VENSON & VENSON
[2009] FamCA 859
•8 September 2009
FAMILY COURT OF AUSTRALIA
| VENSON & VENSON | [2009] FamCA 859 |
| FAMILY LAW - CHILD SUPPORT - Father seeks orders that a child support agreement created between him and the mother as part of consent orders entered into by them before the Local Court in 2000 be set aside - Mother is resisting the father’s application and seeks an order that the father pay the accumulated arrears under the existing child support agreement and the discharge of an earlier interim stay order - Father is also seeking to amend his claim for relief or re-open his case to adduce fresh evidence - Father’s application is dismissed, stay order is discharged and the Court declines to make the order sought by the mother in respect of payment of arrears under the child support agreement because to do so would contravene the Family Law Rules |
| Child Support (Assessment) Act 1989 (Cth) ss 98, 136 Child Support (Registration and Collection) Act 1988 (Cth) Family Law Rules 2004 (Cth) r 1.13, 11.10(1)(a)(ii), 20.03 |
| Air Link Pty Ltd v Paterson (No.2) (2003) 58 NSWLR 388 Baldry v Jackson [1976] 2 NSWLR 415 Goldsmith v Sandilands (2002) 190 ALR 370 Re Australasian Meat Industry Employees’ Union (WA Branch); Ex parte Ferguson (1986) 67 ALR 491 Rodgers v Federal Commissioner of Taxation (1998) 158 ALR 220 Smith v NSW Bar Association (No 2) (1992) 176 CLR 256 |
| APPLICANT: | Mr Venson |
| RESPONDENT: | Ms Venson |
| FILE NUMBER: | SYF | 2376 | of | 2004 |
| DATE DELIVERED: | 8 September 2009 |
| PLACE DELIVERED: | Newcastle |
| PLACE HEARD: | Sydney |
| JUDGMENT OF: | The Hon. Justice Austin |
| HEARING DATE: | 5 and 6 August 2009 |
REPRESENTATION
| COUNSEL FOR THE APPLICANT: | Mr J Lloyd |
| SOLICITOR FOR THE APPLICANT: | Newnhams Solicitors |
| COUNSEL FOR THE RESPONDENT: | Mr R Brender |
| SOLICITOR FOR THE RESPONDENT: | Not Applicable |
Orders
The Further Amended Application for Final Orders filed on 24 July 2008 is dismissed.
Order 5 made by this Court on 6 June 2005 is discharged.
Order 3 sought in the Amended Response filed on 4 August 2009 is dismissed.
Costs are reserved.
IT IS NOTED that publication of this judgment under the pseudonym Venson & Venson is approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth)
| FAMILY COURT OF AUSTRALIA AT SYDNEY |
FILE NUMBER: SYF2376 of 2004
| MR VENSON |
Applicant
And
| MS VENSON |
Respondent
REASONS FOR JUDGMENT
Introduction
Pending before the court for determination is the Further Amended Application for Final Orders filed by the father on 24 July 2008, and the Amended Response filed by the mother on 4 August 2009.
The essential contest between the parties is the father’s proposal that a child support agreement, created between the parties as part of consent orders entered into by them before the Local Court of NSW at Sydney on 24 November 2000, be set aside. That proposal is resisted by the mother.
In addition to dismissal of the father’s Application, the mother seeks discharge of an earlier interim stay order, and an order that the father pay the accumulated arrears under the existing child support agreement.
