Masters & Cheyne
[2016] FamCAFC 255
•2 December 2016
FAMILY COURT OF AUSTRALIA
| MASTERS & CHEYNE | [2016] FamCAFC 255 |
| FAMILY LAW – APPEAL – CHILD SUPPORT – Binding child support agreement – Setting aside a binding child support agreement – Apprehension of bias and pre-judgment – Distinction between bias or pre-judgment and testing the parties’ propositions – Exceptional circumstances – Hardship – Discussion of setting aside and termination of child support agreements under the Child Support (Assessment) Act 1989 (Cth) – Whether a change in the living arrangements of the child alone can amount to exceptional circumstances – Where the primary judge was in error in finding hardship, where that hardship flowed not from the changed circumstances but from the agreement itself – Where the primary judge erred in her exercise of discretion under s 136(2)(d) of the Child Support (Assessment) Act 1989 (Cth) in setting aside the binding child support agreement – Appeal allowed. FAMILY LAW – APPEAL – COSTS – Where error established – Where the appellant and respondent are self-represented – Where the appellant will receive a windfall as a result of her success in the appeal – No order as to costs. |
| Child Support (Assessment) Act 1989 (Cth) Part 5, ss 4(3), 5, 12, 34B, 44(3), 80C(2), 80CA, 80D, 80E, 80F, 80G, 81, 82, 83, 84, 93, 94, 95, 136(1), 136(2), 136(2)(d), 142 Families, Community Services and Indigenous Affairs Legislation Amendment (Child Support Reform Consolidation and Other Measures) Bill 2007, Explanatory Memorandum |
| Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue (Northern Territory) (2009) 239 CLR 27 Ascot Investments Pty Ltd v Harper (1981) 148 CLR 337 Australian Coal and Shale Employees’ Federation v The Commonwealth (1953) 94 CLR 621 Balzano & Balzano (2010) FLC 98-048 Bass & Bass [2016] FamCAFC 64 Christian & Donald [2008] FamCAFC 44 Daley & Daley [2009] FMCAfam 398 Ebner v Official Trustee in Bankruptcy (2000) 205 CLR 337 Federal Commissioner of Taxation v Munro (1926) 38 CLR 153 Galea v Galea (1990) 19 NSWLR 263 Hoult v Hoult (2012) 48 Fam LR 507 Hoult & Hoult (2013) FLC 93-546 House v The King (1936) 55 CLR 499 Keane v Keane (2013) 50 Fam LR 120 Lovell v Lovell (1950) 81 CLR 513 Minister for Immigration and Multicultural Affairs v Jia Legeng (2001) 205 CLR 507 Norbis v Norbis (1986) 161 CLR 513 Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355 Simpson and Hamlin (1984) FLC 91-576 Vakauta v Kelly (1989) 167 CLR 568 Whitford and Whitford (1979) FLC 90-612 |
| APPELLANT: | Ms Masters |
| RESPONDENT: | Mr Cheyne |
| FILE NUMBER: | NCC | 2311 | of | 2009 |
| APPEAL NUMBER: | EA | 69 | of | 2014 |
| DATE DELIVERED: | 2 December 2016 |
| PLACE DELIVERED: | Sydney |
| PLACE HEARD: | Sydney |
| JUDGMENT OF: | Murphy, Aldridge & Austin JJ |
| HEARING DATE: | 26 May 2016 |
| LOWER COURT JURISDICTION: | Federal Circuit Court of Australia |
| LOWER COURT JUDGMENT DATE: | 19 May 2014 |
| LOWER COURT MNC: | [2014] FCCA 856 |
REPRESENTATION
| THE APPELLANT: | In person |
| THE RESPONDENT: | In person |
Orders
The appeal be allowed.
Order 2 made by Judge Terry on 19 May 2014 be set side.
The Application of Mr Cheyne filed on 6 March 2013, seeking to set aside the Binding Child Support Agreement entered into between him and Ms Masters on 31 July 2008, be dismissed.
There be no order as to costs.
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 Masters & Cheyne 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 FULL COURT OF THE FAMILY COURT OF AUSTRALIA AT SYDNEY |
Appeal Number: EA 69 of 2014
File Number: NCC 2311 of 2009
| Ms Masters |
Appellant
And
| Mr Cheyne |
Respondent
REASONS FOR JUDGMENT
Murphy J
I have had the advantage of reading in draft form the reasons of
Aldridge J and, subsequently, those of Austin J.
I agree the appeal should be allowed on the basis that the primary judge’s conclusion that the father would suffer “hardship” within the meaning of s 136(2)(d) of the Child Support (Assessment) Act 1989 (Cth) (“the CSA”) was not open on the evidence before her Honour.
However, I respectfully disagree with Aldridge J as to the interpretation and application of s 12 of the CSA and with his Honour’s conclusion that the primary judge erred in that respect. As the issue is central to at least one of the appellant’s grounds, and potentially of general application, I consider it important to give the reasons for my disagreement.
The Grounds of Appeal
The mother prepared her own material and represented herself. Her Notice of Appeal purports to contain 15 grounds. However, contained within those grounds are over 90 separate challenges which, as Aldridge J points out, stretch over 22 pages and 104 footnotes.
With all respect to the mother, I agree with Aldridge J that her grounds and arguments obscured the central thrust of her challenges rather than illuminated them. Many are not in fact proper grounds of appeal at all.
The bases of the mother’s challenges are in my view properly summarised by Aldridge J and I gratefully adopt that summary.
Pre-Judgment and Bias
I agree with Aldridge J’s conclusion that the mother’s challenges based on prejudgment, or bias more generally, have no foundation. I respectfully agree with his Honour’s reasons for that conclusion.
Issues Arising From The Binding Child Support Agreement
The parties, who I will call for convenience the mother and the father, executed the binding child support agreement the subject of this appeal on 31 July 2008. The three children of the parties’ marriage whose child support was the subject of the agreement then lived with their mother and spent time with their father.
More than three and a half years later, on 23 April 2012, the parties’ youngest child (“the child”), then aged 15 years 4 months, commenced spending six nights per week with his father and one night per week with his mother. That move was instigated by the mother’s desire to relocate from the Hunter region to Melbourne. By that time each of the parties’ other two children had become adults.
As a result of the changes in the child’s care arrangements, his mother’s care percentage for the purposes of the CSA became less than 35 per cent and, following the mother’s move to Melbourne in September 2012, her care percentage decreased further.
If the parties’ binding child support agreement continued to determine the financial support payable by each of the child’s parents, the father would continue to pay $220 per week for him (indexed to inflation) until the child’s eighteenth birthday as provided for in the agreement despite having the child in his sole full-time care. Conversely, despite the father’s full-time care, the mother would pay no child support for him.
Section 12 of the CSA is headed “Interpretation – happening of child support terminating events”. When the parties executed the binding child support agreement on 31 July 2008, the relevant sub-paragraph of s 12(2) provided, relevantly, that a “child support terminating event” happens if the “carer entitled to child support in relation to a child ceases to be an eligible carer”. Section 12 was amended with the new section commencing on 6 January 2009.[1] As a consequence of the amendment, s 12 provides relevantly that a “child support terminating event” happens in relation to a child if “both of the parents of the child are not eligible carers of the child” (s 12(2AA)).
[1]Families, Housing, Community Services and Indigenous Affairs and Other Legislation Amendments (Further 2008 Budget and Other Measures) Act 2008 (Cth), Item 28, Schedule 3.
The father submitted before her Honour that the amendment to s 12 of the CSA was a relevant consideration in assessing whether there were “exceptional circumstances” within the meaning of s 136(2)(d). Her Honour agreed. The mother contends on this appeal that her Honour erred in her interpretation of s 12 and that the amendment to that section was irrelevant to determining whether “exceptional circumstances” was established.
Two issues are raised. First, did her Honour err in considering the amendment to s 12 of the CSA as a factor relevant in determining “exceptional circumstances” within the meaning of s 136(2)(d) of the CSA? In my view, for the reasons which follow, her Honour did not. Secondly, was her Honour’s conclusion that “exceptional circumstances” was established reasonably open to her? In my view, for the reasons which follow, it was. In each of those conclusions I respectfully disagree with Aldridge J.
Child Support Agreements and the CSA
Section 94 of the CSA is important. It provides relevantly:
Registrar to take action to give effect to accepted child support agreement or termination agreement etc.
(1) After the Registrar accepts a child support agreement made in relation to a child, the Registrar must immediately take such further action (if any) as is necessary to give effect to the agreement.
Note: After accepting the agreement, section 34B or 93 or Part 5 might require the Registrar to assess an annual rate of child support payable.
(2) In making any administrative assessment in relation to the child, the Registrar must act in accordance with section 95 (effect of certain provisions of accepted child support agreements).
I respectfully disagree with Aldridge J’s contention that s 80E imposes an obligation upon parties to a limited child support agreement to register that agreement whereas no such obligation exists in respect of a binding child support agreement.
The CSA imposes no obligation upon the parties to either type of agreement to submit it to the Child Support Registrar for acceptance.[2] In that respect, an unregistered agreement for the payment of child support is no different from an informal agreement between parents to not apply for an administrative assessment of child support. In either case parents who, as here, are not restricted by receipt of government benefits, are entirely free to make their own arrangements with respect to financial support for their children (or no arrangements as the case may be) and to keep those arrangements entirely private (See CSA s 4(3)).
[2]Nothing on the record suggests that either of the parties in this case is the recipient of family tax benefit of any other income tested pension or benefit.
