McKean & Page & T & Strathie & Deputy Child Support Registrar
[1999] FamCA 577
•26 May 1999
[1999] FamCA 577
EDITED VERSION (CHILDREN AND COURT STAFF ANONYMOUS)
FAMILY LAW ACT 1975
IN THE FULL COURT
OF THE FAMILY COURT OF AUSTRALIA Appeal No ALE14 of 1997
AT SYDNEY Appeal No EA64 of 1997
File No SY 2180 of 1998
BETWEEN:
DAVID ANDREW MCKEAN
Appellant Father
- and -
SANDRA ANITA PAGE
Respondent Mother
- and -
M T
(an infant by her next friend SANDRA ANITA PAGE)
Respondent
- and -
LYNNE MURIEL STRATHIE
Respondent
- and -
DEPUTY CHILD SUPPORT REGISTRAR
Respondent
REASONS FOR JUDGMENT OF THE FULL COURT
CORAM: ELLIS ACJ, KAY and MUSHIN JJ
DATE OF HEARING: 6 May 1999
DATE OF JUDGMENT: 26 May 1999
APPEARANCES: The Appellant Father appeared in person (GPO Box 2202, Sydney, NSW 2001).
Mr Robertson of Counsel, instructed by Walsh & Blair, Solicitors, 221-223 Tarcutta Street, Wagga Wagga, NSW 2650 appeared on behalf of the Respondent Mother and Ms Sandra Anita Page as next friend of M T.
No appearance on behalf of Ms Strathie (6/29 Park Street, Westmead, NSW 2145)
Mr McCulloch, Solicitor, Australian Government Solicitor, 133 Castlereagh Street, Sydney, NSW 2000, appeared on behalf of the Deputy Child Support Registrar.
McKEAN
and
PAGE,
MT (BY NEXT FRIEND PAGE),
STRATHIE &
THE DEPUTY CHILD SUPPORT REGISTRAR
ALE14 of 1997 and EA64 of 1997
Coram: Ellis ACJ, Kay and Mushin JJ
Date of appeal: 6 May 1999
Date of judgment: 26 May 1999
CROSS-VESTING – Damages – Assault – Appropriateness of award of aggravated damages where adult in locus parentis assaulted child
CROSS-VESTING – Property – Contributions – Defacto Relationships Act 1984 (NSW) – Extent of matters to be considered – Evans v Marmont (1997) 42 NSW LR 70
PRACTICE AND PROCEDURE – Inappropriateness of informal and ex parte communication with trial Judge's associate
This was the first of two appeals brought by Mr McKean against orders of Faulks J. The appellant (a former solicitor) appeared in person.
Mr McKean cohabited with Lynne Strathie from 1988 to 1989. They had a child C for whom he had a child support liability.
Mr McKean cohabited with Sandra Page from 1989 to 1992. They had a child S for whom he had a child support liability.
Ms Page had a child MT from a previous relationship. Mr McKean broke into Ms Page’s home, while on bail for assaulting her, and stabbed both Ms Page and MT, who was then almost five years old.
Faulks J heard:
child support enforcement proceedings brought by the Child Support Registrar,
claims for capitalisation of future child support brought by both mothers,
a cross-vested claim under the Defacto Relationship Act 1984 (NSW) brought by Ms Page,
a cross-vested claim for damages by Ms Page as next friend for MT,
and made rulings on the issue of costs, and the issue of the priority of the claims.
The available assets exceeded the extent of the claims. It was agreed that as a first priority arrears of child support were to be paid from a named bank account.
His Honour next dealt with the defacto property claim by Ms Page. Following Dwyer v Kaljo (1992) DFC 95-127 his Honour apportioned a jointly owned home 55% to Ms Page and 45% to Mr McKean. This claim took priority over the remaining claims.
The assault on MT justified an award of aggravated damages but not exemplary damages. Damages were assessed at $65,000, including a $10,000 aggravated damages component.
It was agreed that future child support should be payable for C and S in the sums of $52,000 and $54,000.
Costs were awarded in favour of Ms Page. A trustee was appointed to oversee the division of Mr McKean’s assets (see second appeal).
On appeal, the appellant challenged the award of aggravated damages, the validity of the appointment of a next friend for MT, a potential conflict of interest of lawyers, and the quantum of the defacto property award. He agreed to abandon other claims relating to orders which did not personally affect him and for which he lacked standing (see Peter v Shipway (1908) 7 CLR 232).
Held
Aggravated damages
It was within the trial Judge’s discretion to award aggravated damages in these circumstances of an adult in locus parentis assaulting a child (see Uren v John Fairfax & Sons Pty Ltd (1966) 117 CLR 118 and Gray v Motor Accident Commission [1998] HCA 70).
The appointment of a next friend
It could be assumed that Ms Page was properly appointed as MT’s next friend. As a matter of caution an order was made nunc pro tunc.
Lawyer’s conflict of interest
Mr McKean lacked standing to dispute any conflict of interest of lawyers representing Ms Page and the child S.
The defacto property award
Mr McKean and Ms Page jointly owned the house which was the subject of her defacto claim. In the absence of a cross-claim by Mr McKean the starting point of the parties’ entitlement was 50%.
