Somers & Collier
[2017] FamCAFC 123
•11 July 2017
FAMILY COURT OF AUSTRALIA
| SOMERS & COLLIER | [2017] FamCAFC 123 |
| APPEAL – DE FACTO – Where application for declaration of de facto relationship dismissed – Finding of de facto relationship is a jurisdictional fact – Section 90SB of the Family Law Act 1975 (Cth) has no work to do unless de facto relationship established – Not asserted that findings were unavailable on the evidence – Appeal dismissed. |
| Family Law Act 1975 (Cth) ss 4AA, 90RD, 90SB |
| DMW v CGW (1982) 151 CLR 491 Edwards v Noble (1971) 125 CLR 296 Norton & Locke (2013) FLC 93-567 Yunghanns & Ors v Yunghanns & Ors (1998) FLC 92-836 |
| APPELLANT: | Mr Somers |
| RESPONDENT: | Ms Collier |
| FILE NUMBER: | SYC | 7198 | of | 2013 |
| APPEAL NUMBER: | EA | 111 | of | 2016 |
| DATE DELIVERED: | 11 July 2017 |
| PLACE DELIVERED: | Sydney |
| PLACE HEARD: | Sydney |
| JUDGMENT OF: | Ainslie-Wallace, Ryan and Loughnan JJ |
| HEARING DATE: | 20 June 2017 |
| LOWER COURT JURISDICTION: | Federal Circuit Court of Australia |
| LOWER COURT JUDGMENT DATE: | 30 June 2016 |
| LOWER COURT MNC: | [2016] FCCA 1629 |
REPRESENTATION
| COUNSEL FOR THE APPELLANT: | Mr Knox SC |
| SOLICITOR FOR THE APPELLANT: | Schultz Toomey O’Brien Lawyers |
| COUNSEL FOR THE RESPONDENT: | Ms Clifford |
| SOLICITOR FOR THE RESPONDENT: | Watts McCray Lawyers |
Orders
The appellant be granted leave to rely on the Further Amended Notice of Appeal annexed to the affidavit filed 15 June 2017.
The appeal against the orders of Judge Sexton made on 30 June 2016 is dismissed.
The appellant pay the respondent’s costs of and incidental to the appeal, such costs to be agreed or assessed and to be paid within twenty eight (28) days from agreement or assessment.
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 Somers & Collier 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 111 of 2016
File Number: SYC 7198 of 2013
| Mr Somers |
Appellant
and
| Ms Collier |
Respondent
REASONS FOR JUDGMENT
Mr Somers (“the appellant”) sought orders for property settlement against Ms Collier (“the respondent”). The appellant contended that he and the respondent had been in a de facto relationship and sought a declaration pursuant to s 90RD of the Family Law Act 1975 (Cth) (“the Act”) to that effect.
On 30 June 2016 Judge Sexton determined that a de facto relationship had never existed and the application for property settlement orders was dismissed.
The appellant appeals that determination.
In order to give context to the appeal, it is necessary to give some background about the parties’ relationship and the findings of the primary judge in relation to that relationship.
Background
The parties originally met in 1977, but fell out of contact when the appellant moved overseas. The parties then commenced dating on a regular basis in August 1998 and their relationship continued until late 2012. In 2013 the appellant moved out of the respondent’s home. There are no children of the relationship.
It was undisputed that the parties lived in separate residences until May 2011. At the commencement of the relationship, the respondent was living with her two children of a previous relationship in a property owned and occupied by her mother. The appellant was living with his mother, first in a rented unit and later, in August 1999, he, his mother and the respondent purchased a unit as tenants in common. The appellant and his mother held a 40 per cent interest each and the respondent 20 per cent. The appellant and respondent jointly borrowed the money to purchase their respective interests. The respondent paid one third of the monthly mortgage instalments and in July 2007 the respondent transferred her interest to the appellant for $85,000. The primary judge found that this transaction was based on the then market value of the unit and was a commercial decision (at [58]).
The appellant and his mother remained living together in that unit until the death of his mother in February 2011. Although in 2007 the respondent purchased a unit in the same building as that occupied by the appellant and his mother, the appellant continued to live with his mother as before. The respondent sold that unit and purchased another property elsewhere in 2009.
