KENNEDY & KENNEDY

[2014] FamCA 1167

FAMILY COURT OF AUSTRALIA

KENNEDY & KENNEDY [2014] FamCA 1167

FAMILY LAW – EVIDENCE – Admissibility of evidence within an affidavit – Application to strike out evidence as to an alleged agreement concluded between the parties by reason of sections 131 and/or 135 of the Evidence Act 1995 (Cth)

Evidence Act 1995 (Cth)

Woodland and Todd (2005) FLC 93-217

APPLICANT: Mr Kennedy

RESPONDENT: Ms Kennedy

FILE NUMBER: MLC 11825 of 2012

DATE DELIVERED: 22 December 2014

PLACE DELIVERED: Melbourne

PLACE HEARD: Melbourne

JUDGMENT OF: Johns J

HEARING DATE: 20 November 2014

REPRESENTATION

COUNSEL FOR THE APPLICANT: Dr Ingleby

SOLICITOR FOR THE APPLICANT: Forte Family Lawyers

COUNSEL FOR THE RESPONDENT: Mr Dickson QC

SOLICITOR FOR THE RESPONDENT: CE Family Lawyers

Orders

1.That the following parts of the wife’s trial affidavit filed 31 October 2014 be struck out:-

(a)Paragraphs 65 to 97 inclusive, and exhibits numbered 12 to 25 inclusive;

(b)At paragraph 46.1, the third sentence;

(c)At paragraph 46.13.2,  the words “after I had received the $235,000 due to me payment from [Mr Kennedy] as a result of settlement”;

(d)At paragraph 98.16, in the second sentence the words “settlement on”;

(e)At paragraph 98.20, the last sentence commencing “This method of proposing … new funds at settlement”;

(f)At paragraph 98.22, in the second sentence the words “and settlement”;

(g)At paragraph 98.29, the third and fourth sentences.

2.That within 28 days of the date of these orders the applicant file and serve any written submissions upon which he seeks to rely in support of paragraph 5 of his Application in a Case filed 13 November 2014 and the respondent file and serve any submissions in reply seven days thereafter, the determination of that issue to be made in Chambers.

3.That paragraphs 1 to 4 and 6 to 7 of the applicant’s Application in a Case filed 13 November 2014 be otherwise dismissed.

IT IS NOTED that publication of this judgment by this Court under the pseudonym Kennedy & Kennedy has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).

FAMILY COURT OF AUSTRALIA AT MELBOURNE

FILE NUMBER: MLC  11825  of 2012

Mr Kennedy

Applicant

And

Ms Kennedy

Respondent

REASONS FOR JUDGMENT

introduction

1. At the time of the hearing of this application, the parties’ competing applications for  property orders were listed for final hearing before me in December 2014.  In anticipation of that hearing, in August 2014 I made procedural orders for the filing of trial affidavits.

2. The application before me for determination at a mention hearing is the husband’s Application in a Case filed 13 November 2014.  That application seeks that specified paragraphs of the wife’s trial affidavit filed 31 October 2014 (“the wife’s trial affidavit”) be struck out.  The application in a case is supported by an affidavit of the husband filed 13 November 2014.

3. In addition to those documents the applicant relied upon written submissions filed on his behalf which were marked as Exhibit A1.

4. The wife opposed the husband’s application, although during the course of oral argument, senior counsel for the wife made some concessions with respect to parts of the wife’s trial affidavit.

BACKGROUND

1. The husband is aged 63 years and is retired.  He resides in rental accommodation in Suburb B.

2. The wife is aged 56 years and is engaged in home duties.  She lives in the former matrimonial home in Suburb C.

3. The parties married in 1983 and separated in 2012.  There are three adult children of the marriage who live independently. 

4. Proceedings were commenced by the husband in this Court in December 2012. 

5. The parties attended a case assessment conference at the Court on 25 March 2013.  Paragraphs 54 to 97 inclusive of the wife’s trial affidavit adduce evidence as to an alleged agreement concluded between the parties at that case assessment conference and the events that transpired thereafter.  It is that evidence which the husband objects to and seeks to have struck out. 