As a result of the decision in Evans v Marmont (1997) 42 NSW LR 70 Dwyer v Kaljo was not a correct exposition of the relevant law. Matters outside the scope of s 20(1)(a)&(b) of the Defacto Relationships Act 1984 (NSW) are not relevant to the just and equitable division of property under the legislation.
By applying Dwyer v Kaljo his Honour had considered extraneous factors when apportioning the property. However it would be an affront to justice to remit the issue (which involved $3000, some of which the respondent would receive through her other claims if it went back into the pool of available assets), and the parties should each take their 50% legal interest in the property.
Procedural irregularity
The “gross impropriety” of counsel addressing his Honour in informal terms in a letter to chambers was criticised.
There ought not be ex parte correspondence without the knowledge of other parties in anything other than exceptional circumstances.
Appeal allowed in part
Costs ordered in favour of Ms Page
Reportable
This is an appeal by David McKean against several of the orders made by Faulks J on 23 May 1997 in a series of proceedings that were heard concurrently. It is convenient to describe the parties involved in the litigation before identifying the orders which were the subject of the appeal and the basis for the appeal.
The appellant cohabited with Lynne Muriel Strathie from November 1988 until August 1989. There is one child born of their relationship, C, born 21 February 1990. C lives with her mother and the appellant has a child support liability in respect of her.
It would appear that at the time cohabitation between the appellant and Ms Strathie ceased, the appellant commenced cohabiting with Sandra Anita Page. That cohabitation lasted until 25 August 1992. There is one child of that relationship, S born 15 May 1991. She resides with her mother, and the appellant has a child support liability in respect of that child.
Sandra Page is the mother of MT born 14 September 1987. MT lived in the household with the appellant and Ms Page.
On or about 22 August 1992 the appellant assaulted Ms Page by pouring boiling water over her. He was arrested and subsequently released on bail. Several nights later he broke into the house where Ms Page and her children MT and S were sleeping. He stabbed Ms Page and the child MT. MT was almost five years of age at the time.
The proceedings before Faulks J, which culminated in the judgment of 23 May 1997, consisted of various applications identified by his Honour as follows:
"
· For sole guardianship and custody of S.
· For restraining orders preventing [the appellant] from coming near [Ms Page] and the children.
· Lump Sum Maintenance for S in the future by way of a departure order under Section 117 of the Child Support Assessment Act (1989).
· An application for damages for assault on behalf of [Ms Page]. (This was subsequently abandoned during the course of the proceedings).
· An application that [Ms Page] be appointed next friend of MT and that she thereafter bring an application under the Jurisdiction of Courts (Cross-vesting) Acts (C’th) and (NSW) for damages for assault [on behalf of MT].
· An application under the Defacto Relationships Act (1984) of New South Wales for a division of property between [Ms Page] and the [appellant] relating to their relationship.
· An application by the Child Support Agency for the collection of some asserted arrears in relation to child support both in respect of [Ms Page] and also Ms Strathie’s. This sum was quantified at $46,505.45 and agreed by the [appellant] during the course of the proceedings.
· In addition, Ms Strathie brought an application in respect of future child support seeking a departure under the Child Support (Assessment) Act (1989).”
During the course of the proceedings a number of matters were agreed upon.
His Honour identified four matters which remained in controversy, namely:
“1.What claim if any the [appellant] might reasonably have under the provisions of the Defacto Relationship Act (NSW) 1984.
2.What would be the quantum for damages in respect of MT arising from the assault occasioned upon her on 28 September 1992.
3.What costs, if any, should be visited upon the [appellant]? (And should these be quantified at this point as was claimed in the sum of $55,000.)
4.In what order or with what priority should these claims be paid. (It transpires that all of the claims could not be met out of the funds available from the [appellant]).”
There was some confusion as to whether or not the application by Sandra Page that she be appointed next friend of her daughter, MT in respect of the damages application was ever formally dealt with.
THE JUDGMENT
The asset pool
His Honour identified the property of the parties as being:
a residence in Wagga Wagga jointly owned by the appellant and Ms Page, $60,000;
land at Oxley in Queensland owned by the appellant, $65,000;
land at Rosewood in Queensland owned by the appellant, $30,000;
money held in trust on behalf of the appellant, $65,108.60;
money held in a Queensland bank account in the name of Marion Brown, belonging to the appellant, $2,800;
shares held in trust on behalf of the appellant, $12,675.
A total asset pool of $235,583.60.
His Honour noted that although some of the assets had been held in "purported trusts" those trusts were set aside by consent.
Priority given to child support arrears
It was agreed by all of the parties to the various proceedings that the sum of $46,505.45 due as arrears of child support should be paid from money held in a bank account in Queensland.
Ms Page's Defacto Relationships claim
His Honour next dealt with the claim by Sandra Page brought under the Defacto Relationships Act (NSW) 1984. There was some preliminary argument as to whether or not that claim should be dealt with in priority to the claims for child support. His Honour determined to deal with the claim as a priority claim, and none of the parties who were affected by that ruling, ie the Registrar of Child Support, Ms Page (either in her own right or as next friend for MT) and Ms Strathie, has sought to appeal against that determination.
The claim, which appeared in paragraph 7 of Ms Page's Form 7 application filed 3 October 1995, was:
"That, pursuant to sub-section 4(2) of the Jurisdiction of Courts (Cross-Vesting) Act 1987 (NSW) and pursuant to section 20(1) of the De Facto Relationships Act 1984 (New South Wales) the respondent pay or cause to be paid to the Solicitors for the applicant, on account of the applicant, the equivalent of 70% of the value of the said property."