DOCUMENTS RELIED UPON
The applicant father relied upon the following documents:
a)Affidavit of the father filed on 17 May 2005
b)Financial Statement of the father filed on 17 May 2005
c)Affidavit of Mr W filed on 27 May 2005
d)Affidavit of Mr H sworn on 27 May 2005
e)Affidavit of the father filed on 26 February 2008
f)Financial Statement of the father filed on 26 February 2008
g)Affidavit of the father filed on 26 May 2008
h)Affidavit of the father filed on 10 July 2008
i)Affidavit of the father filed on 17 July 2009
j)Financial Statement of the father filed on 17 July 2009
The respondent mother relied upon the following documents:
a) Affidavit of the mother filed on 7 April 2005
b) Affidavit of the mother filed on 18 April 2005
c) Affidavit of the mother filed on 7 June 2005
d) Affidavit of the mother filed on 29 January 2008
e) Affidavit of the mother filed on 26 May 2008
f) Affidavit of the mother filed on 11 November 2008
g) Affidavit of the mother filed on 12 November 2008
h) Affidavit of the mother filed on 28 July 2009
i) Financial Statement of the mother filed on 28 July 2009
The mother also tendered in evidence an affidavit sworn by her on 26 May 2005 in other proceedings before the Supreme Court of NSW[1], and an unsworn affidavit which had been prepared for the purpose of these proceedings[2], the contents of which she adopted in her oral evidence.
[1] Exhibit R4
[2] Exhibit R5
There were other documents tendered in evidence as exhibits by both parties.
RELEVANT HISTORY
The parties began cohabitation in October 1992. Two children were born to their relationship, being S in February 1997 and K born in August 1998.
The parties separated in September 2000. Unfortunately, they have been in a state of almost perpetual litigation ever since.
On 26 October 2000 the Child Support Agency wrote to the father advising him of the assessment calculated for the children on the application of the mother.[3]
[3] Father’s affidavit filed 17 May 2005 para.57
The parties were at that time in negotiations about the adjustment of their property interests, which resulted in their agreement on 24 November 2000.
Orders were that day made by consent between the parties in the Local Court at Sydney pursuant to the Property (Relationships) Act 1984 (NSW).[4] Each party consented to the making of those orders following their receipt of independent legal advice.
[4] Father’s affidavit filed 17 May 2005 para.6
Order 5(d) then made by the court was in the following form:
5. (d) The applicant and the respondent agree that the net monthly income from [B] Pty Limited shall be paid equally to the applicant and the respondent from the 30th November 2000 subject to:
(i)The applicant providing from his share of the net monthly income the sum of $1,000 per calendar month for each of the said children by way of child support, making a total payable by the applicant of $2,000 per month.
(ii)In the event of the sale of [B] Pty Limited or in the event of the sale of all or any of the assets of the company the proceeds of sale after payment of any indebtedness shall be shared equally between the applicant and the respondent, and the applicant shall thereafter continue to make a payment of $1,000 per calendar month for each of the said children.
(iii)A reasonable provision of funds for re-equipment of the commercial […] vehicle operated by [B] Pty Limited.
On 20 June 2003 the Child Support Agency wrote to the father advising him that the mother had applied to register a child support agreement that the parties had made together.[5] The agreement is not identified in the correspondence, other than by reference to the date of the agreement being 24 November 2000. The child support liability was retrospectively recalculated from that date by the Child Support Agency.
[5] Father’s affidavit filed 17 May 2005 para.83
The parties have conducted this litigation on the mutual basis that the “child support agreement” identified by the Child Support Agency was that contained within Order 5(d) made by the Local Court on 24 November 2000.
In 2003 the parties were involved in litigation concerning enforcement of the property adjustment orders made between them on 24 November 2000. That litigation was concluded by further orders made in the Local Court at Sydney on 11 November 2003.[6] The mother thought it curious that no application to set aside the child support agreement was made by the father in the context of those proceedings, given the grievances he now raises.