THE HUSBAND’S SUBMISSIONS

1. It is submitted on behalf of the husband that that evidence is inadmissible in accordance with the provisions of s 131(1) of the Evidence Act 1995 (Cth) as it contains evidence of a document that has been prepared in connection with an attempt to negotiate a settlement of a dispute.

2. Section 131(1) of the Evidence Act provides as follows:-

   (1) Evidence is not to be adduced of:

   (a) a communication that is made between persons in dispute, or between one or more persons in dispute and a third party, in connection with an attempt to negotiate a settlement of the dispute; or

   (b) a document (whether delivered or not) that has been prepared in connection with an attempt to negotiate a settlement of a dispute.

3. Simply put, it is submitted on behalf of the husband that any document which is not a signed minute of consent order in relation to the totality of the proceedings or a signed binding financial agreement is not a document which can be admitted into evidence by virtue of the provisions of s 131 of the Evidence Act 1995 (Cth).

4. The husband maintains that the parties did not have a concluded agreement, that the correspondence annexed to the wife’s trial affidavit confirms that there was an ongoing dispute between the parties and that that correspondence is merely evidence of the attempts made by the parties to negotiate a settlement of their dispute.

5. In the alternative, the husband relies on the provisions of s 135 of the Evidence Act 1995 (Cth). It is submitted on his behalf that there is no probative value in the material the subject of objection and further that to admit such material would result in an undue waste of time. In support of that submission it is said on behalf of the husband that if the evidence is admitted, it is likely that:-

   ·the parties’ legal practitioners will be required as witnesses; and

   ·the range of issues in dispute will expand to include a consideration as to why the alleged settlement “fell over”;

   and that as a consequence of the above matters the trial will lengthen.

THE WIFE’S SUBMISSIONS

1. The wife opposed the orders sought by the husband.  She submits that at the case assessment conference, the parties signed a document which was an agreement which concluded the dispute between the parties.  She points to correspondence passing between the parties’ practitioners following the conference which confirmed that the parties had achieved a settlement in principle. The wife seeks to rely upon that agreement and to seek orders in accordance with her entitlements thereunder.  At trial, it will be submitted on her behalf that the terms of the agreement should be applied, that justice and equity require that the Court not look behind the agreement that was entered into between the parties.  Accordingly, it is submitted on behalf of the wife that the evidence of the alleged agreement is relevant and admissible. 

2. In support of that submission, the wife relies upon s 131 (2)(f) of the Evidence Act 1995 (Cth) which provides that subsection (1) does not apply if:-

   The proceedings in which it is sought to adduce the evidence is a proceeding to enforce an agreement between the persons in dispute to settle the dispute, or a proceeding in which the making of such an agreement is in issue;

3. During the course of his oral submissions senior counsel for the wife conceded that paragraphs 65 to 97 of the wife’s trial affidavit together with exhibits numbered 12 to 25 inclusive could be struck out.  Accordingly I will order that those paragraphs be struck out.

4. Paragraphs 54 to 62 of the wife’s trial affidavit is her evidence:

   ·That the parties attended a case assessment conference on 25 March 2013;

   ·that the parties settled the matter at that conference and the fact of the settlement was noted by the registrar;

   ·of the terms of the alleged settlement and annexes a copy of the alleged agreement signed by the parties;

   ·that the basis upon which the wife says she compromised the matter;

   ·that the husband’s solicitors had agreed to formalise the alleged agreement (and annexes correspondence relating to those arrangements);

   ·that sets out the procedural history insofar as it was necessary for the parties to jointly apply for an administrative adjournment of the directions hearing and correspondence relating to that adjournment is annexed; and

   ·of arrangements relating to a proposed round-table meeting to finalise the matter and correspondence related to the proposal.

