JACOBOVA & STEIN - [2009] FamCA 1105

FAMILY COURT OF AUSTRALIA

JACOBOVA & STEIN

[2009] FamCA 1105

FAMILY LAW – CONTEMPT - Contempt by disobedience of an order of the court – flagrant challenge to the authority of the court – capacity to pay as necessary element of an allegation that non-payment constitutes a contempt of court – no case to answer- application dismissed

Child Support (Assessment) Act 1989 (Cth) s 100(2), s 118(1), s 123, s 124
Family Law Act 1975 (Cth) s 112AD, s 112AP

Basic v Newman (1991) 104 FLR 279
Fauna Holdings Pty Ltd & McGillivray & Ors & Mitchell (2000) FLC 93-053; [2000] FamCA 313
Hay and Hay(1998) FLC 92-819; [1998] FamCA 95
Ibbotson v Wincen, In the Marriage of (1994) FLC 92-496
In the Marriage of English [1986] FLC 91-729
Kendling v Kendling [2008] FamCAFC 154
Pelechowski v The Registrar, Court of Appeal (1999) 198 CLR 435
Re F Litigants in person guidelines (2001) FLC 93-072
Witham v Holloway (1995) 183 CLR 525

APPLICANT:

Ms Jacobova

RESPONDENT:

Mr Stein

FILE NUMBER:

MLC

13605

2007

DATE DELIVERED:

29 July 2009

PLACE DELIVERED:

Melbourne

PLACE HEARD:

Melbourne

JUDGMENT OF:

Bennett J

HEARING DATE:

24 June 2009

REPRESENTATION

COUNSEL FOR THE APPLICANT:

Ms M L Smallwood

SOLICITOR FOR THE APPLICANT:

Lewenberg and Lewenberg

COUNSEL FOR THE RESPONDENT:

In person

SOLICITOR FOR THE RESPONDENT:

Orders

(i)That the wife’s application filed on 11 February 2009 is dismissed.

IT IS NOTED IN CONNECTION WITH THESE ORDERS that the judgment of the Honourable Justice Bennett delivered this day will for all publication and reporting purposes be referred to as Jacobova & Stein

