Tower Trust (SA) Ltd v Pincus No. Scciv-02-1887
[2003] SASC 355
•14 October 2003
TOWER TRUST (SA) LTD v PINCUS
[2003] SASC 355
Miscellaneous Appeal
Gray J This is an appeal against an order of a master refusing an application to strike out a claim for want of jurisdiction.
Background
Murray Pincus married Rosemary Dawn Butler on 4 April 1987. They separated in or about May 1999. On 1 May 2001 the decree nisi of dissolution of their marriage became absolute. However they continued to live together until Ms Bulter’s death on 20 August 2002. Tower Trust (SA) Ltd is the executor of Ms Butler’s estate.
Mr Pincus and Ms Butler were joint tenants of the whole of the land comprised in Certificate of Title Register Book Volume 5725 Folio 980 which was a property at 93 Mentone Road, Victor Harbor. The property was said to have formed part of the matrimonial property and was the family home.
A written agreement between Mr Pincus and Ms Butler dated 15 May 2002 provided:
That by way of settlement of property and in full and final satisfaction of any claim that either party may have against the other for alteration of interest or under Part VIII of the Family Law Act 1975 as amended:
1. That the wife shall receive the family home.
2. That the husband shall receive the family car plus $10,000 in cash.
Signed: Murray Pincus Signed: Rosemary Dawn Butler
Date: 15/5/02 Date: 15/5/02
THE CONSENT ORDERS
AS AGREED TO BY BOTH [MS BUTLER] AND [MR PINCUS]
[MS BUTLER] [MR PINCUS] The home $10,000 in cash China cabinet Ford Falcon Car (1981) Phillips fridge NEC television set Medium size Malley’s freezer Sanyo video recorder Kitchen cabinet Video tapes (several) Small Sanyo TV & stand G.E. Washing machine Double bed Simpson dryer Dressing table Steamer trunk Three wardrobes Lounge suite Four tables Single bed Eight chairs (various) Wardrobe & chest of drawers Various crockery, cutlery Rocking chair Cooking utensils, all linen Bar stool Sunbeam electric frypan Floor fan Sunbeam electric chargrill Toshiba microwave Large bread bin Various auto parts, tools, crockery and cutlery The above property Settlement will take place as soon as it is possible.
Signed: [Murray Pincus] Signed: [Rosemary Dawn Butler]
Date: 15/5/02 Date: 15/5/02
The agreement was in a form that could be made the subject of a consent order in the Family Court of Australia.
On 17 May 2002 Mr Pincus and Ms Butler issued proceedings in the Family Court seeking orders for a property settlement pursuant to Part VIII of the Family Law Act 1975 (Cth). They sought a consent order to give effect to their agreement of 15 May 2002. However on 26 June 2002 the property settlement proceedings were discontinued by notice signed by the parties. No orders were made by the Family Court.
As at 20 August 2002, the date of Ms Butler’s death, Mr Pincus’ interest in the property had not been transferred to Ms Butler.
The Proceedings
On 23 December 2002 Tower Trust issued proceedings in this Court. The statement of claim alleged:
The Plaintiff is a company duly incorporated under the Corporations Law and carries on the business as, amongst other things, trust administrators and was formerly known as IOOF Australia Trustees Limited ACN 007 870 644.
The Defendant and the late Rosemary Dawn Butler (“the deceased”) were joint tenants in the whole of the land comprised in Certificate of Title Register Book Volume 5725 Folio 980 more commonly referred to as 93 Mentone Road, Victor Harbor in the State of South Australia (“the property”)
By way of written agreement dated 15 May 2002, the Defendant and the deceased mutually agreed between them as joint tenants to sever their joint tenancy in the property.
According to the agreement referred to in the preceding paragraph, the deceased and Defendant intended for the deceased to be made sole legal owner of the property.
On or about 20 August 2002, the deceased died and at that date of death transfer of the property to the deceased solely had not be effected.
By virtue of a will dated 17 October 1994, the deceased appointed IOOF Australia Trustees Limited (now the Plaintiff company) to be the executor and trustee of her estate.
