MNJ & MEB - [2004] FMCAfam 259

FEDERAL MAGISTRATES COURT OF AUSTRALIA

MNJ & MEB

[2004] FMCAfam 259

FAMILY LAW – Property – separation and divorce – Consent Orders made and implemented – reconciliation – parties later resume cohabitation, but do not remarry – wife applies for previous orders to be set aside pursuant to s.79A(1A) of the Family Law Act 1975 – discussion of concept of orders for property settlement under s.79 of the Family Law Act 1975 being “a once and for all proposition” – discussion of decisions in B v B (1985) FLC 91-610, Kowalski (1993) FLC 92-342, Hodges (1993) FLC 92-413, McCabe (1995) FLC 92-634 and Sommerville (2000) FLC 93-042 – whether property dispute arising out of alleged de facto relationship between parties to a marriage that has long since been dissolved amounts to a “matrimonial cause” – whether parties will be deprived of a remedy for their property dispute if court lacks jurisdiction – whether inference can be drawn from resumption of cohabitation to the effect that parties must have intended that previous orders be set aside, as otherwise they would be left with no remedy in law.

Family Law Act1975

Branchflower (1980) FLC 90-857
Mullane (1983) FLC 91-303
Florie (1988) FLC 91-913
Slapp (1989) FLC 92-022
Sommerville (2000) FLC 93-042
Hickey (2003) FamCA 395
B v B (1985) FLC 91‑610
Russell (1976) FLC 90-039
Kowalski (1993) FLC 92-342
Prowse (1995) FLC 92-557
Dadic (1987) FLC 91-825
Hodges (1993) FLC 92-413
McCabe (1995) FLC 92‑634
Drew (1985) FLC 91-601
Banhidy (1983) FLC 91-302

Applicant:

MNJ

Respondent:

MEB

File No:

MLM 9961 of 2002

Delivered on:

27 May 2004

Delivered at:

Melbourne

Hearing Date:

26 May 2004

Judgment of:

Walters FM

REPRESENTATION

Counsel for the Applicant:

Mr K. Nicholson

Solicitors for the Applicant:

Maria Barbayannis & Co

Counsel for the Respondent:

Mr T. Serra

Solicitors for the Respondent:

Robert A McHugh

ORDERS

The application of the husband to the effect that the court does not have jurisdiction will be dismissed.

FEDERAL MAGISTRATES
COURT OF AUSTRALIA AT
MELBOURNE

MLM 9961 of 2002

MNJ

Applicant

and

MEB

Respondent

REASONS FOR JUDGMENT

(Ex Tempore)

A preliminary question arises

A preliminary question has arisen in these proceedings. The husband argues that this Court does not have jurisdiction to make orders for property settlement or alteration of property interests (pursuant to s.79 of the Family Law Act 1975) unless certain previous (final) orders for property settlement or alteration of property interests (also made pursuant to s.79 of the Family Law Act) are first set aside or appropriately varied. The husband also argues that the previous orders can only be set aside or varied in the limited circumstances set out in s.79A — and that none of those circumstances apply.
The wife agrees that this Court lacks the power to make fresh orders for property settlement unless the previous orders have been set aside. She argues, however, that those orders can and should be set aside pursuant to s.79A(1A) of the Family Law Act.

Some background facts

The background to the matter is adequately set out in the outline of submissions prepared on behalf of the husband in this case. The parties separated as a married couple in 1986. The wife filed an application for final orders in April 1987. The husband asserts that from May 1988 to 1990 he lived in a de facto relationship with another woman. The parties’ divorce was finalised in July 1988 and final orders for property settlement (and dealing with other matters as well) were made in the Family Court of Australia at Melbourne in September 1988 (“the 1988 Orders”). The 1988 Orders were fully executed within months, and neither party in the proceedings now before me asserts that they were not fully implemented.
The parties recommenced cohabitation in 1995 or 1996. It matters little precisely which date is the more accurate for the purposes of these Reasons. The parties did not remarry. Nor did they commence proceedings - during the period of the later cohabitation - to set aside or to vary the 1988 Orders.