On the death of the appellant’s mother, the unit in which he and his mother lived was sold and the proceeds distributed between the appellant and his family members. The sale of the unit was completed in or about June 2011 and in May 2011 the appellant moved into the respondent’s home. It was undisputed that while living in the respondent’s home, it was the respondent who paid all of the outgoings on the property and the appellant paid no form of rent or board. However, in 2011 the appellant deposited $145,000 (in two transactions) into a mortgage offset account to assist the respondent by reducing the interest payments on the loan over the property. Later in 2011 the respondent returned the funds to the appellant, retaining $25,000 with the appellant’s consent which she claimed was a contribution to the costs of renovations and other expenses (at [63]). Her Honour found that there was no financial dependence or interdependence between the parties, and accepted the submission that the $25,000 retained by the respondent was reasonable given that the appellant had made no payments towards his accommodation during the period he lived in the respondent’s home (at [65]).
The primary judge found that the parties deliberately chose not to share a common residence before May 2011, noting that the parties each gave a different reason for that decision (at [39]).
On this point, she concluded:
40. …I am satisfied the Respondent was not tied to [Suburb B] to care for her mother and, in 2007, chose to live independently. She did not choose to live with the [appellant]. While I accept that the parties spent considerable time with each other, though I find the frequency reduced over the years, and I accept that they shared many holidays together, I am not satisfied they shared a common residence during that period.…
In December 2011 the respondent purchased a property in Town Y although she continued to live in Sydney. In early 2012, the appellant purchased a property in Suburb R. The parties separated in late 2012 and in early 2013 the appellant moved out of the respondent’s home. In March 2014, after selling her property in Sydney, the respondent moved to live in the Town Y property.
The primary judge found that the purchases of these properties by the appellant and respondent were made without financial contribution of the other (at [61]).
Although the parties did not live under the same roof, except for the period between May 2011 and March 2013, they spent time with each other and at the home of the other. It was common ground that the appellant rarely, if ever, spent the night at the respondent’s premises until moving in during May 2011. The respondent did spend nights at the appellant’s home, however the duration and frequency of those stays was disputed between the parties. Ultimately the primary judge accepted that the respondent stayed overnight with the appellant on Friday nights and on more than one night each week from time to time but her Honour was unable, on the evidence, to make more precise findings (at [38]). Her Honour further concluded that the respondent’s decision to have the appellant live in her unit between 2011 and 2013 was not a commitment by her to them living together on a genuine domestic basis (at [49]).
The parties attended social and family events as a couple over many years and were known to some family and friends as a couple. The parties had a sexual and romantic monogamous relationship. It was common ground that neither party referred to the other as a partner in any third party notification, such as their tax returns and in relation to the respondent’s Health Insurance Certificate (at [89]).
Her Honour found:
83. I am not persuaded the evidence demonstrates that the parties had mutually committed to a future shared life together. I find that the parties had a mutually satisfying arrangement between them which involved them spending time together, accompanying each other to social events and holidaying together, and supporting each other during difficult times, in particular after their mothers died. While it may be that the [appellant] hoped for a more lasting commitment from the Respondent at the time he moved to [the respondent’s home], on his own evidence that did not happen. Instead, after a positive few weeks which included his birthday party and sexual activity, the Respondent pulled back, insisting on him sleeping separately. A few months later, she purchased her home in [Town Y] and spent increasing amounts of time there. Nevertheless, she says she continued to regard the [appellant] as a friend to share certain activities with her.
Ultimately the primary judge concluded:
98. I have made findings under each statutory consideration and have considered all the circumstances of the parties’ relationship. On a weighing of all these findings, I have concluded that the parties had a close personal relationship for many years which involved sexual activity, attending social events with family and friends, travelling together and providing each other with emotional support. I have had careful regard to the parties’ financial arrangements, including the acquisition of [the jointly owned unit], the [appellant’s] deposit to the Respondent’s offset account and the parties’ agreement for her to retain $25,000. I have also had careful regard to the circumstances of their common residence at the [respondent’s] unit. Whilst the parties’ common residence from May 2011 may suggest that the parties had decided to live together as a couple by that time, I am not satisfied that the totality of the evidence of what occurred before and during that period of common residence supports such a finding.
The appeal
By Amended Notice of Appeal filed on 21 November 2016, the appellant asserted eight grounds of challenge to the orders. Those grounds in broad terms challenged the primary judge’s findings of fact reached on the evidence. The appellant contends that different conclusions were open on the evidence.
A successful appellate challenge to findings of fact faces a considerable hurdle. It is insufficient to assert that other findings may have been available on the evidence or that another court may have come to a different conclusion on that same evidence. It is necessary to demonstrate that the findings were plainly wrong (see Edwards v Noble (1971) 125 CLR 296).
It was not asserted that the primary judge’s findings of fact were not open to her on the evidence and, indeed, counsel appearing for the appellant conceded that those findings of fact were available.
That the primary judge’s findings of facts were open on the evidence means that the test for appellate intervention is not met. Thus the primary judge’s findings of facts which underpinned her determination as to jurisdiction are unassailed.
