Van Essen & Van Essen
[2000] FamCA 775
•29 June 2000
[2000] FamCA 775
FAMILY LAW ACT 1975
IN THE FULL COURT
OF THE FAMILY COURT OF AUSTRALIA
AT BRISBANE
Appeal No. NA7L of 1999
File No. BR10059 of 1997
IN THE MATTER OF:
DANIEL JAMES VAN ESSEN
Appellant/Husband
- and -
SUSAN ELLA VAN ESSEN
Respondent/Wife
REASONS FOR JUDGMENT
BEFORE: Ellis ACJ, Finn and O’Ryan JJ.
HEARD: 22nd day of May 2000
JUDGMENT: 29th day of June 2000
APPEARANCES: Mr Galloway of counsel, instructed by Mott & Associates, Solicitors, 120 Bloomfield Street, Cleveland QLD 4163,
appeared on behalf of the appellant husband.
Mr Kirk SC, instructed by Emerson Black, Solicitors,
Level 10/193 North Quay, Brisbane QLD 4000, appeared
on behalf of the respondent wife.
Catchwords:
Family Law - Application for leave to appeal - Adjournment pursuant to s.79(5) Family Law Act - Family Law Legislation Amendment (Superannuation) Bill 2000 - Ramsay v Aberfoyle Manufacturing Co (Australia) Pty Ltd (1935) 54 CLR 230, Willow Wren Canal Carrying Co Ltd v British Transport Commission [1956] 1 All ER 567, Sydney City Council v Ke-Su Investments Pty Ltd (1985) 1 NSWLR 246,
Re Minister for Minerals and Energy; Ex parte Wingate Holdings Pty Ltd[1987] WAR 190, Meggitt Overseas Ltd & Ors v Grdovic (1998) 43 NSWLR 527 and Grace v Grace (1998) FLC 92-972 considered and applied.
This was an application for leave to appeal, and, if leave were granted, an appeal by the husband against an order made by Hilton J. on 29 September 1999 adjourning the wife’s application for final orders for property settlement and spousal maintenance to a date not before the last sittings of Parliament in 2000.
The parties married in 1988 and separated in August 1997. In November 1998, parenting orders were made in relation to the three children of the marriage. In August 1999, the wife filed an amended application for final orders for property settlement and spousal maintenance. At the time of trial, the husband’s superannuation entitlement amounted to some $100,000. However, it was submitted for the wife that upon retirement it would be in excess of $3,000,000.
Shortly before the hearing on 9 September 1999, the wife indicated that she proposed to seek an adjournment of the proceedings and at the commencement of the hearing an application “for an adjournment of this trial pursuant to section 79(5)” was made on the her behalf, pending the promulgation and coming into effect of the Family Law Legislation (Superannuation) Bill 2000.
The husband submitted on appeal, if leave were granted, inter alia, that the trial Judge:-
erred in law in adjourning the trial to await possible change;
was obliged to apply the law as it stood when the matter was called on for trial and his failure to do was an error in law; and
erred in law and in fact in finding that s.79(5) had application to present circumstances.
At the hearing of the appeal, leave was granted for both parties to adduce further evidence relating to the proposed legislation, which revealed, inter alia, that the Bill, which had been introduced to the House of Representatives on 13 April 2000, had as at 9 May 2000 not yet been debated in the House.
Held:-
Putting aside the provisions of s.79(5), the applicable principles in relation to the adjournment of the hearing of proceedings pending the passage of foreshadowed legislation or of legislation which has been introduced to the Parliament but not enacted are as enunciated in Ramsay v Aberfoyle Manufacturing Co (Australia) Pty Ltd (supra), Willow Wren Canal Carrying Co Ltd v British Transport Commission (supra), Sydney City Council v Ke-Su Investments Pty Ltd (supra), Re Minister for Minerals and Energy; Ex parte Wingate Holdings Pty Ltd (supra) and Meggitt Overseas Ltd & Ors v Grdovic (supra).
Regard should be had to the principles enunciated in the abovementioned authorities in the determination of an application pursuant to the provisions of s.79(5) where the application has as its basis an expectation that at some future date the law may or will be changed.
In the present case, having regard to the evidence before the trial Judge, it could not be concluded that the proposed legislation would be passed, nor could any conclusion be reached as to the final form of such legislation if it is enacted. Thus, it could not said that any change (significant or otherwise) in the financial circumstances of the parties would be likely as a result of the proposed legislation.
The trial Judge erred in concluding that the provisions of s.79(5) allowed him to make the order which he did on the basis of the proposed legislation becoming law, nor did the evidence relating to the proposed legislation enable him to form the opinion that there was likely to be a significant change in the parties’ financial circumstances.
The further evidence adduced before the Full Court was not such as would have enabled the trial Judge to have reached, nor us to reach, either the conclusion or opinion referred to in 4 above.
Appeal allowed and the application for property settlement and spousal maintenance remitted for hearing before a single Judge at the earliest reasonable date.
Directions given relating to the filing of written submissions regarding the costs of the appeal as well as the appeal against an order for costs.
Reportable.
This is an application for leave to appeal and, if leave is granted, an appeal by the husband against the following orders made by Hilton J. on 29 September 1999:-
“1.That the WIFE’S application for final orders for settlement of property and spousal maintenance be adjourned to a date to be fixed to be not before the last sittings of Parliament in the year 2000.
2. That there be no order as to costs.”
As a consequence of orders made by Lindenmayer J. on 22 October 1999, the application for leave to appeal and the appeal were argued together before us.
BACKGROUND
The wife was born on 23 March 1961 and was aged 38 years at the date of hearing before the trial Judge. The husband was born on 20 September 1963 and was aged 35 years at the date of the hearing. The parties married on 2 April 1988 and separated a little over nine years later on 26 August 1997 when the husband left the former matrimonial home. There are three children of the marriage born respectively in 1992, 1993 and 1995.
The husband is a pilot/first officer employed by Qantas. The wife is a qualified architect who since approximately January 1991 has been engaged full-time in home duties.
On 10 November 1997, the wife filed an application in which she sought the following orders:-
“1.That the former matrimonial home situate and known as 17 Adrian Street, Victoria Point in the State of Queensland be transferred to the Applicant Wife.
2.That an account be taken of the nett assets and financial resources of the parties and that a further cash adjustment be made in favour of the Wife in such sum as the Court deems appropriate.