His Honour noted that the only property that was the subject of the De Facto Relationships Act claim was the house at Wagga Wagga. He said that the appellant had indicated:
"…that his preferred approach was that I should acknowledge without question the transfer of the Wagga Wagga property to both parties in equal shares and that I should then make a small adjustment from the remaining assets in favour of the applicant under the Defacto Relationships Act. The gift of one half of the house he said was a “done deal”.
I have interpreted that concession to the extent that it was one by the respondent as meaning that he regarded a proper level of finding in favour of the applicant as being represent [sic] by one half of the Wagga Wagga property plus some other percentage (unnominated.)
I indicated during the course of argument that that did not represent the way in which I regarded the matter as being required to be determined. I did say however that I would test my final result against the proposition advanced by Mr McKean."
His Honour had earlier set out the provision of s 20 of the De Facto Relationships Act:
“20(1)[Relevant contributions] On an application by a de facto partner for an order under this Part to adjust interests with respect to the property of the de facto partners or either of them, a court may make such an order adjusting the interests of the partners in the property as to it seems just and equitable having regard to –
(a)the financial and non-financial contributions made directly or indirectly by or on behalf of the de facto partners to the acquisition, conservation or improvement of any of the property of the partners or either of them or to the financial resources of the partners or either of them; and
(b)the contributions, including any contributions made in the capacity of home-maker or parent, made by either of the de facto partners to the welfare of the other de facto partner or to the welfare of the family constituted by the partners and one or more of the following, namely –
(i)a child of the partners;
(ii)a child accepted by the partners or either of them into the household of the partners, whether or not the child is a child of either of the partners.
20(2)[Declaration of title or rights] A court may make an order under subsection (1) in respect of property whether or not it has declared the title or rights of a de facto partner in respect if the property.”
His Honour then said:
"Justice and equity necessitates my being able to take into account of liabilities and assets of each of the parties notwithstanding that there is no direct provision equivalent to Section 75(2) of the Family Law Act 1975. In this regard, I was referred to a number of authorities by Counsel for the applicant in exercise of and the proper discharge of his obligation to put all matters before the Court[1]. The overall effect of these authorities is to suggest that a Court in exercising jurisdiction under the Defacto Relationships Act should within the constraints of that legislation follow a similar approach to that which would be followed under the Family Law Act 1975. It is clear however that the future financial facts are to be disregarded. It seems sensible and proper however that in determining what property is to be divided, the circumstances of contribution should be taken into account…"
1. D v. McA (1986) DFC 95-300
Amongst the authorities cited in support of his Honour's interpretation of the correct approach to be adopted was Dwyer v Kaljo (1987) DFC 95-053; 11 Fam LR 785 and (1992) 27 NSW LR 728; DFC 95-127; 15 Fam LR 645 (appeal).
After setting out the various contentions of the parties his Honour concluded:
"Given the matters involved in the history of the parties and given the contributions that each of them have made, it seems to me that the following questions are important for my decision:
· The extent of the property owned by Mr McKean prior to the commencement of the relationship namely (sic)
· The contribution made during the course of the relationship by Ms Page was considerable and in the light of all of the circumstances a significant and important one.
· Interests of justice and equity would require me to take account of all of the various claims that are presently in existence against Mr McKean and also the fact that Ms Page has been obliged to flee the country to protect herself and her children.
The net result of these proceedings will mean that Mr McKean is at least nominally bankrupt in that his debts will exceed his assets. He will be left bereft of all assets no matter what figures I might reasonably put upon the matters still to be determined.
This is a consequence which he appears resignedly to accept. So far as I am able to determine, Mr McKean accepts the fact that there will be no residue which he can reasonably claim to be “his share” as a result of these proceedings.
Taking account of these factors, I believe it is appropriate that [Ms Page] should receive 55 percent of the total property. This is the sum of $33,000."
Prioritising the remaining claims
Having dealt with the de facto property claim, his Honour was left with claims by both Ms Page and Ms Strathie for capitalisation of child support, a claim for damages on behalf of MT, and claims for costs of the litigation. His Honour concluded that each one of those claims should rank equally and none of the parties affected by that ruling has appealed.
One counsel, instructed by the same solicitors, appeared in the proceedings on behalf of Ms Page in claims in her own right for alteration of property interests, for child support (said to be thus effectively representing the interests of the child S), and as next friend for the child MT. It was submitted that because each of these parties had conflicting interests, namely it was in the interests of each of these parties to rank in priority to the others, counsel and the solicitors should not have acted in each of the three claims. Eventually his Honour, having determined to treat the claims without giving any of them priority, concluded that there was no sufficient conflict of interest for him to intervene in the proceedings and require separate representation, at least of the interests of MT. None of the parties affected by that ruling has sought to appeal against it.
MT's damages claim
Having determined issues of priorities his Honour then moved to the claim for damages brought on behalf of MT. He described the terrible events of that night and said:
"It is not difficult in such circumstances to imagine the terror and mental anguish that must have been suffered by MT.