FAMILY COURT OF AUSTRALIA AT

FILE NUMBER: MLC 13605 of 2007

Ms Jacobova

Applicant

And

Mr Stein

Respondent

REASONS FOR JUDGMENT

The wife’s application that the husband be dealt with for contempt of orders of this Court was filed on 11 February 2009.
The relevant Order concerns the child … born in November 2003 and was made in proceedings between the husband and the wife, by consent, on 21 November 2008. Inter alia, the Order provides as follows:-
That pursuant to s.123 of the Child Support (Assessment) Act the Husband pay half of all tuition fees and charges of the school for the Child incurred by her attendance at [L School] (or any other agreed private school), as and when they fall due, together with half of all books, school uniforms and any ancillary expenses relating to the Child’s schooling upon production by the Wife of the invoices for same.
The wife’s application was first returnable on 13 March 2009. Upon the husband’s failure to appear in court on that date, the matter was adjourned until 22 June 2009.
The wife is represented by Miss Smallwood, of counsel. The husband appears on his own behalf. The matter was stood down for most of the morning whilst the husband consulted the duty solicitor. The husband applied for an adjournment of the proceedings to enable him to retain a lawyer. I dismissed that application for reasons which I delivered at the time. Essentially, I was satisfied that the husband had had more than sufficient time in which to obtain legal representation and that he would not be able to pay the wife’s costs incurred by reason of any adjournment. However, I was mindful of the guidelines of the Full Court in Re F Litigants in person guidelines (2001) FLC 93-072 and I explained to the husband during the course of the proceedings that I considered the law and natural justice required strict adherence to the procedural requirements in contempt proceedings.
I dismissed a count of the wife’s application wherein she alleged that failure by the husband to pay administratively assessed child support constituted contempt of an order which had fixed the husband’s child support income for a particular period. Counsel for the wife stated that the wife did not require reasons for my decision in this regard. However, it will be apparent from the discussion between myself and Miss Smallwood that I did not consider that the order which was made pursuant to s 118(1)(c) of the Child Support (Assessment) Act 1989 was an order in respect of which the husband could be in contempt in the circumstances of this case.
I informed the respondent husband of the remaining allegations made against him. When I asked the respondent husband whether he wished to admit or deny the remaining allegations that he had acted in contravention of court orders, such that it involved a flagrant challenge to the authority of the court, he denied having done so.
The evidence in support of the wife’s case was contained in an affidavit sworn by the wife on 11 February 2009 in which she deposed:-
I am the applicant wife and bring contempt proceedings arising from the husband’s deliberate breaches of orders made in the Family court of Australia on 21 November 2008, (“the Orders”), now produced and shown to me and marked “CJ1” are the Orders.
I refer to the Orders and specifically Order 16. The fees outstanding and due and payable as at 23 December 2008 are in the sum of $19,500 after payment by me of $1,000 in November 2008. The husband is required by the Order to pay $10,250 being half of the fees due and payable at 23 December 2008. He has made no payment at all and further fees will become due and payable in the total sum of $3469.50 on 16 February 2009, half of which is $1734.25 Now produced and shown to me and marked “CJ6” is correspondence from [L School] dated 23 December 2008 and 11 February 2009.
I refer to the Orders and specifically to Order 16 requiring the husband to pay for half of all school uniforms upon production by the wife of the invoices for same. I sent the husband the invoice for the school uniform by way of registered post on 29 January 2009. Now produced and shown to me and marked “CJ7” is the invoice and registered post receipt. The husband failed to pay for half the school uniform.
The husband made statements under oath during the course of the Less Adversarial Trial before Justice Bennett that he would pay the arrears of school fees, prior to the resumption of the hearing, but he did not…..the husband went into bankruptcy during the course of the Less Adversarial Trial with a debt position of $534,179.16 in excess of his assets.
The husband agreed to the Court making the Orders referred to above, and gave his consent to same, merely weeks prior to failing to observe their terms.
I request that he husband be dealt with pursuant to section 112 AP.
The wife also relied on the following evidence from the school bursar, Ms W, sworn 3 July 2009:-
1.I am the business manager for [L School] and I am responsible for invoicing and receipting all school fees payable and paid to the [School].
2.I say that as of today’s date Mr [Stein] has made no payments towards [the child’s] school fees.
3.The current amount owing with respect to [the child’s] school fees is $23,728. The [school] has received $6,000 from [Ms Jacobova] towards the payment of the total fees outstanding.
4.[The child] has been enrolled in the [school] since 2007 and the [school] has sent Mr. [Stein] quarterly invoices with respect to [the child’s] fees. The latest invoice sent to Mr. [Stein] was on the 7 April 2009 stating that the sum of $21,448 was outstanding. We have not received any payment from him with respect to said invoice.
The wife was cross examined by the husband.
It is common ground that the father has not paid any school fees or any uniform expenses. The amount said to be outstanding for school fees is $14,864 and $255 in respect of school uniform expenses.
