Sionko & Sionko
[2022] FedCFamC1F 774
Federal Circuit and Family Court of Australia
(DIVISION 1)
Sionko & Sionko [2022] FedCFamC1F 774
File number(s): SYC3 723 of 2019 Judgment of: WILSON J Date of judgment: 13 October 2022 Catchwords: FAMILY LAW – NATIONAL ARBITRATION LIST – s 13J application to set aside the arbitral award – application refused. Legislation: Family Law Act 1975 (Cth) s 13J Cases cited: Collector of Customs v Agfa-Gevaert Ltd (1996) 186 CLR 389
De Winter v De Winter (1979) 4 Fam LR 583
Dougherty v Dougherty (1987) 163 CLR 278
Griffiths & Griffiths [2022] FedCFamC1F 219
Gronow v Gronow (1979) 144 CLR 513
Haritos v Federal Commissioner of Taxation (2015) 233 FCR 315
House v King (1936) 55 CLR 490
In the Marriage of Kennon (1997) 22 Fam LR 1
Keating v Keating (2018) 59 Fam LR 158
Mallet v Mallet (1984) 156 CLR 605
Norbis v Norbis (1979) 144 CLR 513
Stanford v Stanford (2012) 247 CLR 108
Other: Justice Duncan Kerr, What Is A Question of Law Following Haritos v Federal Commissioner of Taxation [2016] FedJSchol 18. Division: Division 1 First Instance Number of paragraphs: 32 Date of last submissions: 26 September 2022 Date of hearing: On the papers Place: Melbourne Counsel for the Applicant: Mr D. Dura Solicitor for the Applicant: Willis & Bowring Solicitors Counsel for the Respondent: P. Cook Solicitor for the Respondent: Solari Law ORDERS
SYC 3723 of 2019 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)
BETWEEN: MS SIONKO
Applicant
AND: MR SIONKO
Respondent
order made by:
JUSTICE WILSON
DATE OF ORDER:
12 OCTOBER 2022
THE COURT ORDERS THAT:
1.The application in a proceeding dated 3 August 2022 is dismissed.
2.If any party seeks costs –
(a)any affidavits and submissions in support of an application for costs must be filed and served by noon on 27 October 2022;
(b)any affidavits in reply and submissions in opposition to any application for costs must be filed and served by noon on 11 November 2022; and
(c)the issue of costs will be determined on the papers thereafter.
Note: The form of the order is subject to the entry in the Court’s records.
Note: This copy of the Court’s Reasons for judgment may be subject to review to remedy minor typographical or grammatical errors (r 10.14(b) Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 10.13 Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth).
Section 121 of the Family Law Act 1975 (Cth) makes it an offence, except in very limited circumstances, to publish proceedings that identify persons, associated persons, or witnesses involved in family law proceedings.
IT IS NOTED that publication of this judgment by this Court under the pseudonym Sionko & Sionko has been approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
REASONS FOR JUDGMENT
WILSON J
The arbitrator’s award in this proceeding made 24 June 2022 was the subject of the husband’s application in an arbitration dated 3 August 2022 for orders under s 13J of the Family Law Act reversing or varying the arbitrator’s award. In essence, the husband contended that the arbitrator made an error of law in that the arbitrator exercised his discretion under s 79 in a manner that was unreasonable or plainly unjust. The wife contended that the husband failed to address the requirements of s 13J with the consequence that the husband’s application should be dismissed and that the husband should pay her costs of and incidental to the review application.
As these reasons record, in my view, the review application fails.
Relevant legislative framework
Section 13J(1) of the Family Law Act entitles a party to a registered award to apply to the court for the review of the award on questions of law. Upon such a review, the court may determine all questions of law arising in relation to the award and the court may make such decree as the court considers appropriate including a decree affirming, reversing or varying the award.
The “question of law” in this s 13J application was expressed very broadly, although it was not framed as a question of law properly so called but rather as an order the husband sought. Counsel for the wife contended that the husband failed to articulate a question of law.
In Griffiths & Griffiths[1] I examined at a reasonably high level of abstraction what may answer the description of a “question of law”. A distinction exists between a question of law, a question of fact and even a question of mixed fact and law.[2]
[1] [2022] FedCFamC1F 219.
[2] Haritos v Federal Commissioner of Taxation (2015) 233 FCR 315 and Collector of Customs v Agfa-Gevaert Ltd (1996) 186 CLR 389, 394. See also Justice Duncan Kerr, What Is A Question of Law Following Haritos v Federal Commissioner of Taxation [2016] FedJSchol 18.
