Talbot & Talbot
[2015] FamCAFC 132
•3 July 2015
FAMILY COURT OF AUSTRALIA
| TALBOT & TALBOT | [2015] FamCAFC 132 |
| FAMILY LAW – APPEAL – PROPERTY SETTLEMENT – Where the appellant husband did not appear at the trial and the matter proceeded on an undefended basis – The trial judge erred by including funds disposed of in the asset pool without considering the reasonableness of the husband’s expenditure – The trial judge erred in finding the wife was liable to pay a Centrelink debt and ordering the husband to pay half of the debt – Appeal allowed – Remitted for rehearing. |
| Family Law Act 1975 (Cth), s 75(2), s 79, s 117(2A) Federal Proceedings (Costs) Act 1981 (Cth) Family Law Rules 2004 (Cth), r 11.02, r 11.03 |
Allesch v Maunz (2000) 203 CLR 172
Cerini & Cerini [1998] FamCA 143
Leslighter & Fitzgerald-Stevens (2012) 47 FamLR 384
Lorde & Chu [2014] FamCAFC 228
Marker & Marker [1998] FamCA 42
Omacini and Omacini (2005) FLC 93-218
Stanfordv Stanford (2012) 247 CLR 108
Stead v State Government Insurance Commission (1986) 161 CLR 141
Taylor v Taylor (1979) 143 CLR 1
Townsend & Townsend (1995) FLC 92-569
Wilkes and Wilkes (1981) FLC 91-060
| APPELLANT: | Mr Talbot |
| RESPONDENT: | Ms Talbot |
| FILE NUMBER: | PTW | 5941 | of | 2011 |
| APPEAL NUMBER: | WA | 20 | of | 2013 |
| DATE DELIVERED: | 3 July 2015 |
| PLACE DELIVERED: | Perth |
| PLACE HEARD: | Perth |
| JUDGMENT OF: | Bryant CJ, Murphy and Duncanson JJ |
| HEARING DATE: | 27 October 2014 |
| LOWER COURT JURISDICTION: | Family Court of Western Australia |
| LOWER COURT JUDGMENT DATE: | 13 August 2013 |
| LOWER COURT MNC: | [2013] FCWA 92 |
REPRESENTATION
| THE APPELLANT: | In person |
| COUNSEL FOR THE RESPONDENT: | Mr Byrne |
| SOLICITOR FOR THE RESPONDENT: | Sharma Lawyers |
Orders
The appeal be allowed.
Orders 2 to 8 and order 10 of the orders made by the Honourable Justice Moncrieff on 13 August 2013 be set aside.
The matter be remitted for rehearing by a judge of the Family Court of Western Australia, other than Justice Moncrieff, subject to the following conditions:
(a) Within 28 days the husband shall file and serve:
(i)a Minute of Proposed Orders Sought setting out the orders he is now seeking on a final basis;
(ii)an affidavit of himself;
(iii)an affidavit of each witness; and
(iv)an up to date Form 13 Financial Statement.
(b)In the event the husband fails to comply with any requirement of order 3(a) (above) within the time specified in respect of each, the wife be at liberty to apply to the Duty Judge for leave to proceed on an undefended basis upon giving five days written notice to that effect to the husband.
The Court grants to the appellant husband a costs certificate pursuant to the provisions of 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 husband in respect of the costs incurred by him in relation to the appeal.
The Court grants to the respondent wife a costs certificate pursuant to the provisions of 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 wife in respect of the costs incurred by her in relation to the appeal.
The Court grants to each party 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 party in respect of such part as the Attorney-General considers appropriate of any costs incurred by each party in relation to the new trial granted by these orders.
IT IS NOTED that publication of this judgment by this Court under the pseudonym Talbot & Talbot has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
| THE FULL COURT OF THE FAMILY COURT OF AUSTRALIA AT PERTH |
Appeal Number: WA 20 of 2013
File Number: PTW 5941 of 2011
| Mr Talbot |
Appellant
And
| Ms Talbot |
Respondent
REASONS FOR JUDGMENT
On 13 August 2013, Moncrieff J made orders for settlement of property in accordance with those proposed by the wife in circumstances where the husband did not appear and had failed to comply with earlier orders for the filing of material and with the Court’s Rules more broadly. The husband appeals those orders.