5. Paragraphs 63 and 64 of the wife’s trial affidavit relate to the events of a directions hearing which occurred on 24 July 2013.  They provide evidence as to:-

   ·the parties’ attendance at that directions hearing;

   ·that the parties executed a minute of consent orders  and a superannuation agreement (with handwritten amendments) that day.  Those documents are annexed to the wife’s trial affidavit; and

   ·the fact that the husband provided a signed transfer in relation to the title to the Suburb C property to the wife’s solicitor in compliance with a term of the parties’ alleged agreement. 

6. Annexure 2 to the wife’s trial affidavit is a copy of the alleged agreement signed by the parties and dated 25 March 2013.  The orders sought by the wife in her Amended Response to Initiating Application are in almost identical terms to that document in terms of the relief sought by the wife save that in her Amended Response to Initiating Application the wife seeks the payment of $45,000 being one half of the $90,000 draw-down she alleges the husband drew from the private superannuation fund on 8 April 2014.  It was submitted by senior counsel for the wife that that order is necessary to restore the wife to the position she would have been in had the original alleged agreement been concluded. 

7. Annexure 2 to the wife’s trial affidavit, being the alleged agreement is a document which is clear on its face and unambiguous.  It sets out with particularity the property to be retained by each of the parties and the quantum of a payment to be made to the wife.  Further it clearly states that there is to be an equal division by way of a superannuation split in respect of the parties’ private superannuation fund.  All of the fundamental terms of the agreement alleged are clearly articulated in that document.  The wife now seeks orders the effect of which will be to adjust the parties’ property interests in accordance with the terms of that agreement.  She submits that the parties have acted in reliance upon that agreement, including executing a transfer of land, and that justice and equity require that the terms of the agreement be enacted.

8. The wife submits that evidence of the agreement and the parties’ partial performance of that agreement are relevant matters which can be taken into account by the Court in determining the parties’ applications pursuant to s 79 of the Act.  In support of that submission she relied upon the decision of the Full Court in Woodland and Todd (2005) FLC 93-217. 

9. In Woodland and Todd (supra) the Full Court confirmed the principles enunciated in the earlier decisions of Woodcock (1997) FLC 92-739 and Dupont (No. 3) (1981) FLC 91-103 that an earlier agreement can be considered as evidence of what the parties regarded as just and equitable at the time of the agreement. The fact of such an agreement is not determinative of the parties’ property applications; those applications must be determined on their merits, having regard to the factors set out in s 79(2) and (4) as they exist at the time of the hearing of the applications. The Court is not bound to give effect to the agreement unless, having regard to the relevant considerations pursuant to s 79 it concludes that it is just and equitable to make orders in those terms.

CONCLUSION

1. In Woodland and Todd the Full Court was considering circumstances where the parties had entered into an informal agreement in 1997 and divided their property in accordance with that agreement.  The wife commenced proceedings for property orders in 2002.  That the parties had had an informal agreement and acted upon it does not appear to have been in issue between those parties and accordingly the question of the admissibility of the evidence of that agreement was not in issue.

2. Similarly, in Woodcock (supra) the question of admissibility of the alleged agreement between the parties was not in issue; the Full Court there determined the effect of that agreement on the proceedings pursuant to s. 79 of the Act. 

3. It is evident from those decisions that evidence as to the existence of such an agreement may be relevant (and therefore admissible) in proceedings to determine competing property applications.

4. The submissions made on behalf of the husband confirm that there is a live dispute as to whether there was a concluded agreement, notwithstanding the documents signed by him, including Annexure 2 to the wife’s affidavit.  

5. Having heard and considered the parties’ submissions and reviewed paragraphs 54 to 64 inclusive of the wife’s trial affidavit, I am satisfied that the evidence sought to be adduced by the wife with respect to the alleged agreement is evidence which falls within the ambit of s 131(2)(f) of the Evidence Act.  I am satisfied that it is evidence as to the making of an agreement between the parties where the question of the making of such an agreement is in issue. 