However, if neither type of agreement is submitted for acceptance by the Registrar, there are potential significant ramifications for the parties to the agreement (or informal arrangement). For example, one party might apply for an administrative assessment contrary to the intention of the unregistered agreement or informal arrangement. Or, one party might seek to enforce the terms of an agreement which are intended to substitute for the formula assessment that would otherwise apply on an application for assessment made by one of the parties. Thus, parties to either type of child support agreement are incentivised powerfully to submit them to the Registrar for acceptance.
Of considerable significance to the issues on this appeal, s 136(1) of the CSA provides for acceptance by the Registrar of a child support agreement as a precondition to a party having standing to seek relief pursuant to s 136(2)(d). Section 136(1)(a) provides relevantly, under the heading “Power of court to set aside child support agreements” that “[a] party to … a child support agreement that has been accepted by the Registrar under section 92 or 98U; … may apply to a court for the court to set aside the agreement” (underlining in original).
It is uncontroversial that the parties’ binding child support agreement in this case was accepted by the Registrar.
As s 94 of the CSA makes clear the acceptance of the parties’ agreement by the Registrar invokes mandatory actions by the Registrar. Central to the instant issue, the Registrar was obliged to immediately strike an assessment. As the note to s 94 provides, the application of s 34B or s 95 or Part 5 of the CSA is engaged as the circumstances might dictate. Each requires, in its own way, an administrative assessment of child support to be struck by the Registrar.
As can be seen, the acceptance of a child support agreement by the Registrar establishes an essential connection between the terms of the agreement as an agreement and the terms of the agreement as a child support assessment referenced to, and governed by, the CSA.
That interrelationship is also underscored by s 81 of the CSA which defines child support agreements as a CSA construct. That section incorporates the requirements of each of ss 82, 83 and 84. Those sections, in turn, prescribe the children to whom child support agreements can apply; who might be parties to the agreement; and the provisions which may be included within them. Each and all are referenced to “child support” and/or child support assessments under the CSA. “Child support” is, of course, defined in the CSA as “financial support under this Act, including financial support under this Act by way of lump sum payment or by way of transfer or settlement of property” (CSA s 5; emphasis added).
It was uncontroversial before the primary judge and before this Court that the instant binding child support agreement replaced an earlier agreement between the parties. That earlier agreement invoked the obligations upon the Registrar to which I have earlier made reference. (In that instance, the Registrar’s s 94 obligations arose under s 93). As a consequence, a child support assessment was struck arising from the terms of the earlier agreement. Thus, in this case, the Registrar’s obligations arising pursuant to s 94 upon acceptance of the parties’ instant binding child support agreement arose under s 34B of the CSA.
Section 34B of the CSA provides relevantly:
Administrative assessment for child support period started by new agreement when support already payable
(1) The Registrar must assess the annual rate of child support payable for a child for a day in a child support period if:
(a) the Registrar accepts a child support agreement made in relation to the child; and
(b) child support is already payable by a parent for the child under an administrative assessment; and
(c) the agreement is to affect the annual rate of child support payable for the child.
The Registrar must assess the annual rate immediately after accepting the agreement.
Note 1: Section 95 explains how the provisions of the agreement affect the assessment.
As the terms of s 94 also make clear, in striking an administrative assessment by reference to the applicable statutory provisions, the Registrar must act in accordance with s 95. Section 95 of the Act provides relevantly:
Effect of certain provisions of accepted child support agreements
(1) This section applies in relation to a child support agreement that has been accepted by the Registrar.
(2) If the agreement includes:
(a) provisions under which a party is to pay child support for a child to another party in the form of periodic amounts paid to the other party; or
…
the provisions have effect, for the purposes of Part 5, as if they were an order made by consent by a court under Division 4 of Part 7.
Section 142 of the CSA provides relevantly:
Cessation of orders under Act
(1) Where an order made under this Act is in force in relation to a child and:
(a) a child support terminating event happens in relation to the child; or
…
the order ceases to be in force.
Once it is appreciated that a binding child support agreement operates as an agreement but also operates, by reason of the provisions of the CSA, as a child support assessment (albeit in accordance with the terms of the agreement), it can be seen how s 80D of the CSA can operate exclusively and exhaustively so as to determine a binding child support agreement whereas s 12 and s 142 can operate so as to determine child support payable pursuant to an assessment under the CSA. There is no inconsistency between the two.
Taken together, the provisions of the CSA applicable in this case meant that the child’s child support was governed by an assessment in the form of a consent departure order whose terms could be found in the parties’ binding child support agreement. The terms of the agreement became an administrative assessment of child support in accordance with the terms of the agreement. Although not an order of the court as such, the terms of the agreement were to have effect as if they were. One of the effects of a court order – whether made by consent or otherwise – is that it is susceptible to cessation upon the happening of a child support terminating event as defined by s 12 of the CSA.
Accordingly, in my judgment the primary judge was correct in the effect attributed to s 12 of the CSA upon the parties’ agreement and the assessment deriving from it.
A separate question to which I now turn is whether it was open to her Honour to consider the amendment to s 12 as relevant to a determination of “exceptional circumstances within the meaning of s 136(2)(d) of the CSA.
“Exceptional Circumstances” and “Hardship” In Context
Section 136(2) of the CSA provides relevantly:
(1) A party to either of the following agreements may apply to a court having jurisdiction under this Act for the court to set aside the agreement:
…
(2) If a party has applied under subsection (1), the court may set aside the agreement in accordance with the application if the court is satisfied:
…
(d) in the case of a binding child support agreement--that because of exceptional circumstances, relating to a party to the agreement or a child in respect of whom the agreement is made, that have arisen since the agreement was made, the applicant or the child will suffer hardship if the agreement is not set aside.
In Federal Commissioner of Taxation v Munro,[3] Isaacs J said “[c]onstruction of an enactment is ascertaining the intention of the legislature from the words it has used in the circumstances, on the occasion and in the collocation it has used them”. A modern statement of the same principle can be seen, for example, in Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue (NT):[4]
…the task of statutory construction must begin with a consideration of the text itself. Historical considerations and extrinsic materials cannot be relied on to displace the clear meaning of the text. The language … of legislation is the surest guide to legislative intention.
(Citations omitted)
[3](1926) 38 CLR 153, 180, sub nom British Imperial Oil Co Ltd v Federal Commissioner of Taxation.
[4](2009) 239 CLR 27, 46–7.
The expressions “exceptional circumstances” and “hardship” must be interpreted by reference to their ordinary meaning but also by reference to the whole of the legislative context within which they are used.[5]
[5]See, Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355, 381-382 per McHugh, Gummow, Kirby, Hayne JJ cited in Independent Commission Against Corruption v Cunneen (2015) 256 CLR 1.
Her Honour referred to the fact that the father “bought certainty for himself when he signed the agreement and this was potentially advantageous to him” and equally took upon himself the risk that “the agreement might prove disadvantageous to him”. Equally the mother “sacrificed her right to have the payment regime change if circumstances change”. Her Honour specifically took into account that if changed circumstances were to meet the relevant criteria, they must necessarily be judged within a context that provides for a significant difference between a limited child support agreement and a binding child support agreement and that the latter embraces inherent certainty and consequent restrictions (Reasons [164] – [166]).
The certainty and restrictions inherent in a binding child support agreement and the differences set forth in the CSA between an agreement of that type and a limited child support agreement can each be seen to be particularly important in light of the CSA’s Objects. Her Honour cites two of those Objects, but, interestingly, does not cite the third which pertains specifically to agreements. It provides (s 4):
It is the intention of the Parliament that this Act should be construed, to the greatest extent consistent with the attainment of its objects:
(a)to permit parents to make private arrangements for the financial support of their children; and
(b)to limit interferences with the privacy of persons.
Making “private arrangements” in the form of a binding child support agreement brings with it a significant difference in the role that a court may play when compared to its potential role in respect of limited child support agreements. For example, a limited child support agreement is susceptible to being set aside if, for example, a court determines that the parties “private arrangements” are not what the court considers “proper or adequate” (CSA s 136(2)(c)(ii)). Thus, the synthesis of the CSA’s Objects in the case of a limited child support agreement sees the parties’ arrangements being required, in effect, to mirror the CSA’s other Objects including, as a particular example, the determination of the level of child support being referable to the parental capacity to meet the same (CSA s 4(2)).
That is to be contrasted sharply with the position which pertains to binding child support agreements.
While the terms of neither type of agreement can be varied (ss 80CA; 80F(1)), and while fraud, undue influence, duress, unconscionable or similar conduct can found the setting aside of either (s 136(2)(a),(b),(c)), binding child support agreements cannot be set aside by reference to a court concluding that the child support provided within them is not “proper or adequate”; nor can they be set aside because of a significant change of circumstances; nor because of idiosyncratic notions of “fairness” or “unfairness”.
The statutory Object permitting parties to make private arrangements and to “limit interference with their privacy” is given particular force by reason of the necessity to show “exceptional circumstances” before a court will intervene in them and the additional requirement to prove “hardship” if the parties are held to their agreement.[6]
[6]In addition, the court must exercise a discretion – s 136(1).
The ordinary and natural meaning of each such expression must be seen within that statutory context.