Tower Trust sought the following relief:
A declaration that the joint tenancy as referred to in paragraph 2 be severed.
That the property be transferred to the estate of the deceased.
Costs
Mr Pincus challenged this Court’s jurisdiction. It was said that the proceedings were a “matrimonial cause” within the meaning of the Family Law Act. Accordingly such a claim could only proceed in the Family Court of Australia and could not be heard in the Supreme Court of South Australia.
The Master dismissed Mr Pincus’ application and provided the following reasons:
[Counsel for the plaintiff] referred to the definition of ‘matrimonial cause’ in Section 4(1) of the Family Law Act 1975 as amended. The only possibly relevant portion of that definition, he submitted, was subparagraph (ca)(i), which reads:
‘Matrimonial cause means proceedings between the parties to a marriage with respect to the property of the parties to the marriage or either of them, being proceedings:
- arising out of the marital relationship.’
The significant portion of this definition, [counsel] argued, is ‘proceedings between the parties to a marriage’. In this case, the plaintiff is not a party to a marriage, but the executor of the estate. There is no authority which suggests that the executor of an estate has to stand in the shoes of the deceased in such matters. [Counsel for the plaintiff] also relied on several authorities to establish that this Court or other Courts, other than the Family Court, have made orders in similar or related types of matters.
[Counsel for the defendant] relied on Section 4(1)(ca)(i) … . [He] challenged authorities quoted by [counsel for the plaintiff] on the basis that they preceded the amendments to the Family Law Act. He did not suggest that the amendments to the Family Law Act had altered the definition of ‘matrimonial cause’. More significantly, however, [counsel for the defendant] was not able to point to any authority which countered [counsel for the plaintiff’s] argument.
Issues On Appeal
This appeal raises issues of statutory construction and arguments regarding inconsistency between State and Federal legislation within the meaning of section 109 of the Constitution. It also raises for consideration the severance of a joint tenancy.
The Submissions
Counsel for Mr Pincus submitted that the proceedings brought by Tower Trust constituted a “matrimonial cause” within the meaning of section 4 of the Family Law Act[1]. It was said that section 8 of the Family Law Act conferred exclusive jurisdiction over those proceedings on the Family Court[2]. It was contented that no such proceedings could be instituted in the Supreme Courts of the States of Australia after the commencement of the Family Law Act.
[1][2] Section 8(1) After the commencement of this Act:
(a)proceedings by way of a matrimonial cause shall not be instituted except under this Act; and
Mr Pincus submitted that section 4(2) of the Family Law Act provided that a party to a marriage included a party to a marriage terminated by the death of one party[3]. It was said that Tower Trust stood in the position of Ms Butler in the Family Court proceedings and that the claim related to matrimonial property. As a result it was said that the proceedings constituted a matrimonial cause.
[3] Section 4(2) A reference in this Act, the Standard Rules of Court or the related Federal Magistrates Rules to a party to a marriage includes a reference to a person who was a party to a marriage that has been dissolved or annulled, in Australia or elsewhere, or that has been terminated by the death of one party to the marriage.
Counsel for Mr Pincus raised an inconsistency argument and relied on section 109 of the Constitution.[4] It was said that the Family Law Act disclosed an intention by the Commonwealth Parliament to “cover the field”. It followed that Tower Trust was precluded from seeking relief from a State court.
[4] Section 78B notices (Judiciary Act 1903 (Cth)) were issued, regarding the constitutional argument regarding the definition of ‘matrimonial cause’ and the jurisdiction of this Court. None of the Attorneys Generals wished to intervene.
Counsel for Tower Trust submitted that the proceedings were not a “matrimonial cause”. It was said that Tower Trust was not and never had been a party to the marriage. The fact that it was the executor and trustee of Ms Butler’s estate and stood in the position of Ms Butler did not result in the present constituting a “matrimonial cause”.
Counsel for Tower Trust acknowledged that if Tower Trust sought to enforce the agreement of 15 August 2002 it would have to do so in the Family Court. It was accepted that in that event the State court would have no jurisdiction. The proceedings would be within the exclusive domain of the Family Court.