The wife’s case was closed by her counsel. Had the husband been represented, I would have expected a “no case submission” to be made at the conclusion of the wife’s case. This was evident from the way in which the evidence in the wife’s case fell. Whilst it was common ground that the husband had not complied with the relevant orders there was no evidence that he had the capacity or wherewithal to comply. Accordingly, I asked counsel for the wife why the case should proceed and requested that she respond as if the husband had made the submission that there was no case to answer.
The applicant bears the onus of proof of all elements of the alleged contempt. The standard of proof is beyond reasonable doubt.
Section 112AP of the Act provides that:-
(1) Subject to subsection (1A), this section applies to a contempt of a court that:
(a) does not constitute a contravention of an order under this Act; or
(b) constitutes a contravention of an order under this Act and involves a flagrant challenge to the authority of the court.
(1A) This section does not apply to a contempt that constitutes a contravention of a maintenance order if the order has been complied with before the matter of the contravention comes before the court.
(2) In spite of any other law, a court having jurisdiction under this Act may punish a person for contempt of that court.
(3) The applicable Rules of Court may provide for practice and procedure as to charging with contempt and the hearing of the charge.
(4) Where a natural person is in contempt, the court may punish the contempt by committal to prison or fine or both.
(5) Where a corporation is in contempt, the court may punish the contempt by sequestration or fine or both.
(6) The court may make an order for:
(a) punishment on terms;
(b) suspension of punishment; or
(c) the giving of security for good behaviour.
(7) Where a person is committed to prison for a term for contempt, the court may order the person’s discharge before the expiry of that term.
(8) To avoid doubt, the serving by a person of a period of imprisonment as a result of a contempt of a court arising out of a failure by the person to make a payment in respect of the maintenance of another person does not affect the first-mentioned person’s liability to make the payment.
(9) In this section:
order under this Act means an order under this Act affecting children or an order under this Act within the meaning of Part XIIIA.
There are two preliminary issues, firstly whether there is a relevant contravention and secondly, whether the contravention ‘involves a flagrant challenge to the authority of the court.’
It was alleged that the husband is in contempt with respect to an order for non-periodic child support made pursuant to s 124 of the Child Support (Assessment) Act 1989 (“the Assessment Act”). Section 100(2) of the Assessment Act provides that Part XIIIB (contempt of court) of the FamilyLaw Act 1975 (Cth) applies to any decree made by a court under the Assessment Act as if the decree were a decree made by a court under Part VII of that Act.
There was some suggestion, which I do not accept, by counsel for the wife, that s 100(2) of the Assessment Act cannot operate to make s 112AP (contempt of court) applicable to the order for non-periodic child support made on 21 November 2008 as if that order was an order made under the part of the Family Law Act relating to children. However, as it was conceded by the wife that an essential element of the husband being found in contempt of court would be a ‘flagrant challenge’ by the husband to the authority of the court, it is not a matter which requires further discussion.
I am satisfied that the respondent husband had knowledge of, and understood, the relevant order.
The nub of the case, which I asked counsel for the applicant wife to address, is whether the husband’s failure to comply with an order for payment of non-periodic child support can be a contempt of court, on two counts, without the applicant having proved, or it being common ground, that the husband had the capacity to pay.
Counsel for the wife contended that capacity to make a payment is not a necessary element of a finding that failure to make a payment constitutes a contempt of court.
The wife argued that the fact that the husband consented to orders on the eighth day of a trial and then did not pay or seek to vary or discharge his obligation to do so constituted a flagrant challenge to the authority of the court. Furthermore, the wife argued that it cannot be the case that she could enter into final orders in November 2008 which bring to an end all matters in dispute between herself and the husband and then, when the husband fails to pay anything, she be required to prove that the husband has had the wherewithal to comply.
It was submitted on behalf of the wife that as a matter of social policy, litigants are entitled to place their trust in the authority of the court. Counsel for the wife cited the following passage from the dissenting judgment of Kirby J in Pelechowski v The Registrar, Court of Appeal (1999) 198 CLR 435 at 492 (where the majority had found the injunction made outside jurisdiction):
Yet consider the unjust result which follows. An order of a Judge of the District Court of New South Wales, never set aside, is solemnly made and stands on the public record speaking to the appellant (who understands it), to the judgment creditor who secured it and to the community. The order was designed to prevent misconduct of the precise kind which the appellant quickly effected. He defied the court order. He wholly defeated the interests of a litigant who had invoked court process and who trusted the court to uphold his rights, not only in theory but in practicality as well. The power given to the trial judge by Parliament is seriously confined. This Court allows a person, guilty of deliberately flouting a court order and defying another citizen’s established civil rights, to walk away unpunished, laughing at justice. It is not a shining moment for the authority and effectiveness of judicial orders in Australia.
Clearly, sentiments expressed by Kirby J. are correct However, that case turned on the validity of the injunction and not on the capacity of the appellant to refrain from doing certain acts the commission of which was found to constitute a contempt.