[6] Father’s affidavit filed 17 May 2005 para.75
In May 2004 the father instructed his solicitor to lodge objection with the Child Support Agency to the registration of the child support agreement.[7] His objection was disallowed some months later.[8]
[7] Father’s affidavit filed 17 May 2005 paras.114-115
[8] Father’s affidavit filed 17 May 2005 para.121
On 2 February 2005 the father commenced the current proceedings by filing an Application for Final Orders, seeking an order that Order 5(d)(i) made on 24 November 2000, and subsequently registered as a child support agreement with the Child Support Agency, be set aside. His Application in its amended form seeks that the child support agreement registered with the Child Support Agency on or about 20 June 2003 be set aside as and from 24 November 2000, which accords with the Minute of Order tendered by him at trial.[9]
[9] Exhibit A3
The original Application came before his Honour Justice Watts on 6 June 2005. On that day the Court made orders between the parties with their consent, including the following order:
5. That the operation of and enforcement action in respect of the Child Support Agreement and in respect of the arrears thereof be stayed pending further order, but this is not to apply to the fees and costs referred to in Order No.11 of the Orders made on 24 November 2000.
Otherwise, the Court ordered that the Application of the father, and an Application filed by the mother on 19 April 2005, be both transferred to the Supreme Court of NSW for determination. Separate proceedings were already then pending between the parties before the Supreme Court under the Property (Relationships) Act 1984 (NSW).[10]
[10] Father’s affidavit filed 26 February 2008 para.3
The litigation came on for hearing before the Supreme Court of NSW in February 2006. The proceedings under the Property (Relationships) Act were settled on certain conditions, but the child support proceedings were transferred back to this Court.[11]
[11] Father’s affidavit filed 26 February 2008 para.4
It was the joint position of the parties that the child support dispute not be determined before this Court until after the Supreme Court proceedings were finally concluded under the terms of their settlement,[12] and that did not occur until December 2007.[13]
[12] Father’s affidavit filed 26 February 2008 Annexure A Order 3
[13] Father’s affidavit filed 26 February 2008 paras.5-20
Thereafter, the matter was listed before this Court for the allocation of a hearing date.[14] Further procedural orders were made by the court on 10 March 2008, 14 November 2008, and 10 June 2009.
[14] Father’s affidavit filed 26 May 2008 para.9
The matter came on for hearing before this Court on Wednesday 5 August 2009.
The first order proposed by the mother in her Amended Response was the summary dismissal of the father’s Application. The mother resiled from that position and conceded that the matter ought to be heard on its merits. The hearing commenced and evidence was taken. The evidence was concluded on Thursday 6 August 2009.
During the course of submissions, the mother raised as an issue the legal foundation of the father’s claim, and in reply, the father raised the issue of the manner in which the child support agreement was treated by the Child Support Registrar following amendments to the child support legislation on 1 July 2008.
The matter was adjourned part-heard, with the parties to file written submissions confined to those two discrete legal issues.
LEGISLATIVE FRAMEWORK FOR THE CURRENT LITIGATION
In order to succeed with his current application to set aside the child support agreement, the father acknowledges that he needs to satisfy the provisions of s 136 of the Child Support (Assessment) Act 1989 (“the Assessment Act”).
Section 136 of the Assessment Act has existed in different permutations over the years since proclamation.
Relevantly, s 136 appeared in the following form from 2 October 2001:
136 Power of court to set aside agreements
(1) A court having jurisdiction under this Act may set aside a child support agreement that has been registered in the court if the court is satisfied, on application by a party to the agreement, that the concurrence of the party was obtained by fraud or undue influence.
(2) Subject to section 145 (Registrar may intervene in proceedings), the parties to a proceeding under subsection (1) are the parties to the agreement.
The section remained in that form until enactment of the Child Support Legislation Amendment (Reform of the Child Support Scheme – New Formula and Other Measures) Act 2006 (“the amending Act”).
Schedule 5 of the amending Act introduced a raft of amendments to the Assessment Act in so far as it regulated child support agreements. In particular, the amending Act introduced concepts of “binding child support agreements” and “limited child support agreements”, and reformulated the provisions of s 136 with respect to the circumstances in which child support agreements could be set aside.
The relevant part of Schedule 5 of the amending Act was proclaimed to take effect from 1 July 2008, after which time s 136 appeared in the following form:
136 Power of court to set aside child support agreements or termination agreements
(1) A party to either of the following agreements may apply to a court having jurisdiction under this Act for the court to set aside the agreement:
(a) a child support agreement that has been accepted by the Registrar under section 92 or 98U;
(b) a termination agreement, or a written agreement referred to in paragraph 80G(1)(b), that has been accepted by the Registrar under section 92.