3.That the Husband pay to the Wife such periodic and/or lump sum spousal maintenance as this Honourable Court deems meet after taking into account the property settlement between the parties.
4. Such further or other final orders as this Honourable Court deems meet.
5. That the Husband pay the Wife’s costs of and incidental to this application.”
On 5 March 1998, the husband filed an amended response in which he sought the following orders:-
“1.That the former matrimonial home be sold and the net proceeds be divided equally between the Applicant Wife and the Respondent Husband.
2.That an account be taken of the remaining net assets of the parties and that the assets be distributed in specie between the Applicant Wife and the Respondent Husband according to the respective values of the assets or that in the alternative, the remaining assets be sold and the proceeds of sale be distributed equally between the Applicant Wife and the Respondent Husband.
3. That no order be made as to periodic or lump sum spousal maintenance.
4. Such further or other final orders as this Honourable Court seems (sic) meet.
5.That the Applicant Wife and the Respondent Husband each pay their own costs of and incidental to this application.
6.That the children of the marriage M born 19 February 1992, T born
16 September 1993, B born 4 July, 1995, live and reside with the Applicant Wife.
7.That the Applicant Wife be responsible for the day to day care and control of the children of the marriage.
8.That the Husband and the Wife be jointly responsible for the long term care, welfare and development of the said children of the marriage.
9.That the Husband have contact to the said children of the marriage at all such times reasonable times or as agreed between the parties, or as otherwise ordered by the Court and in particular as follows:-
(a)each alternate weekend between the hours of 9:30 a.m. and 5:30 p.m. Sunday, the first contact weekend to commence on the weekend following the making of these orders;
(b)for one half of all gazetted school holidays for the State of Queensland save the Easter school holidays each year, with the Husband to have the first half of each such said school holidays in 1997, and each alternate year thereafter and the second half of each said set of school holidays in 1998 and each alternate year thereafter;
(c)for the whole of the Easter school holiday period in 1998 and each alternate year thereafter;
(d)should any of the children’s birthdays not fall during a period of contact otherwise provided for in these orders, for a period of four (4) hours commencing 9:00 am and concluding at 1:00 pm on each of the children’s birthdays;
(e)should Fathers Day not fall on a period of contact otherwise provided for in these orders, for a period of four (4) hours between 9:00 am and 1:00 pm on that day;
(f)should Mothers Day fall during a period of contact provided for in these orders, then the children shall be returned to the Wife at 1:00 pm on that Sunday;
(g)that notwithstanding sub-paragraph (b) of these orders, the children shall be returned to the Wife by the Husband at 5:00 pm Christmas Even (sic) and the Wife shall return the children to the Husband at
2:00 pm Christmas Day in 1997, and each alternate year thereafter.
10.That the Husband have telephone contact with the children of the marriage by the Husband telephoning the said children not more than twice per week.
11. That the Wife encourage the children to telephone the Husband.
12.That the Husband have liberty to attend at all school and social events involving the children of the marriage or any one of them, including attendance at such schools to speak to teachers and principals regarding the progress of the said children, however, the Husband shall give the Wife five (5) days notice of his intention to so attend.
13.That the Wife keep the Husband informed of the children’s health, education and other activities.
14.That each of the parties shall do all necessary things and execute all necessary documents to enable an applications (sic) for passports in the childrens’ (sic) names (solely and individually), and in any event such childrens’ (sic) passports upon issue shall be held by the Solicitors for the Husband and shall not be made available to either party without the consent in writing of both parties or the Order of the Court.
15.That should either party wish to take the children or any one of them out of the country, then the party wishing to remove the child or children from the country, shall provide to the other parent six (6) weeks notice in writing providing the following details:-
(a) the proposed date of departure;
(b) detailed itinerary;
(c) the proposed date of return to Australia;
(d) contact telephone number or numbers for the duration of the journey;
16.That a childrens (sic) representative be appointed at the direction of the Family Law Court (sic).”
On 30 November 1998, orders were made that the three children of the marriage reside with the wife and that the husband have contact with each of them.
On 12 August 1999, the wife filed an amended application in which she sought the following orders:-
“That by way of settlement of the Wife’s claim for property settlement and spousal maintenance arising from the marriage:
1. The Wife be adjudged entitled to the following:
(i)The former matrimonial home situate and known as 17 Adrian Street, Victoria Point (“the former matrimonial home”).
(ii)The furniture and contents presently located in the former matrimonial home.
(iii)The 1989 Holden Commodore station wagon registered 255-BMM
(iv) Her superannuation entitlement held with Mercantile Mutual
2.That the Respondent Husband cause to be discharged the mortgage debt due to Colonial State Bank and secured by the former matrimonial home within TEN (10) years and shall indemnify the Applicant Wife in respect thereof.
3.Pending final discharge of the said mortgage debt as referred to in Order 2 hereof, the Respondent meet all mortgage instalments under the said mortgage as and when they fall due
4.That in default of the Husband discharging the mortgage debt and meeting all the mortgage instalments as provided in Order 3 above, then a sum equal to the whole of the mortgage debt, together with interest thereon, as may be determined by the mortgagee (together with interest pursuant to the Family Law Rules) shall become due and owing by the Husband to the Wife and that such sum and interest be a charge against the Husband’s superannuation with the Qantas Staff Superannuation Fund.
5.In the event that the Wife chooses to sell the matrimonial home described in paragraph 1 above, prior to the Husband discharging the mortgage debt, as provided for in paragraph 2 hereof, then the balance owing under the mortgage as at the date of sale shall be payable by the Husband on or before the date of sale, failing which it, together with interest as provided in paragraph
4(a) (sic) hereof, save for penalty interest under the Family Law Rules, shall be a charge against the Husband’s superannuation with the Qantas Staff Superannuation Fund until paid.
6.In the event that the Wife seeks to purchase an alternate place of residence to the matrimonial home referred to in paragraph 1 hereof, within a period of 10 years from the date of this Order, the Husband and the Wife shall join in the transfer of the mortgage debt secured over the matrimonial home, to the new residence to be acquired by the Wife and no charge shall accrue against the Husband’s superannuation entitlement unless the Husband fails to comply with 4(a) (sic) above which shall apply to the replacement home in similar manner to the existing matrimonial home.