The Affidavit Material is Referred to

The wife filed an affidavit in support of her application on 5 August 2003. In paragraph 3 of that affidavit she says:
I married the respondent husband on 16 May 1970 and we separated in about 1986. A decree nisi of dissolution of marriage was granted on 31 May 1988 and became absolute on 1 July 1988. On 7 September 1988 final minutes of consent orders were pronounced in the Family Court of Australia at Melbourne, which orders dealt with child maintenance and property settlement.
A copy of the 1988 Orders is annexed to her affidavit. In paragraph 6 of the wife's affidavit she says:
The husband and I remained separated from 1986 until March 1996, with the husband buying his own home during that period in Seaford. I permitted the husband from March 1996 until 22 August 2001 to remain in my home at Somerville and ultimately a reconciliation was effected.
I note the wife’s use of the word "reconciliation". I also note that the husband, in the two affidavits that he has filed in the proceedings, has not used the word "reconciliation".
In paragraph 7 of the wife's affidavit she deposes:
The husband paid a weekly sum into the mortgage account after the reconciliation by way of his board. I paid all other outgoings for the property at Somerville and for all food and groceries.
In paragraph 10 of the affidavit the wife deposes:
During the five-year period that the husband remained in my home, he stated repeatedly that it was my home and he was not prepared to pay for any replacements or improvements thereto.
In paragraph 12 the wife said:
I stress that my estranged husband returned to reside in my home from 1996 to 2001 and remained there for five years. He made the minimal contributions as referred to above. When he came to my home at Somerville he brought with him his clothes and one cupboard, together with a portable television and stereo. One of his boats had been stored at my house.
In paragraph 18 there is reference to photographs of the parties' children and grandchildren. There is also reference in the affidavit material - in particular, in the affidavit material of the husband - to the fact that one of the children of the parties (namely, Leigh) resided with the parties during the later period of cohabitation (or part thereof). The fact that the parties have children is reflected in the orders that were made in September 1988, and the names and dates of birth of the three of them appear in those orders.
In paragraph 20 the wife said:
The husband always informed me during the period of reconciliation that he would make no claim on my home as he had not contributed to the same.
It is also clear from the wife's material that, although she uses the word "reconciliation", she is careful not to speak in terms of a de facto relationship.
The use of words or expressions which may be perceived to assist a party's case is also apparent from the husband's affidavit material. He swore two affidavits in the proceedings, the first on 4 August 2003, and the second on 24 May 2004. The latter refers to and incorporates the former. Just as the wife was careful to avoid the use of the term "de facto relationship", so it is apparent from the husband's material that he is very careful to use precisely that term. He also carefully avoids the use of the word "reconciliation" in his affidavit material. Accordingly, in paragraphs 12 and 13 of his first affidavit — which deal with the period of cohabitation of the parties from 1995 or 1996 until August 2001 — the husband uses the heading “De Facto Relationship”, and refers to the resumed cohabitation as a de facto relationship.
In his affidavit of 24 May 2004, the husband also avoids the use of the word "reconciliation" — which sometimes leads to some fairly strained language. In paragraph 10 of the husband's later affidavit he says:
Prior to my re-cohabiting with my former wife in April 1995, I regularly gave her additional amounts of money to buy food, clothes and pay gas bills.
It is clear from the passage quoted in the previous paragraph that the husband, notwithstanding that he does not use the word "reconciliation", is referring to the subsequent cohabitation as a form of continuation of the earlier cohabitation. The word "re-cohabiting" would otherwise have no meaning whatsoever. The sentence quoted above also indicates that there was ongoing contact between the parties between the date of separation and divorce in the 1980s and the time that they resumed their cohabitation in the middle of the 1990s.
In paragraph 12 the husband uses a similar term. He states:
Despite the fact that I did not re‑establish cohabitation with my former wife until March 1995, I continued to make all monthly payments into her mortgage as from March 1994.
In paragraph 25 appears the reference to one of the parties' children residing with them. That reference is as follows:

My leaving of the home was initiated by my former wife contacting the Hastings police and they telling me to get out immediately, including our youngest son Leigh who was living there part-time.