He appears to have had some assistance in preparing his material on appeal. While that was of assistance to us, because he represented himself at the hearing of the appeal, it led, with respect, to significant gaps in the husband’s understanding of what was in that material. He asserts that the primary judge did not accord him procedural fairness (albeit with caveats).
That challenge should be rejected for reasons shortly to be expanded upon.
We consider, however, that there is merit in ground one which asserts that his Honour erred in adding back “as a premature distribution to the husband” the proceeds of sale of a piece of real property and also merit in grounds four and five which challenge his Honour’s treatment of a debt owing by the wife to Centrelink.
As a consequence, we consider that the appeal must be allowed. The circumstances of this matter are such that an order that the matter be remitted is inevitable. Equally, however, his Honour’s uncontroversial findings as to the husband’s failure to comply with procedural orders requires, in our view, the imposition of conditions upon that remittal.
Discussion
The Notice of Appeal contains seven grounds of appeal, which will be set out in the course of the discussion below.
Although not raised directly by the grounds of appeal, the appropriate course of action when seeking to challenge a judgment by default is to apply at first instance for relief pursuant to rule 11.03 of the Family Law Rules 2004 (Cth) (“the Rules”), rather than by way of appeal.
In Lorde & Chu [2014] FamCAFC 228, this Court said (at [36]):
Finally, it may be useful if we take this opportunity to draw attention to the fact that it has long been established in this jurisdiction that where a party seeks to set aside orders made in his or her absence, the proper course is for that party to apply at first instance for a rehearing rather than seek to have the matter dealt with by a way of an appeal (Wilkes and Wilkes (1981) FLC 91-060). Moreover, Rule 16.05 of the Federal Circuit Court Rules 2011 (Cth) provides for a rehearing at first instance in such circumstances. We also observe that it is not uncommon, and indeed desirable, that where a judge makes an order in the absence of a party who will be affected by the order, that the judge expressly provide in his or her orders that the party in whose absence the orders were made have liberty to apply, within a specified period of time, to have the orders varied or set aside.
We propose to deal with the challenges to the judicial process first.
Ground Three
The learned trial Judge erred by failing to take into account the rules of procedural fairness and natural justice required to be considered before determining the matter on an undefended basis, given the husband was unable to engage in the Court process at that time
Rule 11.02 sets out the Court’s powers in the event of a party’s failure to comply with a legislative provision or order, and r 11.03 gives the Court discretion to allow relief from orders, guided by the stated considerations.
Rules 11.02(2) and 11.03 provide as follows:
11.02Failure to comply with a legislative provision or order
(2)If a party does not comply with these Rules, the Regulations or a procedural order, the court may:
(a)dismiss all or part of the case;
(b)set aside a step taken or an order made;
(c)determine the case as if it were undefended;
(d)make any of the orders mentioned in rule 11.01;
(e)order costs;
(f) prohibit the party from taking a further step in the case until the occurrence of a specified event; or
(g) make any other order the court considers necessary, having regard to the main purpose of these Rules (see rule 1.04).
11.03Relief from orders
(1)A party may apply for relief from:
(a)the effect of subrule 11.02 (1); or
(b)an order under subrule 11.02 (2).
(2)In determining an application under subrule (1), the court may consider:
(a) whether there is a good reason for the non compliance;
(b)the extent to which the party has complied with orders, legislative provisions and the pre action procedures;
(c)whether the non compliance was caused by the party or the party’s lawyer;
(d)the impact of the non compliance on the management of the case;
(e)the effect of non compliance on each other party;
(f)costs;
(g) whether the applicant should be stayed from taking any further steps in the case until the costs are paid; and
(h) if the application is for relief from the effect of subrule 11.02 (1)—whether all parties consent to the step being taken after the specified time.
His Honour has a discretion under r 11.02 in what he may do in the event of a failure to comply with an order. In the event that this discretion is exercised favourably, where orders for property settlement are sought, his Honour has a second or separate discretion under s 79 of the Family Law Act 1975 (Cth) (“the Act”). (See analogously, Australian Competition and Consumer Commission (ACCC) v Dataline.Net.Au Pty Ltd (2006) 236 ALR 665, at [52] per Kiefel J).
