SANDERS & SANDERS
[2020] FamCAFC 42
•27 February 2020 – ex tempore reasons for judgment 6 March 2020 – addendum
FAMILY COURT OF AUSTRALIA
| SANDERS & SANDERS | [2020] FamCAFC 42 |
| FAMILY LAW – APPEAL – PROPERTY – Appeal against final property settlement orders – Contributions – Inadequate reasons – Error of law – Conceded appeal – Where the error is agreed by the parties – Appeal allowed – Matter remitted – Costs certificates ordered for both parties in relation to both the appeal and the rehearing of the matter. FAMILY LAW – APPEAL – ADDENDUM – Discussion of r 16.05 of the Federal Circuit Court Rules 2001 (Cth) – Amending reasons for judgment. |
| Family Law Act 1975 (Cth) s 75(2) Family Law Rules 2004 (Cth) r 17.02A |
| B & B (Cost Certificates) (2007) FLC 93-339; [2007] FamCA 1177 Bar-Mordecai v Rotman & Ors [2000] NSWCA 123 Bennett and Bennett (1991) FLC 92-191; [1990] FamCA 148 Cramer v Davies (1997) 72 ALJR 146 Dickons v Dickons (2012) 50 Fam LR 244; [2012] FamCAFC 154 O’Connor & Healy [2016] FamCAFC 111 Pollard v RRR Corporation Pty Ltd [2009] NSWCA 110 Quant & Bonde (2018) FLC 93-853; [2018] FamCAFC 150 Todorovic v Moussa (2001) 53 NSWLR 463; [2001] NSWCA 419 |
| APPELLANT: | Ms Sanders |
| RESPONDENT: | Mr Sanders |
| FILE NUMBER: | PAC | 4413 | of | 2017 |
| APPEAL NUMBER: | EA | 103 | of | 2019 |
| DATE DELIVERED: | 27 February 2020 – ex tempore reasons for judgment 6 March 2020 – addendum |
| PLACE DELIVERED: | Sydney |
| PLACE HEARD: | Sydney |
| JUDGMENT OF: | Ainslie-Wallace, Aldridge & Loughnan JJ |
| HEARING DATE: | 27 February 2020 |
| LOWER COURT JURISDICTION: | Federal Circuit Court of Australia |
| LOWER COURT JUDGMENT DATE: | 13 September 2019 |
| LOWER COURT MNC: | [2019] FCCA 2765 |
REPRESENTATION
| COUNSEL FOR THE APPELLANT: | Mr Jackson |
| SOLICITOR FOR THE APPELLANT: | McCabe Partners Lawyers |
| COUNSEL FOR THE RESPONDENT: | Ms Spain |
| SOLICITOR FOR THE RESPONDENT: | Marriott Oliver Solicitors |
Orders
The appeal against the orders of Judge Myers made on 13 September 2019 is allowed and those orders are set aside.
The matter be remitted to the Federal Circuit Court of Australia for rehearing by a judge other than Judge Myers.
There be no order as to costs.
The Court grants to the appellant wife a costs certificate pursuant to s 9 of the Federal Proceedings (Costs) Act 1981 (Cth) being a certificate that, in the opinion of the Court, it would be appropriate for the Attorney-General to authorise a payment under that Act to the appellant in respect of the costs incurred by the appellant wife in relation to the appeal.
The Court grants to the respondent husband a costs certificate pursuant to s 6 of the Federal Proceedings (Costs) Act 1981 (Cth) being a certificate that, in the opinion of the Court, it would be appropriate for the Attorney-General to authorise a payment under that Act to the respondent in respect of the costs incurred by the respondent husband in relation to the appeal.
The Court grants to each of the parties a costs certificate pursuant to the provisions of s 8 of the Federal Proceedings (Costs) Act 1981 (Cth) being a certificate that, in the opinion of the Court, it would be appropriate for the Attorney-General to authorise a payment under that Act to each of them in respect of costs incurred by them in relation to the new trial ordered.
Note: The form of the order is subject to the entry of the order in the Court’s records.
