Maddyson and Maddyson (No. 2)
[2020] FamCAFC 285
•19 November 2020
FAMILY COURT OF AUSTRALIA
| MADDYSON & MADDYSON (NO. 2) | [2020] FamCAFC 285 |
| FAMILY LAW – APPEAL – PROPERTY – Where it is asserted that the appellant was not afforded procedural fairness – Where all that was before the Magistrate as to a valuation was the respondent’s evidence in the form of a text message received from a valuer providing a figure for the appellant’s interest in the property – Where that evidence was inadmissible and also provided the appellant with no opportunity to question the amount or anything about the valuation – Where although the Magistrate adjourned the matter to await receipt of the valuation report no report was ultimately received and nowhere did the Magistrate give leave to the respondent to rely on the figure provided and nor was the appellant given the opportunity to cross-examine the valuer – Where the Magistrate does not explain how and on what basis the discretion was exercised enabling the valuation figure provided by the respondent to be utilised – Where there was a lack of procedural fairness that infected the orders made – Appeal allowed – Orders set aside – Proceedings remitted to the Magistrates Court of Western Australia to be reheard by a Magistrate other than the primary Magistrate. FAMILY LAW – APPEAL – FURTHER EVIDENCE – Where the evidence does not satisfy the principles expounded in CDJ v VAJ (1998) 197 CLR 172 – Where the evidence was available but the appellant made no attempt to present it despite ample opportunity to do so – Where much of the evidence was inadmissible and in any event controversial – Application dismissed. FAMILY LAW – APPEAL – COSTS – Where the appellant sought costs in the event that the appeal succeeded – Where the respondent opposed any order for costs – Where it was reasonable for the respondent to oppose the appeal and no order for costs should be made – Where in the event that a costs order was not made the appellant sought costs certificates pursuant to the Federal Proceedings (Costs) Act 1981 (Cth) for the appeal and for the rehearing – Where the respondent joined in that application but only for the rehearing given that she had incurred no legal costs in relation to the appeal – Costs certificates ordered as sought. |
| Family Law Act 1975 (Cth) Federal Proceedings (Costs) Act 1981 (Cth) ss 9, 8 Family Law Rules 2004 (Cth) r 15.48(1), (2) |
| CDJ v VAJ (1998) 197 CLR 172: [1998] HCA 76 |
| APPELLANT: | Mr Maddyson |
| RESPONDENT: | Ms Maddyson |
| FILE NUMBER: | PTW | 7114 | of | 2015 |
| APPEAL NUMBER: | WEA | 23 | of | 2019 |
| DATE DELIVERED: | 19 November 2020 |
| PLACE DELIVERED: | Adelaide |
| PLACE HEARD: | Adelaide by video link |
| JUDGMENT OF: | Strickland J |
| HEARING DATE: | 25 June 2020 |
| LOWER COURT JURISDICTION: | Family Court of Western Australia |
| LOWER COURT JUDGMENT DATE: | 23 May 2019 |
| LOWER COURT MNC: | NA |
REPRESENTATION
| SOLICITOR-ADVOCATE FOR THE APPELLANT: | Mr Hanly |
| SOLICITOR FOR THE APPLICANT: | John Hanly Legal |
| THE RESPONDENT: | In Person |
Orders
The appeal be allowed.
The orders made on 23 May 2019 be set aside.
The proceedings be remitted to the Magistrates Court of Western Australia 150 Terrace Road Perth for rehearing by a Family Law Magistrate other than the primary Magistrate.
The Court grants to the appellant husband a costs certificate pursuant to the provisions of s 9 of the Federal Proceedings (Costs) Act 1981 (Cth), being a certificate that in the opinion of the Court it would be appropriate for the Attorney-General to authorise a payment under that Act to the appellant husband in respect of the costs incurred by him in relation to this appeal.
The Court grants to each party a costs certificate pursuant to the provisions of s 8 of the Federal Proceedings (Costs) Act 1981 (Cth), being a certificate that in the opinion of the Court it would be appropriate for the Attorney-General to authorise a payment under that Act to each party in respect of such part as the Attorney-General considers appropriate of any costs incurred by each party in relation to the rehearing of these proceedings.
