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Keane & Keane

Keane & Keane

Case [2013] FamCA 332

Constructive Trust

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FAMILY COURT OF AUSTRALIA

KEANE & KEANE AND ORS

[2013] FamCA 332

FAMILY LAW – CHILD SUPPORT – where the parties entered into an agreement that transitioned into a binding child support agreement pursuant to subsequent legislation – where the father seeks to set the agreement aside – the meaning of “exceptional circumstances” – whether the subsequent legislation that transitioned the agreement into a binding child support agreement is of itself an “exceptional circumstance” – where it was held that no “exceptional circumstances” had arisen since the agreement was made that would warrant the agreement being set aside – where the father would have satisfied the threshold for hardship – where even if exceptional circumstances existed, the Court would not have exercised a discretion to set aside the binding child support agreement – application dismissed.

FAMILY LAW – DECLARATION – where the third respondent (the father’s new wife) seeks an order that she be declared to have an 80 per cent interest in the property she owns jointly with the father – where the third respondent asserted that 60 per cent of the father’s legal interest was held by him as a trustee for her in a constructive trust – where that assertion was rejected and the application dismissed.

FAMILY LAW – INJUNCTIONS – where in 2009 the father entered into a costs agreement with his solicitor that provided security for legal fees by way of a charge over the father’s property – where in July 2012 orders were made that the father not further encumber his property – where the father’s solicitor subsequently sought to rely upon the 2009 charge for work done in the matter after the date of the injunctive order – the meaning of encumber – where the court has power to make an order restraining the father’s solicitor from aiding and abetting a breach of a court order – solicitor restrained from relying upon the charge for work done after the injunctive order.

Child Support (Assessment) Act 1989 (Cth)
Child Support (Registration & Collection) Act 1988 (Cth)
Child Support Legislation Amendment (Reform of the Child Support Scheme – New formula and Other Measures) Act 2006 (Cth)
Evidence Act 1995 (Cth)
Family Law Act 1975 (Cth)
Family Law (Child Abduction Convention) Regulations 1986 (Cth)
Family Law Rules 2004 (Cth)

Federal Court of Australia Act 1976 (Cth)

Baker v The Queen (2004) 223 CLR 513
Balzano & Balzano (2010) FLC 98-048
Daley & Daley (2009) FLC 98-039

Ebner v Official Trustee in Bankruptcy (2000) 205 CLR 337

Gallup & Gallup [2009] FMCAfam 839
Garning & Director-General, Department of Communities, Child Safety and Disability Services & Anor [2013] FamCAFC 28
Garning & Department of Communities, Child Safety and Disability Services and Anor (Discharge Application) [2012] FamCA 839
Hammond v The Commonwealth (1982) 152 CLR 188
Inthe Marriage of Gyselman (1992) FLC 92-279
Inthe Marriage of Hay (1998) 23 Fam LR 247

Kamay v Miss X (1986) FLC 91-754

Khalil & Tahir-Ahmadi (2012) FLC 93-506
M…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

AGLC: Keane & Keane [2013] FamCA 332
Case: [2013] FamCA 332
Decision Date

CaseChat Overview and Summary

In *Keane & Keane*, the Family Court of Australia considered applications by the father to set aside a binding child support agreement, by his new wife for a declaration of beneficial interest in a jointly owned property, and by his solicitor regarding a charge over property. The father sought to set aside a child support agreement, arguing that exceptional circumstances had arisen since its inception that caused him hardship. The third respondent, the father's new wife, sought a declaration that she held an 80 per cent beneficial interest in a property she owned jointly with the father, asserting a constructive trust over a portion of his legal interest. The father's solicitor sought to rely on a pre-existing charge over the father's property for legal fees incurred after injunctive orders had been made preventing further encumbrances.

The court was required to determine whether the transition of the parties' original agreement into a binding child support agreement under subsequent legislation constituted an "exceptional circumstance" for the purpose of setting aside the agreement. It also had to consider whether the father had satisfied the threshold for hardship and, if so, whether the court should exercise its discretion to set aside the agreement. Regarding the property dispute, the court needed to assess the validity of the third respondent's claim of a constructive trust. Finally, the court had to interpret the meaning of "encumber" in the context of injunctive orders and determine if the father's solicitor could rely on a prior charge for work done after those orders were made, and whether the court had the power to restrain the solicitor from breaching a court order.

The court held that the subsequent legislation transforming the agreement into a binding child support agreement was not, in itself, an exceptional circumstance. While the father would have satisfied the threshold for hardship, the court found no other exceptional circumstances had arisen since the agreement was made that warranted setting it aside. Furthermore, even if exceptional circumstances had been established, the court indicated it would not have exercised its discretion to set aside the binding child support agreement. The third respondent's claim for a declaration of an 80 per cent beneficial interest in the property was rejected. The court also found that the father's solicitor was restrained from relying on the charge for work done after the injunctive orders were made, as this would constitute aiding and abetting a breach of a court order.

The father's application to set aside the child support agreement was dismissed. The third respondent's application for a declaration of beneficial interest in the property was also dismissed. The court declared that the father owed the Child Support Registrar $78,295.82 in child support arrears and penalties, ordering payment within 60 days and placing a charge over the father's interest in the "G property" in favour of the Registrar. The father's solicitor was restrained from relying on the 2009 charge for legal fees incurred after 10 July 2012, except for outstanding fees as at that date.

Orders