L & K

Case

[2006] FamCA 805

5 May 2006


[2006] FamCA 2005

FAMILY LAW ACT 1975

FAMILY COURT OF AUSTRALIA  

AT MELBOURNE  
  Appeal No. SA 71 OF 2005
  NO. MLM 6779 of 2003 

IN THE MATTER OF:

L  (Appellant Wife)

and

K  (Respondent Husband)

REASONS FOR JUDGMENT
DELIVERED BY THE HONOURABLE JUSTICE GUEST

Before:  Guest J
Heard:  28 February 2006
Judgment:  5 May 2006

Appearances:

Mr Wraith of counsel, instructed by Berry Family Law,
  Solicitors, DX 16105 WILLIAMSTOWN, on behalf of
  the Appellant (wife)

Ms Smallwood of counsel, instructed by Messrs
  Pearsons, Solicitors, DX 436 MELBOURNE, on
  behalf of the Respondent (husband)

APPEAL SUMMARY

MATTER:  L and K

APPEAL NUMBER:           SA 71 OF 2005
  (MLM 6779 OF 2003)

CORAM:  Guest J

DATE OF HEARING:          28 February 2006
DATE OF JUDGMENT:     5 May 2006

CATCHWORDS:                FAMILY LAW – APPEAL from FEDERAL
  MAGISTRATE – PROPERTY SETTLEMENT –
  Appeal brought by wife against orders dismissing
  wife’s application for the discharge of property
  orders made by consent – application to set aside
  consent orders seven years after orders originally
  made – duress – whether wife’s will was overborne
  by the husband when entering into consent orders –
  weight attached to considerations – exercise of
  discretion

Caselaw cited:
Holland v Holland (1982) FLC 91-243, 77,341
Prowse v Prowse (1995) FLC 92-557, 81,571
House v The King (1936) 55 CLR 499
Lovell v Lovell (1951) CLR 513

Appeal dismissed.

INTRODUCTION

  1. This is an appeal by the wife against orders made by Federal Magistrate O’Dwyer on 17 November 2005, whereby his Honour dismissed an Application filed by her on 7 October 2003 for an order (inter alia) pursuant to s 79A(1)(a) of the Family Law Act 1975 (“the Act”) that property orders made by consent on 24 March 1998 at the Broadmeadows Magistrates Court be “discharged”.  By a Form 3A Response filed on 24 November 2003, the husband sought an order that the wife’s application be struck out.

  2. The Notice of Appeal was filed on 15 December 2005 and was instituted pursuant to s 94AAA of the Act. An Amended Notice of Appeal was filed by leave of the court on 28 February 2006.

BACKGROUND

  1. The parties commenced their relationship in about 1974 and married in January 1981.  They separated on a final basis in September 1997.  A decree nisi for dissolution of marriage was made absolute in May 1999.  There are three adult children born of their union.  The wife was born in 1949 and at the time of trial was on a disability pension.  The husband was born in 1950.  He too is in receipt of a disability pension. 

  2. Following separation, the husband instituted property proceedings in the Broadmeadows Magistrates’ Court and consent orders were made on 24 March 1998, some seven years prior to the hearing before the Federal Magistrate. 

  3. In his judgment, the learned Federal Magistrate set out the formal background leading up to the institution of the proceedings by the wife.  His Honour found that at the time of separation the matrimonial assets consisted of the former matrimonial home in [a northern suburb of Melbourne], two abutting allotments of land in [a small town near Bendigo] registered in the wife’s name with a total area of approximately 4.2 hectares, together with various pieces of plant and equipment.  He noted that on one of the allotments the parties erected a modest dwelling and a shed.  This was used as a holiday home although there had been an attempt to conduct some farming activities which were unsuccessful.

  4. The consent orders made on 24 March 1998 provided for the wife to receive the less valuable, undeveloped allotment together with a lump sum of $10,000.  All other assets were to remain with the husband.  His Honour recounted, and correctly so, that the wife was unrepresented at the time and did not seek any legal advice as to her rights nor as to the appropriateness of the consent orders.

  5. His Honour found that in the result, the wife received nothing.  He found there was a dispute between the parties as to how this came about with the wife alleging it was at all times the husband’s intention that she receive nothing.  On the other hand, the husband laid blame upon the wife and her inaction.  It was not disputed that the husband had the wife’s intended allotment transferred back to himself in February 1999. 

  6. His Honour found that in about June 2000, more than two years after the consent orders were made, the wife instructed solicitors to act on her behalf. They wrote to the husband’s solicitor requiring the husband to comply with the consent orders. His Honour found it significant that the course of action adopted by the wife, with the assistance of her solicitor, was not to apply to set the consent orders aside pursuant to s 79A(1) of the Act, but to try to enforce them.

  7. Following considerable negotiation, an agreement was reached which was embodied in a written agreement dated 23 November 2000 (“the Agreement”).  This provided for the husband to pay $10,000 to the wife and that the parties otherwise mutually release each other from “… all debts, claims or the like which either of them has against the other arising out of the (consent) orders”.  In addition, pursuant to an arrangement, the husband returned to the wife a number of rings in his possession.