Note: The form of the order is subject to the entry of the order in the Court’s records.
IT IS NOTED that publication of this judgment by this Court under the pseudonym Maddyson & Maddyson (No. 2) has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
Note: This copy of the Court’s Reasons for Judgment may be subject to review to remedy minor typographical or grammatical errors (r 17.02A(b) of the Family Law Rules 2004 (Cth)), or to record a variation to the order pursuant to r 17.02 Family Law Rules 2004 (Cth).
| THE APPELLATE JURISDICTION OF THE FAMILY COURT OF AUSTRALIA AT ADELAIDE |
Appeal Number: WEA 23 of 2019
File Number: PTW 7114 of 2015
| Mr Maddyson |
Appellant
And
| Ms Maddyson |
Respondent
REASONS FOR JUDGMENT
Introduction
On 19 June 2019, Mr Maddyson (“the husband”) filed a Notice of Appeal against final property settlement orders made by a Family Law Magistrate of the Magistrates Court of Western Australia on 23 May 2019.
That Notice of Appeal was deemed abandoned on 18 July 2019, as a result of the failure by the husband to file his Draft Appeal Index by 17 July 2019.
On 29 January 2020, the Notice of Appeal was reinstated, and on 30 April 2020 orders were made to list the appeal and prepare it for hearing.
One order made was for the husband to file and serve an Amended Notice of Appeal, and on 19 May 2020 he filed that Amended Notice of Appeal.
Ms Maddyson (“the wife”) opposes the appeal.
On 29 May 2020, the husband filed an Application in an Appeal, in effect, seeking leave to adduce further evidence in the form of an affidavit of Mr D, sworn on 2 December 2019.
That application was opposed by the wife, who filed a Response seeking that it be dismissed.
Relevant Background
The husband was 48 years of age, and the wife 46 years of age at the time of the hearing before the Magistrate.
The parties were married and commenced to live together on 26 April 1991, in New Zealand. They had minimal assets at that time.
The parties moved to Australia in 1997, and applied an inheritance the husband had received to meet the relocation costs.
There were a number of separations during the marriage, and during one of those, in 2002, the husband purchased a house and land package at Suburb U for $165,000. He paid a deposit of $500 and obtained a bank loan secured by mortgage for the balance.
After the parties reconciled in December 2006, the husband established a construction business in 2007, with loans secured over the title to the Suburb U property. The wife also worked in the business attending to the administration tasks, and it became quite successful.
In 2013, the mortgage secured over the Suburb U property, which had become the matrimonial home, was refinanced, and the property was transferred into joint names. The total borrowings were $328,000, of which $120,000 was used to pay off business loans.
In 2014, the business was incorporated, with the husband becoming the sole director and shareholder. Later that year the husband also established a family trust.
There was a dispute as to when the parties finally separated. The husband alleging sometime in 2013, and the wife alleging that it was on 1 July 2014. However, no aspect of this appeal turns on the resolution of that dispute.
Following the separation, the husband moved into a commercial unit space rented by the company, with the wife and the children remaining in the now former matrimonial home. The parties agreed that the husband would meet the mortgage repayments on the house property, in lieu of paying child support.
In 2015, the husband purchased a 22 per cent interest in land at Suburb A. The wife is unaware how the husband funded that purchase, but in his affidavit, the husband deposed that he contributed $160,000 towards the purchase from the business account. At some stage a unit complex was constructed at that address, with the husband then becoming the owner of one of the commercial units. There was a dispute between the parties as to how the husband funded the costs of construction.
A divorce order was made in March 2016, and became effective in April 2016.
There are four children of the marriage, with three being over the age of 18 years at the time of the trial. Two of those children (aged respectively 24 and 19 years at that time), and the youngest child aged 7 years, lived with the wife. The youngest child was spending time on weekends with the husband.
The wife had completed a professional degree by the time of the trial, but she was not in paid employment, and was receiving Government benefits.