7.Notwithstanding the provision of 4, 5 and 6 above, in the event of the Husband’s failing to comply with paragraph 3 above in respect of the mortgage over the matrimonial home or any replacement security, then it shall also be open to the Wife to bring enforcement proceedings against the Husband in terms of the Family Law Act to recover the full amount of the debt due by the Husband including interest thereon as herein provided, without the necessity to wait until such time as the Husband’s superannuation entitlement falls due.
8.That the Husband shall irrevocably authorise and direct the Qantas Staff Superannuation Fund to discharge the mortgage debt currently secured over the former matrimonial home with the Colonial State Bank, together with interest as provided for in paragraph 4 above in the event that such mortgage debt has not been discharged at the time that the Husband becomes entitled to receive his superannuation entitlements.
9.That the Order for periodic spousal maintenance made by Registrar Dittman in this Honourable Court on 16 December, 1997, continue until such time as the youngest child, B born on 4 July, 1995, commences Grade 1 of his primary schooling.
10.That the Respondent meet the children’s reasonable school fees and expenses in respect of the children’s attendance at Ormiston College to include school fees, cost of books and uniforms, special levies and compulsory building fund contribution if any, and the cost of excursions and other compulsory school activities in which the children are involved from time to time, with such fees to be paid by the Respondent within (30) days of production of an invoice or account for same by the Applicant.
11.That the Respondent pay one-half of any extraordinary medical expenses incurred by the Applicant Wife in respect of the children with such fees to be paid to the Wife or at her direction within (30) days of production of an invoice or account for same by the Wife.
12.That in the event of any international travel proposed by the Wife for the children of the parties the Husband shall take all necessary steps to ensure that the child/ren derive the benefit of any applicable fare reductions arising from the Husband’s employment with Qantas.
13. Such other orders as the Court deems meet.”
In May 1999, a pre-trial conference was held at which the application was fixed for hearing for 2 and 3 September 1999. It was asserted on behalf of the husband, and not denied on behalf of the wife during the course of the hearing of this appeal, that the wife did not, at that pre-trial conference, foreshadow an application that the hearing not proceed on 2 September 1999.
On 17 August 1999, the wife filed an affidavit in accordance with the provisions of Order 30 rule 2. In that affidavit, she deposed as to the relevant assets and resources as follows:-
“15. The matrimonial property arising from the marriage is as follows:
(i)Former matrimonial home situate and known as
17 Adrian Street, Victoria point (sic) having a value
estimated by me at $210,000 and subject of mortgage
to Colonial State Bank approximating $92,000 leaving
a nett value of approximately $118,000
(ii)Contents of the matrimonial home having an estimate
value of approximately $15,000
(iii)1989 Commodore station wagon registered 255-BMM
in the Respondent’s name and having an estimate value
of approximately (unencumbered) $6,500
(iv)1997 Hyundai motor vehicle registered DSK-811, in
the Husband’s name and having a value estimated by
me at approximately $20,000
(v)Investment held in the Respondent’s name with
Prudential Bache Securities (Australia) Ltd, being
account number 897025 which as at 2 September, 1997,
had a credit balance of $10,000 and which I understand
still has a credit balance of $10,000
(vi)Shares held in the Respondent’s name with Qantas
Limited, the latest statement held by me indicates
that as at 3 December, 1997, the Husband held 566
units which on the current unit price of $5.10. at
16/08/99 has a value of $2,886
$172,386.00
In addition Danny and I have the following superannuation entitlements:
(a) Entitlement in Danny’s name as a member of the
Qantas Staff Superannuation Fund. The latest
statement held by me is that dated 14 November,1997, indicating the following details:
Date of joining plan - 01.08.88
Estimated resignation benefit of 14.11.97 - $110,865.76
Amount preserved to age 55 - $ 76,381.39
(b)Superannuation bond held by me with
Mercantile Mutual, being policy number
8800145240-3 commencing 23 December,
1992, details of which are as follows:
Number of units held at 31.03.99 - 284.4453
Unit price at 31.02.99 - $ 8.1683
Producing present value at 31.03.99 of - $2,323.44
(Note: this fund includes monies previously
held by me as superannuation with Mirvac)
16.The mortgage debt in respect of the matrimonial home stood at $91,302.17 as at 20 July, 1999.
17.Apart from the debt due to Colonial State Bank in respect of the mortgage I have debts due to family members, including my parents, sister and brother and their partners, totalling 95,105.57. such debts having been incurred by me since separation, including payments made for legal and schooling fees and a one-off mortgage payment of $4,500.”
On 27 August 1999, the husband filed his affidavit in accordance with the provisions of Order 30 rule 2. In that affidavit, he deposed, inter alia, as follows:-
“59. Currently the matrimonial assets consist of:-
Former matrimonial home $220,000.00
Mortgage debt on matrimonial home $ 92,000.00
Husband’s motor vehicle $ 14,500.00
Wife’s motor vehicle $ 7,000.00
Contents of dwelling $ 15,000.00
Wife’s jewellery $ 5,000.00
Husband’s shares Qantas $ 2,600.00
TOTAL Assets $264,100.00
LESS Mortgage debt $ 92,000.00
TOTAL $172,100.00
59(a). The husband’s liabilities consist of
(i)Mortgage debt in respect of one half interest in dwelling jointly owned with common law wife $84,500.00.
(ii) Debt to parents in respect of costs $5,000.00.
(iii) Credit Card debt $1,700.00
TOTAL DEBTS $91,200.00
60.I have no accurate idea of the extent of the personal indebtedness of the Applicant.”
On 27 August 1999, the wife filed her Case Outline Document in which it was asserted, inter alia, as follows:-
“F. PROPERTY:
The matrimonial property arising from the marriage is as follow (sic):
(i) Former matrimonial home situate and known as
17 Adrian Street, Victoria point (sic) having a
value estimated at $210,000
(ii) Contents of the matrimonial home having an
estimate value of approximately $15,000
(iii) 1989 Commodore station wagon registered
255-BMM in the Husband’s name and
having an estimate value of
approximately (unencumbered) $6,500
(iv) 1997 Hyundai motor vehicle registered
DSK-811,in the Husband’s name and having
a value estimated at approximately $20,000
(v) Investment held in the Husband’s name with
Prudential Bache Securities (Australia) Ltd, being
account number 897025 which as at 2 September,
1997, had a credit balance of $10,000 $10,000
(vi) Shares held in the Husband’s name with Qantas
Limited, as at 3 December, 1997, the Husband held
566 units which on the current unit price of $5.10.
at 16/08/99 has a value of $2,886
$264,386.00
G. LIABILITIES:
(i) Mortgage debt due to Colonial State Bank
in respect of the matrimonial home as
at 20.07.99 $91,302.17
Apart from the debt due to the Colonial State Bank in respect of the mortgage the Wife has debts due to family members, including her parents, sister and brother and their partners totalling $95,105.57, such debts having been incurred by her since separation, including payments made for legal costs, schooling fees, mortgage payments and general living expenses as detailed in her Affidavit in Chief.
