Lawson & Lawson
[2022] FedCFamC1F 287
Federal Circuit and Family Court of Australia
(DIVISION 1)
Lawson & Lawson [2022] FedCFamC1F 287
File number(s): SYC 5339 of 2021 Judgment of: REES J Date of judgment: 3 May 2022 Catchwords: FAMILY LAW – FORUM – Where the wife commenced proceedings in the United Kingdom and the husband later commenced proceedings in Australia – Where the wife seeks to dismiss or permanently stay the proceedings in Australia – Consideration of Henryv Henry (1996) 185 CLR 571 – Where only money judgments from the United Kingdom can be enforced in Australia – Where the transfer of real estate for the adjustment of property between parties does not constitute a money order – Where both courts have jurisdiction to make orders in personam as to the dissolution of marriage, spouse maintenance and adjustment of rights in property other than superannuation or pension rights in the other jurisdiction – Where the matter can be effectively resolved in Australia but not in United Kingdom – Australia is not a “clearly inappropriate forum” – Wife’s application dismissed. Legislation: Family Law Act 1975 (Cth) ss 75(2), 79, 110
Foreign Judgments Act 1991 (Cth)
Cases cited: Gilmore & Gilmore (1993) FLC 92-353
Henry v Henry (1996) 185 CLR 571
Pierson & Romilly (2020) FLC 93-959
Division: Division 1 First Instance Number of paragraphs: 60 Date of last submission/s: 28 April 2022 Date of hearing: 22 April 2022 Place: Sydney Counsel for the Applicant: Ms Reid Solicitor for the Applicant: Humphreys Family Lawyers Solicitors & Barristers Counsel for the Respondent: Mr Hogan-Doran Solicitor for the Respondent: Barry Nilsson Lawyers ORDERS
SYC 5339 of 2021 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)
BETWEEN: MR LAWSON
Applicant
AND: MS LAWSON
Respondent
order made by:
REES J
DATE OF ORDER:
3 MAY 2022
THE COURT ORDERS:
1.That the wife’s Response to an Application in a Proceeding filed on 10 October 2021 be dismissed.
2.That within 28 days the wife file and serve a Response to Initiating Application setting out the final orders which she seeks and a Financial Statement.
3.That the matter otherwise be referred to a Judicial Registrar for directions.
Note: The form of the order is subject to the entry in the Court’s records.
Note: This copy of the Court’s Reasons for judgment may be subject to review to remedy minor typographical or grammatical errors (r 10.14(b) Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 10.13 Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth).
Section 121 of the Family Law Act 1975 (Cth) makes it an offence, except in very limited circumstances, to publish proceedings that identify persons, associated persons, or witnesses involved in family law proceedings.
IT IS NOTED that publication of this judgment by this Court under the pseudonym Lawson & Lawson has been approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
REASONS FOR JUDGMENT
REES J:
Mr Lawson (“the husband”) and Ms Lawson (“the wife”) were both born in the United Kingdom, commenced their co-habitation there and married there.
In 2006, they moved to Australia and in 2009 they purchased a home in Suburb C. They were both granted permanent residency in 2015 and the husband became an Australian citizen in 2018.
In June 2018, they travelled to the United Kingdom. After three weeks the husband returned to Australia. The wife remained in the United Kingdom.
On 1 June 2021, the wife commenced matrimonial proceedings in the United Kingdom seeking a divorce and ancillary financial relief.
On 23 July 2021, the husband filed an application in the Family Court of Australia (as it was then known) seeking orders for property settlement.
The wife responded, seeking the dismissal or permanent stay of the Australian application.
A decree nisi has been granted by the courts in the United Kingdom.
Before me, the husband seeks to restrain the wife from proceeding in the United Kingdom and to continue with his proceedings in Australia.
The wife seeks the dismissal of the husband’s application and, by inference, to continue the proceedings in the United Kingdom.
A single expert, Mr D, provided evidence about the applicable law in the United Kingdom in his affidavit sworn on 15 February 2022.
Although there may be a dispute between the parties as to the value of their assets, they have each provided a Financial Statement which identifies those assets as follows:
·A property at Town E in the United Kingdom with a value of about $600,000 owned by the husband.
·A property at Suburb C in Australia valued in excess of $3,200,000 (the wife’s estimate is $3,500,000) which is jointly owned but subject to a mortgage. The equity, if the wife’s estimate of value is accurate, is about $1,850,000.