The husband described himself as a tradesman “employed” by the company, and he continued to live in the commercial unit space rented by that company.
The proceedings were commenced by the wife on 14 February 2017, and on 4 April 2017, orders were made providing for the husband to file his responding documents, and to make full and frank disclosure. The husband filed his responding documents, namely his Response, Financial Statement and an affidavit, on 31 July 2017.
The parties attended a conciliation conference on 2 August 2007, but they were unable to resolve the issues in dispute, and the matter was programmed to a Readiness Hearing on 18 April 2018.
In the usual way, orders were made on 2 August 2007 providing for the parties to file their trial documents by the time of the Readiness Hearing.
The wife complied with those orders, but the husband did not. At the Readiness Hearing the time for the husband to comply was extended by 42 days, and the matter was programmed to a two day trial commencing on 22 October 2018.
At [10] the Magistrate said this:
The husband had not filed his trial documents by the time of the trial. The husband made an oral application on the first day of the trial for the trial to be adjourned. That application was refused and the trial proceeded.
Unfortunately, her Honour would appear to be confused about when the application to adjourn the hearing was made. The transcript of the hearing on 22 October 2018 does not reveal that the husband made such an application on that day, but the transcript of the hearing on 23 October 2018 does reveal that the application was made on that day, when it was refused by her Honour. However, nothing turns on which day this occurred.
I pause to note that apart from failing to comply with the orders for the filing of his trial documents, the husband had failed to comply with his obligation to provide full and frank disclosure (see [17] and [18]).
At the trial both parties appeared without legal representation. The wife relied on her affidavit and financial circumstances, and a schedule of assets and liabilities, all prepared for the purposes of the trial.
The husband had no evidence before the court for the purposes of the trial. However, in considering what orders to make, her Honour had regard to the initial affidavit and Financial Statement filed by the husband on 31 July 2017. The husband was also permitted to cross-examine and make submissions.
The Appeal
There are eight grounds of appeal propounded by the husband in his Amended Notice of Appeal, but some of those grounds are repetitive, and lend themselves to being addressed together, for example Grounds 1, 2 and 4. However, Ground 3 asserts that the Magistrate failed to afford the husband “procedural fairness”, and thus that ground needs to be considered first. That is because, where a defect in the administration of justice is found to have occurred, for example, where there is apprehended bias, or as in this case, the failure to provide procedural fairness, the orders must be set aside (Concrete Pty Ltd v Parramatta Design & Developments Pty Ltd (2006) 229 CLR 577 at 611; Royal Guardian Mortgage Management Pty Ltd v Nguyen (2016) 332 ALR 128 per Basten JA at [9] and [10]).
Ground 3 – The Learned Trial Magistrate failed to afford the Appellant procedural fairness.
This ground initially goes to the refusal by her Honour to adjourn the hearing.
The husband claims that he was unaware of the orders for the filing of trial documents, because the court had failed to forward those orders to him.
As referred to above, there was a conciliation conference held on 2 August 2017, at which the husband was present and represented, when orders were made for trial documents to be filed for the purposes of the Readiness Hearing on 18 April 2018. However, the husband failed to comply with those orders, despite him continuing to be legally represented up to 6 March 2018.
At the hearing on 18 April 2018, the husband told the Magistrate that he had not filed his documents because he thought the parties had reached an agreement, but in the end result, that did not occur. Her Honour gave the husband an extension of time to file his documents, and programmed the matter to a trial. Her Honour also indicated that she would have the court send copies of the orders made at the conciliation conference, and those made on 18 April 2018, to the husband.
It seems that that was not done, and the orders were sent not to the husband, but to his former solicitors, and he claimed that he never received them.
On the first day of the trial on 22 October 2018, the husband raised this with the Magistrate, and the following exchange took place:
[THE HUSBAND]: But that – I’m just – excuse me for the thing, but on the last one you said that you were going to email me the things I needed to do and - - -
HER HONOUR: No, I don’t email anybody.
[THE HUSBAND}: I thought the court was going to email what I needed to do.
HER HONOUR: The court made orders on 18 April. You were here?
