Ramsey and Ramsey

[2016] FCCA 1894

FEDERAL CIRCUIT COURT OF AUSTRALIA

RAMSEY & RAMSEY [2016] FCCA 1894

Catchwords:
CHILD SUPPORT – Binding Child Support Agreement – Application to set aside binding child support agreement – application for declaration that child support agreement not binding – whether exceptional circumstances established.

Legislation:

Child Support (Assessment) Act 1989 (Cth), ss.80C, 136

Family Law Act 1975 (Cth), s.90G

Cases cited:

Hoult v Hoult (2013) 276 FLR 412; 50 Fam LR 260; FLC 93-546; [2013] FamCAFC 109

Ramsey & Ramsey [2012] FMCAfam 739

Applicant: MR RAMSEY

Respondent: MS RAMSEY

File Number: SYC 1968 of 2008

Judgment of: Judge Scarlett

Hearing dates: 9-11 April 2014

Date of Last Submission: 11 April 2014

Delivered at: Sydney

Delivered on: 26 July 2016

REPRESENTATION

Applicant: In person

Solicitors for the Applicant: Armstrong Legal

Counsel for the Respondent: Ms Dart

Solicitors for the Respondent: Monardo Lawyers

ORDERS

1. The Amended Initiating Application filed on 10 April 2014 is dismissed.

2. Any party seeking an Order for costs must file and serve an Application in a Case and an affidavit setting out the amount of costs sought and the basis upon which those costs are calculated within one (1) month of the date of this Order.

IT IS NOTED that publication of this judgment under the pseudonym Ramsey & Ramsey is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).

FEDERAL CIRCUIT COURT
OF AUSTRALIA
AT SYDNEY

SYC 1968 of 2008

MR RAMSEY

Applicant

And

MS RAMSEY

Respondent

REASONS FOR JUDGMENT

Application

1. By his Amended Initiating Application filed on 10^th April 2014, midway through a defended final hearing, the Applicant seeks the following Orders:

   1. That the Binding Child Support Agreement executed by the parties on 2 March 2010 be declared not binding.

   2. Alternatively, that the Binding Child Support Agreement executed by the parties on 2 March 2010 be set aside.

   3. That the arrears accrued in respect of the Binding Child Support Agreement be discharges.

   4. That the Father pays child support for the children of the relationship as assessed by the Child Support Agency.

   5.  That the Mother’s remaining Applications be dismissed.

   6. That the Mother pays the Father’s costs of and incidental to these proceedings.

2. The Application is opposed by the Respondent. 

Background

1. The parties were married on (omitted) 1996. They were divorced by order of the Federal Magistrates Court of Australia on 20^th May 2008. 

2. There are two children of the marriage, a boy who was born on (omitted) 1999 and a girl who was born on (omitted) 2001. They reside with the Respondent Mother.

3. On 18^th June 2009 the Applicant commenced proceedings in the Family Court seeking parenting and property orders.

4. The Applicant remarried on (omitted) 2009.

5. On 2^nd March 2010 the parties entered into Consent Orders resolving the parenting and property issues between them. They also entered into the Binding Child Support Agreement the subject of this Application.

6. The Applicant and his current wife became the parents of a baby boy on (omitted) 2010.

7. On 2^nd September 2011 the Respondent filed an Enforcement Summons.

8. On 11^th October 2011 the Applicant filed an Application seeking final orders setting aside the Binding Child Support Agreement under s.136(2)(d) of the Child Support (Assessment) Act 1989 (Cth) and seeking interim orders until the final hearing of his Application:

   a)staying the operation of the Child Support Agreement; and

   b)staying the Enforcement Summons.

9. On 14^th August 2012 I dismissed the Applications for a stay of the Child Support Agreement and a stay of the Enforcement Summons (Ramsey & Ramsey[1]).

   [1] [2012] FMCAfam 739

10. The Applicant’s second child by his current wife was born on (omitted) 2012.

11. On 4^th October 2012 the Applicant became bankrupt by filing a Debtor’s Petition.

12. On 30^th July 2013, when the Application was listed for final hearing, the parties entered into Interim Consent Orders:

    a)adjourning the final hearing of the Application to a date to be determined by the Court;

    b)staying the operation of the non-periodic payments in the Binding Child Support Agreement;

    c)that the parties paid their own costs of the adjournment of the final hearing.