Counsel for the wife properly cited authorities which contain the principle that the notion of ‘flagrant challenge’ need not encompass an element of intention on the part of the contemnor: Fauna Holdings Pty Ltd & McGillivray & Ors & Mitchell (2000) FLC 93-053; [2000] FamCA 313; Hay and Hay (1998) FLC 92-819; [1998] FamCA 95; Witham v Holloway (1995) 183 CLR 525. I accept that this is a correct statement of the law. However, counsel for the wife sought to extrapolate the proposition to the extent that the respondent’s capacity to make a payment in accordance with court orders is not relevant to my determination of whether there has been a ‘flagrant challenge’ to the authority of the court in this instance. She did concede that the respondent’s capacity may be relevant to the question of sentencing but maintained that it is not relevant to a finding of flagrant challenge. I am not able to accept this submission.
A long line of authorities have followed the proposition that intention is not required to establish a flagrant challenge to the court’s authority. In In the Marriage of English,[1] the Full Court, there comprising Fogarty, Murray and Ross-Jones JJ, commented:
….it must be established that the respondent knew of the undertaking or order and that his act or omission in breach of that order or undertaking was a wilful, that is, a deliberate act by him as distinct from accidental or inadvertent. It is not necessary in addition to establish that the conduct was contumacious; that is, it is unnecessary to show that the act or omission was done with a deliberate intention to break or disregard the undertaking or order.
[1] [1986] FLC 91-729 at 75, 294.
I draw a distinction between the wilfulness of an act or omission and the wilfulness of contravening an order by the doing of an act or omission. If an order imposes an obligation on a party to do an act, such as pay school fees, I accept that it is not a necessary element of a contempt proceeding for the applicant to prove that the respondent intended or willingly contravened an order of the court. However, in my view, the applicant must prove to the requisite standard that the alleged contemnor’s failure to do the act, such as pay school fees, was a wilful act or omission.
I asked counsel for the mother to address the proposition that non-payment of school fees and uniform expenses can only be characterised as a flagrant challenge to the authority of the court if the court is satisfied to the requisite standard that the alleged contemnor had the wherewithal to pay and failed to do so or acted so as to frustrate or remove from himself the ability to pay.
An examination of relevant authorities reveals that a ‘flagrant challenge’ will be determined as a matter of fact and degree. Fogarty, Baker and McGovern JJ, in the Full Court decision of Ibbotson v Wincen, In the Marriage of (1994) FLC 92-496, stated:
67. Part XIIIA was introduced in 1989 following the report of the Australian Law Reform Commission - "Contempt" - to move away from the habitual use of the contempt powers of the Court for breaches of custody and access orders. It did so by setting up the detailed structure contained in that Part, a particular procedure, wider sentencing options, and the specific offence contained in s.112AD: see Schwarzkopff, supra, at 79,287-8. Nevertheless, the powers of the Court to punish for contempt of Court arising from the breach of an order remain and are to be found in s.112AP(1) (together with s.35). It is clear that paragraph (b) of that sub-section contemplates that in some circumstances the contravention of an order will constitute a contempt of Court. It defines that circumstance as being where the contravention involves a "flagrant challenge to the authority of the Court". Repeated breaches are not a prerequisite, although that may more readily attract this provision. The use of the term "flagrant challenge" to the authority of the Court is intended to underline the exceptional or striking nature of the contravention in question and thus to differentiate it from what might be described as the general run of breaches which are intended to be dealt with under s.112AD.
68. In the ultimate, it is a question of fact and degree whether the stringent terms of the section are satisfied, bearing in mind, as was pointed in Basic/Newman (1992) FLC 92-297 that it is usually more appropriate to use s.112AD.
(emphasis added)
The decision in Basic v Newman (1991) 104 FLR 279 affirms that contempt procedures should be used sparingly. After setting out the substantive differences between contempt proceedings under s 112AP and contravention proceedings under s 112AD, Mullane J dismissed the application of 12 counts of contempt of court against a respondent mother for failure to provide the child of the parties to spend time with the father, finding that under these circumstances an application under s 112AD would have been the appropriate means of addressing the contraventions.
In the present case, counsel for the wife submitted that, because the husband had been declared bankrupt at the time that the orders were entered into and would thus be unable to make any payment pursuant to the Orders, contempt proceedings, which carry a stronger element of punishment, are the only effective vehicle for addressing the husband’s failure to pay. I reject this proposition. It also does not advance the identification of what can be alleged in this case to constitute the husband’s flagrant challenge to the authority of the court.
A review of authorities where contempt under s 112AP was established makes it clear that what constitutes flagrant challenge must be decided upon the facts.
In the case of Ibbotson,[2] the husband took a child aged seven years to the United States, with the consent of the wife, but failed to return the child to the wife and then travelled with the child across various countries including Cyprus. The trial judge found that the husband’s actions were premeditated and aimed at embarking upon a course that would avoid legal processes. On appeal, the Full Court upheld the trial judge’s finding of contempt and the imposition of a 12 month term of incarceration.
[2] Ibbotson v Wincen, In the Marriage of (1994) FLC 92-496.