[THE HUSBAND]: Yes.
HER HONOUR: What’s your – your orders were sent to [B Lawyers]. They were on the record at the time.
[THE HUSBAND]: Well, that’s why I represented myself last time because I explained that I didn’t have them as my lawyers any more.
HER HONOUR: Yes. Okay. How did you know about today’s date?
[THE HUSBAND]: I asked [the wife].
HER HONOUR: And you attended the conciliation conference?
[THE HUSBAND]: The first one, yes.
HER HONOUR: Yes. Okay. So orders were made on that day about filing documents. So you might need to talk to [B Lawyers]. …
(Transcript 22 October 2018, p.8 lines 1–33)
For reasons which I will explain in a moment, her Honour then adjourned the hearing to the next day, and it was on that day when the husband made an oral application to adjourn the trial. However, on my reading of the transcript, the basis for the adjournment application was not that the husband did not know what he had to file, but rather he wished to seek legal advice (Transcript 23 October 2018, p.7), that he did not file his documents before 18 April 2018 because he thought an agreement had been reached (Transcript 23 October 2018, pp. 7–8), that he did not have time because of his work commitments and caring for one of the children of the marriage on weekends, and as a result he did not have the capacity to prepare the documents (Transcript 23 October 2018, p.8), and finally, that he attempted to instruct another lawyer but he could not afford the costs (Transcript 23 October 2018, p.8).
Her Honour then said this in refusing the application:
HER HONOUR: …So the respondent [husband], has made an oral application for the trial to be adjourned. He has not filed his trial documents, although he has attended court today. Orders were made for the filing of trial documents following a conciliation conference on 2 August in 2017.
The [wife] attended that conferences [sic] as a self-represented litigant and the [husband] attended and he was represented by … that day. By the time of the next court event – the readiness hearing on 18 April – the [wife] had filed her documents for trial; however, the [husband] had not. The [husband] represented himself at that hearing and requested further time in which to file his documents. The time in which he was to file was extended by 42 days from 18 April. The [husband] has not filed trial documents, as I’ve already set out, but has attended at court today.
I am concerned that the [wife] has the right to have her application dealt with in a timely manner, in circumstances in which she has complied – albeit late – with her requirement to file trial documents. The [husband] has set out a series of circumstances that are no doubt difficult, including very long work hours – and those long work hours are indeed acknowledged by the [wife] – combined with spending time with his daughter, leaving him time poor and with very limited time to prepare his trial documents.
In saying that, however, as I’ve already set out in my exchange with the parties, the orders were made initially over a year ago, so there has been time to give consideration to the appropriate evidence to be filed in support of an application. In considering [sic] of the [wife’s] right to have the matter dealt with in a timely manner, I am going to proceed with the trial today. I am going to allow the [husband] the ability to cross-examine the [wife] and to make submissions to me; however, as I’ve already set out, he does not have any evidence before the court.
(Transcript 23 October 2018, p.13 line 25 – p.14. line 14)
I can see no error by her Honour in refusing the application, and certainly there is no lack of procedural fairness in this regard.
The husband knew the case against him, because he was served with the wife’s documents, and he had ample opportunity to present his case (Kiao v West (1985) 159 CLR 550 at 582), but he failed to do so.
The second aspect of this ground is the assertion that her Honour should have adjourned the hearing because there was no formal valuation by a single expert witness of the husband’s interest in the property at Suburb A.
The question of the appointment of a single expert witness to value the husband’s interest, was raised by the wife at the Readiness Hearing on 18 April 2018, given that there was no agreement between the parties about an appraisal obtained by the husband (Transcript 18 April 2018, p.4).
At that hearing both parties agreed that a single expert witness should be appointed (Transcript 18 April 2018, pp.4–5), and the following order was made by her Honour:
4.By no later than 28 days from the date hereof, each party do all things necessary to obtain a joint sworn valuation of the property at Suburb A with the cost of the valuation to be borne equally by the parties.