The husband states very clearly that the parties were indeed cohabiting during that later period, and the use of the term “de facto” characterises the form of the relationship between the parties. In other words, it was a marriage in everything other than name.

Property Orders are “a once and for all proposition”

A court of competent jurisdiction can ordinarily make only one order (or set of orders) for property settlement under section 79 of the Family Law Act. After that (and subject to certain well recognised exceptions), the court has no power to make a further order under section 79. In other words, an order under section 79 of the Family Law Act is treated as being what has been described as “a once and for all proposition”.
There are a number of cases which deal with the concept of an order under section 79 being a once and for all proposition. Those cases include Branchflower (1980) FLC 90-857, the decision of the High Court of Australia in Mullane (1983) FLC 91-303, Florie (1988) FLC 91-913, Slapp (1989) FLC 92-022 and Sommerville (2000) FLC 93-042. Most recently, the Full Court has dealt with this subject in Hickey (2003) FamCA 395.
In Mullane, the High Court held as follows[1]:
The effect of treating the order as if it had been made under sec. 79 is that, subject to a limited jurisdiction to vary it or set it aside, the power of the Family Court to make an order under sec. 79 is treated as having been exercised and as exhausted by that notional exercise. The limited jurisdiction to set aside or vary such an order is that conferred by sec. 79A and exists only in special circumstances, namely, where the Court is satisfied that there has been a miscarriage of justice by reason of fraud, duress, suppression of evidence, the giving of false evidence or any other circumstance ...
[1] at p. 78,068
Section 79A has been amended since the decision of the High Court in Mullane.
The Full Court in Branchflower held that once an order has been made pursuant to the provisions of section 79, the power of the court to make any further property order is spent, unless section 79A applies.
In paragraph 47 of the decision in Hickey the Full Court said:
(This) principle demonstrates that, but for the operation of section 79A, the court has power to make only one order for property settlement pursuant to the provisions of section 79.
I pause here to say that there is no relevant difference between the Family Court of Australia and this Court in that regard. Both courts have jurisdiction to deal with applications under section 79. Although this court's jurisdiction is limited in monetary terms, it clearly has jurisdiction to deal with the property of these parties — subject to the application of the principles that have already been referred to in these Reasons.
In paragraph 47 of Hickey, the Full Court said:
Thus any such order inherently has the effect of finally disposing of all issues relating to the disclosed property of the parties. This has two significant effects on property orders: first, it means that catch‑all orders are essentially ineffectual if they do not effect an alteration of interest. Nevertheless, it is said that their value lies in their form in order to appease concerned parties rather than their possible empty substance. Second, an order for property settlement made pursuant to the provisions of section 79 cannot legally constitute orders in the plural sense but rather as a single order made up of various paragraphs or clauses.
Their Honours continued (at paragraph 48):
In our view, an order made pursuant to the provisions of section 79 was correctly described by senior counsel for the husband as a once and for all proposition. Although there may be partial or interim orders, ultimately there is only one exercise of power under section 79 in respect of the property of the parties even though that single exercise of power may be reflected in a complex order of many paragraphs or clauses, each dealing with a different item of property and some dealing with questions of implementation.
The bottom line (as it were) is that an order under section 79 is indeed a once and for all proposition. Prima facie, therefore, this Court and the Family Court do not have power to deal with a further application by the wife for property settlement — unless the provisions of section 79A apply, or unless some other rule of law applies. In this case, it is clear that the only basis relied upon by the wife for the orders that she seeks is section 79A(1A) of the Family Law Act. If the wife does not succeed in relation to that ground, then she cannot succeed at all and this court will not have jurisdiction to deal with her claim.