The trial judge proceeded on an undefended basis having regard to the following matters:
·The husband did not file and serve a Form 1A Response and Financial Statement within 21 days as ordered on 22 November 2011 and consequently, the wife had leave to proceed on an undefended basis.
·The husband did not file and serve an affidavit as ordered on 30 January 2012.
·The husband did not attend the Readiness Hearing and his solicitor sent a fax to the Court saying she did not have instructions despite attempts to obtain them.
·The husband did not attend the trial.
In this ground the husband asserts procedural unfairness in proceedings which were undefended because he was unable to engage in the Court process at the time and, therefore, the trial judge erred by failing to take into account the rules of procedural fairness and natural justice required to be considered before determining the matter on an undefended basis.
The gravamen of the ground is in two parts: first that the husband was unable to engage in the process and, secondly, that it may have been a result of what (the husband infers) were temporary disabilities which (again inferentially) are now not present.
A relevant aspect of the exercise of the discretion is “an inability or unwillingness to cooperate with the court and the other party …” (Lenijamar Pty Ltd & Ors v AGC (1990) 98 ALR 200).
An explanation for failure to attend is also a highly relevant consideration in cases of this type. (See, for example, Taylor v Taylor (1979) 143 CLR 1; Wilkes and Wilkes (1981) FLC 91-060; Leslighter & Fitzgerald-Stevens (2012) 47 FamLR 384).
His Honour had no evidence of the husband’s illness or incapacity. The wife’s chronology sets out the Court events which the husband did not attend. He did attend the Conciliation Conference, at which orders were made programming the matter to a Readiness Hearing. The wife served her trial material on the husband’s solicitors, but neither the husband nor his solicitors attended the Readiness Hearing. The wife’s solicitors wrote to the husband personally and advised him the matter was in the Callover. The husband did not respond to that letter and neither he nor his solicitors attended the Callover. The Court wrote to the husband’s solicitors advising of the trial date. The wife’s solicitors also wrote to the husband and advised him of the trial date.
His Honour considered the evidence before him, including: the long history; the springing order (and the indulgence given to the husband by the failure to execute it); the complete absence of instructions to his solicitor; the fact that the wife’s solicitors wrote to him direct and received no response including, importantly, no response to the effect that he was too sick to participate at all etc. In effect, the husband conceded as much.
In Allesch v Maunz (2000) 203 CLR 172 Kirby J held:
39.Decision-makers, including the courts, cannot generally force people to protect their own rights, to adduce evidence or other materials, to present submissions or to act rationally in their own best interests. This consideration may be especially relevant in relation to the Family Court where emotions, often engendered by the highly personal issues involved, can sometimes cloud rational thought.
40.Nor are courts obliged to delay proceedings indefinitely because one party, although proved to be on notice of the proceedings, refuses or fails to appear in person or to be represented by a lawyer or some other individual permitted to speak for them who can explain the need for an adjournment. The rights of other parties are commonly involved. In the Family Court, the rights of non-parties (especially children) may be affected. Additionally (as this court has itself accepted), the rights of the public in the efficient discharge by courts of their functions must be weighed against unreasonable delay in concluding litigation.
The essence of the relevant principles (exemplified by Kirby J above) is that procedural fairness requires parties to be given a proper opportunity, and reference to the history of the matter, to which we have referred above, and his Honour’s unchallenged factual findings about the opportunities and failure to avail render the challenge unsuccessful.
In these circumstances, we consider his Honour was entitled to proceed on an undefended basis, and we find no error in this respect.
The husband also contends that he was denied procedural fairness because he did not see a copy of the valuation of the parties’ property at Suburb T until after the trial.
At trial, the following exchange occurred (trial transcript, 13 August 2013, pp 6-7):
BECKERLING, MR: There’s also evidence, your Honour, if you will receive it, from … the valuer, who has valued the property at [Suburb T], and I have that, although it’s a copy of his affidavit and report rather than the original.
HIS HONOUR: Where’s the original?
BECKERLING, MR: the original remains with [the valuer] and we could have it with your Honour before the matter is resolved – before the evidence closes today.
HIS HONOUR: And has that affidavit been served?
BECKERLING, MR: The valuation has been served ---
HIS HONOUR: All right.