The injury caused to MT who was stabbed by Mr McKean was the subject of a gruesome and graphic photograph which became Exhibit M2. As a result MT has a scar the same length as the stab wound. This is quite “predominant” to “Ms Page’s description”. It is asserted and I accept that she is very self conscious of the scar and is very embarrassed on (sic) hurt by it. Her mother comments that she has said to her when she is being bathed or dressed “- it will never go away Mum” (referring to the scar). The evidence is that she is in a marching team but she makes her mother dress her at home so that she does not let other people see her and similarly when she goes swimming she will put clothes over the top of her bathers just because she doesn’t want anyone to see her scar. The evidence is that she can’t dress like her friends with little midriff tops “but then they’ll see my stab wound mum”.
The medical evidence suggests that the scar because it has not gone down in four years will probably be with her for the rest of her life. Plastic surgery to possibly fix the matter could cost in the vicinity of $3,000-$4,000.
She suffers from post traumatic stress disorder. She is very angry and very frightened of men, even her mother’s father.
She felt particularly betrayed by the respondent because he always used to pick her up because she was only a baby. He used to pick her up and sing to her and he told her that he loved her and things like that.
She wakes in the middle of the night screaming and crying, in turn waking the whole house and has been having psychotherapy.
Finally, it could be commented that the assault of the respondent occasioned indirectly the loss by the child of her home and brought about her having to move to a different environment and to live in straightened (sic) circumstances with her mother.
In summary, the matters relevant to my assessment of these damages are as follows:
· The pain and suffering MT must necessarily endured (sic) at the time of the assault.
· The permanent injuries suffered as a result of the assault. This includes a scar on her stomach about which she feels self conscious.
· The continuing medical treatment required by MT to overcome the trauma that was associated with the assault.
· Any future economic loss that MT may suffer brought about by her continuing need for treatment or the social disabilities which she has so far suffered.
· Any significant effect upon MT’s ability to enter into meaningful relationships in the future is clearly something that ought to be taken into account."
His Honour then noted that counsel for MT sought general damages in the sum of $40,000-$45,000, plus an award for aggravated damages in the sum of $10,000, and exemplary damages in the sum of $5,000. His Honour declined to make an award for exemplary damages, saying:
" Generally speaking, exemplary damages are awarded in situations of civil wrong where no criminal proceedings are contemplated or possible. The purpose of such damages is to indicate the community’s disapproval of and in effect, punishment of the respondent. In the circumstances of this case, while the penalty imposed on Mr McKean seems relatively small by reference to the horrific circumstances in which he committed his assault, this is not a matter which I am obliged to determine. The community has passed the judgment of its concern about the conduct of the respondent and it seems to me that it is inappropriate that this Court should impose any further adjustment to take account of this."
His Honour then dealt with the claim for aggravated damages, citing a passage by Coleman J in Marsh v Marsh (1994) FLC 92-443; 17 Fam LR 289, where his Honour said at FLC 80,624:
“The law is well settled that, where the conduct of the defendant is deliberate, in addition to damages awarded by way of compensation, the court may also include a sum in respect of any indignity sustained by the plaintiff, such damages being termed aggravated damages and, though theoretically compensatory, providing for a type of intangible loss not otherwise accounted for under a general damages award.”
Faulks J concluded his award for aggravated damages, saying as follows:
"The circumstances of this matter and this assault must be particularly apt for the award of aggravated damages. The assault occurred on a defenceless child who thought she was loved and cared for by the perpetrator. The assault was carried out at night in a cowardly, invasive and horrific manner. Even the merest forethought on the part of the respondent must have shown him that if the child had survived the consequences for her for many many years must have been horrible indeed. Her pain and suffering and any money for compensation for the loss that she must endure do not in any way compensate for these factors.
In my opinion, there should be an award of aggravated damages."
His Honour then ultimately concluded that the total damages award should be $65,000 made up of the following components:
“
· For pain and suffering $35,000
· For the scarring including future plastic surgery treatment $10,000
· For the continuing trauma and concerns arising from the incident including therapy and psychological treatment $10,000
· For aggravated damages $10,000.”
Capitalised child support
There was an agreement reached by the appellant and Ms Page that the sum of $54,000 should be payable for the future child support of the child S, and there was an agreement reached by the appellant and Ms Strathie that future child support should be paid in respect of the child C in the sum of $52,000.
Costs
Finally, his Honour ordered the payment by the appellant of taxed or agreed costs in the action brought by Ms Page on behalf of the child, MT, and for the costs incurred by Ms Page in her own De Facto Relationships Act claim.
Effect of proposed orders
The effect of his Honour's orders was to take from the pool of assets of $235,583.60 previously identified, the sum of $46,505.45 for arrears of child support, and a sum of $33,000 in respect of Ms Page's De Facto Relationships Act claim. This left a pool of approximately $156,000.
His Honour determined that that pool should be divided as to 29 per cent for MT's damages claim, 23 per cent for Ms Strathie's child support claim, 24 per cent for Ms Page's child support claim, and 24 per cent for the costs awarded to Ms Page.
The orders made to give effect to the judgment commenced with Order 1:
"That for the purpose of administration of these orders, the partners of the firm of Ferrier Hodgson, Chartered Accountants, are appointed jointly and severally as trustees for sale and liquidation of assets as hereinafter provided."