(2) If a party has applied under subsection (1), the court may set aside the agreement in accordance with the application if the court is satisfied:
(a) that the party’s agreement was obtained by fraud or a failure to disclose material information; or
(b) that another party to the agreement, or someone acting for another party:
(i) exerted undue influence or duress in obtaining that agreement; or
(ii) engaged in unconscionable or other conduct;
to such an extent that it would be unjust not to set aside the agreement; or
(c) in the case of a limited child support agreement:
(i)that because of a significant change in the circumstances of one of the parties to the agreement, or a child in respect of whom the agreement is made, it would be unjust not to set aside the agreement; or
(ii)that the agreement provides for an annual rate of child support that is not proper or adequate, taking into account all the circumstances of the case (including the financial circumstances of the parties to the agreement); or
(d) in the case of a binding child support agreement—that because of exceptional circumstances, relating to a party to the agreement or a child in respect of whom the agreement is made, that have arisen since the agreement was made, the applicant or the child will suffer hardship if the agreement is not set aside.
(3) Subject to section 145 (Registrar may intervene in proceedings), the parties to a proceeding under subsection (1) are the parties to the agreement.
(4) If:
(a) the court sets aside a child support agreement under this section; and
(b) the court is satisfied as mentioned in paragraph 117(1)(b) (departure orders);
the court may make an order under Division 4 of Part 7 without an application having been made under section 116.
(5) If:
(a) the court sets aside a child support agreement under this section; and
(b) the court is not satisfied as mentioned in paragraph 117(1)(b) (departure orders); and
(c) the payee has received or will receive benefits pursuant to the agreement;
the court may still make an order that departs from the administrative assessment where it is just and equitable to do so, having regard to the benefits that the payee has already received pursuant to the agreement.
It can be seen that the amending Act expanded the grounds upon which a child support agreement could be set aside by the court, depending upon whether the agreement met the definition of a “binding” agreement or a “limited” agreement.
The amending Act contained savings and transitional provisions within Part 2 of Schedule 5.
In their written submissions, the parties adopt an agreed position that, whether by application of item 73 and/or item 73A of that Schedule and Part, the new legislative provisions do not apply to applications already made to the court, but which are undetermined, as at 1 July 2008.
Although the father was moving upon his Further Amended Application for Final Orders filed on 24 July 2008, that document only amended his original Application for Final Orders which was filed on 2 February 2005.
For procedural purposes, an amendment to an application or other document initiating proceedings takes effect from the date of the original document it amends, and not the date when the amendment is made (Baldry v Jackson [1976] 2 NSWLR 415; Rodgers v Federal Commissioner of Taxation (1998) 158 ALR 220 at 223; Air Link Pty Ltd v Paterson (No.2) (2003) 58 NSWLR 388 at 400-401). Neither the Family Law Act nor Division 11.2.2 of the Family Law Rules contains any provision contrary to that principle.
The father’s current Application must therefore be understood to have been commenced on 2 February 2005.
The father’s Application must consequently be determined by reference to the provisions of s 136 of the Assessment Act in the form that it stood immediately before the relevant amendments took effect on 1 July 2008. That is because his Application was commenced before, but was undetermined at, that date.
In those circumstances, the version of s 136 of the Assessment Act extracted in paragraph 30 above is the version of the legislative provision upon which the father’s pending Application will be determined.
Consideration of that provision reveals that the only grounds upon which the father is now able to press his application to set aside the child support agreement are “fraud” and “undue influence”.
At one point during the protracted life of these proceedings his Honour Justice Le Poer Trench ordered the father to file written particulars of the basis of his claim for relief in these proceedings. The father complied with his Honour’s orders and provided such written particulars, by way of letter dated 5 August 2008, forwarded to the court and the mother. A copy of that letter was annexed to the father’s Case Outline document proffered to the court prior to the commencement of the hearing, and also in his written submissions dated 14 August 2009.