·The husband’s Australian bank accounts containing $32,000.
·Shares in the United Kingdom which the husband values at $500.
·The husband’s Australian superannuation interest which he values at $273,000.
·The husband’s pension interests in the United Kingdom which he values at $293,000.
The larger portion of the assets of the marriage is in Australia.
It may be useful to set out the relevant statutory provisions in relation to adjustment of financial interests in Australia.
In relation to adjustment of property interests, s 79 of the Family Law Act 1975 (Cth) (“the Act”) provides, relevantly:
79 Alteration of property interests
(1)In property settlement proceedings, the court may make such order as it considers appropriate:
(a)in the case of proceedings with respect to the property of the parties to the marriage or either of them—altering the interests of the parties to the marriage in the property; or
…
(2)The court shall not make an order under this section unless it is satisfied that, in all the circumstances, it is just and equitable to make the order.
…
(4)In considering what order (if any) should be made under this section in property settlement proceedings, the court shall take into account:
(a)the financial contribution made directly or indirectly by or on behalf of a party to the marriage or a child of the marriage to the acquisition, conservation or improvement of any of the property of the parties to the marriage or either of them, or otherwise in relation to any of that last‑mentioned property, whether or not that last‑mentioned property has, since the making of the contribution, ceased to be the property of the parties to the marriage or either of them; and
(b)the contribution (other than a financial contribution) made directly or indirectly by or on behalf of a party to the marriage or a child of the marriage to the acquisition, conservation or improvement of any of the property of the parties to the marriage or either of them, or otherwise in relation to any of that last‑mentioned property, whether or not that last‑mentioned property has, since the making of the contribution, ceased to be the property of the parties to the marriage or either of them; and
(c)the contribution made by a party to the marriage to the welfare of the family constituted by the parties to the marriage and any children of the marriage, including any contribution made in the capacity of homemaker or parent; and
(d)the effect of any proposed order upon the earning capacity of either party to the marriage; and
(e)the matters referred to in subsection 75(2) so far as they are relevant…
The discretion in relation to alteration of the interests of the parties extends to allow alteration of their interests in any Australian superannuation entitlements.
A spouse is liable to maintain the other spouse, to the extent that he or she is able to do so, if the applicant for maintenance is unable to support himself or herself by reason of age or capacity for employment or any other adequate reason.
In determining whether to make an order for maintenance, the Court is governed by the provisions of s 75(2) of the Act which provides:
75 Matters to be taken into consideration in relation to spousal maintenance
(1)In exercising jurisdiction under section 74, the court shall take into account only the matters referred to in subsection (2).
(2) The matters to be so taken into account are:
(a) the age and state of health of each of the parties; and
(b)the income, property and financial resources of each of the parties and the physical and mental capacity of each of them for appropriate gainful employment; and
(c)whether either party has the care or control of a child of the marriage who has not attained the age of 18 years; and
(d)commitments of each of the parties that are necessary to enable the party to support:
(i) himself or herself; and
(ii)a child or another person that the party has a duty to maintain; and
(e)the responsibilities of either party to support any other person; and
(f)subject to subsection (3), the eligibility of either party for a pension, allowance or benefit under:
(i)any law of the Commonwealth, of a State or Territory or of another country; or
(ii)any superannuation fund or scheme, whether the fund or scheme was established, or operates, within or outside Australia;
and the rate of any such pension, allowance or benefit being paid to either party; and
(g)where the parties have separated or divorced, a standard of living that in all the circumstances is reasonable; and
(h)the extent to which the payment of maintenance to the party whose maintenance is under consideration would increase the earning capacity of that party by enabling that party to undertake a course of education or training or to establish himself or herself in a business or otherwise to obtain an adequate income; and
(ha)the effect of any proposed order on the ability of a creditor of a party to recover the creditor’s debt, so far as that effect is relevant; and
(j) the extent to which the party whose maintenance is under consideration has contributed to the income, earning capacity, property and financial resources of the other party; and
(k)the duration of the marriage and the extent to which it has affected the earning capacity of the party whose maintenance is under consideration; and
(l)the need to protect a party who wishes to continue that party’s role as a parent; and
(m)if either party is cohabiting with another person—the financial circumstances relating to the cohabitation; and
(n)the terms of any order made or proposed to be made under section 79 in relation to:
(i) the property of the parties…
…
(o)any fact or circumstance which, in the opinion of the court, the justice of the case requires to be taken into account…
…
THE LAW RELATING TO FORUM
In circumstances where financial proceedings have been regularly instituted in courts exercising jurisdiction under the Act, a court might stay those proceedings if the doctrine of forum non conveniens compels the conclusion that the court is a “clearly inappropriate forum”.