That order was subsequently amended by the trial Judge to read:
"That for the purposes of administration of these orders, Peter Murray Walker, Chartered Accountant and a member of the firm Ferrier Hodgson in Sydney, be appointed as trustee for the sale and liquidation of assets as hereunder provided."
That amendment is the subject of a separate appeal. We will deal with that appeal in a separate judgment.
THE APPEAL
By an amended Notice of Appeal the appellant sought to appeal against several of the orders made by the trial Judge under nine separate headings. It is convenient to set those headings out now:
Aggravated Damages
Priority
Ms Strathie's Confinement Order
Beneficiary’s Rights
Next Friend
The Australian Constitution
Lawyers' Conflict of Interest
De Facto Act Award
Costs
Prior to the hearing the appellant filed a Notice of Withdrawal of Ground 6 which was a challenge to the constitutional validity of the cross-vesting legislation and the Child Support (Assessment) Act.
At the hearing before us, we drew to the attention of the appellant the judgment of Higgins J in Peter v Shipway (1908) 7 CLR 232 at 259 where his Honour said:
"No appellant is entitled to succeed unless he can show that the judgment of the Court below does him hurt, contrary to law; and in this case the appellant cannot show any hurt done to her, even to the amount of a shilling, either now or hereafter or in any contingency whatever."
We suggested to the appellant that he was not affected by several of the matters of which he complained and he agreed to abandon Grounds 2, 3, 4, and 9. This left his appeal against:
The award of aggravated damages;
The validity of the appointment of Ms Page as the next friend for MT;
Issues arising out of the potential conflict of interest of counsel for Ms Page; and,
The award made under the De Facto Relationships Act (NSW) 1984.
It is convenient to deal with those matters now.
Aggravated Damages
It was submitted by the appellant that the award of $10,000 for aggravated damages in favour of the child, MT ought not have been made. He submitted that the award was really an award for exemplary or punitive damages which the trial Judge had indicated he was not prepared to make. He submitted that aggravated damages should only lie if there was evidence of an intent to cause insult or humiliation to the plaintiff or where there was a misused authority. He further submitted that there was no evidence that MT was "conscious to any assault" and that there was no evidence to support a conclusion that the assault brought about the child having to move to a different environment and live in straitened circumstances.
The distinction between aggravated and exemplary damages has been the subject of several High Court decisions. In Uren v. John Fairfax & Sons Pty. Ltd. (1966) 117 CLR 118 Taylor J said at 129-130:
"It is, perhaps, desirable to point out that there had been a degree of confusion between ‘aggravated’ and ’exemplary’ damages and sufficient attention has not, in the past, been given to the distinction between these two concepts. The former are, of course, given by way of compensation for injury to the plaintiff, though frequently intangible, resulting from the circumstances and manner of the defendant's wrongdoing. On the other hand, exemplary damages are awarded, as Lord Devlin says in Rookes v. Barnard [(1964) AC, at p 1221], to "punish and deter" the wrong-doer though, in many cases, the same set of circumstances might well justify either an award of exemplary or aggravated damages. “
Windeyer J at 151 said:
“Accepting that a jury may weigh the conduct of the defendant either in mitigation or aggravation of damages, how, if they think it an aggravation, can it be said that no punitive element entered into the assessment? The theory is that in such a case the damages are still only compensatory because the more insulting or reprehensible the defendant's conduct the greater the indignity that the plaintiff suffers and the more he should receive for the outrage to his feelings.”
More recently Kirby J said in Gray v Motor Accident Commission [1998] HCA 70 (citations and footnotes omitted):
”The difficulty of distinguishing between aggravated damages and exemplary damages has been acknowledged by this Court. To some extent compensatory, aggravated and exemplary damages overlap. Thus, compensatory damages themselves may, to some degree, fulfil the purposes for which exemplary damages exist. These are ambiguous concepts and, at least in part, anomalous.
However, it is clear that, by Australian law, compensatory damages may be enlarged to include a component for the aggravated circumstances in which a wrong to the plaintiff has occurred. It is perhaps because of the lack of complete clarity of the differentiating features of aggravated damages, and doubts as to what they involve, that legal practitioners often fail to claim them and persons wronged often fail to recover them. This is doubtless why it has been proposed that the ‘misleading phrase’, aggravated damages, should be replaced by a specific component of damages for mental distress. The danger of double counting in the provision of aggravated damages is an ever present one. The differentiation between ‘aggravated damages’ and ‘exemplary damages’ became more marked following Rookes v Barnard. It assumes critical importance in those jurisdictions where exemplary damages, as such, have been abolished by statute.
Aggravated damages are given for conduct which shocks the plaintiff and hurts his or her feelings. Exemplary damages are awarded for conduct which shocks the tribunal of fact, representing the community. Obviously the two affronts will often coincide and overlap. But in awarding an additional element in the plaintiff's compensatory damages as aggravated damages for such affront, the attention of the decision-maker must be concentrated upon the impact which the wrong had on the plaintiff and the particular injury done to his or her feelings.”
Whilst the line between exemplary and aggravated damages is blurred, it is clear that Faulks J was aware of the distinction and was careful in this case not to award any damages by way of exemplary damages. The award for aggravated damages was clearly justified in circumstances where a child not yet five years of age could reasonably have expected that an adult in locus parentis would not have acted in the dastardly manner in which the appellant acted towards her. In our view, the award of aggravated damages was well within the discretion of the trial Judge and nothing has been demonstrated which would indicate that it would be appropriate for an appellate court to interfere with such exercise of discretion.