Some cases deal with a similar factual situation

There are a number of cases which deal with this type of factual scenario. The starting point, it seems to me, is the decision of the Full Court in B v B (1985) FLC 91‑610. Reading from the headnote, the facts were as follows:
The parties married in 1965 and divorced in 1976. In 1976 an order was made vesting in the wife the whole of the husband's interest in Blackacre. The order was fully executed. In 1978 the husband and wife commenced to live together again in a de facto relationship. The wife sold Blackacre, paid off substantial debts incurred by the husband and purchased Whiteacre jointly with the husband. The parties did not remarry. The attempt at reconciliation between the parties was a failure. In February 1984 the wife applied to have Whiteacre transferred in her name absolutely pursuant to section 79A of the Family Law Act. Her application was dismissed at first instance and the wife appealed.
The factual situation in B v B is almost identical to the factual situation in the present case. In the present case, however, the parties remained separated for a much longer period than that which adhered in B v B. Nevertheless, although reliance was placed upon section 79A in B v B, no reference was made to section 79A(1A). In my view, that is a very significant fact. There is also another very significant fact regarding the weight to be given to the decision in B v B, to which I will refer at a later stage.
In B v B, the Full Court characterised the relationship between the parties after 1978 as "no more than a de facto relationship" and emphasised the fact that the parties had not remarried. The Full Court dealt with certain decisions (including that of the High Court in Russell (1976) FLC 90-039) and arguments presented by counsel for the wife to the effect that the application properly fell within the definition of “matrimonial cause” in section 4(1) of the Family Law Act. The Full Court was unimpressed with those arguments and concluded that the wife should not be permitted to continue with her application under section 79A. At the end of the Judgment, the Full Court said:
There is little doubt that the philosophy of the Family Law Act is towards finality in property orders and the very inclusion of section 79A(1) with its restrictive wording seems to us to emphasise that there must be exceptional and unusual circumstances before a property order can be set aside.
The Full Court also held that the connection between the original order and the relief sought by the wife was far too remote, and that what the wife really sought had nothing to do with the original order. The Full Court said:
Indeed the court is not really being asked to set aside the original order, and certainly it is not being asked to vary it. What the court is really being asked to do is to make a further property order under quite different circumstances and affecting the rights of parties who are not husband and wife when the events occurred upon which the court is now being asked to act.
Prima facie, and if B vB is good law, the lack of a nexus between the marital breakdown and the later cohabitation would mean that the proceedings currently before the court do not fall within the definition of “matrimonial cause” and that, even if they do, section 79A would not apply. If B v B is good law, then, on that authority alone, it would probably be fair for the court to conclude that it does not have jurisdiction, and that the husband's arguments should prevail.

B v B is not Good Law

But B v B is not good law. In Kowalski (1993) FLC 92-342, the Full Court had to consider a different factual scenario. In the course of doing so, the Full Court effectively overruled B v B. The reasoning in B v B was held to be no longer valid (although the Full Court in Kowalski held that the decision in B v B was correct). The factual situation in Kowalski is summarised in the headnote as follows:
The parties married in April 1974 and separated in September 1974. The marriage was dissolved in 1976. The wife alleged that the parties continued a relationship despite separation and despite the fact that the husband had entered into a relationship with another woman. In about 1980 the parties resumed cohabitation but did not remarry. When the husband became seriously ill early in 1992 the wife sought and obtained leave to institute proceedings for property settlement pursuant to sec 79 under sec 44 of the Family Law Act. The relief sought was in respect of the property which had been the parties' matrimonial home in 1974 and their residence for most of the cohabitation. The husband had inherited the home from his first wife.
The trial Judge dismissed the husband's application that the wife vacate the premises and granted the wife's application for an order restraining the husband from interfering with her occupancy of the premises. The husband appealed.
The main issue in Kowalski was whether the proposed proceedings for property settlement were proceedings arising out of the marital relationship within the meaning of paragraph (ca)(i) of the definition of matrimonial cause in section 4(1) of the Family Law Act. Clearly, that is not the same issue as the court must determine in this case.
It needs to be added that, in Kowalski, there were no previous property settlement orders, and it was not “a section 79A case”. Nevertheless, during the course of its discussions the Full Court found it necessary to deal with the decision in B v B[2]:
The facts in B and B were singular. The parties in that case not only had ceased to cohabit and had been divorced in 1976, but orders for the settlement of property had been made between them at the time of the dissolution vesting the then matrimonial property wholly in the wife as she had sought in proceedings which were not defended by the husband. That order was fully executed by the time the parties resumed cohabitation without remarrying in 1978. After the parties resumed cohabitation they purchased with the proceeds of sale of the former matrimonial home now owned by the wife, a new property which was placed in their joint names. When the parties separated again, the wife brought an application under section 79A to set aside the original orders and to obtain a fresh order.
[2] at p. 79,627