That order was not complied with, and as a result, a matter of weeks before the commencement of the trial, the wife took it upon herself to arrange a valuer to attend at the property and provide a valuation. However, the husband, not having done anything himself to obtain a valuation by a single expert witness, and despite it being his property, initially agreed to the wife’s valuer, but then changed his mind about the valuer having access to the property until just before the commencement of the trial. As a result, the valuation was not available when the trial was called on, on 22 October 2018.
The wife told her Honour (Transcript 22 October 2018, p.4) that the valuer was working on the valuation and it should be available that day. Shortly thereafter, at the request of the wife, her Honour adjourned the hearing to the next day to await receipt of the valuation (Transcript 22 October 2018, p. 7).
When the matter was called on, on the next day, the valuation still was not available, and the wife informed her Honour that the report would not be finished until the following day. Her Honour said that she was not able to adjourn the proceedings to the next day, and after refusing the husband’s application for an adjournment, as referred to above, commenced the hearing in anticipation that at least the valuation figure would be available that afternoon. Her Honour said this:
[HER HONOUR]: So that is what we will do. The [wife] has indicated that she will have a figure that she intends to rely upon for the purpose of establishing the asset pool – sorry, a figure for the [husband’s] interest in the Suburb A property that she would like to rely upon by midday today. And I will finalise the proceeding – finalise the hearing after she has been afforded the opportunity to check what that figure is. …
(Transcript 23 October 2018, p.14 lines 16–23)
The wife then gave her evidence, and although he was invited to cross-examine her, the husband indicated that he had “nothing to say” (Transcript 23 October 2018, p.19).
The matter was then stood down to await information from the valuer.
Subsequently the matter resumed, and the wife was recalled to give evidence. She informed her Honour that she had received a text message from the valuer that the value of the husband’s interest in the Suburb A property was $650,000 (Transcript 23 October 2018, pp.20–21).
Her Honour then invited the husband to ask questions of the wife about that information, and the husband asked one question, namely whether the valuation included “the mezzanine floor” or not. The wife responded by saying that the valuer “did not state anything” and confirmed that the text containing the valuation figure had been shown to the husband (Transcript 23 October 2018, p.22 lines 1–18).
Her Honour said nothing further about this issue and invited the parties to make closing submissions, which they did.
In her reasons for judgment all her Honour said about this issue was as follows:
41.At the trial, the wife provided oral evidence about the value of the Suburb A property. She said that she had arranged for a valuer to attend at the property for the purposes of conducting a valuation some weeks before the trial. She explained that the husband had refused the valuer access to the property for a period, hence the valuation evidence not being available until the time of the trial. She deposed to the valuer informing her that the value of the property was $650,000.00
42.The husband asked the wife whether the valuer had included a mezzanine level in the assessment of the value, but otherwise did not dispute the valuation.
Her Honour then adopted the wife’s schedule of assets and liabilities, and included the value of the husband’s interest in the Suburb A property at $650,000.
Plainly her Honour erred in taking that course. First, it could not be said, as her Honour does in [42], that apart from querying the inclusion of the mezzanine level, the husband “otherwise did not dispute the valuation”.
All that was before her Honour was the wife’s evidence that she had received a text message from the valuer valuing the husband’s interest at $650,000. That evidence was not only inadmissible, but it provided the husband with no opportunity to question the amount, or anything about the valuation. There was no valuation report, and nothing that the husband could realistically cross-examine the wife about. Indeed, he asked about the mezzanine floor, but the wife was unable to answer that question. Thus, for the husband to say he had no other questions of the wife is understandable, and could not be interpreted as him not disputing the valuation. The husband, of course, had put his own estimate of the value at $475,000 in his Financial Statement.
I find that in accepting this evidence and utilising the figure of $650,000 as the value of the husband’s interest in the Suburb A property, the husband was not afforded procedural fairness.
It should also be recalled that her Honour adjourned the matter to 23 October 2018 to await receipt of the valuation report, but that did not eventuate, and there was a good deal of discussion on that day as to what should happen to the matter, including whether it should be adjourned off to a later date. However, her Honour determined to proceed with the hearing on the basis that the valuation would be available.