  8. His Honour found that $10,000 was paid by the husband in accordance with the Agreement.  Those monies were applied by the wife in establishing a business.  His Honour said that the business was, “initially at least”, successful and at one time employed 30 casual and permanent staff.  The wife employed her two children in the business.  He found that, unfortunately, due to embezzlement by a staff member, (indeed, it was a child of their union) the business ultimately failed in 2003.  At about the same time, the man, with whom the wife “shared a house”, died.

  9. His Honour then recorded the fact that it was some three years after the Agreement, being some five and a half years after the consent orders were made in March 1988, that the wife filed her Application to set those orders aside.

  10. Given the Agreement entered into between the parties on 23 November 2000 and the submissions made on behalf of the wife, it will provide better understanding to the narrative of this judgment to set out its significant terms.  Having recited the facts of the marriage, its dissolution and the fact that Minutes of Consent Orders were entered into on 24 March 1998, the Agreement further recited:

    “(C)A dispute has arisen as to the compliance of the parties pursuant to the terms and conditions of the said Orders, and

    (D)The parties by this Agreement seek to resolve the dispute.”

  11. The Agreement then provided that “… in order [to] resolve the dispute the parties do mutually covenant each other as follows”, and went on to set out in three paragraphs the terms of the Agreement, namely:

    “(a)This Agreement shall be binding upon the heirs, executors, administrators and assigns of each party respectively;

    (b)[The husband] will pay to [the wife] within 14 days as from the date of this Agreement the sum of TEN THOUSAND DOLLARS ($10,000.00);

    (c)Upon payment of the said sum by [the husband] to [the wife], [the husband] and [the wife] shall release one another from all debts, claims or the like which either of them has against the other arising out of the said Orders”.

THE JUDGMENT OF FEDERAL MAGISTRATE O’DWYER

  1. The hearing of the proceedings traversed three days during which it is plain that the evidence was bitterly contested by each of the parties.  His Honour, with arresting economy, given his preference on the issue of credibility, summarised the evidence before him.  He referred to the fact that much of the time at the hearing was spent on the wife giving evidence concerning allegations of violence perpetrated upon her by the husband who refuted her evidence.  His Honour said that the basis of the evidence was to establish what the wife maintained was the “total control by the husband of both her will and finances throughout the marriage and afterwards”.  This was significant given the manner in which the wife addressed the issue of duress in argument.  His Honour recounted that such control was said to have been established and maintained by the wife’s continual subjection to violence, threats of violence and abusive, denigrating and humiliating treatment of her by the husband.

  2. In the course of his pithy judgment, his Honour made it clear that he did not intend to exhaustively list the allegations but highlighted a few to illustrate the degree of violence said by the wife to have occurred.  He then recounted several incidents that were debated before him which were in the large denied by the husband, although he did admit to the use of some of the language complained of.

  3. His Honour then dealt with his findings and made it clear that he accepted the wife as a truthful and reliable witness.  He preferred her evidence to that of the husband.  When considering the evidence, his Honour was satisfied that the violence of which the wife complained was in fact perpetrated by the husband.  He found that the wife was subject to “years of humiliating, denigrating and violent conduct” at the hand of the husband, which resulted in her “subservience”.  Importantly, his Honour was satisfied that at the time the consent orders were made in March 1998, the wife was “not mentally and emotionally capable of providing informed voluntary consent and was overborne” by the husband.  He found that the husband had no intention of giving anything to the wife from the assets of the marriage, but went through an elaborate charade to appear to be making a fair settlement with her.

  4. On the other hand, and significantly for the purpose of this Appeal, his Honour found that after the consent orders were made, the wife established for herself a new life and became independent of the husband to the extent that she was able to establish her own business.  His Honour was further satisfied that it was not until her business failed and the death of a long term friend who had provided her with a home that she was motivated to issue proceedings.

  5. In paragraph 16 of his judgment, the learned Federal Magistrate then, and properly so in my view, addressed the important issue of whether or not, and notwithstanding his findings to that point, he should exercise his discretion in favour of the wife.  In the result, he was persuaded not to do so and gave a three tier reason for so finding.

    ·Firstly, his Honour found that at the time when it could not be said the wife was “overborne by the husband or subject to duress”, and at a time when she was legally represented, she did not seek to set aside the consent orders but chose instead to attempt to enforce them.

    ·Secondly, his Honour found that the wife had entered into an Agreement with the husband in full satisfaction of any claims arising out of the consent orders, which Agreement was satisfied in accordance with its terms.  His Honour found there was no suggestion that she was overborne by the husband when the Agreement was entered into, save to comment generally about being afraid of him.  In any event, he specifically found that any concern on her part was not such as to amount to duress, referring to SH v DH (2003) FLC 93-164, and that the wife was happy to enter into the Agreement as it provided her with funds to establish her business. He found that she was fully cognisant of her options and made an informed and voluntary choice.

    ·Thirdly, his Honour found that a considerable period of time had elapsed since the consent orders were made and that the wife had failed to provide an adequate explanation for the delay in circumstances where she had shown independence of mind and business acumen over a number of years prior to initiating the proceedings.  He referred to Morrison v Morrison (1995) FLC 92-573.