None of those asserted challenges is made out and those grounds will be dismissed.
By Application in an Appeal filed on 15 June 2017 the appellant sought and was given leave to rely on a Further Amended Notice of Appeal containing three further grounds of appeal, being Grounds 1A, 1B and 1C:
1A The learned trial judge erred in her approach to the interpretation of whether the Court had jurisdiction to determine whether a de facto relationship existed.
1B The learned trial judge erred by not considering whether, under s 90SB(3)(c)(ii) of the Act, the Appellant would suffer serious injustice if a declaration was not made because of the substantial contributions he had made to the relationship.
1CThe learned trial judge erred in not considering whether considerations of justice and equity, imported into the consideration of whether there was such serious injustice, were relevant in the determination of whether there was a relationship and the consequent evaluation of the contributions in the context of the relationship.
Although expressed in three grounds, the additional arguments can be discussed together.
These grounds challenge the primary judge’s interpretation and application of the relevant statutory provisions and contend that the primary judge erred in her approach to the determination of the jurisdiction. The challenge particularly focussed on s 90SB of the Act and its application.
The primary judge was asked to make a declaration of the existence of a de facto relationship pursuant to s 90RD(1) of the Act. The section provides:
…the court may, for the purposes of those proceedings (the primary proceedings) declare that a de facto relationship existed, or never existed, between those 2 persons.
(Emphasis added)
The grant of jurisdiction to the Court carries with it the power to determine the existence of the facts upon which that jurisdiction depends (DMW v CGW (1982) 151 CLR 491 (“DMW”) at 507 (per Mason, Murphy, Wilson, Brennan and Deane JJ). There is however, as the Full Court in Yunghanns & Ors v Yunghanns & Ors (1998) FLC 92-836 said, a clear distinction between the jurisdiction of the Family Court to entertain proceedings and its jurisdiction to make valid orders in those proceedings. The Court said at 85,723, in summarising the essential principles arising, inter alia, from DMW:
109.…
(1) Before making orders in proceedings (including interlocutory orders) the Family Court of Australia, as a court of limited jurisdiction, must be satisfied:
(a)That it has jurisdiction to make those orders in the proceedings; and
(b)That it is appropriate to exercise that jurisdiction by making those orders on the facts of the case as then known to it.
(2) The Court always has jurisdiction to entertain proceedings for the purpose of and up to the point of deciding whether it has jurisdiction to make the orders sought in the proceedings.
(3) In carrying out that limited exercise of jurisdiction, the Court is required to determine any essential facts upon which the existence of its jurisdiction to make the orders sought ultimately depends (“the jurisdictional facts”). That determination is a function which is incidental to the exercise of the jurisdiction referred to in (2) above.
…
So too in Norton & Locke (2013) FLC 93-567 the Full Court said, in relation to whether the Court had jurisdiction to grant an injunction in circumstances where the parties were in dispute as to whether a de facto relationship existed and that question remained unanswered:
18. The terms of s 114(2A) are clear; the court’s power to grant injunctions pursuant to the section can only be granted “in a de facto financial cause”. There is no “de facto financial cause” until a de facto relationship is established and the additional ss 90SK and 90SB conditions met. Until they are met – that is, relevantly, a decision has been made by the court consistent with the case advocated by the respondent – there is no “de facto financial cause” and no jurisdiction to make an order of the type contemplated by s 114(2A). (Nor, it might said [sic], more broadly pursuant to s 90SM or s 90SE as sought by the respondent in the substantive proceedings).
These principles are applicable to the Federal Circuit Court of Australia.
In the written submissions of the appellant at trial the issue for determination was identified thus:
1. The issue for the Court is to determine whether the parties pursuant to Section 4AA(1) whether [sic] the [appellant] was in a de facto relationship with the Respondent between August 1998 and March 2013.
Thus her Honour here was called upon to determine whether the Court had jurisdiction to hear a de facto financial cause by determining as a jurisdictional fact whether the parties had been a de facto relationship as defined in s 4AA of the Act. As we have said, the appeal particularly focussed on the provisions of s 90SB of the Act. That section was not raised by the appellant at all during the hearing before the primary judge nor in the written submissions made on his behalf. It was raised by the respondent in submissions to the primary judge, by way of a shield, in which it was contended that if the primary judge determined that a de facto relationship had existed at some time, the evidence did not support a finding that any of the provisions of s 90SB were met.
It was clear from the way in which the case was run at trial, that all parties understood that absent a de facto relationship, the Court had no jurisdiction.