IT IS NOTED that publication of this judgment by this Court under the pseudonym Sanders & Sanders has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
Note: This copy of the Court’s Reasons for Judgment may be subject to review to remedy minor typographical or grammatical errors (r 17.02A(b) of the Family Law Rules 2004 (Cth)), or to record a variation to the order pursuant to r 17.02 Family Law Rules 2004 (Cth).
| THE FULL COURT OF THE FAMILY COURT OF AUSTRALIA AT SYDNEY |
Appeal Number: EA 103 of 2019
File Number: PAC 4413 of 2017
| Ms Sanders |
Appellant
And
| Mr Sanders |
Respondent
EX TEMPORE REASONS FOR JUDGMENT
Aldridge J
On 13 September 2019, a judge of the Federal Circuit Court of Australia made final orders which divided the property of Ms Sanders (“the wife”) and Mr Sanders (“the husband”) so that they each received equal shares.
The wife appealed those orders asserting principally that the primary judge’s reasons for judgment were inadequate and that his Honour did not assess and give appropriate weight to the various contributions made by each of the parties.
The husband accepts this to be so and concedes that the appeal must be allowed and his Honour’s orders be set aside. Each party seeks costs certificates for the appeal and the rehearing of the matter pursuant to the Federal Proceedings (Costs) Act 1981 (Cth) (“the Costs Act”).
The Appeal
The parties married in 1978. At that time, neither party had any assets of significance.
In 1982, a property at Suburb A (“the Suburb A property”) was purchased from the estate of the husband’s grandmother on the basis that the husband paid some of the estate’s debts and made payments to some of the estate’s beneficiaries. In 1983, the parties borrowed $22,000 from a bank and a loan was secured over the Suburb A property. A reasonable inference is that this advance was the source of the payments made to the estate’s debts and its beneficiaries.
Subsequently, the Suburb A property was renovated with the husband doing most of the renovation work.
The parties separated in 2005, after the wife’s child from a previous relationship alleged that the husband had sexually abused her over many years.
The parties received the following payments during the marriage and after separation:
·In 1998, the husband received a payment of $7,000 from his superannuation fund;
·In 1999, the wife received a payment of $34,000 as compensation for a work related injury;
·In 2000, the husband received a payment of $40,000 from his brother in lieu of a quarter share of his late mother’s estate;
·In 2002, the husband received a payment of $5,000 as compensation for a work related injury;
·In December 2006, the husband received a redundancy payment of $50,071.74; and
·In 2014, the wife received an inheritance of $220,000 from her late mother’s estate.
Not surprisingly, all of these payments, except for the 2014 inheritance received by the wife, had been spent by the time of the hearing before the primary judge.
The property available for division between the parties at the time of the hearing before the primary judge had a total value of $1,223,640 which consisted primarily of the Suburb A property ($1,000,000) and, cash in bank accounts and shares owned by the wife ($179,640). The parties had no liabilities to be taken into account.
It can readily be seen that the cash and shares held by the wife were what remained of the inheritance received by her in 2014 from her late mother’s estate. This amount constituted approximately 14.7 per cent of the property available for division between the parties. There was no suggestion that the husband made any contribution in relation to the inheritance received by the wife from her late mother’s estate.
The primary judge found that during the marriage the parties worked together in a “joint endeavour” (at [13]).
His Honour turned to the parties’ various inheritances and said:
23.The Court firstly finds that it is just and equitable to make an adjournment of property between the parties. The Court considers the financial contributions of the parties. The parties had little by the way of property at the commencement. The husband’s mother provided the parties with the [Suburb A] property and the liability for the costs of the beneficiaries under the estate, with the husband paying out his grandmother’s estate from the funds the parties jointly borrowed. The Court considers the decision of the Full Court in Kessey & Kessey (1994) FLC 92-495 where the Court held that the contribution by a parent of a party to a marriage to the property of the marriage will be taken to be a contribution made on behalf of the child whose parents made that gifts, except where the parent intended the gift for both parties.
24.Noting the earliness of the gift in the parties’ relationship and that no evidence was adduced by the wife as to the gift of [the husband’s mother’s] interest in the inheritance being intended to benefit the wife, the Court finds the [Suburb A] property as the lease-hold estate, as a contribution made on the husband’s behalf. The husband later received $40,000 from his mother’s estate. The wife received a lump sum personal injury payment in the sum of $34,000. The husband received a lump sum of $7000 from his superannuation when leaving his industry and a later Worker’s Compensation payout of $5000.
25.The husband received a redundancy payment of $50,000 post-separation and the wife received an inheritance from her mother’s estate of $220,000. Both parties worked to the best of their ability in what the Court has already described as a joint endeavour during their marriage. They both had time off work for legitimate reasons and with the time off work being a joint decision of the parties. The Court finds that the husband undertook improvements to the [Suburb A] property of a type that should be recognised, pursuant to section 79(4)(c).