H. FINANCIAL RESOURCES
The parties have the following financial resources:
(a)Husband’s entitlement as a member of the Qantas Staff Superannuation Fund. Details of the Husband’s present entitlement are not known to the Wife.
(b)Superannuation Bond held by the Wife with Mercantile Mutual, having a value at 31.03.99 of $2,323.44.”
On 30 August 1999, the husband filed his Case Outline Document in which it was asserted, inter alia:-
“F. PROPERTY:
ASSET OWNER VALUE
Matrimonial home Joint $220,000.00
1997 Hyundai Coupe Vehicle Husband $ 14,500.00
1989 Holden Commodore Vehicle Wife $ 7,000.00
Contents of dwelling Joint $ 15,000.00
Jewellery Wife $ 5,000.00
Qantas Husband $ 2,600.00
$264,100.00
G. LIABILITIES
Mortgage debt on Matrimonial
home in favour of Colonial
State Bank Joint $ 92,000.00
Mortgage debt in half interest
in dwelling jointly with common
law wife Husband $ 84,500.00
Debt to Husband’s parents Husband $ 5,000.00
Credit Card debt Husband $ 1,700.00
H. FINANCIAL RESOURCES:
Qantas Airways Ltd Staff
Superannuation Fund Husband (net) $108,070.60
Super Bond Mercantile Mutual Wife $ 2,323.44
Interest on H.R.Bosher
Family Trust Wife Not known
NOTE:The parties are at issue over the nature contingent or otherwise with respect to the Wife’s interest in the H.R. Bosher Family Trust.”
On 1 September 1999, an affidavit of Angela Wakefield, a financial planner, was filed on behalf of the wife in which she deposed, inter alia, that her practice involves regularly analysing superannuation plans and advising in relation to all aspects of superannuation, including prospective entitlements. She considered the prospective entitlement of the husband pursuant to the Qantas Staff Superannuation Plan on his normal retirement at 1 July 2019, as assessed by her at $3,033,000, to be conservative on the assumptions detailed by her in a letter dated 20 January 1998 which appears at AB 204 to 205. Annexure “D” to her affidavit is a statement dated 24 August 1999 issued by Qantas, detailing particulars relating to the husband’s superannuation, including a statement that the estimated withdrawal benefit as at 1 September 1999 was $166,114.98.
Shortly before the commencement of the hearing before the trial Judge, the wife, through her legal advisers, indicated that she proposed to seek an adjournment of the proceedings. On 9 September 1999, the day on which the hearing commenced before Hilton J, Senior Counsel for the wife made an application to his Honour “for an adjournment of this trial pursuant to section 79(5)”.
After hearing submissions from Senior Counsel for the wife and counsel for the husband, the trial Judge reserved his decision until 29 September 1999 when he made the orders against which the husband has sought leave to appeal and has appealed.
JUDGMENT OF THE TRIAL JUDGE
After referring to certain background material, the trial Judge found that the total value of the assets of the parties was $264,386 and that there was a mortgage debt due to the Colonial Bank, as at 20 July 1999, of $91,302.17. He then referred to certain debts of the wife, totalling $95,105, incurred by her since separation. He went on to say:-
“The husband’s superannuation from Qantas is at present a financial resource and it is not anticipated that the husband will reap the full benefit of his superannuation for another thirty-odd years, on the evidence that has been put before me. It is generally agreed that when the husband retires from Qantas he will receive a figure in the vicinity of $3,000,000.00. If his superannuation was to fall due now it would be worth, as I understand the evidence, something in excess of $100,000.00 but there is no intention on behalf of the husband to retire from his position with Qantas and to collect his superannuation, and in the normal course of events, he would not receive it for some considerable period of time.
It will be seen on the asset and debt situation which I have outlined above, that if this matter were to proceed to trial, there would be little in the way of distribution for the wife even if she was forgiven the debts she owes to her parents, her brother and her sister. The husband would continue as a pilot with Qantas earning some $130,000.00 a year, less tax. He would be liable for child support and maintenance to his wife, although that might be disputed insofar as it might be argued that the wife could do part-time work.”
Thereafter, the trial Judge noted that Senior Counsel for the wife sought an adjournment of the proceedings before him, the basis for which “rests on his interpretation of s79(5) of the Family Law Act 1975”. He then set out the provisions of s.79(5) and continued:-
“In an affidavit filed by leave on 9 September 1999 which was sworn by John Redmond Mott, solicitor for the husband, he sets out in paragraph 4 the reasons for the applicant’s legal representatives seeking an adjournment. This is not disputed. Mr Mott swears in his affidavit that he made enquiries of the office of Dr Margaret Browne, First Assistant Secretary of Family Law and Legal Assistance Division, Attorney-General’s Department, Canberra in the Australian Capital Territory on
7 September 1999 by telephone. He spoke to one, Deborah Turner of that Department who advised him as follows:“(i) Legislation has not yet been introduced into Parliament.
(ii)It is anticipated that the legislation will be introduced towards the end of the Spring sittings of Federal Parliament, that is in December, 1999.
(iii)The consequential expectation is that the legislation would not be debated until the first three to four months of the year 2000.
(iv)Consequently, it is unlikely that the legislation would be passed before July, 2000.
(v)It is possible that the Bill may have to go to committee, in which case passage of the legislation is likely to be delayed.
(vi)It is more realistic to speculate that the Bill would not be passed until the second half of the year 2000.
(vii)Date of commencement may not be for some time after passage of Bill.”
He continues in paragraph 6 as follows:
“6. In verification of that advice I caused a letter to be dispatched by facsimile to the said Department on Wednesday 8th September, 1999. The letter set out in tabular form the advice received per telephone. By return I received on the 8th September, 1999 a facsimile of the letter dispatched by me duly amended by the addition of hand written notes. A true copy of the said amended letter is annexed hereto and marked with the letter “A”.”