The Meaning of “Exceptional Circumstances” And “Hardship”
The expression “exceptional circumstances” has frequently been interpreted in a number of different contexts.[7] In ordinary usage the expression “exceptional” means “unusual or out of the ordinary”[8] or “unusual or extraordinary”.[9] It has been said that:
We must construe “exceptional” as an ordinary, familiar English adjective, and not as a term of art. It describes a circumstance which is such as to form an exception, which is out of the ordinary course, or unusual, or special, or uncommon. To be exceptional a circumstance need not be unique, or unprecedented, or very rare; but it cannot be one that it is regularly, or routinely, or normally encountered.[10]
As Watts J has pointed out, the Full Court has applied that statement.[11]
[7]See, as an example the cases and circumstances collated by Watts J in Keane v Keane and Others (2013) 50 Fam LR 120, including Khalil & Tahir-Ahmadi (2012) FLC 93-506, at [95] citing in turn Segur v Segur [2010] FamCA 556; State Central Authority v Ustinov (No. 4) [2008] FamCA 987 and Emmett & Emmett (No. 2) [2010] FamCA 57.
[8]Oxford English Dictionary.
[9]Macquarie Dictionary.
[10]Lord Bingham of Cornhill CJ in R v Kelly (Edward) [2000] QB 198, 208, quoted with approval by Callinan J in Baker v The Queen (2004) 223 CLR 513, 573, cited by Watts J in Keane (above).
[11]Keane (above), at [49].
The expression “hardship” has also been frequently interpreted in different contexts, primarily by reference to s 44(3) of the Family Law Act 1975 (Cth). The concept involves a “hardness of fate or circumstances; severe suffering or privation”[12] or “a condition that bears hard upon one; severe toil, trial, oppression or need; to cause to suffer privations”.[13] The primary judge referred to Whitford and Whitford,[14] where the Full Court said that “hardship may be caused to an applicant if leave were not granted to institute proceedings, although the applicant is not in necessitous circumstances”.
[12]Oxford Dictionary.
[13]Macquarie Dictionary.
[14](1979) FLC 90-612, 78,145.
The ordinary meaning of the word is not confined to financial hardship. As used in s 44(3) the expression has similarly been held not to be confined to financial hardship. That said, to the extent that the father’s evidence before her Honour addressed hardship, it was directed to financial hardship.
Was The Finding Of “Exceptional Circumstances” Open?
The Relevance of the Amended Section 12
In deciding whether “exceptional circumstances” was established within the meaning of s 136(2)(d) of the CSA her Honour was obliged to compare the circumstances existing when the agreement was executed by the parties with those that existed when the application was heard.
Her Honour referred to two decisions, the first by Judge Brown and the second by Justice Watts.[15] Each of those cases concerned the legislative direction made to the Child Support Registrar in light of legislative amendments operative from 1 July 2008. That amending legislation[16] created the dichotomy between limited and binding child support agreements. The direction to the Registrar arose from the need to accommodate existing agreements within the new legislative regime.
[15]Respectively, Daley & Daley [2009] FMCAfam 398 and Keane (above).
[16]Child Support Legislation Amendment (Reform of the Child Support Scheme – New Formula and Other Measures) Act 2006 (Cth)
Judge Brown said:
102.I do not think that it can be conceivably possible that the parties, when they entered into the child support agreement in February of 2005, foresaw the possibility that the legislature would so radically modify the method of calculation and collection of child support in Australia or the extent of the changes made to the legislative provisions in respect of child support agreements.
…
107.In my view, the combination of these factors takes this case out of the ordinary run of cases and make it an exception. The child support agreement, which the parties entered in early 2005 cannot be regarded as being strictly analogous to a binding child support agreement entered into after 1 July 2008, particularly in the absence of independent legal advice. Exceptional circumstances have arisen which justify it being set aside.[17]
[17]Daley & Daley (above).
Watts J said:
72.I am of the view that if the legislature had intended that the court be able to take into account the fact that a child support agreement was not binding at the time the parties entered into it as a relevant circumstance when assessing whether exceptional circumstances existed, the legislation would have either:
72.1.indicated that that was a factor to take into account when making that determination;
72.2.or created a different test for transitional agreements (as they have done for transitioning State de facto financial agreements (see s 90UM(1)(k) and s 90UM(5) FLA)).
The legislature did neither of these things. When considering setting aside a binding child support agreement, the legislation draws no distinction arising from the method by which a child support agreement has become binding. I do not think the retrospective nature of the legislation is a relevant matter when considering the “exceptional circumstances” test.[18]
[18]Keane (above).
In my view the statements made by each of their Honours should be seen as specific to the nature of the particular amendment effected by that amending legislation. The subject of the amending legislation was, relevantly, the transition from the recognition of agreements made under an earlier statutory regime to a new statutory regime. A specific subject of the amending legislation was the transition of existing agreements to the new form of agreement. A consideration of whether the existing agreements should be terminated and the role, if any, of the new legislation in constituting a circumstance in which that might occur is central to the amending legislation. Each and both might, as Watts J suggests, have been expected to be the subject of legislative contemplation and, in particular, whether that particular legislative change was to be considered “exceptional” or otherwise impact upon the then existing agreements.
The amendment to s 12 is not, in my view, analogous. Nothing about the legislative amendment to s 12 suggests that a specific legislative provision in respect of “exceptional circumstances” might have been in contemplation by the legislature. Section 136 remained unamended and nothing in the amended s 12 suggests that s 136 should have been amended. The expression “exceptional circumstances” (which expression is otherwise undefined and unconfined) was left by the legislature to do the same work as it did before the amendment to s 12.
In my view it is neither more nor less likely that the legislature would have included legislative amendment as a specific instance of exceptional circumstances had that been the intention than it is that legislative amendment would have been excluded from the expression had that been the intention. The expression is left at large; that is, it is left to its ordinary and natural meaning in the context of the provision as a whole and the CSA as a whole. I see no reason why an expression that is left undefined and unconfined in the legislation should be read down.
If a “child support terminating event” within the meaning of s 12 was established, the child support assessment arising from the terms of the binding child support agreement would come to an end. Whatever else might have been the effect upon the parties of their agreement (as to which, see ss 82(3), 83(3) and 84(4)), the agreement could not create a child support assessment and, thus, was not operative to govern child support as defined by the CSA. If, however, s 12 was not engaged, the child support assessment for the child would be struck in accordance with the terms of the binding child support agreement unless, relevantly, it was terminated by court order pursuant to s 136(2)(d) of the CSA.
There can be no doubt that the terms of s 12 of the CSA at the time the parties executed their binding child support agreement were markedly different to those which applied at the time of the hearing before her Honour. In its earlier iteration, s 12(2)(b) provided that child support terminated if the person entitled to child support ceased to be an “eligible carer” (as defined by the CSA). Had s 12 remained in its earlier iteration, the father’s child support assessment, struck by reference to the terms of the agreement, would have terminated when the mother ceased to be an eligible carer. However, the amended s 12, applicable at the time of the proceedings before her Honour and since, provides for the assessment to cease if, relevantly, both parents cease to be eligible carers (CSA s12(2AA)).
Section 80C of the CSA prescribes the requirements for a binding child support agreement. Among those requirements is the necessity for each party to the agreement to receive independent legal advice as to “the effect of the agreement on the rights of the party” and “the advantages and disadvantages, at the time that the advice was provided, to the party of making the agreement” (s 80C(2)(c)(i) and (ii)). The agreement must contain a statement to that effect and an annexed certificate signed by the person providing the advice (s 80C(2)(c) and (d)). It is uncontroversial that the parties received the required advice and that their agreement contained the relevant statement and annexed certificate.
The advice given to each of the parties in accordance with s 80C, if properly and competently given, should have included advice to the parties that the child support assessment struck in accordance with the terms of the agreement would terminate in the event that, relevant to the then circumstances, the mother ceased being an eligible carer for the children.
Advice as to, for example, the “advantages and disadvantages” of entering the agreement can only be given by reference to (among other things) advantages and disadvantages for the party by reference to the relevant statutory provisions applicable at that time. That circumstance suggests that if either including or excluding legislative amendment was contemplated as having a determinative impact upon an assessment of “exceptional circumstances”, specific legislative provision would have been made for such an eventuality. Instead, that course has been eschewed in favour of the expression being attributed its ordinary and natural meaning in the context of the section and the CSA as a whole.
The parties used a pro forma child support agreement supplied by the Child Support Agency. At the time the agreement was executed, the pro forma contained notes for the purpose of assisting those completing it. One such note, appearing under the heading, “Who is Eligible to Apply”, provided that, “the person who will receive the child support payments must have at least shared care of the children. This means they must care for the children at least 35 per cent of the time”. There was and is no issue that each of the parties relied on the statements in the pro forma.
Because s 12 applies to the assessment deriving from the parties’ agreement, its then terms were, in my view, a highly relevant matter in the decision by the parties to enter the agreement. That circumstance changed and changed dramatically.
In my view, it was open to her Honour to take account of the amendment and the consequent significant change in the position upon which the parties bargained – and upon which each received their independent advice. That advice informed, in part, the respective decisions of the parties to embrace the risks for each of them inherent in executing a child support agreement of this particular type as did the terms of the pro forma which, too, was based relevantly on the then s 12.
Her Honour was cognisant of the nature of a binding child support agreement and the risks inherent in parties agreeing to such an agreement which, axiomatically, they embrace by executing it after receiving independent advice. Those risks and the assessments of those risks by each of the parties were taken in the light of independent legal advice, and the pro forma issued by the Child Support Agency, based on the legislation, including s 12 as it then stood. That is a very different assessment of risk associated with the certainty provided by the agreement than the one which would pertain under the current iteration of s 12.
As a consequence, in my view her Honour was correct in finding that the change to s 12 of the CSA was capable of being considered as a relevant factor in determining whether exceptional circumstances were made out within the meaning of s 136 of the CSA.