In the review applicant’s affidavit made 3 August 2022, he asserted that the arbitrator made several errors of fact as well as an error of law, the latter being the arbitrator’s exercise of discretion being unreasonable or plainly unjust.[3] It seemed that the review applicant was relying a long line of established authority that provided for the circumstances justifying appellate interference within the extraordinarily wide discretion conferred in a s 79 proceeding.[4]
[3] De Winter v De Winter (1979) 4 Fam LR 583 and Mallet v Mallet (1984) 156 CLR 605.
[4] House v King (1936) 55 CLR 490, Gronow v Gronow (1979) 144 CLR 513, Mallet v Mallet (op cit), Norbis v Norbis (1979) 144 CLR 513, Dougherty v Dougherty (1987) 163 CLR 278 and Stanford v Stanford (2012) 247 CLR 108.
Assuming that the questions of law were as posed in paragraphs 45 and 46 of the review applicant’s undated written submissions, the questions of law were as follows –
(a)whether the arbitrator’s failure to identify the parties’ respective contributions caused the arbitrator’s discretion to miscarry leading to orders being made that were unreasonable or plainly unjust; and
(b)whether the arbitrator’s failure to consider the husband’s post separation contributions caused the arbitrator’s discretion to miscarry leading to orders being made that were unreasonable or plainly unjust.
These are my reconfigurations of the propositions put forward by the review applicant. They were not to questions of law actually proposed by the review applicant.
Those propositions differed to those stated in paragraph 29 of the review applicant’s written submissions. At paragraph 29 the review applicant contended as follows –
By reason of the Arbitrator making errors as to:
(i)Failing to recognize the contribution made by the Husband’s family towards the purchase/mortgage and utilities associated with ownership of [E Street, Suburb F], and
(ii)Husband’s payment of the mortgage repayments and utilities for the former matrimonial home post separation
the Arbitrator has failed to correctly apply s 79(4) FLA and misapplied his discretion.
The arbitrator’s consideration of contributions
The arbitrator’s reasons spanned 316 paragraphs over 49 pages. As the review applicant focused in particular on the subject of contributions, it is relevant to observe that the arbitrator recited in paragraph 10(g) of his reasons that the issues that fell for determination included contributions. That issue was in the following terms –
The assessment of contributions before and during the relationship and following separation and the consideration of each party’s future financial needs and whether there is to be an adjustment in favour of either party for relevant factors under section 75(2).
It could not be said that the arbitrator was not alive to the requirement for him to examine, in detail, every facet of the parties’ contributions, including post separation contributions. In paragraph 15 of the arbitrator’s reasons the arbitrator set out the legal requirement for his consideration of contributions. It was in the following terms –
In determining claims for alteration of property interests, I am required to:
….
Consider, identify and assess the contributions by the parties to the acquisition, conservation and/or improvement of their property, including financial and non-financial contributions and any contributions to the welfare of the family before, during and after the relationship came to an end;
That accorded with the observations of the High Court in Stanford v Stanford.[5] The arbitrator additionally observed as follows –
Finally, it is considered not only open to me but sometimes necessary and proper for me to then stand back and consider the effect of those findings and determinations and resolving what Order is “just and equitable” in all the circumstances. In other words, I may consider, not only the percentage division of the property and its consequences after considering and weighing all relevant matters, but may need to consider the real dollar value and the monetary consequences of the proposed division.
[5] (2012) 247 CLR 108.
The arbitrator made observations about the parties’ initial contributions between paragraphs 28 and 71 of the arbitrator’s reasons. Of significance were the following –
(a)at the commencement of the relationship in 1995 the wife did not own any asset of significance;
(b)the husband owned a one quarter interest in E Street, Suburb F with his three brothers;
(c)at trial the husband’s one quarter interest was valued at $550,000;
(d)the purchase price for E Street, Suburb F was $80,000 of which $60,000 was obtained from National Australia Bank secured by mortgage, each sibling being registered as a tenant in common in equal shares on or about April 1984; and
(e)the arbitrator found that neither party brought any asset to the relationship that required recognition following a 29 year relationship.