In Henry v Henry (1996) 185 CLR 571 (“Henry”), the High Court considered the principles to be applied in considering an application relating to forum. The Court held that the test to be applied is that of a “clearly inappropriate forum”. The High Court noted:
39.Some of the matters properly to be taken into account in a case such as the present emerge from what has already been written. To start with, no question arises unless the courts of the respective countries have jurisdiction with respect to the parties and their marriage. And if there is a question as to the jurisdiction of the foreign court, it may be necessary to adjourn the local proceedings to enable the foreign court to determine that question. However, if both have jurisdiction, it will be relevant to consider whether each will recognise the other’s orders and decrees. If the orders of the foreign court will not be recognised in Australia, that will ordinarily dispose of any suggestion that the local proceedings should not continue. However, if the orders of the foreign court will be recognised in Australia, it will be relevant to consider whether any orders may need to be enforced in other countries and, if so, the relative ease with which that can be done. As well, it will be relevant to consider which forum can provide more effectively for complete resolution of the matters involved in the parties’ controversy.
40.Other considerations include the order in which the proceedings were instituted, the stage which they have reached and the costs that have been incurred. It will also be relevant to consider the connection of the parties and their marriage with each of the jurisdictions and to have regard to the issues on which relief might depend in those jurisdictions. Moreover, it will be relevant to consider whether, having regard to their resources and their understanding of language, the parties are able to participate in the respective proceedings on an equal footing. The list is not exhaustive. Rather, the question whether Australia is a clearly inappropriate forum is one that depends on the general circumstances of the case, taking into account the true nature and full extent of the issues involved.
(Emphasis added)
(Footnote omitted)
Further, the High Court noted that:
25.… legitimate personal or juridical advantage is a relevant but not decisive consideration, the fundamental question being “where the case may be tried ‘suitably for the interests of all of the parties and for the ends of justice’”.
(Footnote omitted)
It follows from the decision in Henry that the matters here to be considered are:
·Do both courts have jurisdiction in relation to the parties and their marriage?
·If both have jurisdiction, will each recognise the orders and decrees of the other? If the orders of the foreign court will not be recognised in Australia, that will ordinarily dispose of any question that the local proceedings should not continue.
·Which forum can provide more effectively for complete resolution of the matters involved in the controversy?
·The order in which the proceedings were instituted, the stage they have reached and the costs that have been incurred.
·The connection of the parties and their marriage to each of the jurisdictions.
·Whether, having regard to their resources and their understanding of the language, the parties are able to participate in each jurisdiction on an equal footing.
·Does either party have a legitimate personal or juridical advantage in proceedings in his or her chosen forum?
As the Full Court stated in Pierson & Romilly (2020) FLC 93-959:
14.…the process is not one of weighing those factors that point towards a stay against those that point away from a stay, but rather of assessing whether there are enough factors indicating that the forum is clearly inappropriate, in which case a stay should be granted. If there are significant factors pointing to the conclusion that the chosen forum is appropriate, it is immaterial that there may be many factors suggesting that another forum might also be appropriate or even more appropriate.
I propose to deal with each consideration seriatim.
Do both courts have jurisdiction in relation to the parties and their marriage?
In relation to the superannuation interests, the parties agree, in the instructions to the single expert, in the following terms:
The superannuation/pensions of the Husband which are situated in Australia are subject to Australian superannuation/pension rules. The pension assets of the Husband which are situated in the UK are subject to the law of England and Wales. For there to be an order made against the Husband’s UK pensions there will need to be an order of a UK court as the pension companies will not recognise an order made in a different jurisdiction.
It is not controversial that a court in the United Kingdom could not make a splitting order (an order allocating some or all of the superannuation entitlement to the non-member spouse) in relation to the husband’s Australian superannuation interests because those courts cannot exercise jurisdiction pursuant to the Act in Australia.
