said that on paper I would be receiving $15,000. But 10,000 of this had to be paid back to [X Company] for me to purchase and take our family car and that the remaining $5000 was worked out as a total value of furniture he took with him. All I wanted was for him to be out of my life, so I signed.
Her Honour highlighted the first three sentences in this paragraph. In my view, that evidence is at least similar to, and certainly congruent with, what is alleged in the circumstances of this case.
·The second critical matter for me is the advice from Mr White which, in my view, was less than fulsome and appropriate in the circumstances. He confirmed that he was aware of Ms Hogan’s concerns about Mr Hogan. As I have noted, his advice, so to speak, was of a kind that enabled a settlement deed to be overturned in Bester.
·Perhaps, most importantly, of special significance was the disproportionate percentage for Ms Hogan under the Consent Orders, especially in the light of the length of the relationship. In my view, Ms Hogan’s entitlement under those orders was manifestly inadequate.
Conclusion
In my view, the combination of factors which I have just described brought about a miscarriage of justice in the relevant sense, namely ‘any other circumstance.’ The same circumstances, in my view, warrant the Court to exercise its discretion and to grant the application as sought.[40]
[40] See generally the Full Court’s discussion in Prowse (1995) FLC ¶92-557 and Morrison & Morrison (1995) FLC ¶92-573.
In short, in the light of my discussion of the relevant principles and the evidence before the Court, the best course is for the application to be granted, which would be on the ground of “any other circumstance”, rather than duress. As requested or agreed by both Counsel, the application having been granted, it should be referred to a conciliation conference as soon as convenient. The hope, of course, would be that an early resolution might be negotiated so that all parties can get on with their lives and the limited funds and assets of the parties are not further dissipated.
Formally, the Orders made by the Local Court at Bega on 18th March 2008 are set aside pursuant to s.79A of the Act. The parties are to attend a conciliation conference in Canberra on 20th September at 10:00am. The parties, and their partners, are to provide a sworn summary of their updated financial positions 5 days prior to the conciliation conference.
I will hear the parties on the question of costs by way of written submission within 21 days.
I certify that the preceding sixty-nine (69) paragraphs are a true copy of the reasons for judgment of Neville FM
Date: 9 September 2010
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