Section 90SB of the Act is as follows:
A court may make an order under section 90SE, 90SG or 90SM, or a declaration under section 90SL, in relation to a de facto relationship only if the court is satisfied:
(a)that the period, or the total of the periods, of the de facto relationship is at least 2 years; or
(b)that there is a child of the de facto relationship; or
(c)that:
(i)the party to the de facto relationship who applies for the order or declaration made substantial contributions of a kind mentioned in paragraph 90SM(4)(a), (b) or (c); and
(ii)a failure to make the order or declaration would result in serious injustice to the applicant
…
(Emphasis added)
Section 90SB of the Act has no work to do unless the existence of a de facto relationship has been established.
The argument in relation to these grounds relates to the period between May 2011 and March 2013, during which the parties lived in the same unit. In order to appreciate the thrust of the appellant’s argument, it is useful to set out her Honour’s findings about that period of the parties’ lives.
Findings in relation to the parties’ relationship between May 2011 and March 2013
The primary judge found that the parties occupied separate bedrooms for the majority of the period of cohabitation between May 2011 and March 2013 (at [41]). Her Honour accepted that in this period the respondent travelled to [Town Y] frequently without the appellant (at [43]). Her Honour considered the parties’ evidence about the state of their relationship and the attribution of significance to the fact of their sharing a common residence (at [44] to [46]), and concluded that in the period from 2011 to 2013 the parties’ relationship changed, and that by late 2012 it was over (at [49] and [50]).
Her Honour found that the respondent’s decision to have the appellant living in her home was not a commitment to living with him as a couple on a genuine domestic basis. The primary judge noted the parties agreed that during this period of common residence, the respondent paid all outgoings on the property but that the appellant paid the Foxtel account (at [60]). It was also not disputed that the appellant paid no rent or board during this time (at [63]). Her Honour took into account that the appellant deposited money into an offset account to assist the respondent to meet the interest on her housing loan, and that the funds were repaid to the appellant but for $25,000, and found that the $25,000 represented compensation for his occupancy of the unit (at [63] to [65]).
Most potently however, her Honour recorded a conversation between the parties, the substance of which was not challenged, in which the respondent said to the appellant in May 2011: “my unit is not your unit and never will be. I am letting you stay. Any property I have is a result of my own efforts, money and sacrifice by my family.” Her Honour further recorded the appellant’s response: “I don’t want your property. I am just happy to be able to stay here” (at [78]).
It is against these findings of fact that her Honour concluded:
98.…Whilst the parties’ common residence from May 2011 may suggest that the parties had decided to live together as a couple by that time, I am not satisfied that the totality of the evidence of what occurred before and during that period of common residence supports such a finding.
Her Honour finally concluded:
100. Having regard to my findings in relation to all the circumstances of the parties’ relationship, I have decided the parties have not been in a relationship as a couple living together on a genuine domestic basis at any time during the period August 1998 and March 2013. Given my decision, it is unnecessary for me to consider the requirements of s 90SB.
(Emphasis added)
Discussion
Turning then to the arguments advanced in the appeal. It was contended that, despite her Honour’s global finding that the parties did not at any time have a relationship as a couple living together on a genuine domestic basis, she was nonetheless obliged to return to the period of shared residence and consider whether the evidence in relation to that period enabled a finding that the parties were living together on a genuine domestic basis for that period. It was submitted that this obligation arose once s 90SB was raised in the hearing before the primary judge and by failing to do so her Honour did not properly consider the jurisdictional considerations.
To the extent that the submission amounts to a contention that her Honour’s finding across the entirety of the parties’ relationship omitted or failed to give proper consideration to the period in which the parties shared a residence, we reject it. As can be seen from her reasons as a whole, her Honour gave separate consideration to the period in which the parties shared a residence and considered that period in light of the whole of the evidence in her determination of whether a de facto relationship existed between the parties (at [98]).
Further, it was contended that, notwithstanding her Honour’s finding at [100] that at no time were the parties in a de facto relationship, she was nonetheless required to conduct a separate determination by reference to s 90SB of the Act. It seems, so far as we understand the appellant’s argument, that her Honour should have considered s 90SB of the Act and its conditions to determine whether there existed a de facto relationship.
The primary judge’s error was expressed to be a failure to “[consider] whether, under s 90SB(3)(c)(ii) of the Act, the Appellant would suffer serious injustice if a declaration was not made because of the substantial contributions he had made to the relationship”.
The appellant submitted:
7. …it was incumbent on the trial judge to determine whether there was a relationship for less than two years and then to determine whether substantial injustice had been caused to the Appellant. The Appellant submits that there was clearly substantial injustice caused to the Appellant given that his contributions over that period would be neither recognized nor assessed…
(Appellant’s outline of argument filed 16 June 2017)
The submissions then set out the evidence which, it was said demonstrated “a financial nexus and a series of financial dealings between the parties”.