Exhibit “B” is a letter written by Mr Mott to Dr Margaret Browne, Department of Attorney-General, Australian Capital Territory. As Mr Mott says in his affidavit, he dispatched by facsimile an amended letter to the said Department which letter contained at its foot, an endorsement to the effect that the contents of his letter truly and accurately reflected the advice given verbally. Mr Mott states that an endorsed copy of his letter was duly returned to him on 8 September 1999. He sets out what he had been advised by the Department. It sets out the advices previously referred to by Mr Mott.”
The trial Judge then noted that the basis of the wife’s application pursuant to s.79(5) was “[this] correspondence and the intentions of the Attorney-General’s Department”.
After noting that the husband opposed the wife’s application and referring to his counsel’s submissions and Meggitt Overseas Ltd & Ors v Grdovic (1998) 43 NSWLR 527, the trial Judge said:-
“The situation in the present case is completely different. Here, there is specific legislation, s79(5), allowing the court to grant an adjournment on the basis of proposed legislation becoming law. Not to grant an adjournment in this particular case would fly in the face of s79(5)(b) which has been introduced specifically to avoid any injustice.
Mr Kirk sought an adjournment. I think it appropriate in this case, based on the submissions of Mr Kirk, to grant an adjournment to the end of the last sittings of Parliament in the year 2000. At the expiration of that time, depending on what is known about the pending legislation on superannuation, the matter may be reviewed.
I make no order as to costs.”
DRAFT NOTICE OF APPEAL
The grounds of appeal, if leave is granted, are set out in the draft Notice of Appeal and are as follows:-
“1.The learned Trial Judge erred in law in adjourning the trial to await possible legislative change.
2.The learned Trial Judge erred in law to find that, if the law relating to superannuation changed (if at all, in way (sic) that could not be known) it was likely to bring about a significant change in the financial circumstances of the parties.
3.In circumstances where the applicant sought an adjournment not to await the vesting of the husband’s superannuation fund upon retirement, but to await a hoped for change in the law relating to existing superannuation entitlements, the learned Trial Judge had no proper ground for adjourning the trial.
4.The learned Trial Judge was obliged to apply the law as it stood when the matter was called on for trial and his failure to do so was an error of law.
5.The learned Trial Judge erred in law and in fact in finding that s. 79(5) had application.
6.The learned Trial Judge was wrong to reserve the question of costs, and ought in the circumstances to have required the applicant wife to pay the husband’s costs thrown away by reason of the adjournment.”
APPLICABLE PRINCIPLES
It was common ground that the principles governing the application for leave to appeal are those expressed by the High Court in Adam P. Brown Male Fashions Pty Limited v Philip Morris Inc. (1981) 148 CLR 170, particularly at 177. See also Rutherford and Rutherford (1991) FLC 92-255.
The principles governing the manner in which an appeal against an exercise of discretion should be determined, if leave is granted, are enunciated in House v The King (1936) 55 CLR 499 at 504. Those principles need not be repeated in the context of this case.
FURTHER EVIDENCE
At the commencement of the hearing of the appeal, with the consent of the wife, leave was granted to the husband to adduce further evidence on the hearing of the appeal, if leave is granted. That further evidence is contained in the affidavit of his solicitor, John Redmond Mott, sworn 18 May 2000 and relates to the Family Law Legislation (Superannuation) Bill 2000. No objection was taken as to the admissibility of any of the contents of the affidavit.
Leave was also granted to the wife, with the consent of the husband, to adduce further evidence on the hearing of the appeal, if leave is granted. That evidence is contained in the affidavit of her solicitor, Michael John Emerson, sworn 12 May 2000 and also relates to the Family Law Legislation (Superannuation) Bill 2000, a copy of which is annexed to the affidavit. No objections were taken as to the admissibility of any of the contents of the affidavit.
SUBMISSIONS
It was submitted on behalf of the husband that the application of the wife was not an application for an adjournment to await the vesting of the husband’s superannuation but was an application for an adjournment for a period sufficient to allow the Parliament of the Commonwealth to enact certain legislation, namely that contained in the Family Law Legislation Amendment (Superannuation) Bill.
At the date of the wife’s application to the trial Judge, the Bill had not been introduced into the Parliament nor, it was submitted, was there before his Honour any description of the powers that the legislation might give to the Court. However, as the further evidence demonstrates, the Family Law Legislation Amendment (Superannuation) Bill was in fact introduced in the House of Representatives on
13 April 2000. That Bill proposes certain amendments to the Family Law Act, including the following clauses to which the respective counsel drew our attention:-
· Clause 90MC provides:-
“A superannuation interest is to be treated as property for the purposes of paragraph (ca) of the definition of matrimonial cause in section 4.”
· Clause 90MS provides:-
“(1)In proceedings under section 79 with respect to the property of spouses, the court may, in accordance with this Division, also make orders in relation to superannuation interests of the spouses.
(2)A court cannot make an order under section 79 in relation to a superannuation interest except in accordance with this Part [Part VIIIB of the Family Law Act].”
· Clause 90MT provides:-
“(1)A court, in accordance with section 90MS, may make the following orders in relation to a superannuation interest (other than an unsplittable interest):
(a)an order to the effect that, whenever a splittable payment becomes payable in respect of the interest:
(i)the non-member spouse is entitled to be paid the amount (if any) calculated in accordance with the regulations; and
(ii)there is a corresponding reduction in the entitlement of the person to whom the splittable payment would have been made but for the order;
(b)such other orders as it thinks necessary for the enforcement of an order under paragraph (a).
(2)Before making a splitting order in relation to a superannuation interest, the court:
(a)must determine the overall value of the interest in accordance with the regulations; and
(b)must allocate a base amount to the non-member spouse, not exceeding the overall value.”
· Clause 90MZD provides:-
“(1)An order under this Part in relation to a superannuation interest may be expressed to bind the person who is the trustee of the eligible superannuation plan at the time when the order takes effect, but only if that person has been accorded procedural fairness in relation to the making of the order.
(2)If an order is binding on the person who is the trustee of an eligible superannuation plan at the time when the order takes effect, then the order is also binding (by force of this subsection) on any person who subsequently becomes the trustee of that eligible superannuation plan.”