  6. Given the attack made upon his Honour’s conclusion, which again was, in my view, commendably concise, I propose to incorporate his findings into this judgment.  His Honour said:

    “17.Although I have a great deal of sympathy for the wife in respect of the difficulties she no doubt suffered during her marriage, it cannot be ignored that she failed when she was capable of doing so, to take timely action to protect her interests.  Indeed, she chose a course of action other than setting aside the consent orders.  The wife was prepared to accept an agreement to enforce the consent orders at a time she could and should have made an application to set aside those orders.  It is, in my view, quite evident that she now has embarked on these proceedings after events in her life turned sour and she was in need of financial assistance.  I am sure, had her business not failed, she would not have been motivated to take these proceedings.

    18.Whilst it can be said that the wife obtained little from the marriage, whether by way of initial consent orders or the agreement, and that on the face of it there has been a miscarriage of justice, the wife has the onus of satisfying me that it would be an appropriate exercise of my discretion to set aside the orders.  In my view, the wife has fallen far short of satisfying that onus having regard to her decision to enforce the consent orders and the very significant delay in instigating this proceeding (See Prowse v Prowse (1995) FLC 92-557”. (emphasis added)

  7. It was in those circumstances that his Honour dismissed the wife’s Application.

THE APPEAL

  1. By her Amended Notice of Appeal the wife relied upon the following grounds:

“1.       That the finding by the trial Magistrate that there was no suggestion that the appellant was overborne by the husband when she reached an agreement with him on or about 25 November (paragraph 16 (ii) of the Reasons for Judgement), was against the evidence and the weight of the evidence.

2.       That the trial Magistrate did not take into account or, in the alternative, failed to give any or any proper weight to the evidence contained in paragraphs 47, 48, 50, 51, 52 and 64 of the appellant's affidavit filed 6 December 2004.

3.        That the trial Magistrate ought to have found that the appellant entered the said agreement dated on or about 25 November 2000 whilst under duress from the husband and that her consent thereto was not voluntary.

3A    Further or in the alternative that the trial Magistrate attached excessive weight to the fact of the execution of the agreement on or about 25 November 2000.

3B.       That the trial Magistrate was mistaken that the effect of the said agreement was to enforce the orders made 24 March 1998, and such mistake led him into error.

4.       That on the evidence the trial Magistrates ought to have found that by reason of the respondent's conduct, a miscarriage had occurred by reason of :

         (a)      Fraud;

                   (b)      Duress.

5.       That on the evidence, the trial Magistrate ought to have found that the delay in instigating the proceeding was due to the significant duress suffered by the appellant.

5A      Further or in the alternative the trial Magistrate’s finding that the appellant’s explanation for her delay was inadequate was against the evidence.

5B.     Further or in the alternative the trail Magistrate attached excessive weight to the question of the delay and the explanation for the delay

6.       That the finding as to the appellant's motivation (paragraph 17 of the Reasons for Judgment) was irrelevant having regard to the finding that 'on the face of it there has been a miscarriage of justice' (paragraph 18 of the Reasons for Judgment).

6A      That the finding that had the appellant’s business not failed she would not have been motivated to take these proceedings was against the evidence.

THE SUBMISSIONS

  1. In his Outline of Written Submissions, Mr Wraith, who appeared on behalf of the wife helpfully, in my view, grouped the Grounds of Appeal relied upon into the following four categories.

    ·Firstly, Grounds 1, 2 and 3, dealing with his Honour’s findings in relation to the circumstances surrounding the wife entering into the Agreement on 23 November 2000;

    ·Secondly, Grounds 3A and 3B, dealing with his Honour’s findings as to the nature and significance of the Agreement and its relevance to the exercise of his discretion pursuant to s 79A of the Act;

    ·Thirdly, the issue of delay, both in relation to his Honour’s finding as to the adequacy of the wife’s explanation (Grounds 5 and 5A) and the weight given to the issue of delay in the ultimate exercise of his Honour’s discretion (Grounds 5B), and

    ·Fourthly, Ground 6 and 6A concerning his Honour’s findings in relation to the apparent weight attached to the wife’s motivation in bringing her Application.

    [Ground 4 was abandoned by Mr Wraith.]

  2. In the course of his oral submissions, Mr Wraith summarised the appeal grounds as follows:

    (1)That his Honour made a mistake as to the nature of the Agreement entered into on 23 November 2000 whereby he viewed it as “an enforcement” of the previous orders, when in fact it was a variation purporting to finalise the wife’s rights under the original orders made by consent in the Magistrates’ Court (Ground 3(b)).

    (2)That his Honour gave weight to an irrelevant consideration, namely the fact of the Agreement being entered into, rather than the consequences that flowed from it (Ground 3(a)).

    (3)Alternatively, having accepted the wife as a witness of truth, his Honour made a finding against the evidence that her will was not overborne (that is, not subject to duress) when executing the said Agreement (Grounds 1, 2 and 3 inclusive).

    (4)His Honour’s finding that the wife’s explanation for the delay was inadequate was against the evidence and the weight of evidence (Ground 5(a)).

    (5)His Honour’s finding that the delay in bringing the proceedings was not due to duress was against the evidence (Ground 5).

    (6)His Honour erred in the exercise of his discretion by misapplying the principles relevant to the assessment of the significance of the delay (Ground 5(b)) and

    (7)His Honour erred in the exercise of his discretion in that he gave weight to an irrelevant consideration, being the wife’s motives for bringing the proceedings (Ground 6 and 6(b)).