Tower Trust did not seek to enforce the agreement of 15 August 2002 or the minutes of order filed in the Family Court. Counsel relied on the agreement of 15 August 2002 to support the claim for a severance of the joint tenancy. It was pointed out that the action was for a declaration concerning severance. It was said that the deceased held an equitable interest in the entire property. That interest had existed prior to Ms Butler’s death. It was said that the agreement had been concluded and that as a result Tower Trust was now entitled to the declaration sought and an order for transfer.
Consideration of the Issue
In Smith v Smith[5] Gibbs CJ, Wilson and Dawson JJ observed:
[5] (1986) 161 CLR 217 at 234 per Gibbs CJ, Wilson and Dawson JJ
There is nothing in the provisions of Part VIII [of the Family Law Act] to suggest that the Parliament intended exclusively to cover the field so arbitrarily defined, and the very description of the field in that way indicates that the Family Law Act reveals no intention to express exhaustively what the law should be governing the provision of maintenance or other benefits for one spouse out of the deceased estate of the other spouse. Some reliance was placed in argument on s. 81 of the Family Law Act; however, although that section requires that some orders under Pt VIII should finally determine the financial relationships between the parties to a marriage inter vivos and avoid further proceedings between them, it reveals no intention to prevent or inhibit proceedings by a spouse against the personal representative of a deceased spouse. Indeed, the very scope and object of the Family Law Act suggests that it was not intended that all disputes between spouses regarding matters affecting their property should be dealt with under Pt VIII. For example, a claim by one spouse against another for contribution as a joint tortfeasor, or an application to approve the settlement of an action by a spouse who was an infant, would not fall within the scope of the Family Law Act.
In Coluzzi v Coluzzi[6] Young J dealt with a similar challenge to the jurisdiction of a State court:
[6] [2001] NSWSC 94 at [39]
One must always look at the circumstances of each particular case. In the instant case there is absolutely nothing with respect to the breakdown of the matrimonial relationship (indeed it has not broken down), or the material upon which the plaintiff relies, to say that there is a trust. Her claim would be exactly the same if the other co-owner of the property was a complete stranger. Accordingly, in my view the proceedings do not arise out of the marital relationship and are not a matrimonial cause.
In the present case it was accepted that the property was at one time matrimonial property. However, by the date of Ms Butler’s death the Family Court proceedings had been discontinued. As earlier observed Tower Trust did not seek to enforce the agreement as set out in the minutes of order prepared for the purpose of proceedings in the Family Court. It sought a declaration concerning severance with consequential relief.
The claim advanced was that the agreement of 15 August 2002 evidenced the severance of the joint tenancy. It was said that the joint tenancy was then severed and Ms Butler acquired an equity in Mr Pincus’ interest in the property. It was contended that the fact that the property to which the claim relates was once property of a marital relationship did not automatically bring the claim within the exclusive jurisdiction of the Family Court.
Joint tenants can sever a joint tenancy during their lifetime. In Williams v Hensman[7] the court observed:
A joint-tenancy may be severed in three ways: in the first place, an act of any one of the persons interested operating upon his own share may create a severance as to that share. The right of each joint-tenant is a right by survivorship only in the event of no severance having taken place of the share which is claimed under the jus accrescendi. Each one is at liberty to dispose of his own interest in such manner as to sever it from the joint fund losing, of course, at the same time, his own right of survivorship. Secondly, a joint-tenancy may be severed by mutual agreement. And, in the third place, there may be a severance by any course of dealing sufficient to intimate that the interests of all were mutually treated as constituting a tenancy in common. When the severance depends on an inference of this kind without any express act of severance, it will not suffice to rely on an intention, with respect to the particular share, declared only behind the backs of the other persons interested. You must find in this class of cases a course of dealing by which the shares of all the parties to the contest have been effected…
The present claim asserted that the joint tenancy was severed by the agreement of 15 August 2002.