Fauna Holdings involved a contravention of consent Orders where the husband sold a boat contrary to an injunction contained in the Orders. Although there was a possibility that the contravention was not contumacious, in the sense that the husband may have believed the order to be invalid, the Full Court upheld the trial judge’s view that flagrancy was to be determined ‘having regard to the nature of the breaches rather than the intent behind them.’[3] This case does not, as counsel for the wife submitted, stand as authority for the notion that capacity to make a payment is not a relevant consideration in determining flagrancy. Indeed, the Full Court noted the trial judge’s finding that the sale of the boat was not required to meet the husband’s reasonable living expenses.
[3] Fauna Holdings Pty Ltd & McGillivray & Ors & Mitchell [2000] FamCA 313, para 73.
The recent case of Kendling v Kendling [2008] FamCAFC 154 notes that the Oxford Dictionary defines ‘flagrant’ as ‘conspicuously or obviously offensive’ and the Macquarie Dictionary as ‘glaring, notorious or scandalous.’[4] The contravention alleged in Kendling also involved the breach of an injunction which restrained the husband from dealing with or disposing of certain assets. In that case, the husband’s ‘considerable commercial experience and success’ was a relevant factor in establishing flagrancy.[5] Coleman, May and Boland JJ noted that:
[193] The fact that the breaches of the court’s orders in this case do not represent the most extreme or flagrant challenges to the authority of the court is not the test. What was required was that the trial judge be satisfied that these breaches were exceptional or striking. Nothing to which we have been referred persuades us that it was not reasonably open to the trial judge to so conclude.
[4] Kendling v Kendling [2008] FamCAFC 154, para 184.
[5] Ibid, para 190.
The evidence submitted by the wife in this case does not lead me to conclude that the husband’s failure to pay school fees constitutes an exceptional or striking breach by the husband of orders or in any other sense a flagrant challenge to the authority of the court. In reaching this conclusion, I am mindful that the husband’s liability for school fees, of approximately $14,900, did not arise all at once. A significant part of the husband’s debt to the school may pre-date the Order of 21 November 2008 but the amount owing would also have grown considerably since the Order was made. I take into account that the husband has paid nothing. It appears to be poor behaviour on his part and, in other contexts, would reflect poorly on his attitude to parenthood and to his daughter but these facts do not satisfy me that the husband had the capacity to pay and elected not to do so.
The husband’s failure to pay one half of the school uniform expenses to the approximate amount of $255 was also a matter about which there was no evidence of the husband’s capacity to pay. Obviously it would have been less difficult to adduce evidence of the husband’s capacity to pay $255 as opposed to $14,900. However, counsel for the wife conceded, correctly in my view, that non-payment of $255 is not a matter in respect of which the wife would have sought that the husband be dealt with for contempt. It was only ever intended to be one of a number of counts. Incidental expenses are important nonetheless, because the child will have a long career at L School where she is now in Preparatory Grade. She will require many more uniforms. The father’s behaviour in this regard does not bode well for what kind of benefit he will be to the child in the future. However, on the state of the evidence in this case, poor parenting does not, of itself, qualify as contempt.
I dismiss the wife’s application filed on 11 February 2009.

I certify that the preceding 36 (thirty-six) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Bennett.

Associate:

Date: 29 July 2009