Simply stated, the Australian court cannot make an order in relation to the United Kingdom pension and the United Kingdom court cannot make an order in relation to the Australian superannuation interests.
In relation to the other aspects of the proceedings, that is the dissolution of the marriage, spousal maintenance and the adjustment of rights in the property other than superannuation or pension rights, both courts have jurisdiction to make orders in personam.
If both have jurisdiction, will each recognise the orders and decrees of the other? If the orders of the foreign court will not be recognised in Australia, that will ordinarily dispose of any question that the local proceedings should not continue.
It is necessary, when dealing with this aspect, to consider the application for dissolution of marriage, the application for spousal maintenance and the application for adjustment of property interests separately because the law relating to recognition and enforcement is different in relation to each.
Both of the courts in Australia and in the United Kingdom have jurisdiction to deal with the dissolution of the marriage and each will recognise the order or decree of the other.
In relation to spousal maintenance, I accept the evidence of the single expert that courts in the United Kingdom will enforce an order made in Australia and a UK order for spousal maintenance can be enforced in Australia pursuant to s 110 of the Act.
The situation is not as clear in relation to the enforcement of an order for adjustment of interests in property.
As to the enforcement of Australian orders in the United Kingdom, the single expert stated:
71.As regards an Australian money judgment (which is to say a final and conclusive judgment pursuant to which one party is required to pay a sum of money to the other), Part I of the Foreign Judgments (Reciprocal Enforcement Act) 1933 as applied by the Reciprocal Enforcement of Foreign Judgments (Australia) Order 1994 provides for the registration of such a judgment by the [UK] court.
72.The judgment must be less than six years old, and must not have been wholly satisfied. The judgment will not be registered if it could not be enforced by execution in the Australian court. If those tests are met, there is no discretion to refuse registration. Upon registration, the judgment is treated for the purposes of enforcement as if it were an [UK] judgment.
73.As regards an Australian order for spousal maintenance, Part I of the Maintenance Orders (Reciprocal Enforcement) Act 1972 and the Reciprocal Enforcement of Maintenance Orders (Designation of Reciprocating Countries) Order 1974 provide for the registration of such an order by the [UK] court. On the same principle, registration is essentially an administrative process rather than a question of discretion; and upon registration the order is treated for the purposes of enforcement as if it were [a UK] order.
74.A property adjustment order does not neatly fall into either camp. However, it is likely to be capable of “enforcement” in practical terms (if not in a technically pure sense) by the issue of a fresh claim in [the UK]: the [UK] court is likely to assist a deserving claimant if he or she has no alternative means of enforcement.
(Footnotes omitted)
Thus I accept that an order for adjustment of property interests (excluding superannuation or pension interests) which was made in Australia could be enforced in the United Kingdom provided that the Australian order was a “money judgment”. I infer that an order made in Australia requiring, for example, the transfer of an interest in property to a party, could not be enforced in the UK.
Since the property at Suburb C, which is the major asset of the parties, is owned by them as joint tenants, it is difficult to envisage that any order could be made, resolving the interests in the property of the parties, which was a money order only. Even if the wife seeks an order for the payment of a sum of money, it would be necessary for the Court to make consequential orders requiring the wife, on receipt of the sum ordered to be paid, to do all things necessary to transfer to the husband her interest in the Suburb C property and for the husband to indemnify the wife in respect of any existing registered encumbrance such as the mortgage liability.
I do not accept, in the circumstances of this case, that it is possible for the proceedings in Australia to be determined by the making of a money order and therefore orders made in Australia dealing with the Australian real property could not be enforced in the UK.
Whether an order made in a court in the United Kingdom for the adjustment of property entitlement (excluding orders relating to Australian superannuation interests) can be enforced in Australia is not clear.
The Act contains no provisions for such enforcement.
The provisions of the Foreign Judgments Act 1991 (Cth) (“the Foreign Judgments Act”) are not available to enforce an order adjusting property rights where the subject matter of the order is immoveable property situated outside the United Kingdom and, pursuant to the provisions of s (4)(a) of the Foreign Judgments Act the UK court is taken not to have jurisdiction.
Counsel for the wife submitted that a money order, made in the United Kingdom, could be enforced in Australia.
However, that proposition meets the same obstacles, as to the terms of such an order, as the resolution of the proceedings in Australia, unless the orders sought by the wife in the UK proceedings are confined to seeking the whole of the property in the United Kingdom. Even in that event, it would be necessary to make an order requiring her to transfer her interests in the Australian property to the husband.