In doing so, her Honour referred to the “retrospective legislative change” being “taken with other matters,” so as to “combine to constitute exceptional circumstances”.[19] Her Honour plainly considered the change in legislation to be an extremely important factor but equally plainly (and properly in my respectful view) did not see it as determinative of that question.
[19]Daley (above) and Keane (above).
Other Circumstances Considered by the Trial Judge
Her Honour was plainly aware of the fact that if the circumstances can be seen to fall within the ordinary vicissitudes of life and were circumstances that are “regularly, or routinely, or normally encountered” then the circumstances could not be found to be exceptional. In that respect her Honour accepted that a change in the care arrangements for a child during the relevant period is foreseeable but said “that alone does not mean that such a change can never amount to exceptional circumstances”. In my view her Honour was correct in so finding.
Her Honour also took account of the fact that, when the agreement was made, child support was payable by the father in respect of three children who lived for over 80 per cent of the time with the mother. At the time of the application child support was payable in respect of a child, in respect of whom “the mother’s care … dropped to 16 per cent in April 2012 and was 2 per cent in 2013” (Reasons [126]). Her Honour described those changes at [144] as “a ‘radical revision’ in the child’s care arrangements”. That finding was entirely open to her Honour.
In addition, her Honour found specifically at [126] that “there was no prospect of any return to the previous arrangements for [the child]’s care”. That finding is based on evidence before her Honour, and findings made in respect of that evidence, that the then relationship between a child then aged 17 and his mother had been strained and that they were at that time “estranged”.[20] Those findings, too, were well open.
[20]Reasons, at [55], referring to the mother’s Affidavit filed 12 August 2013, at paragraph 174.
Her Honour also found specifically that the change in the care arrangements for the child “did not come about because of any behaviour by the father to inveigle [the child] out of the mother’s care” and rejected the mother’s contentions that he had undermined their relationship (Reasons [145] – [146]). Some five months after the child came into his father’s care, the mother relocated from the Hunter region to Melbourne.
Conclusion as to Exceptional Circumstances
In my judgment, no error is demonstrated in respect of her Honour’s finding of “exceptional circumstances”.
Was The Finding of “Hardship” Open?
The terms of s 136(2)(d) require this question to be answered: “If, by reason of establishing exceptional circumstances, the binding child support agreement is susceptible to being set aside, would holding the parties to the agreement create hardship for the applicant or the child?”
There can be no issue here that hardship would be created for the child. If the parties are held to the agreement no case is made by the father that the child would suffer by reason of the father’s need to continue paying the mother in accordance with the agreement’s terms. Indeed, the father’s own Financial Statement makes it clear that he is more than able to do so and there is no suggestion that he would not continue to do so or that there is any other factor that would prevent him from doing so.
The issue before her Honour was, then, would hardship be occasioned to the father if the parties were to be held to the terms of their agreement. The circumstances just described are also, of course, relevant to that question.
Her Honour concluded ultimately that she was satisfied that “unless the agreement is set aside the father will suffer hardship in the sense of being required to make a payment to the mother in circumstances not contemplated by the child support legislation” and (in effect conversely) in not being able to obtain a contribution from the mother to the costs of caring for the child. Her Honour continued, “this is not a financial hardship given his income but it is a hardship nevertheless because it is unjust that the mother should not make a contribution if she is capable of doing so” (Reasons [181] – [182]; emphasis added).
Her Honour took account of the fact that the husband was aged 56, was a qualified professional and had an income of $192,088 per annum. At trial, he had net assets of about $1.16 million and an excess of income over expenditure “even once the payment [the father] is supposed to be making to the mother is taken into account” (at [174]). Although not referred to by her Honour, the husband’s Form 13 Financial Statement reveals that excess to be $551 per week after taking account of a payment of $242 per week under the agreement.[21] Her Honour records at [175] the husband’s submission as to hardship being that “if the agreement was not set aside … it would take him longer to pay off his house”.
[21]Father’s Financial Statement filed 6 December 2012. The agreement provided for the payment of $220 per week to be indexed.
Importantly as it seems to me, her Honour is not correct, in my respectful view, in saying that the payment required of the husband occurs in “circumstances not contemplated by the child support legislation”. Holding the parties to their agreement is precisely the result contemplated by the child support legislation when the parties purchase certainty by entering a binding child support agreement. In that regard, as earlier discussed, the legislation draws a clear distinction between binding child support agreements and limited child support agreements.
Moreover, the child support legislation precisely contemplates that certainty through a binding agreement (freely entered after receipt of independent advice as to its ramifications and advantages and disadvantages) comes with the potential for the occurrence of future circumstances beyond the contemplation of the parties at the time the agreement was executed.
So, too, no legislative provision requires the bargain struck to be “fair” or to provide financial support that is “proper” or “adequate” as the formula provisions of the CSA (or indeed societal mores) might judge it. The fact that future circumstances might bring about “unfairness’ or any such epithet is, again, precisely contemplated by the child support legislation and is a price paid for certainty at the time of the execution of the agreement. The exception to that is when the high bar created by “exceptional circumstances” and “hardship” is met.
I am, with great respect, unable to see how and in what way her Honour examined the actual ramifications for the father in him being held to the agreement so as to arrive at a conclusion that hardship within the meaning of s 136(2)(d) was created.
In April 2012 the father discontinued making payments in accordance with the agreement. He is, then, potentially liable to the mother for the amount owing under the agreement from the date he ceased paying until when the child turned 18 and the father’s liability ceased. He is liable for an amount in the region of $31,200.[22]
[22]An approximate calculation based on 130 weeks using an average of $240 per week.
It might be said by the father that the payment of either such amount is “unfair” or “unjust” or that such a result is “counterintuitive” given his care (and financial support) of the child. Indeed, her Honour said toward the conclusion of her judgment at [202] (when discussing the exercise of her discretion), “I do not accept the mother’s contention that the application of common sense has no place in legal disputes”. Whether that is true or not, the question necessary to be answered is whether holding the father to the agreement constitutes hardship within the meaning of s 136(2)(d) as earlier discussed. I am unable to see how on her Honour’s findings it was open to conclude that it did.
In my view, her Honour’s conclusion that the father would suffer hardship if held to the agreement was not reasonably open and error is demonstrated as a consequence.
Discretion
In light of the conclusion just reached, it is strictly unnecessary to consider an asserted error in the exercise of her Honour’s discretion.
It will be clear from what I have earlier said that her Honour’s failure to consider the dollar values of what was at stake for the father in light of his financial circumstances when compared with each party agreeing to a binding child support agreement with its inherent consequences for the future is a failure to take account of a relevant consideration. It will be clear from what I have earlier said that I also consider her Honour took account of irrelevant considerations.
While her Honour discussed the ramifications of entering a binding child support agreement when examining exceptional circumstances, those same circumstances were also important to the exercise of the discretion in light of the relatively small amount of money owing by the husband in light of his overall financial position. I am unable to conclude that her Honour took those matters into account in exercising her discretion and in my view that discretion miscarried as a consequence.
Conclusion
The appeal should be allowed.
Costs
I agree with Aldridge J that each party should bear their own costs and that no certificate should issue to the mother for the reasons given by his Honour.
Aldridge J
On 19 May 2014, pursuant to s 136(2)(d) of the Child Support (Assessment) Act 1989 (Cth) (“the CSA”), Judge Terry set aside a binding child support agreement entered into between Mr Cheyne (“the father”) and Ms Masters (“the mother”) on 31 July 2008.
Her Honour did so because she was satisfied that exceptional circumstances had arisen in relation to the child in respect of whom the agreement was made (“the child”) and that the father would suffer hardship if the agreement was not set aside. This was because the child, who at the time the agreement was entered into had been living with the mother nine days a fortnight, commenced to live almost solely with the father from September 2012.
The mother now appeals from that decision. The mother’s Amended Notice of Appeal contained 15 grounds extending over 22 pages and containing 104 footnotes. The length and excessive detail of the submissions tended to obscure rather than highlight the points raised by the mother. Nonetheless the main challenges to the primary judge’s reasons are readily identifiable and can be summarised as follows:
· That there was a reasonable apprehension of pre-judgment and bias on the part of the primary judge;
· That the primary judge erred in:
o taking into account legislative changes to s 12 of the CSA (which defines child support terminating events for the purpose of s 142);
o finding that the change in the child’s residence in 2012 constituted an exceptional circumstance within the meaning of s 136(2)(d);
o finding hardship within the meaning of s 136(2)(d); and
o the exercise of her discretion under s 136(2)(d).
For the following reasons, I am satisfied that the third and fourth challenges have been established, that the appeal should be allowed and that the father’s application to set the agreement aside should be dismissed.
The parties commenced cohabitation in 1984 and married in 1995. Together they had four children born between 1989 and 1996.
The parties separated in early 2006.
On 18 February 2008 the parties entered into a binding child support agreement which specified the amount of child support the father was to pay for the two younger children. Although the second eldest child was then aged sixteen and a half, no agreement was reached in respect of him and his child support remained the subject of administrative assessment.
On 28 March 2008 consent parenting orders were made. The orders provided for the youngest child to live with the mother and spend time with the father for five nights a fortnight during school terms and for half of the school holidays.
The continuing administrative assessment for the second eldest child did not work well and on 31 July 2008 the parties signed a fresh binding child support agreement which terminated the previous agreement. The new agreement provided for child support for the three children then still under the age of 18.
In the agreement, the parties specified that the agreement would terminate in respect of each child on the child’s eighteenth birthday.