Further, in discussing the valuation her Honour correctly indicated to the wife that she would have “to seek leave to rely on that”, and pointedly the following exchange took place:
HER HONOUR: And then [the husband] will be entitled to cross-examine the valuer if he wants to. Okay?
[THE WIFE]: Okay?
HER HONOUR: So that’s something that you need to bear in mind.
(Transcript 23 October 2018, p.6 lines 35–41)
As it transpired though, not only was there no valuation report, but nowhere did her Honour give leave to the wife to rely on the valuation figure provided, and the husband was not given the opportunity to cross-examine the valuer at all.
Further, after the matter was adjourned briefly to enable the wife to telephone the valuer and find out what was happening, the following exchange took place:
HER HONOUR: Yes. How did you go?
[THE WIFE]: Yes. I just rang him and he said he will have a figure by 12.
HER HONOUR: All right.
[THE WIFE]: Yes.
HER HONOUR: Now, the – is he going to have a written report?
[THE WIFE]: Not by 12. He said that he will have the figure done and he said that he can text and email us a copy of it.
HER HONOUR: Email a copy of what?
[THE WIFE]: Of his figures that he has written out.
HER HONOUR: But is he going to have his report available?
[THE WIFE]: Not his report. He said he would have to have more time.
HER HONOUR: Okay. Okay. So the difficulty is that you won’t have any formal evidence before me but then – would you like to proceed on that basis and then I will just have to use my discretion as to how to deal with that issue?
(Transcript 23 October 2018, p. 12 line 38 – p.13 line 17)
However, apart from incorrectly suggesting that the husband did not dispute the valuation figure, nowhere does her Honour explain how, and on what basis she exercised her discretion to utilise the figure provided.
In that context, I also note that it is unclear whether the valuer appointed by the wife, and seemingly agreed to by the husband, can be described as a single expert witness. However, assuming that he can be, apart from anything else, the requirement in r 15.48 of the Family Law Rules 2004 (Cth) (“the Rules”), is that a single expert witness must prepare a written report (subrule (1)) and must give each party a copy of that report (subrule (2)). That of course did not happen, and although her Honour has a discretion to waive compliance with that rule, it is not apparent that her Honour did that. Of course, it must still be remembered that there was no valuation report as such that could be the subject of r 15.48.
The third aspect of this ground relates to the acceptance by her Honour of the wife’s schedule of assets and liabilities. There is of course the issue of the value of the husband’s interest in the Suburb A property, which I have just addressed, but there was also the question of whether there was a debt of $339,045.89 owed by the husband in relation to the construction of the commercial unit on that property.
The background to this issue was that in his affidavit filed on 31 July 2017, and which was before her Honour, the husband deposed to not being able to obtain a loan, and arranging to pay the builder, who he said was his friend, the cost of construction once the property proceedings were finalised. He said that this friend was “Mr M”, and the final construction costs were $390,000. He then said that he owed his friend that amount, and he also included that as a liability in his Financial Statement filed at the same time.
The first thing to note about that is that the actual name of the “friend” was Mr D, and the second thing, is that the the alleged costs of construction were not $390,000 but the amount referred to above, namely $339,045.89.
The wife in her trial affidavit filed on 16 April 2018 said this:
33. [The husband] said in his affidavit that he needed to get a loan to build the unit. I think [he] is being untruthful. At the time of building units on the Land, [the husband] had a personal bank account ending …81 with a balance in November 2015 of $456,385 so he had the cash to contribute to the builidng [sic] of units on the Land. In his affidavit, [the husband] said that he got a loan of $390,000 (“loan”) from Mr D to build the unit. In [the husband’s] affidavit he refers to “Mr M”, who gave him the loan. I’m unsure whether [the husband] is trying to mislead the court by purposely mistaking Mr D’s name in his affidavit and not putting in his real name “Mr D” owner of R Construction Group Pty Ltd.