  3. When dealing with Grounds 3A and 5B regarding the issue of delay, Mr Wraith submitted that the most telling aspect was the absence of any finding or evidence to support a finding of any prejudice (detriment, or hardship) which the husband would suffer as a consequence of the execution of the Agreement on 23 November 2000, or otherwise arising from the wife’s delay in bringing the proceedings (Tormsen v Tormsen (1993) FLC 92-392). He pointed out that the question of hardship or detriment to the husband in the event of an order being made under s 79(1A) of the Act was addressed by his counsel in the transcript of submissions before his Honour (p 21 & p 22 L20-23).

  4. Put another way, Mr Wraith submitted the relevance of the issue of delay was its impact on the court, which is obliged “to do justice” between the parties.  He submitted that where there was a clear miscarriage of justice (such as that arising from the consent orders made on 24 March 1998) and in the event that the execution of the Agreement per se and the issue of delay did not give rise to any detriment, prejudice or hardship to the husband, then the discretion should be exercised in the wife’s favour, a failure to do so being plainly unjust.  He submitted there was no evidence that if his Honour’s discretion had been exercised in favour of the wife that any detriment, prejudice or hardship could not be compensated upon the re-exercise of discretion by the court.  That was very much in issue before his Honour at the trial. 

  5. In summary, Mr Wraith complained that his Honour relied upon the fact of the delay and of the Agreement without reference to its consequences to do justice between the parties.  He submitted there was no evidence that the husband acted on the Agreement to his detriment and that the execution of the Agreement did not impact upon the court’s ability, in the result, to do justice between the parties. 

  1. Mr Wraith referred to Morrison (supra) at p 81,676-77 emphasising that firstly, there was no evidence of hardship or prejudice to the husband and secondly, there was a clear significant disadvantage to the wife in not being able to litigate her case.

  2. As to Grounds 1, 2 and 3, Mr Wraith submitted that they dealt with findings which went to weight surrounding the wife’s entry into the Agreement.  As to Grounds 1 and 2, having found the wife to be a witness of truth, he urged that his Honour failed to refer to significant parts of her evidence, both oral and in affidavit concerning her state of mind at the time the Agreement was entered into.  For example, that she received advice from her solicitor, Mr De Marco, which was admissible not as to evidence of the truth of the facts of what she was told, but as to its effect upon her state of mind.

  3. As to Ground 3, Mr Wraith submitted that when the outcome of the Agreement itself was so modest, it may be inferred that the wife was subject to duress (see Holland v Holland (1982) FLC 91-243). He submitted that the wife lost her entitlement to the specified Lot being transferred to her (being the undeveloped land) and accordingly, the Agreement was in fact “a variation” of the court orders and purported to close off her rights.  He submitted that the terms of the Agreement were so unfavourable so as to infer that the wife acted under duress.  Not only did she merely accept $10,000 in settlement, she forewent her entitlement to the Lot and in effect, “… slipped backwards”.  His Honour found her to be a witness of truth, yet when she gave evidence as to her state of mind explaining why she settled on the terms of the Agreement, his Honour, without saying why, rejected her evidence that her will was overborne. 

  4. In relation to Ground 3B, Mr Wraith submitted that the Agreement did not enforce the orders, but varied them.  He said the evidence was that the husband transferred the land to the wife and had her re-transfer it back to him.  The transfers took place on 17 February 1999 (affidavit of wife filed 6 December 2004, par 41).  He submitted that the Agreement purportedly prevented the wife from exercising any enforcement rights she may now have under the original order.

  5. As to Grounds 5 and 5A, Mr Wraith submitted that a paradox arose from the fact that his Honour found the wife to be a credible and reliable witness, yet in fact rejected her evidence explaining the delay without giving any reasons for his doing so.

  6. As to Grounds 6 and 6A, it was submitted on behalf of the wife that these Grounds dealt with findings concerning the wife’s “motivation”.  Mr Wraith argued that whilst it was open for his Honour to make the finding, it was irrelevant to the exercise of his discretion.  He submitted that the wife’s reasons for deciding to re-open the issue and entertain litigation were irrelevant to the decision-making process, which should only be confined to an assessment of the merits of her Application to set the consent orders aside on the facts, and in light of the law.  That is, any motive for her decision to do so was irrelevant to the exercise of his Honour’s discretion.

  7. In the course of her succinct submissions, Ms Smallwood, who appeared on behalf of the husband, dealt chronologically with the oral summary of Mr Wraith.  In dealing with the first submission (Ground 3B), it was submitted that in fact his Honour did not treat the nature of the Agreement as one ousting the jurisdiction of the court, but considered the facts and terms of the Agreement.  In the course of his judgment (par 16(i)), his Honour dealt with the Agreement pointing out that the wife chose to “attempt to enforce” the original court orders.  Ms Smallwood referred to the fact that the Agreement was entered into following several months of negotiation.  She submitted that the evidence revealed the wife initially sought a lump sum of $25,000 but after negotiations, compromised her claim for $10,000, which was “the end of the dispute between the parties”

  8. Ms Smallwood emphasised the fact that in par 17 of his Judgment, his Honour referred to the fact that the wife was prepared to accept an Agreement to “enforce” the consent orders at a time when she could and should have made an application to set them aside.  Ms Smallwood submitted that the “attempt to enforce” the original consent orders demonstrated her state of mind and referred to the transcript of the wife’s cross examination at T47:

    “Just listen.  Please listen.  I said to you before, and you agreed with me, the negotiations between solicitors went over many months? … That’s correct.