The appellant submitted:
Jurisdictional fact(s)
21. As such, the initial determination as to the existence of a relationship or otherwise is a preliminary jurisdictional step or fact for the Court to exercise before determining the contributions.
22. There is a separate determination required where s 90SB(3)(c)(ii) is raised as to whether there was a de facto relationship of under 2 years, and then whether the [appellant] would suffer serious injustice if a declaration was not made because of the substantial contributions he has made.…
(Appellant’s outline of argument filed 16 June 2017)
Despite, correctly as we see it, describing the work to be done by s 90SB, the submissions go on and argue that the primary judge did not consider the evidence in relation to the appellant’s significant contributions made during the parties’ relationship nor did she consider issues of substantial injustice to the appellant.
The thrust of the argument seems to be exposed at paragraphs 57 to 59 of the written submissions where the appellant submitted:
57. It is no answer to say that the different evidence relating to that distinct period was not relevant in that the trial judge considered that there was no relationship as a couple for any period during the period August 1998 to March 2013. This was a separate consideration and required a separate assessment under s 90SB.
58. Similarly and relevantly, the trial judge did not stand back and looking [sic] at the evidence as to the nature of the relationship for that lesser period.
59. That was a necessary step which was not carried out as a proper part of the exercise of the judicial discretion on that aspect. That needed to be done as a step before the trial judge could consider the next step of whether the substantial injustice test was satisfied in relation to the appellant and what substantial contributions he had carried out in the lesser period.
(Appellant’s outline of argument filed 16 June 2017)
The submissions continue and contend that the primary judge failed to take into account considerations of justice and equity “imported into the consideration of whether there was such serious injustice”. The argument then follows that the primary judge failed to consider whether the appellant made substantial contributions to the property of the parties during the “lesser period”. Nor did her Honour consider whether the appellant would suffer serious injustice if a declaration was not made.
The appellant argued that such a separate assessment was required in this case and submitted:
68. …Even if it was thought not to be relevant where a de facto relationship was not established for the whole period of 1998 to 2013, it would have been relevant to a lesser period where the
s90SB(3)(c) (ii) considerations were appropriate.Relevance
69. It is submitted that the consideration is also relevant to the test of the interpretation of the sections to determine what were appropriate contributions to property disputes arising in de facto relationships.
70. It is submitted that that did not occur in this instance given that the judge below made an erroneous determination on the preliminary jurisdictional issue.
We reject that construction of the sections. A finding of the existence of a de facto relationship is the foundation for jurisdiction. Jurisdiction cannot be obtained merely by reference to whether a person had made “substantial contributions” to a relationship with another person and that “serious injustice” might flow if the jurisdiction was not exercised. As Dawson J said in DMW at 511:
Whether proceedings answer the description of proceedings by way of a matrimonial cause so as to fall within the jurisdiction of the Family Court and outside the jurisdiction of the other courts specified in the proclamation … cannot be dependent upon the ultimate outcome of those proceedings.
In our view, that is exactly the reasoning of the appellant’s submissions, and must be rejected. By its clear terms, matters of “contribution” and “injustice” for the purposes of s 90SB are only relevant once a determination has been made that a de facto relationship existed between the parties. Until that has been established, those questions are irrelevant.
That is plain from the words of s 90SB itself.
As to the ostensible injustice arising from contributions which would otherwise be unaddressed, these issues can be explored in another jurisdiction.
Finally, it was argued that the primary judge erred in her approach to the evidence in that she did not “stand back” and consider the whole of the evidence of the parties’ relationship. It was submitted that her Honour merely considered the evidence, compartmentalised by the provisions of s 4AA of the Act. A reading of her Honour’s reasons quickly disposes of that challenge. Her Honour considered the various matters to which s 4AA speaks and made findings about the evidence and on those issues. Her Honour then indeed “stood back” and at [98] weighed and considered the evidence, and her findings in relation to the evidence, and concluded that the parties were not in a de facto relationship at any time.
This challenge is not made out and the appeal will be dismissed.
Costs
As is customary we sought submissions from the parties on this question at the conclusion of the hearing. Counsel for the appellant conceded that if the appeal failed, the appellant must bear an order for costs. So it will be ordered.
I certify that the preceding fifty-seven (57) paragraphs are a true copy of the reasons for judgment of the Honourable Full Court (Ainslie-Wallace, Ryan & Loughnan JJ) delivered on 11 July 2017.
Associate:
Date: 11 July 2017
4
4
2