34. I believe [the husband] is trying to deplete the matrimonial asset pool by making up a loan and trying to get his friend Mr D to back him up. I asked [the husband] for evidence that he has a loan with Mr D for the unit and I received a Tax invoice receipt for $339,045.89 with R [sic] Construction Group Letterhead, not signed by Mr D and the invoice is for a unit on W Street, so its [sic] not even an invoice for a loan for the unit. Annexed hereto and marked ‘Q’ is a true copy of the invoice I received from [the husband].
35. I asked [the husband] for further evidence as the loan amount had changed from $390,000 to $330,045.89 and was not the right address, I asked if [he] had lied in his affidavit and I did not receive any reply back to my email.
36. I also sent an email to Mr D about the loan and never received a reply, I also rang Mr D several times to speak to him about the loan and he has not replied [sic] any of my phone calls. For these reasons, I believe that the loan is made up to delete the matrimonial asset pool and would ask the court not to include it in our liabilities.
Pausing there, the wife is mistaken as to the correctness of the address; the address on the “invoice” is the address of the builder, and not of the husband’s commercial unit.
In her documents prepared for the Readiness Hearing on 18 April 2018, the wife included Mr D as a witness she proposed to call, and on that day her Honour gave the wife permission to issue a subpoena to “Mr D” to attend to give evidence at trial.
Subsequently, that subpoena was issued, but as the wife explained to her Honour on 22 October 2018, she had been unable to serve the subpoena, and thus she had not been able to arrange for Mr D to give evidence.
For the husband’s part, it seems he made no attempt to have Mr D give evidence, or to have him provide an affidavit. Further, there was no documentation beyond the unsigned “invoice” provided by the husband as to this alleged debt, including what the correct amount was, to whom it was in fact owed, and the terms of repayment.
Significantly, the husband also failed to cross-examine the wife as to this, and in particular, as to her allegation that he had a balance of $456,385 as at November 2015 in a personal bank account ending in …81 which was available to meet the costs of construction.
Her Honour dealt with this issue as follows:
43In his Form 13 the husband deposes to owing Mr M (which the wife takes to be the husband’s friend, Mr D of R Constructions) the sum of $390,000.00 for the costs of construction of the unit on the Suburb A property. In his Affidavit filed 31 July 2017 the husband deposes to the loan being an “informal, verbal, handshake agreement” and “in the construction industry, these types of agreements are common as most people do not bother going to the trouble or expense of having the loan formally drawn up.”
44.The wife submitted that the husband’s evidence with respect to the amount owing for the construction of the unit should not be accepted. In her view, the husband was attempting to mislead the Court with respect to the alleged liability. The husband did not challenge the wife’s affidavit evidence that at the time of construction of the units he held $456,385.00 in an account.
45.In was incumbent upon the husband to put independent evidence before the Court about the loan, and he failed to do so. For example, the husband had only provided a tax invoice with respect to the loan, but had not put evidence before the Court about the terms of the loan, consequences of default of those terms, nor was there evidence from Mr D to verify the amount owing. In the circumstances, the alleged loan will not be taken into account in the assessment of the parties’ assets.
The husband submits that her Honour failed to afford him procedural fairness by:
(a)Not asking any questions of him about this alleged debt, and whether he had the funds in the bank as the wife claimed;
(b)Not advising him that “he needed to bring Mr D to court to verify the amount owing to him in relation to the construction of the Suburb A property”;
(c)Failing to advise him that he could challenge the evidence of the wife as to the funds in the bank; and
(d)Failing to “raise with the [husband] her intention to make a finding that there was no debt associated with the Suburb A property”.
However, none of these complaints demonstrate a lack of procedural fairness. The husband was aware of the wife’s case, and he had the opportunity to present his case, but he chose not to. Further, there was no obligation on the Magistrate to run the husband’s case for him, and in particular, to ask questions of him about this issue. Importantly, her Honour went to great lengths to explain that the husband could cross-examine the wife and thereby challenge her evidence, and object to inadmissible evidence (Transcript 23 October 2018, pp.5–6).
Thus, although I expressed some concern about this aspect of her Honour’s decision in my reasons for judgment delivered on 21 April 2020 in reinstating the husband’s Notice of Appeal (Maddyson & Maddyson [2020] FamCAFC 87 at [23]-[26]), having now considered the matter more fully, I find that there is no merit in this aspect of this ground.