On 23 April 2012 the youngest child commenced living six nights per week with the father and one night per week with the mother. At the end of September 2012, the mother moved from the Hunter region to Melbourne. Although the mother proposed returning to the Hunter region for regular two week blocks and that the youngest child live with her during those times, that never eventuated. Thus effectively, by the time of the hearing, the youngest child had lived almost entirely with the father from September 2012.
The grounds of appeal
Apprehension of bias and pre-judgment
The mother submits that a number of comments made by the primary judge during the course of the hearing suggested her Honour had pre‑judged the case and that a reasonable person would have apprehended that the primary judge was biased against the mother.
The mother submits that the following quotes of statements made by her Honour during the first instance hearing and taken from the transcript of proceedings establish a reasonable apprehension of bias or pre-judgment on the part of the primary judge:
·“So the critical issue, Ms [Masters], is whether the exceptional circumstance is that there has been a complete change of residence for that child and whether logic supports a situation where Mr [Cheyne] should be continuing to pay you money for the support of a child who isn't living with you. I mean, isn't that the critical issue here?”
·“If he pays you money, Ms [Masters], he's not paying money to help with the support of his son, which is the purpose of the child support legislation, he's effectively paying you money to help support you. And that was never the purpose of the binding child support agreement.”
·“But the whole underlying substratum of this in relation to Mr [Cheyne] paying money to you has gone. If Mr [Cheyne] pays money to you he is not helping to support his son, because his son isn't living with you and you aren't paying anything for the child's support.”
·“The issue is whether the husband should be continuing to pay you child support for a child who doesn't live with you. That is the hardship issue. Not the question of capacity to pay.”
·“I am not going to change my mind. You seem to be missing the entire point, Ms [Masters], which is this; the reason that a binding child support agreement was entered into for Mr [Cheyne] to pay you money was because you had the primary care of a child. You no longer have any care of that child except, perhaps, for two per cent of a year. The basis for Mr [Cheyne] to pay any money to you has been removed. Even if Mr [Cheyne] was earning a million dollars a week, and had a billion dollars in assets, what would be the rationale for him to pay money to you when you no longer have the care of the child? That, to me, is the point of the case, Ms [Masters].”
·“I understand that submission. And the issue for me is going to be whether hardship is just restricted to financial hardship, or whether it’s open to me to find that it would cause someone to – hardship to have to pay out a regular weekly sum, when the whole substratum – the whole reason for that to occur has disappeared. That's what I'm going to have to grapple with, Mrs [Masters].”
·“I mean, basically, the substratum of this is we’ve got an underlying situation where [Cheyne] is being required to pay a very large amount of child support in circumstances where the child in question is actually living with him and spending no time with the mother. And, I mean, it’s that – whether we can get around – whether we can do anything about that with all these documents and applications, I don’t know. But, I mean, it’s important to keep in mind that that’s what’s underlying all of this.”
·“Ms [Masters], please don’t go off at a tangent. I need to concentrate on the problem that I have got to solve, which revolves around the fact that [the child] is living with Mr [Cheyne] but he’s still being required to pay in excess of $200 per week child support. That’s the problem I have to solve.”
The principles to be applied are well known. In Ebner v Official Trustee in Bankruptcy (2000) 205 CLR 337 at 344 – 345, Gleeson CJ, McHugh, Gummow and Hayne JJ held:
6. Where, in the absence of any suggestion of actual bias, a question arises as to the independence or impartiality of a judge (or other judicial officer or juror), as here, the governing principle is that, subject to qualifications relating to waiver (which is not presently relevant) or necessity (which may be relevant to the second appeal), a judge is disqualified if a fair-minded lay observer might reasonably apprehend that the judge might not bring an impartial mind to the resolution of the question the judge is required to decide. That principle gives effect to the requirement that justice should both be done and be seen to be done, a requirement which reflects the fundamental importance of the principle that the tribunal be independent and impartial. It is convenient to refer to it as the apprehension of bias principle.
7. The apprehension of bias principle may be thought to find its justification in the importance of the basic principle, that the tribunal be independent and impartial. So important is the principle that even the appearance of departure from it is prohibited lest the integrity of the judicial system be undermined. There are, however, some other aspects of the apprehension of bias principle which should be recognised. Deciding whether a judicial officer (or juror) might not bring an impartial mind to the resolution of a question that has not been determined requires no prediction about how the judge or juror will in fact approach the matter. The question is one of possibility (real and not remote), not probability. Similarly, if the matter has already been decided, the test is one which requires no conclusion about what factors actually influenced the outcome. No attempt need be made to inquire into the actual thought processes of the judge or juror.
8. The apprehension of bias principle admits of the possibility of human frailty. Its application is as diverse as human frailty. Its application requires two steps. First, it requires the identification of what it is said might lead a judge (or juror) to decide a case other than on its legal and factual merits. The second step is no less important. There must be an articulation of the logical connection between the matter and the feared deviation from the course of deciding the case on its merits. The bare assertion that a judge (or juror) has an “interest” in litigation, or an interest in a party to it, will be of no assistance until the nature of the interest, and the asserted connection with the possibility of departure from impartial decision making, is articulated. Only then can the reasonableness of the asserted apprehension of bias be assessed.
In Galea v Galea (1990) 19 NSWLR 263, Kirby ACJ said at 281:
It is important to draw a distinction between intervention which suggests that an opinion has been finally reached which could not be altered by further evidence or argument and one which is provisional, put forward to test the evidence and to invite further persuasion.
I consider, in the light of the above quotes, that the primary judge was exploring the consequences of the mother’s argument. It must be acknowledged that even if the mother’s argument is correct as a matter of law, it is on its face counterintuitive, the effect of the mother’s argument being that a person can receive child support despite having no care or responsibility for the child for whose benefit it is paid. That, of course, is a risk that parties to such an agreement take.
The consequences go beyond that, however. The parties have a child who has not yet turned 18. It need hardly be said that the conflict between the parents over the mother’s stance in relation to child support is hardly likely to have a beneficial effect on the relationship between the mother and the youngest child. I consider that it was quite appropriate for the primary judge to explore that issue directly with the mother.
Taking these matters into account and reading the transcript as whole, I am not satisfied that an independent bystander would consider that the primary judge had made up her mind and would not genuinely consider the mother’s arguments. Whilst her Honour was forcefully testing the mother’s position, the issue is not whether the primary judge had a blank mind but whether she remained “open to persuasion”: Minister for Immigration and Multicultural Affairs v Jia Legeng (2001) 205 CLR 507 at [71].
A second difficulty for the mother is that she did not ask the primary judge to disqualify herself from the proceedings. By not raising this issue at the time and by waiting until after judgment has been delivered, the mother has waived the right to complain about the primary judge’s conduct: Vakauta v Kelly (1989) 167 CLR 568 at 577. Whilst the position may be less stringent in relation to litigants appearing for themselves, it remains a relevant consideration.
This challenge does not succeed.
That the primary judge erred in taking into account legislative changes to s 12 of the CSA
The mother submitted that the primary judge erred in taking into consideration the definition of “terminating events” contained within s 12 and in taking into account the legislative changes that had been made to s 12 since the agreement was entered into.
Her Honour found that s 12 of the CSA applied to binding child support agreements (at [74]). For the purposes of this discussion, it is sufficient to note that s 12 defines the “happening of child support terminating events”. When such an event occurs the Registrar, upon becoming aware of it, must take account of such event or change of circumstances by amending the assessment (s 74). Similarly, where an order made under the CSA is in force in relation to a child, that order ceases to have effect upon the happening of such an event.
In her Honour’s view, s 12 was relevant to binding child support agreements:
68.The mother submitted that s.12 had no application in this case because the agreement contained its own provision about the date of termination i.e. [the date of the child’s eighteenth birthday]. However I accept the submission of Counsel for the Child Support Registrar that s.12 applies. Any other interpretation would lead to an untenable situation such as that if a child died or commenced living away from home in a de facto relationship at the age of 17 the agreement would continue in force until the termination date in the agreement.
It is clear that the primary judge was of the view that s 12 applied because of what she considered to be the effect of s 95 and s 142 (at [60]-[66]).
Section 95(2) provides:
(2) If the agreement includes:
(a)provisions under which a party is to pay child support for a child to another party in the form of periodic amounts paid to the other party; or
(b)provisions under which the rate at which a party is already liable to pay child support for a child to another party in the form of periodic amounts paid to the other party is varied; or
(c)provisions agreeing between parties any other matter that may be included in an order made by a court under Division 4 of Part 7 (Orders for departure from administrative assessment in special circumstances);
the provisions have effect, for the purposes of Part 5, as if they were an order made by consent by a court under Division 4 of Part 7.
Section 142(1) provides:
(1)Where an order made under this Act is in force in relation to a child and:
(a)a child support terminating event happens in relation to the child…
…
the order ceases to be in force.
As can be seen, s 142 refers to child support terminating events, which are defined by s 12 of the CSA. Her Honour found that child support terminating events, as set out in s 12, applied to the agreement. As I will shortly explain, I consider that her Honour was wrong to make that finding.
The primary judge continued to expand on her view of the relevance of s 12:
69.As s.12 stands today it makes no difference whether it applies or not, because there is no terminating event in s.12 applicable to the agreement except for the termination date specified in the agreement which has not yet arrived. However s.12 was amended effective 6 January 2009 and on 31 July 2008 it contained s.12 (2) (b) which provided that one parent ceasing to be an eligible carer was a child support terminating event.