The arbitrator made observations about the parties’ contributions during the relationship until the time of separation. Of significance were the following –
(a)each party disputed the contributions made by the other, both financially as well as in the capacity as parent and homemaker;
(b)the husband worked as a tradesperson and purchased in 2003 the business G Company (“the business”) which he owns and operates to this day;
(c)the husband borrowed $70,000 to purchase the business, secured by mortgage over the home at B Street, Suburb J being the former matrimonial home of the parties;
(d)the wife worked in various jobs for the whole of the relationship including at the business although the wife was principally involved in homemaker and parenting roles with limited assistance from the husband;
(e)both the husband and the wife were involved in the care and upbringing of Mr X who worked for a time with his step-father in the business;
(f)the parties lived rent free for about two years from late 1987 or thereabouts with the maternal grandmother at C Street, Suburb J;
(g)in August 1986 the parties purchased their first home at D Street, Suburb J, paying $56,500 and borrowing $46,000 with the wife applying $10,000 to that purchase from funds derived from her property settlement with her former husband in late 1986;
(h)as the wife did not qualify for a home loan, the wife and the wife’s sister Ms K were joint borrowers to enable the purchase to proceed;
(i)other than being a joint borrower, Ms K did not contribute to the purchase price;
(j)the husband paid mortgage instalments;
(k)after renovation work was completed, the husband and wife moved into D Street, Suburb J in late 1987 or early 1988;
(l)in 1999 the parties sold D Street, Suburb J and acquired B Street for $330,000 funded by the proceeds of sale of D Street ($215,000 less $11,480 due to National Australia Bank) and mortgage finance from H Finance in the sum of $147,000;
(m)the parties’ child Ms Y was born in 2001;
(n)the parties separated under one roof in 2014, continuing to live at B Street, Suburb J;
(o)B Street, Suburb J was sold in late 2020, settlement of which was effected in October 2020; and
(p)the net proceeds of sale being a little over $900,000 were deposited in a controlled monies account maintained by the wife’s solicitors.
The arbitrator found that considerable conflict pervaded the marital relationship of the parties and that the husband and wife failed to cooperate or communicate on financial matters especially following separation during which period (2017-2019) various household utilities and local rates went unpaid. The arbitrator found that those payments were due in equal share.
The arbitrator found that in 2015 the home in Suburb J was struck by a major weather event causing extensive damage and at the time, the home was not insured.
Allegations of family violence
The arbitrator addressed allegations by the wife in relation to family violence between paragraphs 72 and 99 of the arbitrator’s reasons. The arbitrator recited the wife’s assertions of family violence, then her version of the evidence as well as the husband’s version of it. In the upshot, the arbitrator relied on In the Marriage of Kennon[6] and Keating v Keating[7] in concluding that no evidence existed by which the arbitrator could be satisfied that there was a discernible impact which adversely affected the wife’s ability to make contributions in any form.
[6] (1997) 22 Fam LR 1.
[7] (2018) 59 Fam LR 158.
Post separation contributions
It will be recalled that the review applicant placed particular reliance upon what was said to be a failure by the arbitrator to have considered post separation contributions. In fact, the arbitrator addressed post separation contributions between paragraphs 100 and 104 of the arbitrator’s reasons. Of significance were the following –
(a)the parties lived separately under the one roof between 2014 and 2020;
(b)the parties made an equal contribution to the repairs to the home and cleaning up after the major weather event in 2015;
(c)the wife assumed sole responsibility for the parties’ child until that child attained her majority in 2019;
(d)the husband became entitled to an interest in cash following the death of his mother in 2018 yet the wife made no contribution to that amount with the consequence that the arbitrator did not bring the sum of $7,879 into account as an asset as a balance sheet item.
The arbitrator’s treatment of the SUBURB F PROPERTY
The arbitrator recited that a contentious issue in the case was the determination of the husband’s interest in the property at E Street, Suburb F. The wife contended at the arbitration that the husband retained a 25% interest in that property, corresponding to a value of $550,000. The arbitrator recorded that the property at E Street, Suburb F had a current value of $2,200,000. The husband and his brothers purchased that property to provide a home for their parents in their later years. The arbitrator went on to address the Deed of Family Arrangement dated 21 January 2022 or thereabouts. No issue was taken in this review application about that deed.
The specific challenge of this review application
Between paragraphs 30 and 43 of his counsel’s written submissions, the review applicant put forward his contentions about the alleged error raised and set out in paragraph 9 above. Those contentions may be relevantly distilled in the following manner –
(a)the arbitrator adopted a contradictory approach to (the) impact of the parties’ contributions because the arbitrator identified the husband’s initial contribution as including a one quarter interest in that land as being $550,000;
(b)the arbitrator decided that neither party brought any asset of value to the relationship requiring recognition yet the arbitrator regarded as being significant the sum of $10,000 paid by the wife towards the deposit.