It seems clear from those particulars that the father was mistakenly relying upon the provisions of s 136 of the Assessment Act as it stood after 1 July 2008, rather than the version in which it stood before that date, in pressing his Application before the Court.
The father has not at any time particularised or characterised his claim against the mother as one involving either “fraud” or “undue influence”. No evidence was adduced to support findings of such conduct, and no cross examination of the parties was directed to such concepts.
In the absence of any evidence that could sustain a case to set aside the child support agreement on the basis of either “fraud” or “undue influence”, the father’s application must be dismissed because they are the only grounds of remedy available to the father by reason of the saved legislative provisions.
The father now implicitly concedes that to be so. Finding himself in that predicament, the father submits that he ought be granted leave to re-open his case to amend the basis upon which he claims relief, and to make further submissions about his entitlement to relief upon those amended grounds.[15] The grant of such leave is resisted by the mother.
[15] Father’s written submissions paragraph 15
The question now to be determined is whether the father ought be permitted to re-open or amend his case and bring it to a conclusion in the manner he proposes.
LEAVE TO RE-OPEN OR AMEND
The father submits that he will not, and needs no grant of leave to, re-open and adduce further evidence.[16] He asserts that the amended ground of proposed relief will be similar to the original ground of proposed relief, so that further evidence will be unnecessary, and that the mother will not be prejudiced by adoption of that course.[17]
[16] Father’s written submissions paragraph 15(b)
[17] Father’s written submissions paragraph 16
The mother does not agree. She points out that the evidence and oral submissions were complete on Thursday 6 August 2009, that the matter was then adjourned for written submissions to be made on two discrete points of law, and that the written submissions now made by the father fall outside the ambit of the leave granted for written submissions.[18] By entertaining the father’s request and granting the leave he seeks, the mother asserts that prejudice would be occasioned to her for numerous reasons which are incurable or insurmountable on the evidence as it exists.[19] The mother additionally refers to the delay and expense that both parties have already endured on their tortuous path of litigation as a reason why these proceedings ought not be protracted.[20]
[18] Mother’s written submissions paragraph 6
[19] Mother’s written submissions paragraphs 7-18
[20] Mother’s written submissions paragraphs 19-21
This Court does not employ a system of pleadings as in other jurisdictions, but there are still limitations upon a party’s ability to amend the nature of the case presented (Division 11.2.2 of the Family Law Rules). The father’s submission amounts to an application to amend his case, which is within the literal reach of the Rules (Rules 1.13, 11.10(1)(a)(ii)), but that does not absolve the father from persuading the Court that it should grant permission for that to occur. There are numerous private and public considerations that dictate whether a party ought be permitted to amend their case at a late stage in the proceedings, and the party proposing the amendment bears the burden of convincing the court that the amendment should be permitted (Halsbury’s Laws of Australia at paras 325-2975 – 325-2980).
A court has discretion to permit a party to re-open his or her case to adduce further evidence (Re Australasian Meat Industry Employees’ Union (WA Branch); Ex parte Ferguson (1986) 67 ALR 491 at 493-494; Goldsmith v Sandilands (2002) 190 ALR 370). Where the hearing is complete, the primary consideration is the prejudice to the other party (Smith v NSW Bar Association (No 2) (1992) 176 CLR 256 at 266-267).
It is noteworthy that the father was aware of the amendments to the child support legislation at or about the time that they were enacted.[21] He formulated his case in the knowledge of that legislative change. At the commencement of the hearing the case was put for the father on the basis that the subject child support agreement was a “limited child support agreement”, but he now asserts that it is in fact a “binding child support agreement”.[22] That fact, and the relevant evidence bearing upon it, was known, or at least discoverable, by the father well in advance of the trial (Re Australasian Meat Industry at 493).