BECKERLING, MR: --- I’m told. I don’t think that the affidavit has been, your Honour.
HIS HONOUR: Well, it’s the valuation that’s the relevant part of it. How was that served and when?
BECKERLING, MR: That was served by [the valuer] directly. Yes. The valuation was undertaken on 9 August.
HIS HONOUR: All right. Okay. It’s not exactly what I consider the best proof of service but there we go – and – but certainly it’s clear that [the husband] was made aware, so – all right.
BECKERLING, MR: [The valuer] also went into the property to inspect it, your Honour, and, as I understand it, he was advised then of the purpose of that visit.
HIS HONOUR: That’s fine. If you want to tender the whole bundle, that’s fine.
In our view, this was not sufficient to establish that service of the valuation had properly been effected upon the husband. In that respect, we accept that the husband was not accorded procedural fairness.
However, we observe that the husband’s own Form 13 Financial Statement, filed on 20 January 2012, estimated the value of the Suburb T property to be $486,000, which is significantly more than the valuation of $350,000.
The High Court in Stead v State Government Insurance Commission (1986) 161 CLR 141 confirmed that it is also necessary to show that compliance with the rules of natural justice would have made a difference. The plurality said (at [145]):
That general principle [entitlement to a fair trial] is, however, subject to an important qualification which Bollen J plainly had in mind in identifying the practical question as being: Would further information possibly have made any difference? That qualification is that an appellate court will not order a new trial if it would inevitably result in the making of the same order as that made by the primary judge at the first trial. An order for a new trial in such a case would be a futility.
For this reason not every departure from the rules of natural justice at a trial will entitle the aggrieved party to a new trial. By way of illustration, if all that happened at a trial was that a party was denied the opportunity of making submissions on a question of law, when, in the opinion of the appellate court, the question of law must clearly be answered unfavourably to the aggrieved party, it would be futile to order a new trial.
Where, however, the denial of natural justice affects the entitlement of a party to make submissions on an issue of fact, especially when the issue is whether the evidence of a particular witness should be accepted, it is more difficult for a court of appeal to conclude that compliance with the requirements of natural justice could have made no difference.
And their Honours continued (at [147]):
… All that the appellant needed to show was that the denial of natural justice deprived him of the possibility of a successful outcome. In order to negate that possibility, it was, as we have said, necessary for the Full court to find that a properly conducted trial could not possibly have produced a different result.
The trial judge’s reliance on the valuation favours the husband and therefore, it cannot be said that, had the husband been provided a copy, it would have made a difference to the outcome.
In these circumstances, we find no merit in this ground.
Ground Two
The learned trial Judge erred by using different dates of valuation for the [Suburb T] property and the proceeds of sale of the [Town K] property, which had the effect of inflating the asset pool for division.
This ground asserts that using different dates of valuation had the effect of inflating the asset pool. However, as argued, the challenge is embraced by what we have said above. That is, the error is not using two different values (as the ground suggests) but as explained above.
Ground One
The learned trial Judge erred by finding that the proceeds of sale of the [Town K] property in the sum of $252,251 be added back to the net asset pool as a premature distribution of property to the husband.
Where one party unilaterally distributes to themselves property which no longer exists and which, but for that premature distribution, would be susceptible to s 79 orders, justice and equity may require the Court to take account of the dissipated property by adding it back as against the dissipating party (Townsend & Townsend (1995) FLC 92-569). Whether that should occur, or whether the dissipation should be taken into account pursuant to s 75(2)(o), or indeed at all, are all matters requiring the exercise of the trial judge’s discretion (Townsend; Omicini & Omicini (2005) FLC 93-218; Cerini & Cerini [1998] FamCA 143).
In this ground the husband asserts the trial judge erred by adding back the proceeds of sale as a premature distribution of property.
To provide some background to this ground, the husband owned a property in Town K which was subject to a debt.
Immediately prior to the parties’ separation, the Town K property was sold by the husband and the proceeds were “in the sum of $252,251” (at [14]). The husband received these funds.
The parties disagree as to the date of separation. The wife said the parties separated in February or March 2010. The husband’s case was that separation took place some 13 months later. His Honour did not make a specific finding as to the date of separation.