The review applicant argued –
(a)the total value of the pool for division was $1,720,737 of which $550,000 represented approximately one third of the value;
(b)the arbitrator adopted a confusing approach to the treatment of the E Street, Suburb F property;
(c)on its proper construction, the arbitrator’s award is to be read (paragraph 38(i) and (ii) especially) as being a reference to the husband’s mother and brother having met the husband’s obligations in paying mortgage instalments in relation to E Street, Suburb F, although the arbitrator did not find as much in precise terms; and
(d)the arbitrator failed to acknowledge the husband’s contribution towards the net asset pool “through his interest in the E Street property”.[8]
[8] Paragraph 40 of the written submissions of counsel for the review applicant.
Several propositions of fact were put in opposition by counsel for the wife. They may be synthesised in the manner set out below –
(a)at paragraph 117 of the arbitrator’s award, the arbitrator recorded the uncontroversial fact that between 1986 and 2020[9] the husband was absent from the E Street property during which time the husband did not make any payments in respect of his share of loan or mortgage indebtedness and he did not pay any share of bills;
(b)at paragraph 118 and 119 of his reasons the arbitrator found that there was no evidence as to who actually paid the balance of the husband’s loan, even though the husband had been given leave to adduce that evidence had he wished to do so; and
(c)at paragraph 132 of the arbitrator’s reasons the arbitrator recorded that no accurate evidence had been adduced of the financial arrangements (between the husband and the wife) as to the sharing of expenses such as rates, insurance, maintenance, repairs and the payment of liabilities.
[9] A period of 34 years.
consideration
The review applicant cast his case under s 13J on the basis that the orders made by the arbitrator were unreasonable or plainly unjust. That was said to be the “question of law” he sought determined, even though he did not express that as a question nor give particulars of the question itself or the basis of the assertion beyond those identified above in written submissions. Counsel for the wife opposed this application on the basis that the arbitrator’s findings were wholly maintainable at a factual level and in reality, the review applicant challenged the arbitrator’s findings at a factual level rather than asserting the existence of a question of law to be determined.
As to whether the ultimate result of the arbitration being unreasonable or plainly unjust can be a question of law, I am of the view that it can. It is one of the categories specifically identified in the High Court authorities mentioned in paragraph 6 above concerning legitimate bases for the interference with the judicial discretion conferred by s 79 of the Family Law Act.
That said, a review under s 13J for an unreasonable result or on the basis that orders were made that are plainly unjust invites – dare I say demands – an extremely detailed examination of all relevant factors.
In this case the review applicant focused on his contributions to E Street, Suburb F. He chose to address his criticisms of the arbitrator’s findings along a moving chronological timeline – initial contributions, contributions in the period 1986 to 2022 and then post separation. The arbitrator made various factual findings against each epoch of time on which the husband chose to sharply focus.
So far as initial contributions were concerned, the arbitrator found that the husband acquired a one quarter interest in E Street, Suburb F having regard to the payments he advanced.
In the period of 1986 to 2020 the arbitrator found that the husband decamped the E Street, Suburb F property and moved back in mid-2020. In that period the arbitrator found that the husband made no payments in relation to the mortgage debt or other debts and that he did not pay utilities or associated outgoings. Further, the arbitrator found that no evidence had been adduced, despite leave, as to how the loan was serviced in respect of the husband’s liability. That was important because the review applicant invited me to conclude that the husband’s mother or brothers did so. The review applicant pointed to no evidence to make good his proposition in that regard. In the face of an express finding in respect of which the review applicant failed to bring to my attention competing evidence, I am unable to accept his contention that the arbitrator should have found that the husband’s mother or his brothers made all, any or some of the payments due by the husband in the period 1986 to 2020.
It seemed to me that the arbitrator’s findings were wholly correct. No factual error was thereby disclosed. Nor, based on that finding, could it be said that the arbitrator’s orders are unreasonable or plainly unjust.
So far as the post separation contributions were concerned, the arbitrator addressed them in paragraph 64 of his reasons by observing that in the period 2014 to 2020 when the B Street property was sold, the household expenses were met by the parties but not equally. There was no error in that, nor was a question of law enlivened, nor was that finding such as to lead to the ultimate result of the arbitration being one that was unreasonable or plainly unjust.
Outcome
The review applicant failed in his s 13J challenge. I dismiss his 3 August 2022 application in a case.
Costs
If any party seeks costs –
(a)any affidavits and submissions in support of an application for costs must be filed and served by noon on 27 October 2022;
(b)any affidavits in reply and submissions in opposition to any application for costs must be filed and served by noon on 11 November 2022; and
(c)the issue of costs will be determined on the papers thereafter.
I certify that the preceding thirty-two (32) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Wilson. Associate:
Date: 13 October 2022
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