The Full Court continued[3]:
Quite apart from any question of nexus, that application was doomed even if section 79A had been reached, as the Full Court pointed out. The wife could not complain of a miscarriage of justice as she received in the original orders all that she had sought, nor could she complain of a default in the execution of the order or the impossibility of its implementation. She might have been able to make out a case under section 79A(1)(d) since there were still two children in her custody who were of school age. But as the Full Court pointed out at p 79,953 she did not seek to set aside or even to vary the original order which had given her the former matrimonial home for her and the children to live in.
[3] at p. 79,627
I pause here to comment that that statement of the Full Court in Kowalski would appear, in my view, and with the greatest respect to their Honours, to be an inaccurate one — because the decision in B v B quite clearly reveals that the wife was seeking to set aside the original orders and to seek different orders in substitution for them. Nevertheless, the Full Court continued in Kowalski[4]:
What she sought was ''a further property order under quite different circumstances''. It is our view that even if the parties in question had not dissolved their marriage and had resumed cohabitation as husband and wife after the execution of the section 79 property orders, the result would still have been the same. Section 79A cannot be used to circumvent the basic principle that there can only be one property settlement between the parties to a marriage. [Emphasis added]
[4] at p. 79,627
Even though the Full Court held that the reasoning in B v B should be rejected, it had no discomfort with the ultimate conclusion reached in B v B. The reality is, however, that, section 79A(1A) was not relied upon in B v B, and it was not referred to by the Full Court in Kowalski. It was obviously not regarded as a possible ground which may have been of assistance to the wife in her case. Nevertheless, I am conscious of the very strong statements made by the Full Court in Kowalski, and (in particular) the sentence which I have emphasised in the quote appearing in paragraph 39 above.
Although I have highlighted that sentence, it remains somewhat difficult to understand — because the whole purpose of section 79A is to circumvent the basic principle that there can only be one property settlement between the parties to a marriage. It has no other purpose. And if a party does bring himself or herself within section 79A, then that party is entitled, subject to the steps referred to in cases such as Prowse (1995) FLC 92-557, to have the earlier order set aside, or varied and (perhaps) to have other orders made. The High Court recognised that scenario in Mullane. With the greatest of respect to their Honours, I am not sure what the Full Court meant by that statement.
Regarding the matter that it considered to be the main issue in the case, the Full Court in Kowalski said[5]:
A more logical and consistent approach is one which is based on the proposition that once a marriage has been celebrated between the parties, the entire relationship between the parties whether arising out of contributions before, during or after the formal tie of marriage was entered into or dissolved, falls within the ambit of Part VIII of the Family Law Act 1975. This principle explains why contributions made between cohabitants who later marry are judged according to the criteria set out in the Family Law Act 1975 and not according to those set out in the Property Law Act 1958 (Vic) or the De Facto Relationships Act 1984 (NSW). It is also consistent with the proposition that post-separation and post-divorce contributions continue to be taken into account. These parties are before the Family Court because they were once married and hence the proceedings can be said to arise out of the marital relationship, even if the property, the subject of such proceedings, does not. As Ross-Jones J remarked in Dadic at p 76,214: "A resumption of cohabitation after dissolution ... between parties who have previously been married to each other is clearly distinguishable from a de facto relationship as such where the parties have never been married to each other."
[5] at p. 79,630
The Full Court continued[6]:
It follows that the reasoning, although not the actual decision in B v B, can no longer stand and must be regarded as overruled.
[6] at p. 79,631
The Full Court in Kowalski held that the entire relationship between the parties (whether arising out of contributions before, during or after the formal tie of marriage was entered into or dissolved) falls to be determined under Part VIII of the Family Law Act because it is to be treated as a matrimonial cause under the definition of matrimonial cause in section 4 of the Family Law Act. If that is good law, then the reality is that only a court that has jurisdiction to deal with matrimonial causes has power to deal with the dispute between the parties now before the court.