His Honour described (at [14]) the asset pool to be as follows:
Cash at bank (Wife) $2
Furnishings and effects (Wife) $1,000
[Suburb T] property (Husband) $350,000
Sale proceeds of [Town K] property (Husband) $252,251
Shares (Husband) $70,000
Motor vehicle (Husband) $18,000
Furnishings and effects (Husband) $26,000
Boat (Husband) $7,500
Business (Acquired by husband after separation) $67,000
The trial judge noted the total assets as advanced by the wife were $724,753 because she had not included the value of the business. She had included the sale proceeds of the Town K property on the basis that the husband’s use of those funds was a premature distribution of property as described in Townsend.
His Honour observed that there is some tension between the concept of a premature distribution of property that no longer exists and the need to define current property interests.
His Honour then said:
17Interestingly, the husband sought orders that the property be divided as at separation which would have clearly included the $252,251 but not the subsequently acquired business. The husband, of course, had an obligation of disclosure which he has failed to meet. He has sworn a statement of financial circumstances, but he has not disclosed particularly how he has dealt with the proceeds of sale of the [Town K] property, save and except that it is clear from the bank statements that have been produced that the sum required for the acquisition of his interest in the business came from those proceeds of sale.
18I propose, therefore, to proceed on the basis of the proceeds of sale being included in the pool. I do so on the basis that the husband has not discharged his obligation as to how those proceeds have been dealt with, and further, on the basis that it is further open to me, if the circumstances warrant, to deal with assets as they are as at the date of separation.
19The only rider to that, of course, would be the issue of the value of the [Suburb T] property which has been valued more recently. In any event, the husband’s failure to meet his obligation has been considered in cases such as Weir & Weir (1993) FLC 92-338 where the Full Court has held that a trial judge need not be concerned about taking a robust approach to the known assets where a party has failed to comply with their obligations of full and frank disclosure.
For reasons deposed to by the wife in an affidavit before the trial judge, she was not fully aware of the husband’s assets or their value. She deposed to knowledge of the sale of the husband’s Town K property, that “he told [her] he had paid off the mortgage on the [Suburb T property]” and that she did “… not know what he did with the balance of the sale proceeds.” (Emphasis added).
The husband had, in January 2012, some two years or so after separation and about 18 months prior to the hearing before his Honour, filed a Financial Statement. It disclosed, relevantly, the Suburb T property, a bank account with a balance of about $16,500 and a business valued at nil.
Importantly, the trial judge also had bank statements in evidence before him at the time of the hearing. As can be seen, his Honour finds that the proceeds of sale have been deposited to the account represented by those bank statements, and that the husband bought an interest in a business post-separation for $67,000 from those proceeds (Reasons [14]; [17]). Although his Honour does not say so, that finding seems to clearly emanate from the bank statements which were in evidence before him. That fact was uncontroversial before us. The same bank statements reveal a balance of about $33,000 as at June 2011.
No other analysis of the bank statements and, in particular, how the funds deposited may have been expended, is evident in the trial judge’s reasons.
His Honour says that he “determined to deal with the assets as they are as at the date of separation”. The trial judge did so as a means of including within the “pool” of assets the proceeds of sale. In order to avoid double counting, his Honour did not include the purchase price of the husband’s business interest (Reasons [14]; [15]; [17]).
The trial judge then referred to the husband’s lack of disclosure and, as can be seen in the passage quoted above, reasoned that he “… need not be concerned about taking a robust approach to the known assets …” as a consequence. (Emphasis added).
We consider that his Honour’s approach was erroneous and leads to the conclusion that we cannot be satisfied that the orders made by the trial judge are just and equitable.
His Honour’s reasons reflect a determination to “deal with assets as they are as at the date of separation”. Yet, his Honour did not do so because, while he included the proceeds of sale at that time, he included the value of the Suburb T property as at the date of trial.
The trial judge referred (at [15]) to “some tension” between what was said by the High Court in Stanford & Stanford (2012) FLC 93-518 and “the concept of a premature distribution of property that no longer exists”. Yet his Honour did not, with respect, resolve that tension.