    Yes.  During that time you felt yourself strong enough to be able to persist with your instructions and trying to right the wrongs that had been done to you? … That’s correct, yes.

    Yes.  As a consequence of those negotiations, another agreement was entered into between you and my client, through the solicitors, yes, and terms of settlement were signed?  … Yes.

    A release?  … Yes.

    In which document you signed, on your solicitor’s advice, or with your solicitor’s advice, a document that said my client would give you $10,000 and that would be the end of it all – I am just putting it in simple language so you understand, OK? …  Anyhow, I’m not stupid.

    And that would be the end of all claims as between you and he.  Yes?  …Yes.

    Now, when you signed that document did you read it?  … No.

    When you signed the document did Mr De Marco explain its meaning to you?  … Yes, he did.

    So you understood …?  … He told me off the record … 

    No, I am not interested in what he told you off the record.  Just listen to my question.  He explained to you what the document meant?  … Yes, he did.

    Whatever else he might have told you, he explained to you what the document meant?  … Yes.

    You understood when he explained to you what the document meant to you and your husband were agreeing that you would get $10,000 and that would be the end of all litigation between you and he about property, and you also got your rings back.  Yes?  … Yes.

    So you took the cheque?  … Yes.

    A bank cheque was made out to you, given to you by your solicitors.  Your solicitor gave you the bank cheque.  You are not in – that won’t be picked up on the …?  … Sorry, yes.

    Yes.  Your solicitor gave you the rings that were returned?  … Yes.

    You took both of those things?  … Yes.

    And you cashed the cheque?  … Yes.

    OK.  So you then went to live your life and my client went to live his life.  Yes?  … Yes.”  (T 49-48)

  9. Ms Smallwood submitted that a reading of the transcript revealed that the wife gave evidence she received a cheque for $10,000 in 1998, which she returned to the husband.  Her position at trial was that she believed if she cashed the cheque, it would “bounce”.  For the husband’s part, he gave evidence that the wife returned the cheque because she did not want “anything” from the marriage.  Ms Smallwood referred to the evidence set out in the husband’s affidavit filed 13 September 2004 (Exhibits “D”, “E” and “F”), which she described as “revealing”.  Exhibit “D”, being a letter from the husband’s solicitors to the wife dated 8 April 1998, indicated that they were arranging a settlement.  Exhibit “E” was a receipt from the solicitor’s file, which acknowledged the cheque and the Transfer of Land.  Exhibit “F” was a copy of the Transfer of Land dated 15 May 1998, on which day the wife signed the second transfer to return the land to the husband’s ownership. 

  10. It was submitted by Ms Smallwood that in any event, that which occurred in mid 2000 was not an “enforcement” as such, as the husband had complied with the orders and it was the parties themselves who “undid the compliance”.  Notwithstanding this, however, it was her submission that it did not matter how his Honour viewed the Agreement.  She submitted that it resulted in an independent agreement being struck between the parties, whereby each of them released the other from debts and finalised the proceedings between them.  Ms Smallwood made it clear that it was not binding upon the parties and its relevance merely went to demonstrate the state of mind of the parties and their actions.  She pointed out that since the Agreement, the wife received the $10,000, utilised it for her own purposes and otherwise did nothing more, despite being legally represented by a number of different solicitors.  I find merit in those submissions.

  11. Ms Smallwood further submitted that the wife exercised “control” by freely entering into the Agreement.  She undertook fresh negotiations with the assistance of a solicitor and at all times was able to make independent and mature decisions.  The fact of the Agreement demonstrated her ability to enter into a legal arrangement.

  12. Ms Smallwood then dealt with Grounds 3A and 5B (being number 2 and 6 of the Summary) and submitted that it was not “mandatory” for the husband to show any hardship, or prejudice in order to advance his case.  She said, and properly so, that his Honour was required to take into account a number of matters and that it was a “balancing” exercise between a number of competing interests.  Ms Smallwood referred to Prowse v Prowse (supra) at p. 81,572 acknowledging that whilst “hardship” is one of the usual factors, it is only one of many (see also Morrison v Morrison (supra) p. 81,674, citing McMahon v McMahon (1976) FLC 90-038) emphasising that it was not a mandatory factor for consideration, but one of a number that may be considered in the exercise of his Honour’s discretion. Furthermore, Ms Smallwood submitted that in the context of the circumstances of the application before his Honour, its importance was lessened. She referred to Tormsen (supra) (at p. 80,017) and submitted that it was a “fluid situation”, there being no mandatory concept attaching to the issue of hardship.  Ms Smallwood argued that Mr Wraith had elevated this factor at too high a level.  In reply, Mr Wraith conceded that he was not asserting it was “mandatory” in order for a discretion to be exercised against an applicant.  It was his submission that the Agreement was irrelevant to the exercise of discretion (Woodcock v Woodcock (1997) FLC 92-739 at p. 83,968).