There is of course the application by the husband for leave to adduce further evidence comprising an affidavit of Mr D. However, there is no basis for such leave to be granted. The further evidence does not satisfy the principles to be found in the High Court decision of CDJ v VAJ (1998) 197 CLR 172 per McHugh, Gummow and Callinan JJ at [109], [111], [114] and [116]. It was evidence that was plainly available in the lead-up to and at the time of the trial, yet the husband failed to make any attempt to present the same to the court, despite ample opportunity to do so. Further, not only is it the case that much of the content of the affidavit is inadmissible, but it also raises more questions than it provides answers, and it is highly controversial. As such, it would require not only a responding affidavit from the wife, but cross-examination, which the Full Court is not set up to accommodate.
In these circumstances the application will be dismissed.
However, of course, I have found that there is merit in this ground of appeal insofar as the claimed failure to provide procedural fairness relates to the receipt by her Honour of the wife’s evidence as to the valuation figure, and her Honour’s utilisation of that figure in making the orders for property settlement.
That outcome in effect also disposes of Grounds 1, 2 and 4, which assert as follows:
Ground 1 – The Learned Trial Magistrate acted upon a wrong principle by admitting inadmissible evidence as to the value of the Suburb A property.
Ground 2 – The Learned Trial Magistrate acted upon a wrong principle by failing to follow the strict legislative pathway required in relation to the admission of the single expert valuer’s opinion as to the value of the Suburb A property.
Ground 4 – The Learned Trial Magistrate acted upon a wrong principle when she said it was open to her to use her discretion as to how to deal with the value of the Suburb A property.
As for Ground 5, which asserted that the Magistrate had erred by failing “to follow the guidelines for judicial officers hearing cases involving self-represented litigants", as was conceded by the husband’s counsel, and indeed, as is expressed in the husband’s summary of argument, an alleged divergence from those guidelines does not of itself bespeak appealable error (Yein & Zihao [2019] FamCAFC 20); what needs to be established is a failure to provide procedural fairness, or rather a failure to ensure a fair trial.
Here, the assertion as to a lack of procedural fairness has already been addressed in considering Ground 3, and nothing more need be said.
Ground 6 is in reality a repetition of the issue raised in Ground 3, and again, nothing more need be said.
With Ground 7, its success is dependent on receipt of the further evidence, but given that I will be dismissing that application, this ground has no merit.
Finally, there is Ground 8, but once again, that is a repeat of the assertions made in Ground 3, and does not require separate consideration.
Having found a lack of procedural fairness, that is a defect in the administration of justice, and should result in the appeal being allowed and the orders being set aside. Here, the failure to afford procedural fairness as identified, infects the orders that her Honour made. Thus, the appeal should be allowed and the orders set aside.
Conclusion
Having found merit in Ground 3, to repeat, the appeal must be allowed and the orders set aside.
In the circumstances, given the nature of the error, it is also not open for this Court to re-exercise the discretion, and unfortunately the proceedings will need to be remitted to the Magistrates Court of Western Australia to be reheard by a Magistrate other than the primary Magistrate.
Further, given the basis on which the appeal is being allowed, there is no need to address the Application in an Appeal seeking leave to adduce further evidence, and that will be dismissed.
Costs
In the event that the appeal succeeded, the husband sought an order for costs on the basis that the wife should have conceded the appeal.
The wife opposed that application.
I am not disposed to make an order for costs in the husband’s favour, given that in my view, it was reasonable for the wife to oppose the appeal.
In the event that a costs order was not made, the husband sought costs certificates pursuant to the Federal Proceedings (Costs) Act 1981 (Cth) for the appeal and for the rehearing. The wife joined in that application, but only sought a certificate for the rehearing, given that she had not incurred any legal costs in relation to the appeal.
I find that it is appropriate to issue costs certificates as sought, given that the appeal is being allowed on a question of law.
I certify that the preceding ninety-four (94) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Strickland delivered on x November 2020.
Associate:
Date: 19 November 2020
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