The Bill proposes that the relevant provisions commence on the first anniversary of the day on which the Act receives the Royal Assent. It further proposes that separating spouses have the ability to divide their superannuation either in its accumulation or payment phase by agreement or, failing agreement, by Court order in accordance with the provisions of the new Part VIIIB of the Family Law Act which appears to provide a complete set of rules for the division of any superannuation interest. The Bill provides that the relevant provisions relating to superannuation will apply to all marriages, including those dissolved prior to the first anniversary of the day on which the Act receives the Royal Assent other than to marriages referred to in Clause 5(2) of the Bill.
The further evidence demonstrated that the Bill had not as at 9 May 2000 been debated in the House of Representatives and that such debate was not likely to occur until at the earliest the end of May. The Bill would then have to be considered by the Senate. The evidence disclosed that it was not possible to predict when the Bill might be passed and receive the Royal Assent.
It was then submitted on behalf of the husband that, leaving aside any consideration of the provisions of s.79(5) in the circumstances prevailing at the time the application was made on behalf of the wife, the trial Judge had a duty to hear and determine the competing property proceedings before him and to dismiss the wife’s application for an adjournment. Counsel for the husband in the written submissions went on to submit:-
“4.2.3The Courts are charged with the high responsibility of administering justice according to the law as it is. The party evoking (sic) the jurisdiction of the Court must be permitted to seek his justice upon that basis and the Court cannot deny him that right became (sic) of the reasonable expectation that at some future date the law will be changed and with that change, that his rights according to law will be changed.
4.2.4In the present case there is no certainty at all the rights that any party (sic) will be changed or effected (sic).
4.2.5It is, and was in this case, unfair to deny the litigant his entitlements at law, indeed it is a breach of duty to do so. His Honour had an obligation to both of the parties to determine their matter according to law, and ought not to have distinguished their case from any others, and treated them differently to other litigants.”
In support of the submission, we were referred to Meggitt Overseas Ltd & Ors v Grdovic (supra) where at 532, Mason P, with whom Sheller and Beazley JJA. agreed, said:-
“These basal principles have been applied in a line of cases denying that it is proper to grant a contested adjournment of legal proceedings for the purpose of enabling one party to take advantage of a proposed amendment of the enacted law. In Ramsay v Aberfoyle Manufacturing Co (Australia) Pty Ltd (1935) 54 CLR 230 at 253, Starke J said:
“Courts of law, however, can only act upon the law as it is, and have no right to, and cannot, speculate upon alterations in the law that may be made in the future.”
In Willow Wren Canal Carrying Co Ltd v British Transport Commission [1956] 1 All ER 567; [1956] 1 WLR 213, Upjohn J refused an application to stay an action until a Bill which was then before parliament and which in its then form would relieve the defendants of their statutory obligations, might become law. His Lordship said (at 569):
“It is argued that the proper course, therefore, is to let this action be stayed until the fate of the Bill is known. A preliminary objection is taken to that, which seems to me to be fatal to the application, and it is this: sitting in this court, it is my duty to see that litigants have their cases tried, as they are entitled to, and I cannot take into account the possible effect of some Bill now before Parliament which, if passed into law in its present form, may have some effect on the rights of the parties. That seems to me to be a correct formulation of the law. This court is not concerned with what Parliament may think it wise to do in relation to the rights of the parties, but the plaintiff is entitled to come to this court and say ‘In the normal course of events my action will very soon be ripe for hearing. I desire that the court should hear it’, If subsequently to that Parliament in its wisdom thinks it right by some enactment to affect the rights of the parties even to the extent of modifying or abrogating the effects of any judgment which the plaintiffs may be fortunate enough to obtain, no one doubts the right and power of Parliament to do so. It is plain, however, that it is not right for this court either now or at the hearing to take into account the possible effect of a Bill which is at present before Parliament and which, so far as this Court is concerned, may never become law, or, if passed into law, may contain provisions which ultimately do not affect the rights of the parties before the court. In other words, it is a matter of speculation on which this Court will not embark whether a Bill at present before Parliament will be passed into law in its present form.”
See also the discussion in the joint judgment of Lockhart J and Gummow J in Attorney-General (NT) v Minister for Aboriginal Affairs (1987) 73 ALR 33 at 50-53.
These principles led Woolf LJ and Saville J sitting as the Queen’s Bench Division to quash an adjournment decision by an inferior court in Rv Walsall Justices; Ex parte W [1990] 1 QB 253. They were applied by the Full Court of the Supreme Court of Queensland in refusing to have any regard to proposed legislation in Deputy Commissioner for Taxation (Cth) v Moore Bank Pty Ltd [1987] 1 Qd R 414 at 417. They were applied by Gray J when he refused an application to fix an early trial date in order to avoid the impact of anticipated legislation in Juppv Computer Power Group Ltd (1994) 122 ALR 711. And most significantly there is the decision of this Court in Sydney City Council v Ke-Su Investments Pty Ltd (1985) 1 NSWLR 246. There the Court of Appeal by majority refused an adjournment application based upon the “prospect of a legislative change in the situation”. McHugh JA said (at 258):
“Thirdly, as a general rule, it is not a proper exercise of the discretion to grant an adjournment on the ground that it is believed that the law may or will be changed in the near or remote future. As Dean J pointed out in R v Whiteway; Ex parte Stevenson [1961] VR 168 at 171:
‘... I think it was the duty of the court when the applications came on for hearing to deal with them in accordance with the law as it then stood ... It would be a cause of injustice if courts could adjourn cases because they had some real or imagined belief that the law might be amended.’
In that case the adjournment was opposed but the principle is of general application.””
We were invited by counsel for the husband to adopt the principles to which Mason P. referred. His Honour went on to refer to the decision of the Full Court of the Supreme Court of Western Australia in Re Minister for Minerals and Energy; Ex parte Wingate Holdings Pty Ltd [1987] WAR 190, noting the views of the majority, Wallace and Olney JJ. However, he said at 534:-
“The third judgment in that case was given by Burt CJ. The Chief Justice dissented and refused the adjournment, citing Willow Wren, R v Whiteway and Ke-Su. He held (at 194) that:
“... As a matter of principle the submission made by Wingate in its opposition to the adjournment should be accepted. The courts are charged with the high responsibility of administering justice according to the law as it is. A party invoking the jurisdiction of the court must be permitted to seek his justice upon that basis and the court cannot deny him that right because of a reasonable expectation that at some future date the law will be changed and with that change that his rights according to law will be changed. It may well be that his victory, should he enjoy one, will be Pyrrhic. If it is, then so be it. That is a matter for him.”