The Appointment of the Next Friend.
The proceedings brought on behalf of the child, MT, were brought in the Family Court of Australia pursuant to the provisions of the Jurisdiction of Courts (Cross-Vesting) Act (NSW). Section 4(2) of that Act purports to invest the Family Court of Australia with original and appellate jurisdiction in respect to a matter in which the Supreme Court of New South Wales has jurisdiction under New South Wales law. Section 11(1)(c) provides for a court exercising such jurisdiction to apply such rules of procedure as the court considers are appropriate in the circumstances, being rules that are applied in a superior court in Australia.
Order 31A rule 6(2) of the Family Law Rules [Jurisdiction under Cross-vesting Act] provides as follows:
"If, in proceedings before a Family Court, a party seeks to have rules of evidence and procedure other than those of the relevant Family Court applied under paragraph 11(1)(c) of the Cross-vesting Act in dealing with a matter for determination in the proceedings, the party must, in the party's application, specify the rules that the party seeks to have applied."
Order 31A rule 6(3) provides for a party to such proceedings before the Family Court, who seeks to submit that procedure other than relevant Family Court procedure should be adopted, should make an application before the matter is set down for trial seeking directions.
There is nothing in the Appeal Book to suggest that any directions were made concerning the appointment of Ms Page as next friend for her daughter, MT. Indeed, in his Reasons for Judgment his Honour identifies as one of the matters for adjudication an application by Ms Page to be appointed as next friend of MT. Such an application can be found in Order 9 sought by Ms Page in the Form 7 application she filed on 3 October 1995. She sought:
"That pursuant to Order 23 rule 13 the applicant be appointed on the return date of this application as the next friend of the child MT born 14 September 1987, an infant."
It appears from the documents in the Appeal Book that on 27 February 1996 a Statement of Particulars of Injuries, Continuing Disabilities and Future Costs was filed bearing the heading "MT by her next friend Sandra Anita Page, Plaintiff". Whether or not any order had actually been made appointing Ms Page as the next friend is not clear.
His Honour heard evidence in this matter in May 1996. He reserved judgment which was eventually delivered on 27 May 1997. On 16 May 1997 the appellant filed a Form 8 application seeking an order inter alia that Sandra Page cease to be the next friend of MT forthwith and that all actions be stayed until a proper and fit next friend be appointed. Whilst the material contained in the appellant's affidavit filed in support of that application is a little difficult to follow, it seems that he was arguing that Ms Page was not a person who had no interest in the proceedings adverse to MT because any money Ms Page would recover in her own actions could only come from money which might otherwise be available for the children, including MT.
It appears from the transcript of 2 June 1997 that the application to remove Ms Page was not dealt with until after judgment was delivered. His Honour said of the application:
"Well, there is nothing in the material you find which would cause me at the conclusion of proceedings where the only remaining role for a next friend is to - well, there is no remaining role for a next friend except in relation to any appeal. To remove a next friend at that point would be a fairly unusual step to begin with and given that there is not evidence in the material you have filed which would lead me to that conclusion, even if the proceedings were still afoot I do not see that order as succeeding."
In the course of the submission made to this Court by the appellant during the appeal, when asked to identify what locus standi the appellant had to proceed with this ground he indicated that he was concerned that if there was any question as to the propriety of the appointment of Ms Page as next friend, that he might be at jeopardy of having MT bring an action against him in respect of the same cause of action once she turned 18. He conceded that if any question of propriety of the appointment was settled by this Court then such a course would not be open to MT.
Even though we are of the view that the general presumption of regularity should apply and that we can assume that Sandra Page was lawfully appointed as next friend for MT, given that Faulks J identified her appointment as a matter still in issue before him, and given that he does not appear to have dealt with that appointment directly in the course of his reasons for judgment, it is appropriate that we, acting with an abundance of caution, remove any doubt at all about the irregularity of the appointment. We propose to make an order nunc pro tunc appointing Sandra Anita Page as the next friend of MT for the purposes of the proceedings in Suit No. CA537 of 1995.
That order having been made we are of the view that the appellant cannot demonstrate that his rights have in any way been infringed by the appointment of Ms Page. In the circumstances, notwithstanding the provisions of Order 23 rule 13 which require the Court to be satisfied that a person to be appointed as next friend
(a) is a fit and proper person to act as next friend;
(b)has no interest in the proceedings adverse to the person under the disability; and,
(c) has filed a consent to act in accordance with Form 30;
in the exercise of our power, under Order 4 rule 1, to dispense with compliance of any of the requirements of the Rules, either before or after the occasions for compliance has arisen, we think it is appropriate that the appointment be made. Nothing has been raised in the material by the appellant which would indicate that Ms Page was anything other than a fit and proper person to bring these proceedings on behalf of her daughter.
Lawyer’s Conflict of Interest
Whilst it is not abundantly clear when reading the grounds contained in the Notice of Appeal as to precisely what it is that the appellant is complaining about, it would appear that he is seeking that the various claims made be the subject of a re-trial because of an asserted conflict of interest on behalf of the lawyers who acted for Ms Page and the child S. The assertion was that it was in the interests of the lawyers personally to ensure that the trusts he had established for the benefit of the children were set aside so as to enable money to be made available for the lawyers' costs. Further, that whilst the lawyers acted both for Ms Page and the child MT, there was a conflict of interest as Ms Page was seeking to have her claim under the De Facto Relationships Act dealt with in priority to the claim made on behalf of MT.