13. Notation A of the Interim Consent Orders said:

    It is noted that the Applicant Father will pay periodic child support to the Respondent Mother, at an amount calculated by the Child Support Agency pursuant to Clause 19 and 20 of the Binding Child Support Agreement dated 2 March 2010.

14. In 3^rd September 2013 the Application was listed for final hearing on 9^th April 2014 to continue through to 11^th April.

15. However, on 3^rd April 2014 the Applicant filed an Amended Initiating Application seeking orders that:

    a)the Binding Child Support Agreement be set aside;

    b)the Respondent’s remaining applications be dismissed; and

    c)the Respondent should pay the Applicant’s costs.

16. The final hearing commenced on 9^th April 2014.

17. On 10^th April 2014, the second day of the hearing, the Applicant filed the Amended Application, which was really a Further Amended Application, seeking the orders set out in paragraph [1] above.         

The Hearing

1. The Applicant relied on the following documents:

   a)his affidavit sworn 26^th July 2013;

   b)his affidavit sworn on 13^th March 2014;

   c)his affidavit sworn on 7^th April 2014;

   d)his Financial Statement sworn on 29^th July 2013; and

   e)his Financial Statement sworn on 13^th March 2014.

2. The Applicant gave oral evidence and was cross-examined by Ms Dart of Counsel for the Respondent.

3. The Respondent relied on her affidavits sworn:

   a)2^nd September 2011;

   b)7^th November 2011; and

   c)4^th April 2014.

4. The Respondent gave oral evidence and was cross-examined by the Applicant, her former husband, who was not legally represented.

5. The hearing was conducted in two stages as a result of the Applicant’s further Amended Application filed on 10^th April, the second day of the hearing. The Applicant’s proposed order 1 sought that the Agreement should be declared not to be a binding agreement because of a failure by the Applicant’s then solicitor to give him adequate legal advice in accordance with s.80C of the Child Support (Assessment) Act 1989.

6. Exhibit 1 was a copy of a letter of advice from the Applicant’s then solicitor dated 25^th June 2008. The solicitor was not called to give evidence. The Applicant waived his privilege in respect of this letter and other correspondence from his then solicitor.

7. Counsel for the Respondent relied on the decision of the Full Court of the Family Court in Hoult v Hoult[2], which dealt with the essentially similar s.90G of the Family Law Act 1975 (Cth), in support of the proposition that a certificate by the lawyer that independent advice had been given was prima facie evidence and that the onus rested on the Applicant to disprove that fact.

   [2] (2013) 276 FLR 412; 50 Fam LR 260; FLC 93-546; [2013] FamCAFC 109

8. I dismissed the Application insofar as Order 1 was concerned.

9. The hearing proceeded until the close of evidence the next day.

10. Judgment was reserved.

11. On 22^nd June 2016 the Respondent filed an Application in a Case supported by an affidavit, seeking to reopen the proceedings. The Application was returnable on 6^th July 2016. By that stage, the Applicant was legally represented by Ms Smyth, who filed a Notice of Address for Service. She advised the Court that the Application to reopen was opposed.

12. The following day the Application in a Case was discontinued.

13. It is important to note that, because the Application in a Case was discontinued, I have not had regard to the contents of the affidavit that was filed in support of the Application in a Case. The substantive Application has been decided on the basis of the evidence that was before the Court at the original hearing.

Setting aside a Binding Child Support Agreement

1. Section 136 of the Child Support (Assessment) Act deals with the power of the Court to set aside a child support agreement. Subsection 136(2)(d) provides that the court may set aside the agreement on 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.

Conclusions

1. It is the Applicant’s case that because of a significant downturn in his finances, which impelled him to become bankrupt by filing a Debtor’s Petition on 4^th October 2012, he would suffer hardship if the Binding Child Support Agreement were not set aside.

2. The Applicant has made out a case of hardship but what he has not done is show that this hardship arises from exceptional circumstances. I am not satisfied that a financial downturn impelling the Applicant to make himself bankrupt can be classified as a circumstance of such an unusual or exceptional nature that it can be regarded as “exceptional circumstances” within the meaning of s.136(2)(d).

3. Consequently, the Application will be dismissed.          

I certify that the preceding thirty-six (36) paragraphs are a true copy of the reasons for judgment of Judge Scarlett

Date:     26 July 2016