The decision of the High Court, by which the trial judge was bound, required his Honour to consider the property interests of each of the parties before him. That task was by no means easy given the failure of the husband to participate and the consequent nature of the wife’s evidence. The “known assets” on the evidence before the trial judge included a sum of $33,000 in the husband’s bank account and a business. His Honour was correct in asserting that he could be robust about findings consequent upon the husband’s lack of disclosure (and, it might be said, non-participation and non-appearance) but he needed to do so by reference to the evidence before him.
The trial judge had evidence (such as it was) of the then balance of the husband’s interest in property at the time of the proceedings: a bank account balance and of the purchase price of a business interest. He could be robust in assuming the latter as the value of the business. It was within his Honour’s discretion to determine that justice and equity required consideration of the fact that $150,000 more was available to be distributed between the parties pursuant to s 79 shortly after separation some sixteen months earlier
However, if that discretion was to be exercised in that manner, it was necessary for the trial judge to take account of a number of relevant considerations, one of the most important of which was what the evidence revealed about expenditure from the account into which the funds were banked. That is because, among other things “… parties are entitled to reasonably conduct their affairs post-separation in a manner that is consistent with properly getting on with their lives” (Cerini, supra) and, if money is to be “added back” some three years after it was spent, account must be taken of what the evidence reveals about what was spent on “ordinary living expenses” and of the financial circumstances of the parties more generally. (See, for example, Marker & Marker [1998] FamCA 42).
Here, his Honour was hampered by the circumstances and the consequent sparseness of the evidence. However, the bank statements, which was the very evidence upon which the trial judge relied, revealed ostensible expenditure on matters that plainly seem to reveal expenditure falling within the rubric of living expenses (for example, the statements show transactions such as $66.37 spent at Coles, $116.50 spent at Australia Post, $249.00 spent at Kmart, $54.95 spent at Suburb T Pharmacy, etc )
We consider, then, that his Honour erred in the exercise of his discretion by reason of failing to consider matters relevant to the exercise of that discretion.
Grounds Four and Five
The learned trial Judge erred in failing to order the wife to fully disclose relevant evidence with respect to her Centrelink debt and Centrelink history
The learned Trial Judge erred in ordering the husband to contribute to the wife’s Centrelink debt particularly by creating an unquantified percentage split between the husband and wife given the lack of specificity on the part of the wife.
The trial judge then turned to consider the wife’s Centrelink debt, which arose from her being overpaid after failing to advise Centrelink of a change in her circumstances. The wife asserted the debt was $34,984, but his Honour found that he could not quantify it, saying:
22… although I have been very helpfully provided with a bundle of documents … the difficulty is that the wife very recently made further inquiries on the basis of the documents that have been produced by Centrelink and pointed out to Centrelink certain errors in their calculations which make it impossible for me to now quantify the debt.
23 Accordingly, I can only take it into account in a very general sense that this is a liability that would appear to be no greater than approximately $33,000 that the wife will have to meet. …
The trial judge stated that the inability to identify the extent of the debt caused him “difficulty”, as he took the view that it should “properly be taken into account” (at [25]). He noted that if it was taken into account at the figure nominated by the wife, the asset pool was likely to be about $690,000.
His Honour found:
·The debt could not be quantified [22];
·He could, as a result, only take the debt “into account in a very general sense” [23];
·That general sense is that there is “a liability that would appear to be no greater than approximately $33,000” [23];
·The wife will have to meet that debt [23];
·The debt arises from an overpayment of the wife’s entitlements [24];
·It was “difficult to determine how … I should treat [the debt]” [39];
·The debt would be dealt with by “making a modest adjustment under section 75(2) …” [39];
Given the trial judge’s earlier findings and the fact that his Honour returns to the debt when considering s 79(4)(e) (at [38] and following), it might be thought, despite the terms of his Honour’s orders, that one half of the approximated amount of the debt is the trial judge’s adjustment for s 79(4)(e).
If that be the intention, a significant difficulty is that the effect of his Honour’s orders was to reduce the amount the wife would otherwise receive by $16,500 because the orders facilitated the payment by her of a capital sum when the evidence before him was to the effect that, not only had there been no demand for any such repayment, but that there would not be. The wife deposed in her affidavit filed on 13 May 2013 (emphasis added):
47.It was my mistake that I continued to receive Centrelink. However, [the husband] knew it very well that I was receiving Centrelink payments. I used the payment towards household expenses. I currently owe about $33,000. Centrelink has reduced my payment by $50 per fortnight which will continue until fully paid.