70.“Eligible carer” is defined in s. 7B of the Act as a person who has at least shared care of the child and s.5(3) of the Act provides that a person is taken to have shared care if they have at least 35% and not more than 65% care of a child.
71.The mother’s care of [the child] dropped to about 16% on 23 April 2012 and if s.12 had not been amended the reduction in [the child]’s time with the mother on 23 April 2012 would have terminated the agreement.
The primary judge then took this consideration into account in determining whether or not there was an exceptional circumstance within the meaning of s 136, saying:
172.The additional factor of the change of the legislation in my view puts beyond doubt that circumstances of an exceptional nature have arisen in this case since the agreement was made.
In order to understand this aspect of the appeal it is necessary to look at the provisions of Part 6 of the CSA, which enable parties to enter into binding child support agreements and limited child support agreements.
A binding child support agreement is only binding if it complies with the detailed requirements of s 80C(2). It cannot be varied (s 80CA).
Section 80D(1) sets out the limited ways in which such an agreement can be terminated. It states:
(1)A binding child support agreement (the previous agreement) may be terminated only by:
(a) a provision being included in a new binding child support agreement made by the parties to the previous agreement to the effect that the previous agreement is terminated; or
(b)the parties to the previous agreement making a written agreement (a termination agreement):
(i)that is binding on the parties in accordance with subsection (2); and
(ii) to the effect that the agreement is terminated; or
(c)a court order setting aside the previous agreement under section 136.
(Emphasis added)
The balance of the section sets out the formal requirements for the validity of a termination agreement (similar to those imposed by s 80C(2)) and identifies the time when the previous agreement is taken to be terminated.
Thus the circumstances in which a binding child support agreement may be terminated are limited indeed. This is consistent with Parliament’s intention in introducing s 136(2)(d). The Explanatory Memorandum for the Families, Community Services and Indigenous Affairs Legislation Amendment (Child Support Reform Consolidation and Other Measures) Bill 2007, which introduced the section, states that “[i]t is not intended that binding agreements should be set aside lightly” (p.9).
I consider that the express and detailed terms of these sections constitute a complete code dealing with the validity and termination of these agreements and that great care should be taken before importing considerations derived from other sections of the Act into cases dealing with binding child support agreements.
Parties have the option of entering into limited child support agreements, which have less stringent requirements for entry (s 80E) and are more readily terminated (s 80G). Importantly, two of the ways in which these agreements may be terminated under s 80G(1) are:
…
(d) if the notional assessment of the amount of child support that would have been payable by one party to the previous agreement to another party is varied by more than 15% from the previous notional assessment in circumstances not contemplated by the previous agreement—a party to the previous agreement giving the Registrar written notice of the termination of the agreement within 60 days of that party receiving notice of the variation; or
(e) if the previous agreement was made 3 or more years earlier—a party to the previous agreement giving the Registrar written notice of the termination of the previous agreement.
Thus, unlike a binding child support agreement, a limited child support agreement may be terminated because of a significant change in the underlying circumstances or after three years. Therefore a person entering into a binding child support agreement is at a considerable risk of continuing to be bound by the agreement notwithstanding that there has been a significant, but not exceptional, change in circumstances.
The parties may, of course, wish to take that risk. Such agreements may be made in the context of other financial arrangements between the parties and may be an integral part of an overall settlement: see, for example, Bass & Bass and Anor [2016] FamCAFC 64 at [20].
Further, the words of Murphy J in Hoult v Hoult (2012) 48 Fam LR 507 at 513 as to binding financial agreements under the Family Law Act 1975 (Cth) (“the FLA”) remain apt in this respect. His Honour said:
31.By way of (stark) contrast, the regime contemplated by Part VIIIA sees parties having the freedom to enter binding agreements without reference to what might be “just and equitable” within the meaning of s 79 of the Act. That is, binding agreements might be informed by the parties idiosyncratic notions or perceptions of what is, or is not, just and equitable or otherwise appropriate for them. Vitiating elements aside, the parties are perfectly free to make “a bad bargain” (in s 79 terms). Importantly, any such agreement can be “binding” within the meaning of s 90G and, by reason of so being, can exclude Part VIII of the Act without reference to a court and without reference to what a court might consider is a “just and equitable” settlement within the meaning of s 79.
On appeal, Strickland and Ainslie-Wallace JJ agreed with those comments: Hoult & Hoult (2013) FLC 93-546 at 87,296-87,297.
Once a limited child support agreement has been entered into, it must be registered (s 80E(1)(d); cf. s 80C). Section 91 makes it clear that in undertaking the act of registration, “the Registrar may act on the basis of the application made to the Registrar for acceptance of the agreement, the documents accompanying the application and the agreement itself, and is not required to conduct any inquiries or investigations into the matter”.
If the Registrar is satisfied that an application for registration has been properly made, the Registrar must accept the agreement. It is quite clear from s 94 and s 95 of the Act that the Registrar is obliged to give effect to the agreement and that the agreement governs the obligations of the parties as to child support. The Registrar therefore has no role in determining the appropriateness of any agreement. It seems clear that the purpose of the Registrar’s involvement is to ensure that administrative assessment does not occur whilst agreements are in place. A limited child support agreement cannot be accepted by the Registrar unless an administrative assessment is in place at the time it is entered into (s 92(3)).
There is no requirement that a binding child support agreement be registered. There is nothing, however, that prevents its registration. Thus, even if s 74 (the application of child support terminating events to administrative assessments) did apply to assessments made by the Registrar after the registration of a limited child support agreement, that is not necessarily the case for a binding child support agreement. This is because there is no obligation to lodge such an agreement with the Registrar. It would be an odd outcome if the s 12 child support terminating events applied to those binding child support agreements which had been registered but not to those that were not.
However, in both cases the Registrar is obliged to make an assessment in accordance with the registered agreement. Thus s 74 cannot apply because the Registrar could not make the consequential amendment to the assessment envisaged by the agreement. This is a further indication that the child support terminating events do not apply to binding child support agreements.
As has been seen, the primary judge relied upon s 95 and s 142 to find that the child support terminating events as defined by s 12 from time to time apply to binding child support agreements. I do not agree that this is so.
Only those provisions of the agreements that fit within s 95(2) may be enforced as if they were orders of a court. One of the evident purposes of s 95(2) is to facilitate the recovery of unpaid child support from a party who has agreed to pay it under a child support agreement. In the absence of this provision the party entitled to the payment of the child support would be obliged to sue for its recovery in a civil court relying on the contractual obligations of the agreement itself. This provision permits the Family Court of Australia or the Federal Circuit Court of Australia to enforce the identified provisions of a child support agreement as if they were child support departure orders made by that Court.
Section 142 provides, inter alia, that when an order under the Act is in force, that order ceases to be in force when a child support terminating event happens in relation to a child. Such events are defined by s 12.
Properly understood, s 95(2) does not pick up s 142. This is because the obligation to pay child support remains governed by the child support agreement. Whilst some of the obligations of the agreements may be enforced as if they were orders of the court, they never become orders. The obligation to pay continues to arise from the agreement.
Further, it is to be observed that if, by virtue of s 95(2) and s 142, the child support terminating events as defined by s 12 applied to child support agreements, both s 80D and s 80G would be entirely otiose and rendered quite pointless. Those provisions provide a code as to the termination of child support agreements, and those agreements can be terminated only by their application. I do not consider that it is a reasonable construction of the Act that a binding child support agreement could remain on foot and binding but that the provisions within that agreement (which must all deal with child support) could be rendered nugatory by the application of the s 12 child support terminating events. Again, it would make binding child support agreements pointless because they would be, in effect, reduced to mere administrative assessments.
Section 95(2) brings into play only the relevant enforcement provisions and not provisions that deal with the termination of the obligation to pay itself.
Finally, s 95 provides that the relevant provisions have effect “for the purposes of Part 5”. Section 142 is contained within Part 7.
Thus, in summary, I consider that the only way a binding child support agreement may be terminated is by taking one of the steps provided for in s 80D. It follows therefore that the child support terminating events as defined by s 12 are not relevant in any way to the termination of a binding child support agreement and that I consider the primary judge was wrong in so finding.
Therefore to the extent that her Honour did take the legislative changes to s 12 into account, I consider that she was in error to do so.
Her Honour correctly found, however, that s 12 did not directly apply because there were currently no child support terminating events in s 12 that applied to the present agreement.
Instead, her Honour took the legislative change to s 12 into account as an “additional factor” that put it “beyond doubt” that there were circumstances of an exceptional nature (at [172]).
That finding must be seen in the light of her Honour’s finding at [171] that the radical change in the child’s care arrangements was “an exceptional circumstance in itself”.
I am not satisfied that the legislative changes to s 12 carried any significant let alone decisive weight with her Honour. Any error that was made was not material to the overall determination of the matter.
This challenge has not been established.
That the primary judge erred in finding that the change in the child’s residence in 2012 constituted an exceptional circumstance within the meaning of s 136(2)(d)
The issue here is whether the change in the youngest child’s care arrangements in 2012 constituted an exceptional circumstance for the purpose of s 136(2).
Section 136 provides:
Power of courts to set aside child support agreements or termination agreements
(1)A party to either of the following agreements may apply to a court having jurisdiction under this Act for the court to set aside the agreement:
(a) a child support agreement that has been accepted by the Registrar under section 92 or 98U;
…
(2) If a party has applied under subsection (1), the court may set aside the agreement in accordance with the application if the court is satisfied:
…
(d)in the case of a binding child support agreement--that because of exceptional circumstances, relating to a party to the agreement or a child in respect of whom the agreement is made, that have arisen since the agreement was made, the applicant or the child will suffer hardship if the agreement is not set aside.
