Vida & Vida

Case [2022] FedCFamC1F 968


FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA

(DIVISION 1)

Vida & Vida [2022] FedCFamC1F 968

File number(s): SYC 1533 of 2019
Judgment of: WILSON J
Date of judgment: 9 December 2022  
Catchwords:

FAMILY LAW – NATIONAL ARBITRATION LIST – review application – s 13J and s 13K invoked – eight grounds asserted – no questions of law postulate.

FAMILY LAW – NATIONAL ARBITRATION LIST – orders made by arbitrator in pursuance of s 106B of the Family Law Act – jurisdiction of arbitrator in s 10L arbitration to make orders under s 106B – extensive examination of history of arbitration under the Family Law Act – held, no jurisdiction for arbitrator to make s 106B order.

Legislation:

Courts (Mediation and Arbitration) Act 1991, Act no 113 of 1991 ss 19D and 19E

Family Law Act 1975 (Cth) ss 10L, 13E, 13J, 13K, 75, 79, 106A and 106B,

Family Law Amendment (Shared Parental Responsibility) Act, Act 46 of 2006  

Cases cited:

Air Canada v Secretary of State for Trade [1983] 2 AC 394

Aitken & Aitken (No 3) [2022] FedCFamC1F 496

AK v Western Australia (2008) 232 CLR 438

Al-Medinni v Mars UK Ltd [2005] EWCA Civ 1041

Amaca Pty Ltd v Werfel [2020] SASCFC 125

Anisminic Ltd v Foreign Compensation Commission [1969] 2 AC 147

Assistant Commissioner Condon v Pompano Pty Ltd (2013) 252 CLR 38

Australian Coal and Shale Employees Federation v Commonwealth (1953) 94 CLR 621

Avon Downs Pty Ltd v Federal Commissioner of Taxation (1949) 78 CLR 353

Bakalov & Bakalov [2021] FedCFamC1F 161

Beirne & Beirne (No 2) [2022] FedCFamC1F 54

Bellenden (formerly Satterthwaite) v Satterthwaite [1948] 1 All ER 343

Black v Black (2008) 38 Fam LR 503

Blanco v Blanco (No 2) (2019) 60 Fam LR 80

Braddon v Braddon (2018) 59 Fam LR 234

Bremer Handelsgesellschaft mbH v Westzucker GmbH (No 2) [1981] 2 Lloyd's Rep 130

Brisbane South Regional Health Authority v Taylor (1996) 186 CLR 541

Bunbury v Fuller (1853) 156 ER 47

Campbelltown City Council v Vegan (2006) 67 NSWLR 372

Cantoni & Cantoni [2022] FedCFamC1A 11

Cantwell v Beitzel (2014) 87 NSWLR 103

Carr v State of Western Australia (2007) 232 CLR 138

Chan & Lee [2022] FedCFamC1A 85

Chevron Australia Pty Ltd  v CBI Constructors Pty Ltd [2021] WASC 323

Chu Kheng Lim v Minister for Immigration Local Government & Ethnic Affairs (1992) 176 CLR 1

Commonwealth v Baume (1905) 2 CLR 405

Commonwealth of Australia v Yarmirr (2001) 208 CLR 1

Concrete Pty Ltd v Parramatta Design & Developments Pty Ltd (2006) 229 CLR 577

Construction, Forestry, Mining and Energy Union (CFMEU) v Australian Industrial Relations Commission (Private Arbitration Case) (2001) 203 CLR 645

Cooper Brookes (Wollongong) Pty Ltd v Commissioner of Taxation (1981) 147 CLR 297

DL v R (2018) 266 CLR 1

DMW v CGW (1982) 151 CLR 491

Director of Public Prosecutions (Vic) v Le (2007) 232 CLR 562

Drinkwater v Caddyrack Pty Ltd (No 3) [1997] NSWSC 589

Elgin…

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Vida & Vida [2022] FedCFamC1F 968
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[2022] FedCFamC1F 968
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CaseChat Overview and Summary

In the case of Vida & Vida, the applicant sought a judicial review of an arbitration decision that had been made in relation to the division of assets following the breakdown of the marriage. The application was made on the basis that the arbitrator had erred in law by not considering the tax implications of the proposed division of assets. The Family Court was required to consider the grounds of the application, including whether the arbitrator had failed to consider the tax implications of the property division and whether the application of the principles in Rosati was mandatory or discretionary.

The court held that the principles in Rosati were not mandatory and that the failure to apply them did not constitute an error of law. The court further held that the onus was on the parties to adduce evidence in relation to tax implications, and that it was not the role of the arbitrator to source such evidence. The court found that the husband had not provided any evidence in relation to the tax implications of the proposed division of assets, and that the arbitrator was therefore not required to consider such implications.

In light of the above, the court dismissed the application for judicial review. The court held that the arbitrator had not erred in law and that the application was without merit. The court did not make any orders in relation to the application, as it was dismissed.

Orders

Orders of the court

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Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

As her separate submissions concerning ground 2(c), the wife put forward further contentions about the effect of the proposed order on the husband’s earning capacity. She submitted – (a)the arbitrator considered all relevant issues at paragraphs 34.4, 91 and 275 of the arbitrator’s reasons, recognising that the pool to be divided was $7,478,806 and providing that the husband was ordered to receive 10% more than the wife;(b)the arbitrator recognised the husband’s rental income at paragraph 286 of the arbitrator’s reasons; and (c)the arbitrator’s orders do not make provision for the sale of real property owned by N Company.CONSIDERATION OF GROUNDS 1 AND 2 In this case, the review applicant erroneously elevated the four propositions expressed in Rosati to a point resembling that of a statute. In particular, he contended that by failing to apply the four propositions in Rosati, the review applicant demonstrated the existence of an error of law in respect of the arbitrator’s failure to apply the first limb. I reject the argument that the first (or any) limb of Rosati represented a statement of doctrine such that an error of law is enlivened by a failure to apply it. By its express words, the first limb is written in highly conditional (not mandatory) terms, such as “whether the incidence of capital gains tax should be taken into account ...varies according to the circumstances of the case”. To my mind, that does not impose an obligation, nor does any failure to do as the first limb invites but does not require, constitute an error of law. The review applicant contended in paragraph 39 of his written submissions that “had the arbitrator sought evidence” about tax and other effects, then certain consequences would have followed. It must not be overlooked, as was recorded in paragraph 293 of the arbitrator reasons, the arbitrator stated that – (a)the husband did not nominate any property which might be realised;(b)despite deposing to his seeking tax advice, the husband advanced no evidence about tax issues that may arise upon the realisation of his interests; and (c)no evidentiary basis existed on which any potential liability to tax ought to have been taken into account. In my view, the review applicant erroneously purported to cast the onus upon the arbitrator to source evidence about the husband’s taxation liability. Arbitrations are adversarial. The arbitrator adjudicates on competing contentions.[18] The arbitrator does not source evidence for the parties.[18] Air Canada v Secretary of State for Trade [1983] 2 AC 394, Sainsbury's Supermarkets Ltd and others v Mastercard Inc and others (European Commission intervening) [2020] 4 All ER 807 and Al-Medinni v Mars UK Ltd [2005] EWCA Civ 1041. The arbitrator found as a factual matter that the husband adduced no evidence about the taxation implication of any property sales. It fell to the husband to have done so. It is common in cases in this court where tax issues (or even potential tax issues) are involved for parties to obtain advice on the point and to lead sophisticated evidence on those taxation issues.[19] [19] Aitken & Aitken (No 3) [2022] FedCFamC1F 496.