  13. Ms Smallwood submitted that the more important matters affecting his Honour’s discretion in favour of the husband included the extraordinary period of time in which the wife did nothing with respect to issuing proceedings and that she otherwise elected to negotiate with the husband, engage professional advisors, re-negotiate the settlement, receive and use the fruits of the settlement, and chose not to exercise her rights under s 79A of the Act.

  14. It was further submitted that, as a result of the wife’s behaviour, the husband was understandably of the belief that litigation was, and had been, finalised.  Ms Smallwood argued that all these matters were important in the “mix of ingredients” when considering the exercise of a discretion.  She placed weight upon the fact that the lack of hardship on one party’s side was not decisive and that, having regard to the particular facts considered by his Honour, the exercise of his discretion was properly undertaken given the parties’ conduct over six years.

  15. Ms Smallwood referred to Morrison (supra) at p. 81,675 where Fogarty, Baker and Kay JJ had this to say:

    “In our view issues such as delay and hardship are not necessarily decisive of the outcome of these proceedings.  They are important factors to be taken into account, but there may be other factors which nevertheless would make it appropriate to exercise the discretion favourably to the Applicant.”

    In that case, the husband also did not offer any evidence of hardship. 

  16. It was her submission that the question of the wife’s delay must work against her, and that the longer the delay, the more significant it became.  Ms Smallwood otherwise referred to the issue of finality of litigation as being important (Morrison v Morrison (supra) and Tormsen v Tormsen (supra)) and the provisions of s 81 of the Act as being a desirable end.

  17. Ms Smallwood argued that the onus was squarely upon the wife (Prowse v Prowse at p. 81,566) and that two steps were involved. Firstly, that she bore the onus and secondly, that in the particular circumstances of the proceedings, it was a case in which an appropriate exercise of discretion was called for. In that regard, the wife had failed.

  18. Ms Smallwood referred to Morrison v Morrison at p. 81,676-77, where a number of matters for consideration were set out, and submitted that such reasons are examples of the variety of factors for consideration that may arise from each individual case. She emphasised that the court should not, for example, be fettered by a limited consideration of the three matters set out in McMahon v McMahon (supra) at 75,144 and discussed in Tormsen at p 80,017. There the court made it clear that the “three distinct hurdles” referred to in McMahon’s case were mere factors to be considered in the overall light “of what the justice of the case required”

  19. Ms Smallwood then dealt with Mr Wraith’s third summary point (dealing with Grounds 1, 2 and 3).  She submitted they overlap and, when dealing with the wife’s will being allegedly overborne, relied upon the actual evidence (T p. 47), which demonstrated that such was not the case.  She submitted that Grounds 2 and 3 were contained within that same concept.  She pointed out that although the wife was styled a witness of truth by his Honour, in this instance she gave two contrary versions of the same event. 

  20. Ms Smallwood then dealt with Mr Wraith’s summary 4 (Ground 5A), and submitted that his Honour’s findings were consistent with the evidence, pointing out that the wife had a number of solicitors acting for her during the relevant time.  She first saw a solicitor in early 2003 (T 51) and gave evidence that she did not want to act until her son was 21 and had left the home.  Ms Smallwood submitted that the evidence revealed that the matters raised by the wife were insignificant and not persuasive at any level.  Referring to par 16(ii) of his Honour’s judgment, Ms Smallwood submitted that his Honour found the wife was fully cognisant of her options and made an informed choice.  Further, that his Honour found that a considerable time had elapsed since the making of the consent orders and that the wife’s explanation for the delay was inadequate.

  21. As to summary point 5 (Ground 5), Ms Smallwood submitted that the findings of his Honour were consistent with the evidence.  Dealing with Mr Wraith’s 6th point (Ground 5B), which was an excess weight argument, Ms Smallwood submitted that his Honour gave it appropriate consideration and referred to the various factors expounded in Prowse v Prowse and Morrison v Morrison.  As to summary point 7 (Ground 6 and 6A), she submitted that his Honour merely made a comment of what he believed in using the words “… I am sure”.  Whilst he was the maker of the comment, there was nothing said or any findings made in his judgment to suggest that he was influenced by that “observation”.  I agree with that submission.

CONCLUSION

  1. This is an appeal from a discretionary judgment. The principles which govern such an appeal have been considered in a number of authorities.  See Australian Coal and Shale Employees Federation v The Commonwealth (1953) 94 CLR 621 per Kitto J at 627; Gronow v Gronow (1979) 144 CLR 513; Lovell v Lovell (1950) 81 CLR 513, especially Latham CJ at 519; Sharman v Evans (1977) 138 CLR 563, especially Barwick CJ at 565; House v The King (1936) 55 CLR 499, especially Dixon, Evatt and McTiernan JJ at 504-505. These principles were more recently considered by the High Court in CDJ v VAJ (No. 1) (1998) 197 CLR 172 at 230, where Kirby J said:

    “Neither this Court, nor the Full Court in relation to appeals to it, has authority to disturb a decision under appeal simply because the appellate judges, faced with the same material, would have reached a conclusion different from that under appeal.  To approach the appellant function in such a way would contravene established authority.  It would involve one level of the judicial hierarchy, without lawful warrant, intruding into the decisions of another (Bellenden (formerly Satterthwaite) v Satterthwaite [1948] 1 All ER 343 at 345, cited in G v G [1985] FLR 894 at 898, 903). To authorise appellate disturbance, where the decision under appeal is discretionary or involves quasi-discretionary evaluation, it is necessary for those mounting the challenge to demonstrate that, in reaching the orders the subject of the appeal, the court below has acted on a wrong principle or (although the precise error of principle cannot be identified) has reached a conclusion that is plainly wrong. (House v The King (1936) 55 CLR 499 at 504-505). Obviously, what is ‘plainly wrong’ will vary in the eyes of different beholders. It is not necessary for an appellant to demonstrate the kind of unreasonableness that must be shown to authorise judicial intervention in the decision of an administrator otherwise acting within power (So called Wednesbury unreasonableness:  Associated Provincial Picture Houses Ltd v Wednesbury Corporation [1948] 1 KB 223. See discussion in Re. F [1976] Fam. 238 and in G v G [1985] FLR 894 at 900). The reference to ‘plainly wrong’ is designed to remind the appellate court of the need to approach an appeal with much caution in a case where an error of principle cannot be clearly identified.

    Such reasons for appellate restraint are of general application.  However, they have particular relevance to appeals within, and from, the Family Court of Australia.  This is because of the functions and purposes of that Court and the difficult and evaluative decision which it often has to make.  The peculiar nature of decisions relating to the intensely personal questions of the division of the property of parties to a failed marriage and the welfare of their children makes it essential that those who decide appeals respect the onerous responsibilities of those whose decisions they review.  They need to recognise that it is of the very nature of such decisions, including those relating to the residence of children, that any two decision-makers may, with complete integrity and upon the same material, often come to differing conclusions (In the Marriage of Lea (1981) 7 Fam LR 553 at 555-556; G v G [1985] FLR 894 at 897-898). This is an inescapable feature of the nature of this jurisdiction (In re K (Infants) [1965] AC 201 at 218-219; In the Marriage of Abdo (1989) 94 FLR 379 at 389; 12 Fam LR 861 at 870; [1989] FLC 92-013 at 77,321-77,322).

  2. The Grounds of Appeal are primarily addressed to the question of weight given by the learned Federal Magistrate to the issues for his determination.  In my view, his Honour did address variously those issues complained of and in the exercise of his discretion formulated his clear conclusion.  I see his Honour’s judgment as a succinct, balanced, logical and cohesive synthesis of all the necessary elements in arriving at his decision.

  3. I repeat what Stephen J had to say in Gronow v Gronow (supra at FLC 78,848-9) when dealing with the principles which guide an appellate court in relation to interference with the exercise of discretion by a trial judge.  They are well established.  His Honour had this to say:

    “The constant emphasis of the cases is that before reversal an appellate court must be well satisfied that the primary judge was plainly wrong, his decision being no primary exercise of his judicial discretion.  While authority teaches that error in the proper weight to be given to particular matters may justify reversal on appeal, it is also well established that it is never enough that an appellate court, left to itself, would have arrived at a different conclusion.  When no error of law or mistake of fact is present, to arrive at a different conclusion which does not of itself justify reversal can be due to little else but a difference in view as to weight:  it follows that disagreement only on matters of weight by no means necessarily justifies a reversal of the trial judge.”

    Those principles and the earlier principles to which I have referred, apply to an appeal to this Court from orders made by a Federal Magistrate.

  1. The emphasis placed by Mr Wraith upon the fact that his Honour should have exercised his discretion in favour of the wife in the absence of prejudice, hardship or detriment to the husband arising from the Agreement of 23 November 2000 or her delay in bringing the proceedings failed to appreciate the task for his Honour’s determination.  I agree with Ms Smallwood’s submission that his Honour correctly accounted for and balanced the competing factors concerning those matters he considered appropriate in the exercise of his discretion.

  2. Dealing with the circumstances surrounding the wife entering into the Agreement, I do not see any merit in the arguments of Mr Wraith.  The starkly distinguishing feature from other cases involving the concept of duress is that the negotiations in the discrete circumstances of the proceedings before his Honour took place over time and that the wife had the benefit of legal advice.  I have earlier in this judgment detailed transcript references relied upon by Ms Smallwood.  Mr Wraith sought to place some reliance upon evidence arising from re-examination which was hearsay in nature and in circumstances where there was no evidence led at trial by the wife’s solicitor generally to support the contention advanced by her counsel before me.  There is clear evidence that the wife understood the impact of the Agreement. 

  3. Dealing specifically with Ground 2 of the Notice of Appeal, it is not incumbent upon a trial judge to enumerate and slavishly repeat all the trial evidence relied upon.  This was a lengthy trial at the conclusion of which his Honour was seized with all material facts for his determination.  I agree with the submission of the husband that the evidence referred to fell far short of establishing to the requisite standard of persuasion that the wife’s will was overborne.  It seems to me that counsel for the wife failed to recognise the significance attached both to the period of negotiation and the fact of professional representation which, in the exercise of his Honour’s discretion, clearly played a significant part in the decision making process.