The primary judge found:
153.If the agreement is not set aside then even allowing for a small financial contribution by the mother if [the child] spends time with her in the future the father will be providing almost 100% of the financial support for [the child] and almost 100% of the care, and yet instead of the mother paying child support to the father as the objects and principals of the Assessment Act together with her income suggest would ordinarily occur the father will be required to pay the mother $236.63 per week for 2.8 years, equating to $30,000.00, in circumstances where she had made only a trifling outlay to the costs of supporting [the child].
Her Honour said that binding child support agreements should not be readily set aside because of a change in circumstances, but that in the matter before her the changes were exceptional. She said:
168.In the context of binding child support agreements however there is an out if exceptional circumstances can be established, and in this case the father decided to take the risk of locking himself into a binding child support agreement against the background that the agreement would be terminated if the mother’s care of [the child] reduced below 35%. He could not have anticipated a change of legislation which meant that the mother’s care could reduce to zero and his increase to 100% and yet he would remain locked into the agreement.
169.Not only that the pro-forma agreement which the parties signed included the following at the commencement of the agreement:
The person who will receive the child support payments must have at least shared care of the children. This means they must care for the children at least 35% of the time
170.A lay person reading something like this on a form prepared by the CSA could be forgiven for believing, no matter how much legal advice they received, that this plank would not be pulled out from under them after they signed the agreement and that a situation could not arise where they would be obliged to pay child support to the other party when there had been a major change in care arrangements.
171.I am satisfied that the radical change in [the child]’s care arrangements instigated by the mother on 23 April 2012 when considered in the context of the purposes of the child support legislation was an exceptional circumstance in itself, and there has been no change in the care arrangements since then leading to the child spending more time with the mother rather the reverse has occurred and his time with his mother has steeply declined.
It is to be recalled that a binding child support agreement is an agreement of a very particular kind. The requirements for entry into these agreements are stringent and include that the parties must obtain advice from a legal practitioner as to the advantages and disadvantages of entering into the agreement (s 80C(2)(c) and (d)). These agreements cannot be varied and may be terminated only in very limited ways.
It is obvious therefore that each party to such an agreement takes a risk that the certainty they gain by entering into such an agreement is balanced against the difficulties in changing it. Clearly a change in the living arrangements of a child the subject of the agreement is foreseeable, especially if the agreement is to be in place for some time.
Parties are not obliged to enter into a binding child support agreement. Parties could choose, for example, to enter into a limited child support agreement, which is much more easily terminated. Indeed, such an agreement may be terminated by a change in the care arrangements that would, if it were an administrative assessment, alter that assessment by 15 per cent. Limited child support agreements may also be terminated at any time after three years.
There would be little point to binding child support agreements if they could be terminated so readily.
Secondly, it is open to parties to include in their agreement a term which provides for the liability to pay child support to end on a specified day (s 84(1)(g)). Multiple provisions may be included (s 84(2)). I do not see why the parties could not specify the termination date as being the first to occur of a number of specified days. This could include, for example, a termination date which occurs a specified number of days after there is a defined change in the care arrangements of the child.
Here, the parties chose the child’s eighteenth birthday to be the termination date. They were not limited to that option.
Thirdly, it is readily foreseeable that children’s living arrangements will change over time. The longer the period covered by an agreement, the prospect of a significant change becomes more likely. This is particularly so of children as they move into their teenage and late teenage years.
In Simpson and Hamlin (1984) FLC 91-576 (“Simpson”), which was a decision dealing with s 79A(1)(d) of the FLA, the primary judge found that a complete change in the residence of the children within two weeks of a final property settlement amounted to circumstances of an exceptional nature. At 79,657 – 79,658 the Full Court said:
So far as the first point is concerned, his Honour quite rightly, in our view, concluded that:
“The occurrence of a change in the responsibility for the daily care and control of children of a marriage, after the making of a property order under sec. 79 of the Family Law Act could not be held of itself to be an unusual circumstance. The ordinary vicissitudes of life coupled with the difficulties that parties to a marriage often experience in the task of restructuring their lives following the dissolution of their marriage and the division of their assets, and their obligations to the support of each other and the support, care and control of their children, frequently creates situations in which it is desirable having regard to the children’s welfare that such a change occurs.”
The question therefore was whether the change which occurred in this case was such as to “take it out of and beyond the ordinary circumstances in which such change might be reasonably expected to occur”. He saw that feature in the present case in “the fact that the change occurred unexpectedly and so quickly after the making of the property order”. The fact that the change was originally intended by the husband to be temporary, he considered irrelevant in view of the fact that it afterwards became accepted by the parties as a permanent arrangement. However, his Honour also accepted that C would be likely to move back to her father’s household in January 1985.
His Honour in our view stated correctly the law applicable on this point. What amounts to “exceptional circumstances” is very much a question of fact and degree. With findings on such matters an appellate tribunal is reluctant to interfere. Whilst we might have had some hesitation ourselves as to whether or not in the light of the history of these parties and their admitted future intention, the change of custodial arrangements was so exceptional as to take it out of the normal vicissitudes of life, it was in our view a finding which his Honour was entitled to make on the evidence and which we cannot disturb.
In the case before us, the primary judge was satisfied that “the radical change in [the child’s] care arrangements” was “an exceptional circumstance in itself” (at [171]). This was because the child moved from spending five days per fortnight with the father to almost 14 days per fortnight. Clearly, that is a significant change; the question, however, is whether such a change is exceptional. Would a change of eight days have been exceptional, or seven, and so on? The difficulty in drawing the line between significant and exceptional is obvious.
What was persuasive in Simpson was the sudden and unexpected change which occurred immediately after the orders were made. Consistent with the approach in that case and for the reasons I have just set out, I am of the view that in the circumstances of this case the change in residence was sufficiently foreseeable so as to render it not exceptional. The place of s 136(2)(d) in the scheme of binding child support agreements and limited child support agreements must be borne in mind. The former have stringent entry requirements and there are limited ways of terminating them. Thus, for the purpose of s 136(2)(d), “exceptional” must be given its full meaning.
The primary judge was satisfied that the change in care arrangements “was an exceptional circumstance in itself” (at [171]). Her Honour also relied on the legislative change to s 12 as “an additional factor” that put “beyond doubt that circumstances of an exceptional nature have arisen”. As I have explained, neither of these findings were open to her Honour. For these reasons, whilst I fully accept that a finding of exceptional circumstances is very much one for the primary judge, I am of the opinion that such a finding was not open on the evidence before the court and that her Honour accordingly erred in making it.
There is one further point to be made. Section 136(2)(d) requires that the hardship that will arise if the agreement is not set aside must flow from the changed circumstances.
The primary judge found:
182.I am satisfied that unless the agreement is set aside the father will suffer hardship in the sense of being required to make a payment to the mother in circumstances not contemplated by the child support legislation.
183.He will also suffer hardship in not being able to obtain a contribution from the mother to the costs of caring for [the child]. This is not a financial hardship given his income but it is a hardship nevertheless because it is unjust that the mother should not make a contribution if she is capable of doing so.
In these passages the hardship described by her Honour is merely the consequence of the agreement and flows from its terms. It does not arise from the changed circumstances. As such, it does not fall within the terms of s 136(2)(d). It is quite clear from s 136 that the relevant hardship must flow from the exceptional circumstances themselves because of the use of the words “because of”.
There is no reason at all why a binding child support agreement should mirror the administrative child support assessments from time to time. What would be the point of such an agreement if that were so? On the contrary, the point of such agreements is to give the parties flexibility to agree on fixed and certain arrangements, often as part of a larger overall agreement. It is difficult therefore to assert that hardship arises merely because had there been no agreement, an administrative assessment would have resulted in different payments.
For these reasons this challenge succeeds and I am of the opinion that the appeal should be allowed. Order 2 (which was the Order setting aside the agreement) should be set aside and, in lieu, the father’s application seeking that order should be dismissed.
That the primary judge erred in finding hardship within the meaning of s 136(2)(d)
The mother submitted that the primary judge erred in finding hardship.
Her Honour noted that the father had an income of $192,088 per annum, net assets of $1.16 million and had a surplus of income over expenditure even when the child support was taken into account. The father’s submission was recorded as being that he would suffer hardship because it would take him longer to pay off his house.
I have quoted the primary judge’s findings as to hardship and indicated that the hardship identified by the primary judge flows not from the changed circumstances but from the agreement itself.
In any event, the evidence falls well short of establishing hardship. Hardship is “akin to such concepts as hardness, severity, privation, that which is hard to bear or a substantial detriment” and means “something more burdensome than ‘any appreciable detriment’”: Whitford and Whitford (1979) FLC 90-612 at 78,144-78,145.
It follows therefore that the father had not established hardship and this challenge also succeeds.
That the primary judge erred in the exercise of her discretion under s 136(2)(d)
It follows that as I consider neither exceptional circumstances nor hardship could be established on the evidence, there was no basis for the exercise of the discretion to set aside the agreement.
The binding child support agreement therefore should not have been set aside.
The father submitted that it was in fact a condition of the binding child support agreement that the agreement would only apply while the mother retained 35 per cent care of the child. This, he submitted, flows from the child support agreement itself. It is appropriate to deal with that submission.
The parties used a pro-forma child support agreement provided by the Child Support Agency, which covers 11 printed pages. The agreement is preceded by an “Application for Acceptance” which appears on the second and third pages of the document. On the second page, next to that application, are comments including the following paragraph:
The person who will receive the child support payments (the receiving parent or non-parent carer) must have at least shared care of the child (REM). This means they must care for the child (REM) for at least 35 per cent of the time.