I respectfully agree. I am strengthened in this view by the other authorities which I have already discussed and by the editor’s note appearing in [1987] WAR 190. There it is stated that on 21 March 1986 the High Court of Australia (Wilson J, Brennan J and Dawson J) by majority refused an application for special leave to appeal. The majority (Wilson J and Dawson J) observed that in refusing special leave they were not to be taken as endorsing the course taken by the Full Court. Brennan J would have granted special leave.”
We would, with respect, agree with his Honour.
Indeed, Senior Counsel for the wife, in his written submissions, accepted the principle that in a contested application for an adjournment:-
“It is not proper for the Court to take into account as a controlling factor the prospect of a substantive legislative amendment which would accrue to the benefit of one party “(Meggitt Overseas Ltd & Ors v Grdovic (1998) 43 NSWLR 527 – headnote”).”
However, he submitted that s.79(5) does not provide for an adjournment in the conventional sense but rather a “deferral” of the hearing until the happening of a “likely” event which will enable the Court “to do justice” between the parties. He drew our attention to the following exchange between the trial Judge and counsel for the husband relating to the likelihood of a change to the law:-
“HIS HONOUR: It would be fair to say there is likely to be a change.
MR GALLOWAY: There is likely to be a change. We don’t know when.
HIS HONOUR: What the change will be we don’t know.
MR GALLOWAY: We don’t know what it is.
HIS HONOUR: But there is likely to be a change.
MR GALLOWAY: But in particular we don’t know whether it will affect parties who are already in the stream. And it is likely, in my submission, that it won’t affect them because, your Honour, it will not have retrospective effect.”
He further submitted that the principle referred to in Meggitt’s case (supra) cannot have an effect on the proper interpretation of s.79(5) as that section does not purport to limit the circumstances whereby a change in financial circumstances is likely and no Court should import such a limitation.
In support of his submissions, Senior Counsel for the wife referred to Grace v Grace (1998) FLC 92-792 (Nicholson CJ, Kay and Coleman JJ.) at 84,888:-
“We also consider that a characterisation of the purpose of power under s 79(5) is assisted by looking beyond the specific reasons for its insertion into the Family Law Act and considering where it fits within the broader context of the scheme established within the Act for property settlement under s 79. The most important relevant features of the scheme may be briefly stated:
· An application for property settlement must be brought no later than 12 months after the marriage has been dissolved; otherwise leave must be obtained pursuant to s. 44(3) of the Act.
· The Act draws a distinction between “property” and “financial resources”. The Court is able to make orders that settle the property of the parties but not their financial resources. Thus, in making orders that settle property, the Court is required to have regard to each party's financial resources but can only settle the property of the parties, which is in existence. Further, it is limited in its powers to make orders in respect of third parties: Ascot Investments v Harper and Harper (1981) FLC 91-000; (1980-1981) 148 CLR 337.
· The usual process to be undertaken in determining applications for property settlement under s. 79 of the Act is clear and operates upon the property of the parties at the time of the hearing: Ferraro and Ferraro (1993) FLC 92-335 at 79,550.
· In making an order under s. 79, sub-s. (2) requires that “[t]he court shall not make an order under this section unless it is satisfied that, in all the circumstances, it is just and equitable to make the order”. This applies to determinations under
s. 79(5).· Section 85 of the Act enables the Court to find that transactions have been made by a party which “is made or proposed to be made to defeat an existing or anticipated order in those proceedings or which, irrespective of intention, is likely to defeat any such order”: see the discussion in Halabi v Artillaga & Ors (1994) FLC 92-470.
· In making orders for property settlement, s. 81 of the Act requires the Court to have regard to the policy of bringing finality to the parties’ financial disputes.
· Once an order is made under s. 79, further applications may only be brought where the narrow criteria of s. 79A are satisfied. The logic of precluding repeated applications to bring finality to proceedings, except where there is proof of the narrow exceptions under s. 79A requires a countervailing safeguard which meets the possibility that parties may have little property available for settlement at the time of hearing but an expectation of the acquisition of more at a subsequent stage.
Seen in this context, it is apparent that the exercise of the discretion to adjourn pursuant to s 79(5) has very serious consequences for the actual subject matter of the dispute and does not just relate to the conduct of the hearing. It is therefore a different type of “adjournment” to that which is often the subject of discussion in those authorities that suggest that appellate courts should be reluctant to interfere with the exercise of discretion by a trial judge as to whether to grant an adjournment or otherwise.
The discretion to adjourn proceedings is guided by the legislature. Taking the words of s 79(5) on their face, we agree with Mr Rose that there are certain preconditions which, cumulatively, must be found in order to invoke the power to order an adjournment:
· that there is likely to be a change in financial circumstances;
· that the likely change is a significant one;
· that having regard to the likely and significant change, it is reasonable to adjourn the proceedings; and
· that an order made if that significant change occurs is more likely to do justice as between the parties than an immediate order.
We would add in respect of this last precondition that in light of s 79(2) we read “justice” as incorporating “justice and equity”.
Without limiting the matters which may be taken into account in determining a claim that financial circumstances are likely to change, s 79(7) further directs the Court to have regard to a party’s participation in superannuation plans and whether a party may acquire property from a discretionary trust. This reflects the issues which, as recorded by the authors of Butterworths, prompted the insertion of the provision, but does not preclude other contingent interests such as inheritances from being a reason to exercise the power accorded by s 79(5).
As a matter of principle therefore, it is our view that an order granting or refusing an adjournment under s 79(5) is not an “adjournment” in the merely practice and procedural sense in which the term is commonly used. Such an order goes to the core subject matter of the determination to be made under s 79, thus conferring a substantive not just procedural quality to its consequences.
Before leaving this topic, in light of discussion in recent years concerning further amendments to the provisions of the Act relating inter alia to property we would conclude this discussion by observing that it is perhaps unfortunate that the term “adjournment” is used in s 79(5). This is because the term “adjournment” in this context may better be described as a “deferral” of the hearing of the application until the happening of one or more specified events which impact upon the capacity to conduct the property settlement determination required by s 79.