Something different from an “ordinary” de facto relationship

For all that the husband describes the later relationship as a de facto relationship, and to use the words already quoted as having been used by Ross‑Jones J in Dadic (1987) FLC 91-825, the parties’ resumption of cohabitation was something very different from an “ordinary” de facto relationship. The parties' affidavit material clearly evidences the facts that the parties had ongoing contact, and that the husband supported the wife financially for some time before the resumption of cohabitation (or re-cohabitation, as he referred to it). The nature and quality of the relationship that these parties had, and the form of cohabitation, is also to be seen in the fact that one of their children resided with them during the later period of cohabitation. Further, it is fair to observe that an essential (implied) characteristic of a defacto relationship is that any dispute between the parties to it is not, and could never have been intended to be, a “matrimonial cause”.

The property dispute is a “matrimonial cause”

It is strongly arguable, therefore — indeed, it seems to me to be almost unanswerable — that any dispute as to property between these parties is a matrimonial cause for the reasons set out in Kowalski. For the husband to now assert that he proposes to commence proceedings in another court may well be to overlook the fact that the other court will lack jurisdiction, and to fail to recognise that these parties will be left with no remedy in law at all if this court concludes that it has no power under section 79A to deal with the wife's application. That consideration, in itself, does not amount to justification for the court concluding that it must have power — but it opens the door to an analysis of the next line of cases in this area.

