Kennon v Spry

The case involved appeals concerning property settlement orders made by the Family Court of Australia. The primary dispute centred on whether certain trust assets, controlled by the husband (Dr Spry), should be included in the pool of property divisible between him and his wife (Mrs Spry) following their separation and impending divorce. The husband had established trusts and subsequently made dispositions of assets to these trusts, which he argued were beyond the court's jurisdiction to divide.

The High Court was required to determine several key legal issues. These included whether the wife's equitable right to the due administration of a trust and the husband's discretionary power to appoint trust assets constituted "property" of the parties to the marriage under section 79(1) of the *Family Law Act 1975* (Cth). The Court also considered whether contributions to existing trusts could be characterised as "ante-nuptial or post-nuptial settlements" under section 85A of the Act, and whether the court retained jurisdiction to make property orders even after the dissolution of the marriage, as if the divorce had not yet occurred.

The High Court reasoned that the wife's equitable right to due consideration and due administration of the trust, coupled with the husband's discretionary power as trustee, created an interest that could be treated as property for the purposes of the *Family Law Act*. This right, akin to an equitable chose in action, attracted the protection of a court of equity and possessed a degree of concreteness or solidity, distinguishing it from a mere hope. The Court found that the husband's actions in varying the trust and disposing of assets were intended to defeat an anticipated property settlement order, and therefore, the assets could be brought back into the divisible property pool.

The appeals were dismissed. The High Court upheld the trial judge's orders, which had treated the trust assets as part of the divisible property of the parties. The appellants were ordered to pay the costs of the appeal, and applications for special leave to cross-appeal were dismissed.