If the UK court were to make an order that the husband pay the wife a sum of money, it would also be necessary for that court to make orders requiring her to transfer her interest in the jointly owned property in Australia to the husband and for him to indemnify her in relation to its encumbrances. An order for the payment of a sum of money alone is not capable of resolving the issues to be determined. The Full Court in Gilmore & Gilmore (1993) FLC 92 353 came to a similar conclusion where their Honours said of such orders:
At their most simplistic they may amount to an order directing one party to pay the other a sum of money. On the other hand, and more typically, the orders, whilst they may direct the payment of a sum of money, usually contain detailed provisions relating to the transfer of one party’s interest in property to the other, the granting of indemnities, and the assumption of liabilities etc. Certainly the typical property order in Australia dealing with the type of case with which we are concerned here, namely real estate and a business, would be likely to be more detailed and sophisticated than simply an order for a sum of money…That is substantially because the Australian Act (ss 79 and 81) requires the court, as far as practicable, to make orders which finally determine the financial relationship between the parties.
I therefore conclude that, in relation to the issue of adjustment of property rights, having regard to the nature and location of the property of these parties, neither jurisdiction can enforce the order of the other.
Which forum can provide more effectively for complete resolution of the matters involved in the controversy?
If the matter were determined in Australia, it would not be necessary for an Australian court to make any order affecting the husband’s UK pensions because there is sufficient property in Australia from which an order could be made, if necessary, to compensate the wife for the husband’s ownership of those pensions.
Similarly, there is sufficient property in Australia to make an adjustment which would not require the Court to make orders for the disposition of the property in Town E.
Therefore, an Australian court can effectively provide a complete resolution of the financial issues.
The UK court cannot make orders affecting the husband’s right to the Australian superannuation and there are not sufficient assets in the United Kingdom from which compensatory orders could be made.
The matter can be effectively resolved in Australia but it cannot be effectively resolved in the United Kingdom.
The order in which the proceedings were instituted, the stage they have reached and the costs that have been incurred.
The wife’s proceedings were instituted first in time. It does not appear that the proceedings, in relation to financial issues, have advanced in either jurisdiction, beyond the filing of the Initiating Applications.
The connection of the parties and their marriage to each of the jurisdictions.
Each party is resident and domiciled in the jurisdiction in which she or he has instituted proceedings.
Whether, having regard to their resources and their understanding of the language, the parties are able to participate in each jurisdiction on an equal footing.
Both parties speak English as their first language.
Since early 2020, the Family Court of Australia (as it was then known) has conducted substantive hearings with all the parties and their legal representatives appearing electronically.
There is no impediment to either party’s conducting the hearing electronically.
Similarly, there is no impediment to either party’s travelling to the other jurisdiction to appear in person and each suffers a similar disadvantage if required to travel to a country where he or she is not resident. In the event that the wife needs funds to facilitate her attendance in Australia, such funds can be provided by way of an order for lump sum maintenance or interim property settlement.
In Australia, an application in relation to interim spousal maintenance or interim property settlement can be made at any stage of the proceedings and is dealt with as a summary application on the papers.
Does either party have a legitimate personal or juridical advantage in proceedings in his or her chosen forum?
Neither party asserts a legitimate advantage in litigating in her or his chosen forum.
I accept that, “the case may be tried ‘suitably for the interests of all of the parties and for the ends of justice’” in either forum.
Having regard to all of those considerations, I find that Australia is not a “clearly inappropriate forum” and the wife’s application will be dismissed.
IS the CONTINUATION OF THE FINANCIAL PROCEEDINGS IN the United Kingdom OPPRESSIVE?
The husband concedes that the proceedings in relation to the dissolution of the marriage should continue in the United Kingdom.
It is oppressive and vexatious for the wife to continue to litigate in the United Kingdom where the orders she will obtain in relation to the adjustment of property interests will not be capable of enforcement in Australia, that being the place where about two thirds of their property is located.
As a matter of comity between courts, I will not order that the wife be restrained from continuing the property proceedings in the United Kingdom. That is a matter for the UK court. However, directions will be made for the matter to proceed in Australia.
I certify that the preceding sixty (60) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Rees. Associate:
Dated: 3 May 2022
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