Section 79A Cases

They start with the decision of McCall CJ, the former Chief Judge of the Family Court of Western Australia, in Hodges (1993) FLC 92-413. The factual situation in Hodges is unusual and I do not propose to revisit it in these Reasons. The reality in that case, however, is that the property orders could not be attacked under the provisions of section 79A of the Family Law Act because the orders that were under attack were not orders made under the Family Law Act at all. They were orders made under section 30 of the Western Australian Family Court Act, and they were made under that Act because, at the time that they were made, there was no power for the Family Court of Western Australia to make orders for property settlement under the Family Law Act — as the parties had not been divorced, and had not commenced proceedings for principal relief.
In a carefully considered decision, McCall CJ reviewed various arguments raised in the matter — none of which related to section 79A. On page 80,226 of Hodges, his Honour refers to the decision in B v B, and also refers to section 79 of the Family Law Act. His Honour then refers to Kowalski, and to the fact that the reasoning in B v B, although not the actual decision, was held not to be able to stand. His Honour continued (at the foot of page 80,226) as follows:
In dealing with the actual facts of B v B, the Full Court in Kowalski went on to say the wife did not seek to set aside or even to vary the original order which had given her the former matrimonial home for her and the children to live in. What she sought was a further property order under quite different circumstances. It is our view that even if the parties in question had dissolved their marriage and had resumed cohabitation as husband and wife after the execution of the section 79 property orders, the result would still have been the same. Section 79A cannot be used to circumvent the basic principle that there can only be one property settlement between the parties to a marriage. [Emphasis added]
The passage upon which emphasis has been placed in the quote from Hodges set out in the previous paragraph is the sentence to which I referred earlier in these Reasons. I have already commented on that passage — and upon the factual anomaly in the statement by the Full Court in Kowalski to the effect that the wife in B v B did not seek to set aside the original order (when the decision in B v B would seem to reveal that that is exactly what she did). In Hodges, at page 80,227, his Honour continued:
It therefore appears to me that in the present case the question of whether there has been a dissolution of the marriage is not a material fact. What is material is that there has been a property order.
His Honour ultimately held (on the facts in that case) that a cause of action estoppel should apply.
The next relevant case, in my view, is Bourke (No. 2) (1994) FLC 92-479. I do not propose to quote from Bourke at any length because it is referred to in the subsequent cases which are relevant to my determination. The first of those is the decision of the Full Court in McCabe (1995) FLC 92-634 — which appears to be the first case in which an argument was mounted (in circumstances such as these) in reliance upon section 79A(1A). The decision of the Full Court (at page 82,368) records how that situation came about. Section 79A(1A) seems to have been added as an additional ground (and, indeed, almost as an afterthought) at the commencement of the hearing before the Full Court. I do not know whether the Full Court invited the parties to consider the provisions of section 79A(1A), but the bottom line is that this is the first case of which I am aware in which the court has had to consider its possible application to this general factual matrix.
The facts in McCabe are set out in the headnote:
The parties separated in 1989 and shortly afterwards consent property orders were made. Two months later the parties reconciled without taking any steps to implement the terms of the orders which had been made.
The parties separated four years later and the wife instituted proceedings under Family Law Act 1975 (Cth) s 79A to have the consent property orders set aside. The husband opposed her application and sought to have it dismissed on the ground that it disclosed no reasonable or arguable cause of action. The husband’s application for summary dismissal of the wife’s application was dismissed
McCabe was a case in which the parties had very clearly stated that they wished to set aside earlier orders to which they had consented, and a letter had in fact been sent to the court for that purpose. At page 82,369-70, the Full Court said:
In cases of this nature conclusions about intention which should be attributed to the parties will depend upon the particular circumstances of each case. That material would not necessarily be confined to the initial decision to reconcile or, as in this case, to write to the court. Their intention may crystallise into a more precise form as time progresses and as the parties’ reconciliation continues and they conduct their lives together, including their financial affairs, so that it becomes inconsistent with any other conclusion…
There is no reason to doubt that parties can expressly or by their conduct consent to the discharge of prior orders so as to enable the court to make a fresh property order. Indeed, this would be a more likely conclusion in most cases of this type. The conclusion contended for by Mr Sofronoff would produce a situation where the previous orders were unenforceable but neither party could seek new orders (other than orders under s 78) and would be inhibited from taking proceedings in another court because such proceedings would inevitably constitute a “matrimonial cause”.
In my view, those two passages are extremely important. They emphasise that intention can be attributed to parties in a broad range of circumstances. Such an intention can crystallise as time progresses. In this case, there is no doubt that the parties intermingled their finances to some extent during the later period of cohabitation. They each made relevant contributions, and they conducted their lives as if they were married. That is so, notwithstanding the semantics used (and consciously used) by each of the parties in their affidavit material.