To the extent that the wife’s indebtedness was to be taken up pursuant to s 79(4)(e), which at least one reading of his Honour’s reasons suggests, what needed to be taken into account, on the wife’s own evidence, was not repayment of $33,000 or any part of it, but the wife’s apparent on-going obligation to pay $50 per fortnight.
If his Honour was not intending to take up the Centrelink debt as a s 75(2) factor, because his Honour’s order purported to crystallise the debt (thereby assuming actions by Centrelink contrary to the evidence before him), it was necessary for his Honour to give reasons as to why each party should pay half. No reasons are given for any such conclusion.
Ground Six
The learned trial Judge erred by delivering judgement by having fully disclosed evidence before the Court.
This ground lacked particularity.
In his submissions before us, the husband said this ground related to deficiencies in the evidence concerning the Centrelink debt and the expenditure of the Town K sale proceeds.
We have dealt with both of these matters above.
Ground Seven
The learned trial Judge erred by failing to consider the husband’s long term needs under section 79 of the Act.
The husband submitted that the trial judge failed to consider his long-term needs; however, he conceded that he placed no evidence before his Honour in this respect, as he had not filed an affidavit or participated in the proceedings.
The trial judge had some evidence from the wife regarding the husband’s health and inability to work. In her affidavit filed on 13 May 2013, she deposed that:
·he was diagnosed with bowel cancer in 2008 and became very sick;
·he subsequently improved; and
·at the time of separation, he was not working and had Hepatitis C.
At trial, the wife also gave evidence to the effect that the husband is a partner in a business and tendered a Facebook photograph of him working (trial transcript, 13 August 2013, pp 21-22).
The evidence was therefore inconclusive as to the husband’s current circumstances.
The finding made by his Honour was as follows (at [38]): “The husband appears to have rehabilitated himself and acquired an interest in a business, however, presumably, with the expectation of generating sufficient funds for his support.”
In the absence of evidence from the husband as to his circumstances, the trial judge could not have made any findings as to the matters to be taken into account under s 75(2) of the Act. We find no merit in this ground.
Costs order made at first instance
In his Amended Notice of Appeal, the husband sought an order that all of the orders made by the trial judge be set aside; however, no ground of appeal specifically addressed the order requiring him to pay the wife’s costs fixed in the sum of $10,000.
The wife’s counsel submitted the costs order should stand even if the appeal was successful. Counsel relied on s 117(2A)(c) of the Act, and referred to the conduct of the husband in failing to participate in the proceedings and comply with orders.
In making the order for costs in the wife’s favour, the trial judge took into account the matters set out in s 117(2A) of the Act. His Honour found (at [44-46]) that:
·the husband failed to comply with his obligations as to disclosure;
·the husband failed to comply with the orders of the Court which caused the wife to incur expense;
·the husband had not made any meaningful offer;
·the wife had done significantly better by way of outcome than the husband proposed; and
·the husband failed to rationally consider an offer that was a sensible compromise.
The husband was the author of his own predicament given that no findings were made regarding his health preventing him doing things. Further, we consider the husband is seeking an indulgence from the Court, albeit not by setting aside but on an appeal.
In the circumstances, we consider the order for costs should stand.
Conclusion
We find that the husband has demonstrated that the orders made by the trial judge ought to be set aside, with the exception of the order relating to costs. His Honour was clearly faced with evidentiary difficulties as a consequence of the husband’s failure to participate in the proceedings, however, his Honour fell into error.
In these circumstances, the appeal should be allowed and the matter remitted for a rehearing before a judge other than the Honourable Justice Moncrieff, subject to strict conditions of compliance as set out above.
Costs of the appeal
Both parties sought certificates pursuant to the Federal Proceedings (Costs) Act1981 (Cth) if the appeal succeeded. We propose to grant certificates in relation to the appeal and the hearing.
I certify that the preceding Seventy Seven (77) paragraphs are a true copy of the reasons for judgment of the Honourable Full Court (Bryant CJ, Murphy & Duncanson JJ) delivered on 3 July 2015.
Associate:
Date: 3 July 2015
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