6. The wife seeks to rely upon that evidence, it being relevant in the determination of the parties competing s 79 applications.  It is her case that pursuant to the provisions of s. 79 that it is just and equitable that there be an adjustment of property in accordance with the terms of the agreement signed by the parties in March, 2013. That evidence of such an agreement can be relevant and admissible in the determination of the property applications is confirmed by the Full Court in Woodland and Todd (supra).  Having regard to that decision I am satisfied that the wife should be permitted to adduce evidence in relation to the alleged agreement.

7. I do not accept the submission made on behalf of the husband that to admit paragraphs 54 to 64 of the wife’s trial affidavit would result in an undue waste of time in accordance with the provisions of s.135 of the Evidence Act. That evidence is an important limb of the wife’s case and to exclude it would deprive her of the opportunity of making that argument.  There is no dispute between the parties that Annexure 2 to the wife’s trial affidavit (being the agreement) was executed by the parties or that subsequently they executed other documents, including a Minute of Consent order.  Hence, I am not satisfied that the admission of that evidence will lead to the parties’ lawyers being called as witnesses.  Nor am I satisfied that the admission of those parts of the wife’s trial affidavit will significantly lengthen the proceedings.

8. Accordingly, I will dismiss that part of the husband’s application seeking that paragraphs 54 to 64 of the wife’s trial affidavit be struck out.

9. Paragraph 3 of the husband’s Application in a Case seeks that specific parts of the wife’s trial affidavit be struck out on the basis that they are inadmissible by reason of s 131 of the Evidence Act 1995 (Cth). In relation to those objections I rule as follows:-

   (a)As to the objection taken to paragraph 46.1, in respect of the second sentence, that objection is overruled on the basis that the sentence is admissible in accordance with the provisions of s 131(2)(f) of the Evidence Act. I strike out the third sentence on the basis that it is argument;

   (b)As to paragraph 46.13.2, I will strike out the words “after I had received the $235,000 due to me payment from [Mr Kennedy] as a result of settlement” on the basis that that evidence is not relevant to the issues before the Court.  Whether or not the wife has made an arrangement to pay monies from her anticipated property settlement is not a matter relevant to my determination of the parties’ current property applications;

   (c)As to paragraph 98.16, I strike out the words “settlement on” from  in the second sentence of that paragraph;

   (d)As to paragraph 98.20, it is common ground between the parties that the sentence commencing “This method of proposing … new funds at settlement” be struck out.  Accordingly I will strike out that sentence;

   (e)As to paragraph 98.22, the words “and settlement” be struck out of the second sentence of that paragraph;

   (f)As to paragraph 98.29, the third and fourth sentences of that paragraph  be struck out.

10. Accordingly the orders I make are as follows:-

    1.That the following parts of the wife’s trial affidavit filed 31 October 2014 be struck out:-

    (a)Paragraphs 65 to 97 inclusive, and exhibits numbered 12 to 25 inclusive;

    (b)At paragraph 46.1, the third sentence;

    (c)At paragraph 46.13.2,  the words “after I had received the $235,000 due to me payment from [Mr Kennedy] as a result of settlement”;

    (d)At paragraph 98.16, in the second sentence the words “settlement on”;

    (e)At paragraph 98.20, the last sentence commencing “This method of proposing … new funds at settlement”;

    (f)At paragraph 98.22, in the second sentence the words “and settlement”;

    (g)At paragraph 98.29, the third and fourth sentences.

    2.That within 28 days of the date of these orders the applicant file and serve any written submissions upon which he seeks to rely in support of paragraph 5 of his Application in a Case filed 13 November 2014 and the respondent file and serve any submissions in reply seven days thereafter, the determination of that issue to be made in Chambers.

    3.That paragraphs 1 to 4 and 6 to 7 of the applicant’s Application in a Case filed 13 November 2014 be otherwise dismissed.

I certify that the preceding thirty-three (33) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Johns delivered on 22 December 2014.

Associate: 

Date:  22 December 2014