The first sentence of the second of the passages in McCabe referred to in paragraph 47 above warrants careful consideration. The Full Court said:
There is no reason to doubt that parties can expressly or by their conduct consent to the discharge of prior orders so as to enable the court to make a fresh property order. [Emphasis added]
In my view, the words "so as to enable the court to make a fresh property order" are extremely important. In some cases, and B v B was such a case (and so is the present case), the initial orders have long since been carried out, and there can be no doubt that all or almost all of the property dealt with in them has been subsumed by other property. A great deal of water may have passed under the bridge, as it were. It follows that the parties would not or may not have directed their minds - even by some form of implied intention or inference - to specifically setting aside the original orders because of some perceived need or desire to reallocate the property that was the subject of those orders.
What the Full Court acknowledges and reinforces by the sentence "Indeed, this would be a more likely conclusion in most cases of this type" is that parties - by their behaviour, and by conducting themselves once again as a married couple after a period of separation — would not wish to be prevented from re-litigating the issue of property settlement should it become necessary for them to do so. They would not want what may well be perceived as something akin to an artificial impediment to be placed in their way.
The Full Court in McCabe clearly accepted that an inference can be drawn from the parties’ conduct to the effect that they intended what I have loosely described as the impediment that the previous orders comprised to be removed - so that, if necessary, fresh property orders can be made. Put another way, such an intention can (but need not necessarily) be imputed to the parties.
Clearly, there is no actual or express intention in that regard. It is true that the parties did not remarry. It is also true that they did not set aside the earlier orders during the later period of cohabitation, but there was no need for them to do so because those orders had been fully carried out. For all that, the parties behaved in such a manner as to lead to an almost irresistible inference that they wished their rights to litigate property issues to remain (or to be reinstated). The decision in Kowalski is authority for the proposition that any dispute between them is likely to be a matrimonial cause. If the parties wish to litigate property issues, then they must do so in a court with jurisdiction to deal with matrimonial causes, and I could not possibly infer that they intended to remove their rights in that regard.
The decision in McCabe makes no reference to Kowalski, Hodges and/or B v B.
The last of the cases to which I propose to refer is the decision of Nicholson CJ in Sommerville (2000) FLC 93-042. His Honour's discussion of the matter commences at page 87,664 - with the statement from Mullane to which I have referred. That is also the starting point that I have adopted. His Honour then deals with the application under section 79(1A) and the decision of the Full Court in McCabe, and His Honour also cites the passages to which I have referred earlier. His Honour then makes reference to Drew (1985) FLC 91-601 and Banhidy (1983) FLC 91-302.
It is clear that His Honour was concerned about the possible lacuna in relation to jurisdiction. If a matter is a matrimonial cause, but the Family Court cannot deal with it because of a rule such as that referred to in Mullane, then a serious injustice may result. His Honour said (at page 87,665):
When these principles are applied to the present case, I think that there are strong grounds for concluding that the parties by their conduct consented to the setting aside of the original order.
His Honour then reviewed various factual matters that were relevant to the case of Sommerville - and, clearly, those factual matters do not adhere in this case. His Honour continued (at paragraph 127) as follows:
Against this background the consequences of any other finding leave the wife as the victim of a considerable injustice for the reasons pointed out by Fogarty J in Drew's case. The injustice of course is associated with her having applied the proceeds of the property settlement for joint purposes when the reconciliation occurred and being left without a remedy despite her contributions to the marriage following reconciliation. This is not an injustice associated with a making of the original order, but an injustice associated with what occurred thereafter.
I think that this is clearly a case that falls within the McCabe principle and I am satisfied that the parties, by their conduct, have consented to the discharge of the original order…
In my view, by alluding to the possible injustice that would result to the wife if a matrimonial cause could not be litigated, His Honour was referring to the discussion in McCabe in the passages which I have quoted. His Honour was saying, in my view, that the parties, by their conduct, must inevitably be regarded as having consented to the setting aside of the earlier orders - so that a court of competent jurisdiction could be empowered to make fresh property orders.

The Court does have jurisdiction

When I apply the law as it presently stands to the facts of this case (as I have discussed them), I am satisfied that this court does have jurisdiction to deal with the wife's application. Accordingly, the application of the husband for orders acknowledging that the court does not have jurisdiction will be dismissed.

I, Paul O'Halloran, certify that the preceding sixty-four (64) paragraphs are a true copy of the Reasons for Judgment of Walters FM

Associate:

Date: 15 June 2004