This ground of appeal suffers from the same problem that the fifth ground of appeal suffered from, namely a lack of locus standi on behalf of the appellant. Other than his general interest as a parent of S, the dispute as to priorities and a potential conflict between Ms Page and the child were matters which ultimately did not concern the appellant. No matter what the result was in the proceedings, he was to be left without any visible asset. The awards that were to be made against him by his own concessions exceeded the assets available to meet them.
In support of the appeal ground we were referred to the decision in Re Westmoreland 270 F Supp 408 (1967). This a decision of Boottle CJ in the United States District Court, Georgia. An attorney had his fee disallowed by a Bankruptcy Referee in circumstances where the referee was of the view that there had been a conflict of interest between the attorney and his client. The attorney sought to review the decision of the referee. That decision was upheld. In the course of the decision there is a discussion of the ethical rules which bind attorneys in the United States and which appear in the Canons of Professional Ethics of the American Bar Association and other places, such as:
"an attorney may not by his contract of employment place himself in a position where his own interests or the interests of another, whom he represents, conflict with the interests of his client".
Such a proposition would clearly represent itself as sound law in Australia (see for example Law Society of NSW v Harvey [1976] 2 NSWLR 154, Thevenaz (1986) FLC 91-748; 11 Fam LR 95, Mallesons Stephen Jaques v KPMG Peat Marwick (1990) 4 WAR 357).
The issue before us, however, was not whether the solicitors and counsel for the various applicants had a conflict of interest, but whether that conflict of interest somehow infringed upon the rights of the appellant. For reasons already given it is clear they did not. In those circumstances, in our view, the appellant had no locus standi to seek any relief based on that conflict.
The Defacto Relationships award
Finally the appellant sought to challenge the award of $33,000 to Ms Page under the provisions of the De Facto Relationships Act. He submitted that an appropriate award was 7 per cent of the value of the property.
The property was valued at $60,000. It was owned jointly by the parties. That ownership was not challenged before his Honour. There was no cross-claim by the appellant under the provisions of the relevant New South Wales legislation seeking an alteration of interests in his favour. Accordingly in our view the starting entitlement of the respondent Ms Page was to a 50 per cent share in the property in any event. The question his Honour should then have asked himself was whether or not in the circumstances it was appropriate to make any further adjustment having regard to the provisions of s 20 of the De Facto Relationships Act.
His Honour's approach to the s 20 application was to follow a line of authority which included D v McA (1986) DFC 95-030; 11 Fam LR 214, Roy v Sturgeon (1987) 11 NSW LR 454; (1986) DFC 95-031; 11 Fam LR 271, Dwyer v Kaljo (supra), Black v Black (1991) DFC 95-113; 15 Fam LR 109, and Green v Robinson (1995) 36 NSW LR 96; DFC 95-159; 18 Fam LR 594. His Honour indicated that it was appropriate to take into account not only the direct and indirect contributions of the parties to the property but also:
"...the various claims that are presently in existence against Mr McKean and also the fact that Ms Page has been obliged to flee the country to protect herself and her children."
His Honour delivered the judgment in this case on 27 May 1997. Six days earlier, on 21 May 1997, a Full Bench of the Court of Appeal of the Supreme Court of New South Wales heard argument on whether the line of authority of which Dwyer v Kaljo (supra) was one example, should be preferred over a conflicting line of authority of the New South Wales Supreme Court established in Wallace v Stanford (1995) 37 NSWLR 1; DFC 95-165; 19 Fam LR 430. In summary, the difference of approach between the two authorities was that Dwyer v Kaljo was authority for the proposition that the s 20(1)(a) and (b) considerations did not limit the matters to which the Court could pay attention in determining what was a just and equitable order, whilst Wallace v Stanford stood for the proposition that they were so limited.
The Court of Appeal of the Supreme Court of New South Wales delivered its judgment in Evans v Marmont (1997) 42 NSW LR 70; DFC 95-184; 21 Fam LR 760 on 1 July 1997. Gleeson CJ and McLennan CJ in Equity gave a joint judgment in which they concluded that Wallace v Standford (supra) should be approved and Dwyer v Kaljo (supra) not followed. Meagher J agreed with this construction of s 20. Mason P and Preistley JA each wrote separate judgments. Neither of them was prepared to express as strong and authoritative a view as the majority that s 20 should be narrowly interpreted.
The outcome of the decision in Evans v Marmont (supra) is that in determining what is just and equitable within the meaning of s 20(1) of the De Facto Relationships Act (NSW) 1984 regard may be had only to the matters contained in sub paras (a) and (b) thereof. It is clear that in the matter before us Faulks J paid regard to other matters which could not be fairly said to fit within the confines of those sub-paragraphs. In those circumstances his Honour's adjustment cannot stand. To that extent the appeal ought succeed.