The claim of Tower Trust seeks declaratory and ancillary relief. To succeed Tower Trust must establish that a severance of the joint tenancy occurred. It is said that the written agreement evidences the fact of severance. This is the claim that Tower Trust propounds in these proceedings.
The claim that the proceedings are beyond the jurisdiction of this Court should be rejected. There is no inconsistency within the meaning of section 109 of the Constitution. The Family Law Act did not intend to cover the field. The fact that the claim relates to former matrimonial property does not require the conclusion that any proceeding with respect to it is a matrimonial cause within the meaning of s 4 of the Family Law Act. The Family Law Act did not seek to preclude an executor from commencing proceedings for a declaration that severance had been agreed in respect of a joint tenancy and that the beneficial interest in the property be transferred.
[7] (1861) 70 ER 862 at 867
This court has jurisdiction. The decision of the Master was correct. The appeal is dismissed.
JUDGMENT CITATIONS LISTED IN ORDER OF APPEARANCE IN JUDGMENT
1 Section 4(1)
(ca) proceedings between the parties to a marriage with respect to the property of the parties to the marriage or either of them, being proceedings:
(i) arising out of the marital relationship;
(ii) in relation to concurrent, pending or completed proceedings between those parties for principal relief; or
(iii)in relation to the dissolution or annulment of that marriage or the legal separation of the parties to that marriage, being a dissolution, annulment or legal separation effected in accordance with the law of an overseas jurisdiction, where that dissolution, annulment or legal separation is recognized as valid in Australia under section 104; or
…
(ea) proceedings between:
(i) the parties to a marriage; or
(ii) if one of the parties to a marriage has died - the other party to the marriage and the legal personal representative of the deceased party to the marriage;
being proceedings:
(iii) for the enforcement of, or otherwise in relation to, a maintenance agreement that has been approved under section 87 and the approval of which has not been revoked;
(iv) in relation to a maintenance agreement the approval of which under section 87 has been revoked; or
(v) with respect to the enforcement under this Act or the applicable Rules of Court of a maintenance agreement that is registered in a court under section 86 or an overseas maintenance agreement that is registered in a court under regulations made pursuant to section 89; or
2 Section 8(1) After the commencement of this Act:
(a)proceedings by way of a matrimonial cause shall not be instituted except under this Act; and
3 Section 4(2) A reference in this Act, the Standard Rules of Court or the related Federal Magistrates Rules to a party to a marriage includes a reference to a person who was a party to a marriage that has been dissolved or annulled, in Australia or elsewhere, or that has been terminated by the death of one party to the marriage.
4Section 78B notices (Judiciary Act 1903 (Cth)) were issued, regarding the constitutional argument regarding the definition of ‘matrimonial cause’ and the jurisdiction of this Court. None of the Attorneys Generals wished to intervene.
5 (1986) 161 CLR 217 at 234 per Gibbs CJ, Wilson and Dawson JJ
6 [2001] NSWSC 94 at [39]
7 (1861) 70 ER 862 at 867
Section 4(1)
(ca)proceedings between the parties to a marriage with respect to the property of the parties to the marriage or either of them, being proceedings:
(i) arising out of the marital relationship;
(ii) in relation to concurrent, pending or completed proceedings between those parties for principal relief; or
(iii)in relation to the dissolution or annulment of that marriage or the legal separation of the parties to that marriage, being a dissolution, annulment or legal separation effected in accordance with the law of an overseas jurisdiction, where that dissolution, annulment or legal separation is recognized as valid in Australia under section 104; or
…
(ea) proceedings between:
(i) the parties to a marriage; or
(ii) if one of the parties to a marriage has died - the other party to the marriage and the legal personal representative of the deceased party to the marriage;
being proceedings:
(iii) for the enforcement of, or otherwise in relation to, a maintenance agreement that has been approved under section 87 and the approval of which has not been revoked;
(iv) in relation to a maintenance agreement the approval of which under section 87 has been revoked; or
(v) with respect to the enforcement under this Act or the applicable Rules of Court of a maintenance agreement that is registered in a court under section 86 or an overseas maintenance agreement that is registered in a court under regulations made pursuant to section 89; or
0
2
0