This at best is confusing and at worst misleading. There is no such restriction on who may enter into a child support agreement and the paragraph was a reflection of who could then seek administrative assessment of child support.
The Application for Acceptance is not, however, part of the agreement itself.
Further, it is necessary to recall that the binding child support agreement has affixed to it a legal certificate signed by legal practitioners. That statement provides that each of the parties had received independent legal advice as to the effect that the binding child support agreement would have on the rights of the party and the advantages and disadvantages, at the time the advice was provided, to the party in making the agreement.
For these reasons the father’s submission cannot be accepted.
Other challenges
The mother raised a number of other challenges to the primary judge’s order.
Principle amongst these was the mother’s contention that exceptional circumstances had not arisen because, notwithstanding the change in the care arrangements, she was doing all she could to maintain the child spending significant time with her but was frustrated by the father’s conduct. In the light of the disposition of the appeal this is no longer a relevant issue.
The mother raised a number of other but minor matters. In the light of the fact that the appeal is being allowed and because of their nature there is no utility in pursuing them.
Costs
Each of the parties appeared for themselves. The mother, who was successful, has, of course, incurred the costs of preparing the appeal books and obtaining transcripts. She indicated that her preference was for there to be no order as to costs and for the parties to be granted a certificate under the Federal Proceedings (Costs) Act 1981 (Cth).
The appropriate order in the circumstances is that there be no order for costs. Whilst the mother has incurred some disbursements, the effect of the appeal is that she will continue to receive child support payments without incurring any costs in relation to the support of the child. Any financial hardship associated with preparing the appeal is ameliorated by that windfall. Accordingly, I would not grant a certificate to her.
Austin J
There is no need to repeat the background facts and circumstances. I agree the appeal should succeed, but I need to separately address the issues upon which my reasons for that result depart from those expressed by Aldridge J.
Although the wife squarely addressed the issue in her summary of argument, I consider it unnecessary for the disposition of this appeal to express a concluded view about whether a “child support terminating event” prescribed by s 12 of the Child Support (Assessment) Act 1989 (Cth) (“the Act”) operates independently of the grounds set out within s 80D of the Act to terminate the liability for payment of child support under a binding child support agreement. That is because the trial judge found in this case (at [69]-[74]) that none of the child support terminating events specified by s 12 of the Act, in the modified form that section stood and applied to the parties’ child support agreement at the relevant time, had occurred and so the section did not bear upon the decree under appeal (Order 2). The High Court has remarked upon the wisdom of avoiding unnecessary dicta and leaving the law to develop step by step as cases calling for a decision arise (Ascot Investments Pty Ltd v Harper (1981) 148 CLR 337 at 355). My adherence to that advice in this case is fortified because, while the reach of s 12 of the Act was the subject of debate at trial, the Child Support Registrar, who was a party and expressed a view to the trial judge on the issue (at [68]), was not a party to the appeal and so we were deprived of submissions on the issue from a keenly interested party.
Relevantly for present purposes, the proceedings were determined by an order which set aside the parties’ binding child support agreement because the trial judge was satisfied the husband had demonstrated, pursuant to ss 80D(1)(c) and 136(2)(d) of the Act, both the existence of “exceptional circumstances” and “hardship” to justify that result.
Despite my unwillingness to express a concluded view about the interplay between ss 12 and 80D of the Act with respect to the termination of child support liability under binding child support agreements, the wife also squarely raised in her summary of argument a quite separate question which does fall to be determined in this appeal: whether the amendment of s 12 of the Act after the parties struck their binding child support agreement could be taken into account by the trial judge as a factor in the discretionary determination as to whether the husband established the existence of “exceptional circumstances” warranting the agreement being set aside pursuant to s 136(2)(d) of the Act. The husband’s belief about the manner of operation of the legislation is a different question from the actuality of its operation.
At the time the parties struck their child support agreement in 2008, s 12(2)(b) of the Act provided that if the wife ceased to be an “eligible carer” of the child (which status was then defined under of ss 5(1), 5(3), and 7B of the Act to mean having between 35 and 65 per cent of the child’s care) such an occurrence would constitute a “child support terminating event”. The wife did, in fact, later cease to be an “eligible carer” of the child, but when that occurred from 2012 onwards, the Act had been amended. Section 12(2)(b) was repealed with effect from January 2009 and that eventuality was no longer defined as a “child support terminating event”.
The trial judge therefore posed herself the question of whether the change in legislation could be taken into account as a consideration that might influence the determination about the existence of “exceptional circumstances” (at [161]), but that question was posed in the “context” of the husband’s decision to “take the risk of locking himself into” the agreement based on his understanding that his liability to pay child support under the agreement would end if the wife ceased to be an eligible carer (at [168]-[170]), which understanding the trial judge found was “reinforced” by the information printed on the pro forma document published by the Child Support Agency used by the parties (at [104], [128]-[130]). Her Honour found she could take that factor into account and did so, though it was not a decisive consideration. Her Honour found the amendment of the Act after the parties’ agreement was struck was a “relevant” consideration which could be taken into account, but it was only an “additional factor” that put the existence of exceptional circumstances “beyond doubt”. By the time the trial judge reached that conclusion, the existence of exceptional circumstances had already been determined on an accumulation of other circumstances.
It was well open to the trial judge to take into account the husband’s mistaken belief that an event of the type originally prescribed by s 12(2)(b) of the Act would end his child support liability under the agreement, when in fact it did not, as a material factor in the determination of whether the husband had established the existence of exceptional circumstances under s 136(2)(d) of the Act. It was not an extraneous or irrelevant consideration so as to attract appellate intervention (House v The King (1936) 55 CLR 499 at 504-505). Conversely, even if it was an irrelevant consideration, the trial judge’s reasons revealed it was not integral to the determination and, since it did not “really affect” the decision, it should escape appellate interference (Lovell v Lovell (1950) 81 CLR 513 at 519).
The trial judge was satisfied by several uncontroversial facts that “exceptional circumstances” were established. When the parties executed the binding child support agreement in July 2008, the child was living with the mother for nine nights each fortnight, but that arrangement changed significantly in April 2012 when the child moved to live with the father and, by January 2013, the child was rarely spending any time at all in the mother’s care. That change in the child’s living arrangements was precipitated unilaterally and suddenly by the mother and, in particular, by her decision to move inter-state. The father’s mistaken belief that the child must continue to spend at least 35 per cent of his time in the mother’s care as a pre-condition to the continuing validity of the agreement was a supplementary consideration.
As Aldridge J points out, parties who enter into binding child support agreements must balance considerations of certainty against the risk of changed circumstances and it plainly is foreseeable that the living arrangements of a child who is the subject of such an agreement may change to some extent over time, particularly when the prospective term of the agreement is measured in years. That is why another trial judge may have concluded on the same evidence that “exceptional circumstances” did not exist. But that is not the test of appellate intervention. In this instance, the trial judge found “exceptional circumstances” did exist after quite properly acknowledging:
75. …the 2006 amendments which created binding child support agreements made it deliberately difficult for a party to escape from such an agreement because of a change of circumstances.
…
143.I accept that a change in the care arrangements for a child after an agreement is signed is foreseeable, but that alone does not mean that such a change can never amount to exceptional circumstances.
…
166.…it is entirely reasonable and just that it should be difficult for one party to get out of the agreement because of a change of circumstances.
There is a strong presumption that the decision under appeal is correct and should be affirmed unless the court of appeal is satisfied it is clearly wrong (Norbis v Norbis (1986) 161 CLR 513 at 539-540; Australian Coal and Shale Employees’ Federation v The Commonwealth (1956) 94 CLR 621 at 627). The trial judge’s finding in respect of “exceptional circumstances” was not, of course, the final decision, but it directly influenced the ultimate decision under appeal. Findings about the existence of exceptional circumstances are recognised to be questions of fact and degree in each case, the first-instance findings about which should only be reluctantly disturbed on appeal (see Balzano & Balzano (2010) FLC 98-048 at [38]; Christian & Donald [2008] FamCAFC 44 at [39], [42], [43]; Simpson and Hamlin at 79,658).
In aggregation, the facts relied upon by the trial judge were rationally capable of proving that the changes, at least in so far as they were apprehended by the father, were “out of and beyond the ordinary circumstances in which such change might be reasonably expected to occur”, which is the essence of the test for “exceptional circumstances” (see Balzano & Balzano at [38]-[41]; Christian & Donald at [34]-[45]; Simpson and Hamlin at 79,657). The changed circumstances in this instance were, from the father’s perspective, of relatively profound proportions, wholly unexpected, and not reasonably foreseen. It was therefore open for the trial judge to find “exceptional circumstances” established and not an appealable error for her Honour to do so, since the finding was not clearly wrong. I would reject the appellant’s ground of appeal on that point.
Even though it was open for the trial judge to find “exceptional circumstances” demonstrated, so as to satisfy the first element of s 136(2)(d) of the Act, for the reasons given by Aldridge J, it was an error to go on and find the second element of “hardship” established. Accordingly, I agree the appeal should succeed and I agree with the orders proposed by Aldridge J to dispose of the appeal.
I certify that the preceding one hundred and ninety two (192) paragraphs are a true copy of the reasons for judgment of the Honourable Full Court (Murphy, Aldridge & Austin JJ) delivered on 2 December 2016.
Associate:
Date: 2 December 2016
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