[21] Father’s affidavit filed 10 July 2008 para.1.8
[22] Father’s written submissions paragraph 12
I am persuaded by the arguments advanced by the mother. The father is now, belatedly, trying to advance a different case from the one he has prosecuted for several years.
The father now proposes reliance upon a different legislative provision, namely s 98 in lieu of s 136. There may be some overlap, but the tests proscribed are materially different. Section 98 is directed to the discharge, suspension, revival, and variation of provisions of a child support agreement, whereas s 136 is directed to the setting aside of the entire agreement on quite specific grounds.
Moreover, s 98 only relates to child support agreements that are registered in a court having jurisdiction under the Assessment Act. Presently, there is no evidence that the child support agreement under consideration is, or was, so registered. The father would therefore, contrary to his submission, need leave to adduce further evidence at least with respect to that issue.
I accept the submission that the mother’s counsel made forensic decisions about the manner in which the case should be advanced for her in light of the character of the case presented by the father.
The father ought not now be permitted to litigate a case of a different complexion within the context of the present proceedings. It would be unfair to the mother to permit the father, who will be unsuccessful with his application, to renew the trial at its conclusion on an entirely different ground in the hope of more success. That would lay waste to the mother’s tactical conduct of the case to this point.
The father has failed to persuade me that he ought be permitted to either amend his claim for relief or re-open his case to adduce fresh evidence. I decline to permit him to do so. Accordingly, it is unnecessary to consider further the evidence already adduced by the parties in the case. The father’s Application will fail for legal rather than evidential reasons.
ANCILLARY ORDERS SOUGHT BY THE MOTHER
The mother seeks discharge of the stay orders made on 6 June 2005[23], which when expressed with precision, is a request for the discharge of Order 5 made by this Court on 6 June 2005.
[23] Amended Response filed 4 August 2009 Order 2
The mother also seeks an order that the father pay to the mother the debt now outstanding under the child support agreement, which is said to total $97,839.42 as at 20 July 2009.[24] Curiously, that amount is at odds with the records of the Child Support Agency, said to be accurate to 9 July 2009, specifying a debt of $111,441.78, inclusive of penalties.[25]
[24] Amended Response filed 4 August 2009 Order 3
[25] Exhibit A1
Now that the father’s application to set aside the child support agreement has failed, there is no reason to continue the stay of the otherwise valid child support agreement. The stay only existed pending the determination of these and other related proceedings before the Supreme Court of NSW. I accede to the request to discharge the stay order.
I decline to make the order sought by the mother in respect of payment of arrears under the child support agreement because to do so would contravene the Family Law Rules. No submissions were made by the mother addressing this aspect of her case.
With the child support agreement having been accepted or registered by the Registrar under the Assessment Act, the child support liability created by the agreement became a registrable maintenance liability under the Child Support (Registration and Collection) Act 1988 (“the Registration Act”). Payments were collected by the Child Support Agency. Recovered arrears are payable to the Child Support Registrar under the Registration Act (s 111F).
The mother has not complied with Rule 20.03, which precludes her enforcement of the child support arrears. That is not to say that arrears cannot be pursued, but not in the manner proposed in these proceedings by the mother.
COSTS
The parties have each sought costs against one another arising from the prosecution of their competing applications.[26]
[26] Further Amended Application filed 24 July 2008 Order 2; Amended Response filed 4 August 2009 Order 4
The father has been unsuccessful in his application for relief, and the mother has been substantially successful.
The mother has submitted that an order should be made in her favour compelling the father’s payment of her costs.[27] The father has made no submissions as to costs, as he had hoped that I would grant him leave to re-open his case and continue the hearing.
[27] Mother’s written submissions paragraphs 22-23
Since I have not received the benefit of bilateral argument about costs, I will hear the parties further in the event that either party wishes to pursue an application for costs against the other.
I certify that the preceding sixty nine [69] paragraphs are a true copy of the reasons for judgment of the Hon. Justice Austin
Associate:
Date: 8 September 2009
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