As there was no cross-application, the respondent is entitled to one half of the property ($30,000) in any event. In the pragmatic sense, if we simply allow the appeal and reduce the sum to $30,000 then the remaining $3,000 goes into the pool of assets to be available to meet the balance of the orders. Under the terms of the judgment Ms Page will receive 24 per cent of those moneys on account of her child support claim and a further 24 per cent of those moneys on account of her claim for costs. The net loss to her in the circumstances is some $1500. The other alternatives are to remit the claim back for reconsideration or to attempt to substitute our own discretion in respect of the matter.
Following discussion with both the appellant and with counsel for the respondent Ms Page, it was decided that it would not be appropriate to remit the matter. The amount in issue is so small and the likelihood of recovery of any significantly greater order so remote that it would be an affront to justice to do so.
It is clear that the property was acquired almost exclusively with monies provided by the appellant. Cohabitation was for a period of approximately three years during which time the respondent contributed "rather more to the welfare of the family than he did". She had to make those contributions in circumstances beset with the appellant's violence and other unacceptable behaviour. On the material before us, we are of the view that a result which reflects the parties' legal interest in the property is an appropriate one, namely an equal division of the property.
COSTS OF THE APPEAL
At the conclusion of the proceedings before us counsel for Ms Page sought an order that she receive her costs in the sum of $2,000. The appellant opposed the making of that order.
It should be noted that the appeal commenced at 2.15pm and concluded at 4.15pm. Counsel for the respondent appeared at approximately 2.45pm announcing that he was under the mistaken belief that the case was not listed until 3.00pm. Altogether his attendance in the proceedings lasted for approximately one and a half-hours.
The appropriate principles to be applied in respect of the order for costs are those applicable under the law for the State of New South Wales rather than under s 117 of the Family Law Act. In civil proceedings in New South Wales costs normally follow the event, although a discretion exists in respect of them. Whilst we are conscious that any award for costs in this case is likely to be a hollow order, in most respects the appeal has been unsuccessful. This is especially so in respect of the attack against the award for damages made in favour of MT. In the circumstances we are of the view that it is appropriate that there be an award for costs in favour of the respondent, which we would fix in the sum of $1250.
ORDERS
1. That the appeal be allowed in part
2. That Order 3 of the orders made by the Honourable Justice Faulks on 2 June 1997 be varied by substituting for the phrase
"divide the balance as to 55% to the applicant Sandra Anita Page and as to 45% to the respondent David Andrew McKean"
the phrase
"divide the balance equally between the applicant Sandra Anita Page and the respondent David Andrew McKean".
3. That the appeal be otherwise dismissed.
4. That the appellant pay $1250 towards the costs of the respondent Sandra Anita Page appearing as next friend for MT.
Other Matters
When this appeal commenced the appellant, who appeared in person, sought to raise several issues of procedural irregularity. As these matters did not appear to relate to any of the Grounds of Appeal, we indicated we did not wish to hear argument about them. There was, however, amongst the material put in support of the submissions and contained in his written outlines of argument, a matter which we feel ought not go without comment. We should stress that we have not heard at all from the counsel involved, nor from the Judge or any member of his staff in response to these matters, and therefore make no findings in relation to them.
The submission read as follows [subject to certain deletions]:
"Inappropriate correspondence between the Court to Ms Page's counsel which any reasonable person could construe is indicative of bias, as follows:-
(a) Headed note-paper of [X] Chambers, Canberra apparently sending a fax from Mr [PQ] Barrister, to Judges' chambers at the Canberra Court and marked "URGENT" as follows:
"SL,
To save John the trouble of meeting in this case, here are the directions I was going to seek.
Thanks,
[P]"
The "John” is thought to be the trial Judge and SL his Associate.
(b) Headed note-paper of the Honourable Justice John Faulks, Judge's Chambers, Family Court, Canberra bearing a letter dated 23 February 1996 written to the said Mr [Q] as follows:
"Dear [P],
McKean & Page directions signed by Deputy Registrar following.
(sgd) SL."
McKean intends seeking leave to incorporate copies of these two documents into the Appeal Book. He received same under cover of letter from the registry manager, Family Court Sydney, Mr Brian Robertson dated 23 February 1999, also stating copies had gone to the Appeals Registrar. The letter on His Honour's paper is apparently the start of a 4 page fax."
Assuming that the documents the subject matter of the complaint exist, and that they have been accurately quoted, we have not been told anything of the circumstances in which the correspondence occurred and we are unable to say anything of the propriety of an apparently ex parte contact in the midst of defended proceedings. We do, however, wish to comment upon the gross impropriety of counsel writing a note to the Judge's secretary addressing the Judge in such intimate terms. Irrespective of the personal relationship that might exist between a member of counsel and a Judge, or might exist between a member of counsel and a member of the Judge's staff, in any correspondence from counsel to the Court involving any aspect of the Court's business, it is thoroughly inappropriate for counsel to address a member of the Bench in anything other in appropriately formal terms, such as "His/Her Honour", "Justice…" or "the Judge".
In anything but exceptional circumstances, one would not expect there to be any ex parte correspondence with a Judge in the course of a case other than after permission had been obtained from all other parties to the case to make such an approach. There is nothing in the material before us which would indicate one way or the other whether the approach by counsel to the Judge was with the knowledge and acceptance of all of the parties to the suit or otherwise, and we make no further comments about the propriety of that matter. We are, however, of the view, that a letter using intimate terms ought not have been sent and ought have been answered with an appropriate reprimand.
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