It can be seen that the primary judge did not consider whether the funds borrowed in 1983 were used to acquire the Suburb A property. To the extent that they were, it was a joint contribution.
The primary judge then discussed the various considerations that arise under s 75(2) of the Family Law Act1975 (Cth) and said:
26.The effect of these proposed property orders will not affect as what might be described as the earning capacity of the parties. Taking into account their respective contributions, the Court takes into account those measures set out at section 75(2): The Court finds that the wife’s contributions, as homemaker and parent, were greater, where having heard the evidence of the parties, those duties were largely left to the wife by the husband. The Court finds that based upon contributions, it is just and equitable, that there be no adjustment made in either parties’ favour.
This last comment made by the primary judge is somewhat perplexing because the Suburb A property was jointly owned by the parties but the wife was the sole owner of the cash and shares that were available for division between the parties. No adjustment made in favour of either of the parties would see the wife receive half of the Suburb A property ($500,000), plus her cash and shares ($179,640), car ($14,000) and furniture ($5,000), which totals $698,640 or approximately 57 per cent of the available property for division between the parties. Nonetheless, the orders made by the primary judge provided for equal distribution of the property.
The obligation to give reasons is well known (Bennett and Bennett (1991) FLC 92-191 at 78,266–78,267; Pollard v RRR Corporation Pty Ltd [2009] NSWCA 110 at [57]–[59]).
In property settlement cases, the trial judge is required to assess the contributions of the parties “holistically and by analysing the nature, form, characteristics and origin of the property” to be divided and “in turn, analysing the nature, form and extent” of the myriad of contributions of all types made by each of the parties (Dickons v Dickons (2012) 50 Fam LR 244 at [21]).
There is a vast difference in the nature, extent and characteristics of the contributions of the excess value of the Suburb A property in 1982 after the joint mortgage is taken into account (whatever that value may be since there was no evidence of its value at that time); a payment for a work related injury received during the marriage and presumably spent for the benefit of the family; and an inheritance received nine years after separation, the balance of which represented nearly 15 per cent of the property available for division between the parties.
His Honour’s reasons which have been set out above, undertake no such analysis. It appears as if all the contributions were regarded as equal or at least when taken into account together, were equal. This was clearly not the case, especially as to the 2014 inheritance received by the wife.
Another way to look at it is to say that the 2014 inheritance received by the wife was of such a different nature and extent that it had to be dealt with separately as it was a point critical to the contest between the parties. The wife’s case that this contribution by her to the property available for division between the parties justified her receiving significantly more than 50 per cent of the property needed to be dealt with. It was not.
It follows that the primary judge’s reasons for judgment do not come to grips with the issues in the case and do not explain how the equal division of the parties’ property was regarded by him as appropriate.
The parties accept this to be the case. It follows, in my opinion, that the appeal must be allowed, the orders set aside and the matter remitted for rehearing before another judge in the Federal Circuit Court of Australia.
Costs
Each party seeks costs certificates under the Costs Act in relation to both the appeal and the rehearing of the matter.
The steps to be met before orders for costs certificates may be made are well known. See, for example, Cramer v Davies (1997) 72 ALJR 146; B & B (Cost Certificates) (2007) FLC 93-339.
The authorities establish that the following matters must be satisfied before a costs certificate can be issued pursuant to either s 6 or s 9 of the Costs Act, namely:
·The existence of a Federal appeal;
·That the appeal has succeeded on a question of law; and
·That the Court concerned should have heard the appeal.
Clearly in this case, there was a Federal appeal and it is being heard today.
It falls then to consider whether the appeal has succeeded on a question of law. Given the errors of law which attended his Honour’s reasons, I am satisfied that the appeal did succeed on a question of law.
It is therefore appropriate to grant both parties costs certificates under the Costs Act for the appeal and the rehearing of the matter.
I propose orders to that effect.
Loughnan J
I agree with the orders proposed and the reasons given.
Ainslie-Wallace J
I too agree with the orders proposed and the reasons given by Aldridge J.
Therefore, the orders of the Court will be:
(1)The appeal against the orders of Judge Myers made on 13 September 2019 is allowed and those orders are set aside.