The term “adjournment” connotes that the hearing has commenced or is due to commence within a relatively short time. Accordingly, the property identified as forming the basis of the hearing when commenced before adjournment would usually remain the subject matter for orders. Yet, clearly, the purpose of s 79(5) is to not give rise to an expectation among the parties or the Court that they are concerned with the property available for distribution at the time of the s 79(5) application. Rather, the purpose of an order under s 79(5) is to defer the step of ascertaining the property pool for distribution to a defined future point in time.”
We would respectfully agree with those comments of their Honours.
Thus, it was submitted that in considering an application for a deferral pursuant to the provisions of s.79(5), a judge should not take into account the principles enunciated in Meggitt’s case (supra) and the cases therein referred to.
Further, Senior Counsel for the wife drew our attention to the comment of Sedley J. in Sparkes v Harland [1997] 1 WLR 143 at 147:-
“There is in my judgment no rule of law that impending legislative change is never a material consideration in the exercise of the court's powers and discretions. Everything, it seems to me, turns upon the subject matter and the relevance of the pending legislation or possibility of change to the issues which the court has before it.”
After referring to that passage, Mason P. in Meggitt’s case (supra) went on to say at 536:-
“Perhaps this statement is unexceptionable having regard to the way it is expressed. I will leave that matter open. But the passage cannot be inverted into a statement to the effect that it is proper to take into account impending legislative change in support of a contested adjournment.”
Senior Counsel for the wife went on to submit that it was open to the trial Judge to conclude that it was likely that there would, in the circumstances before him, be a significant change in the financial circumstances of the parties and that the cause of that significant change is not a material consideration.
On behalf of the husband, it was submitted that it could not be inferred that the proposed legislation would effect a significant change in the financial circumstances of either of the parties. The legislation, he submitted, would merely enlarge the powers of the Court. Thus, it was submitted that the trial Judge erred in concluding that s.79(5) allowed the Court to grant an adjournment on the basis of the proposed legislation becoming law.
It was submitted on behalf of the wife, however, that, notwithstanding the discretionary nature of the relevant clause, the Bill provides not only for a change in the powers of the Court but also provides an ability for the parties themselves to divide their superannuation as they may agree. Thus, it was put that, if the Bill becomes law, the parties will have the right to be able to deal with their superannuation by agreement or by requesting the Court to make an order and thus it alters, by adding to their rights, their financial circumstances.
Accordingly, it was submitted that the proposed legislation provides for a significant change in the financial circumstances of the parties.
CONCLUSION
In our view, putting aside the provisions of s.79(5), the applicable principles in relation to the adjournment of the hearing of proceedings pending the passage of foreshadowed legislation or of legislation which has been introduced to the Parliament but not enacted, are as enunciated in Ramsay v Aberfoyle Manufacturing Co (Australia) Pty Ltd (supra), Willow Wren Canal Carrying Co Ltd v British Transport Commission (supra), by McHugh JA. in Sydney City Council v Ke-Su Investments Pty Ltd (supra), Burt CJ. in Re Minister for Minerals and Energy; Ex parte Wingate Holdings Pty Ltd (supra) and by the NSW Court of Appeal in Meggitt Overseas Ltd & Ors v Grdovic (supra).
We are also of the view that regard should be had to the principles enunciated in those authorities in the determination of an application made pursuant to the provisions of s.79(5) where the application has as its basis an expectation that at some future date the law may or will be changed. However, in determining such an application, the question of whether there is likely to be a significant change in the financial circumstances of the parties on account of the proposed legislation has to be addressed on the basis, of course, of the evidence before the Court.
In the present case, having regard, in particular, to the evidence which was before the trial Judge, it could not be concluded that the proposed legislation would be passed, nor could any conclusion be reached as to the final form of such legislation if it is enacted. Thus, it could not be said that any change (significant or otherwise) in the financial circumstances of the parties would be likely as a result of the proposed legislation.
In our view, therefore the trial Judge erred in making the order against which the husband has sought leave to appeal and appealed on the basis that he did. His Honour was not entitled, in the circumstances of this case, to conclude that the provisions of s.79(5) allowed him to make the order which he did on the basis of the proposed legislation becoming law, nor did the evidence relating to the proposed legislation enable him to form the opinion that there was likely to be a significant change in the financial circumstances of the parties.
The further evidence which has been adduced before this Court is not such as would have enabled the trial Judge to have reached, nor ourselves to reach, either the conclusion or the opinion to which we have referred. Despite the introduction of the legislation, there is still no certainty of the final form of the legislation or of its ultimate passage.
Accordingly, we are satisfied that the husband has demonstrated an error in principle on the part of the trial Judge and that the adjournment worked a substantial injustice to the husband. We would therefore grant the husband leave to appeal and for the reasons given, allow the appeal and set aside Order 1 made on 29 September 1999. The application of the wife for property settlement and spousal maintenance should be listed for hearing before a single Judge of the Court at the earliest reasonable date.
APPEAL AGAINST COSTS ORDER AND COSTS OF THE APPEAL
At the conclusion of the hearing of the appeal, both counsel agreed that it would be more appropriate if this Court dealt with the appeal against the costs order of the trial Judge and with the costs of the appeal by way of written submissions. We accept these observations and propose giving directions in relation to such submissions.
ORDERS
We therefore order:-
1.That leave be granted to the husband to appeal against the orders of
29 September 1999.
2.That the appeal be allowed and Order 1 made on 29 September 1999 be set aside.
3.That the application for property settlement and spousal maintenance be listed for hearing before a Judge of the Court at the earliest reasonable date.
4.(a) That the appellant husband file and serve any written submissions in relation to the costs appeal within 21 days of the date hereof.
(b)That the respondent wife file and serve any written submissions in answer thereto within 14 days thereafter.
(c)That the appellant husband file and serve any written submissions in reply thereto within a further seven (7) days thereafter.
(d)That each submission have endorsed on the cover sheet the date on which a copy of that submission was served on the other party.
5.(a) That either party be at liberty to make an application by way of written submissions in respect of costs incurred by him or her in relation to the appeal within 21 days of the date hereof.
(b)That the other party have a further 14 days in which to make written submissions in answer thereto.
(c)That the first mentioned party have a further seven (7) days in which to make any written submissions in reply thereto.
(d)That each submission have endorsed on the cover sheet the date on which a copy of that submission was served on the other party.
I certify that the preceding 53 paragraphs
are a true copy of the reasons
for judgment delivered by
this Honourable Full Court.
Associate
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