  4. Given the emphasis placed by Mr Wraith upon his argument that the wife entered the Agreement under duress it is helpful to recall what the Full Court to say in Holland (supra) at p 77,341, namely:

    “… Agreement to a consent order which may not adequately reflect a party’s entitlements under sec. 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 …”

    It is not suggested in argument that the advice tendered by her professional advisors was incompetent.  Significantly, and which fact weighed heavily in his Honour’s decision, the Agreement was negotiated over several months, some two and a half years after the consent orders and with professional assistance.  It is painfully obvious that the consent orders of 24 March 1998 resulted in a settlement for the wife that was neither just nor equitable.  That, however, is not the end of the matter.  The wife’s election on 23 November 2000 bore considerable significance in his Honour’s determination as did the circumstances both preceding and succeeding the date of the Agreement and which, along with other factors, influenced the exercise of his discretion.  The wife made an informed choice.

  5. The learned Federal Magistrate was satisfied that at the time the consent orders were entered into on 23 March 1998 the wife was not mentally nor emotionally capable of providing informed and voluntary consent.  It is correct to say that as at March 1998 she received so little from the marriage that on the face of it there had been a miscarriage of justice.  I might add, however, that the fact that a party received less than would have been ordered does not, without more, amount to a miscarriage of justice.  It is clear law however, that if the outcome of the actual consent orders was so clearly less than what is just and equitable, the court may infer that a party has acted under duress or ignorance or in circumstances where their will has been overborne. 

  6. The final matter for consideration is to determine whether the court, in the exercise of its discretion, should vary or set aside the order (Prowse v Prowse (supra)).  It is at this point that his Honour took into account a number of significant factors discrete to the particular circumstances for his determination.  They were as follows:

    ·Firstly, that after the orders were made the wife in any event established for herself a new life and became independent;

    ·Secondly, that following the husband’s default in meeting his obligations pursuant to the consent orders, and being several years later, she consulted a solicitor and after several months of negotiation an Agreement was entered into on 23 November 2000 together with a mutual release from all debts and claims which each party may have against the other, “arising out of the consent orders”;

    ·Thirdly, and significantly, when provided with legal advice the wife elected to effectively “enforce” the orders, and not proceed to set them aside pursuant to s 79A of the Act. This was some two and a half years following the making of the orders;

    ·Fourthly, at the time the Agreement was entered into there was no evidence, or sufficient evidence that her will was overborne by the husband, save to comment that she was “afraid” of him.  See Barton v Armstrong (1973) 2 NSWLR 599 per Mason J at 617 and Jacobs J at 611; Kokl v Kokl (1981) FLC 91-078. It should not be overlooked that the negotiations were protracted in time and that the wife had the protective benefit of legal representation. Her choice, as his Honour said, was both informed and voluntary and made in circumstances where she was fully cognisant of her options;

    ·Fifthly, that the funds received by her pursuant to the Agreement were applied by the wife to establish a business.  She got on with her life.  Unfortunately, the vicissitudes of life were such that her business failed and an important male friend died; and

    ·Sixthly, the wife instituted proceedings on 7 October 2003, some three years after the Agreement had been entered into and almost five and a half years after the original consent orders were made.  His Honour gave this aspect proper consideration.  In the exercise of his discretion, his Honour regarded the delay in bringing the proceedings as “considerable” and that her explanation for the delay was “inadequate”. He had proper regard to the appreciable intervening period during which the wife had shown independence and business acumen before instituting proceedings. Such findings were clearly open to him. He was of the view that the wife failed to take timely action to protect her interests, and importantly, when the opportunity was earlier open for her, she elected to chose a course to recover the lump sum award rather than set aside the consent orders pursuant to s 79A of the Act. It is also relevant that her opening proposal in the negotiation process far exceeded the amount which she subsequently agreed to accept. This finding was open to his Honour.

  7. As the Full Court said in Prowse v Prowse (supra at p 81,571):

    “All of the circumstances surrounding the making of the consent orders, and the circumstances of the parties since that time need to be considered in order to determine whether the justice of the case calls for an exercise of discretion in favour of or against the granting of an extension of time”.

    The relevant matters for consideration were discrete to the particular circumstances before his Honour who gave them such weight as he considered appropriate in the exercise of his discretion.  They are “factors” or “considerations”, and not an “exclusive code within the confines of which the court’s discretion to extend time must be exercised”.  See Prowse v Prowse (supra) at p 81,572 and 573. In my view, his Honour’s judgment is unimpeachable, addressing those matters he considered relevant and, in the result, made orders that were reasonably open for him to make. It was a “balancing exercise” on his part.  In this regard, one must bear in mind the boundaries placed upon an appeal court before it can interfere with the exercise of judicial discretion by a judge at first instance.  See, already cited, House v The King (1936) 55 CLR 499 particularly at p 504-505 and Lovell v Lovell (1951) 81 CLR 513.

  8. In the circumstances, the Appeal will be dismissed.  The orders of the court will be:

    1.That the Amended Notice of Appeal filed by the wife on 28 February 2006 be dismissed.

    I certify that the preceding 58 numbered
     paragraphs are a true copy of the
    reasons for judgment herein of
    the Honourable Justice Guest.


    Associate to Guest J

Actions
Download as PDF Download as Word Document


Cases Citing This Decision

0

Cases Cited

11

Statutory Material Cited

0

Holland v Holland [2017] NZHC 1037
Woodcock v Woodcock [2000] QSC 153