(2)The matter be remitted to the Federal Circuit Court of Australia for rehearing by a judge other than Judge Myers.
(3)There be no order as to costs.
(4)The Court grants to the appellant wife a costs certificate pursuant to s 9 of the Federal Proceedings (Costs) Act 1981 (Cth) being a certificate that, in the opinion of the Court, it would be appropriate for the Attorney-General to authorise a payment under that Act to the appellant in respect of the costs incurred by the appellant wife in relation to the appeal.
(5)The Court grants to the respondent husband a costs certificate pursuant to s 6 of the Federal Proceedings (Costs) Act 1981 (Cth) being a certificate that, in the opinion of the Court, it would be appropriate for the Attorney-General to authorise a payment under that Act to the respondent in respect of the costs incurred by the respondent husband in relation to the appeal.
(6)The Court grants to each of the parties a costs certificate pursuant to the provisions of s 8 of the Federal Proceedings (Costs) Act 1981 (Cth) being a certificate that, in the opinion of the Court, it would be appropriate for the Attorney-General to authorise a payment under that Act to each of them in respect of costs incurred by them in relation to the new trial ordered.
ADDENDUM
The above reasons for judgment were given ex tempore on 27 February 2020, immediately after counsel for each of the parties completed their oral submissions. In the course of preparing the written version of the ex tempore reasons for publication, the Court became aware that the version of the primary judge’s reasons for judgment in the Appeal Book is not the same as the version that is currently available on the Court’s judgment database.
The primary judge’s reasons for judgment were given orally on 13 September 2019. Although they were described as being ex tempore, they were not, because they were not delivered at the time of the hearing on 18 February 2019, but rather some seven months after. Nonetheless, as they were given orally, the usual practice is that the written version of the reasons for judgment is not released until it has been settled by the judge. In such a case, a judge is entitled to correct matters of expression and the clarity of the reasons but cannot make any changes to their substance (Bar-Mordecai v Rotman & Ors [2000] NSWCA 123 at [193]–[195]; Todorovic v Moussa (2001) 53 NSWLR 463 at [41]–[42]; O’Connor & Healy [2016] FamCAFC 111 at [17]–[19]; Quant & Bonde (2018) FLC 93-853 at [14]–[19]).
Presumably, this course was followed. The primary judge’s reasons for judgment in the Appeal Book contain a certificate by his Honour’s associate dated 26 September 2019, accepting that they are a true copy of his Honour’s reasons.
A Notice of Appeal was filed on 8 October 2019.
On 15 November 2019, his Honour’s associate sent a further version of the reasons for judgment, which were certified to be accurate as at 13 November 2019, to the Judgments Co-ordinator of the Federal Circuit Court of Australia, requesting that she “[p]lease use this as the settled judgment in the above matter”.
The changes to the reasons for judgment and the orders, other than the deletion of a costs order, are not substantial.
However, in our view, it is not permissible for a judge of the Federal Circuit Court of Australia to alter published reasons for judgment unless the changes are permitted by r 16.05(2) of the Federal Circuit Court Rules 2001 (Cth) (“the Federal Circuit Court Rules”) and are made only after the parties have been given the opportunity to be heard on the alterations.
Rule 16.05(2) of the Federal Circuit Court Rules applies only to judgments or orders and not reasons for judgment (see s 5 of the Federal Circuit Court of Australia Act 1999 (Cth)). There is no equivalent in the Federal Circuit Court Rules to r 17.02A of the Family Law Rules 2004 (Cth), which states:
…
The court may, at any time:
(a)vary or set aside reasons for judgment if the reasons were issued by mistake; or
(b)correct a clerical mistake in reasons for judgment, or an error arising in reasons for judgment from any accidental slip or omission.
Even under this rule, the scope for amending reasons for judgment is limited.
For these reasons, we are content to rely on the original version of the reasons for judgment certified on 26 September 2019. We have, however, felt it necessary to add these additional comments to explain any discrepancies between the references to the reasons of the primary judge made in our reasons for judgment and those of the primary judge that are presently available on the Court’s judgment database.
I certify that the preceding thirty-three (33) paragraphs are a true copy of the ex tempore reasons for judgment of the Honourable Full Court (Ainslie-Wallace, Aldridge & Loughnan JJ) delivered on 27 February 2020 with a ten (10) paragraph addendum delivered on 6 March 2020.
Associate:
Date: 6 March 2020
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