FAMILY COURT OF AUSTRALIA
| WARRICK & MIA | [2018] FamCA 426 |
| FAMILY LAW – PROPERTY SETTLEMENT – Binding Financial Agreement – Where the parties entered into a binding financial agreement under s 90C of the Family Law Act 1975 (Cth) in 2007 – Where the binding financial agreement specifies that “in the event of a breakdown of the marriage assets and personal effect which are held in both parties names acquired after the marriage shall be property of both parties and should be divided between the parties on a contribution basis” – Where the binding financial agreement does not define “contribution basis” – Where the wife submits that in order to give effect to the parties’ intentions at the time the agreement was made the wording of the agreement should be changed to reflect a division based on direct financial contributions – Where even if the proposed amendment was allowed, the Court is not satisfied that the resultant meaning would be unambiguous – Consideration of Kostres & Kostres (2009) FLC 93-420 – Where the binding financial agreement is unclear and therefore is unenforceable – Where of the Court’s own motion the binding financial agreement must be set aside. |
| Family Law Act 1975 (Cth) ss 75(2), 79, 90C, 90G, 90KA Judiciary Act 1903 (Cth) ss 31, 32 |
| Calverley v Green (1984) 155 CLR 242 Hoult & Hoult (2011) FLC 93-489 Kostres & Kostres (2009) FLC 93-420 Toll (FGCT) Pty Ltd v Alphapharm Pty Ltd (2004) 219 CLR 165 Twigg and Twigg v Kung (1994) FLC 92-456 |
| APPLICANT: | Mr Warrick |
| RESPONDENT: | Ms Mia |
| FILE NUMBER: | PAC | 845 | of | 2017 |
| DATE DELIVERED: | 12 June 2018 |
| PLACE DELIVERED: | Sydney |
| PLACE HEARD: | Parramatta |
| JUDGMENT OF: | Loughnan J |
| HEARING DATE: | 3 and 4 May 2018 |
REPRESENTATION
| COUNSEL FOR THE APPLICANT: | Mr Adam |
| SOLICITOR FOR THE APPLICANT: | Just In Case Legal |
| COUNSEL FOR THE RESPONDENT: | Mr Todd |
| SOLICITOR FOR THE RESPONDENT: | Bloomsbury Legal |
Orders
The agreement between the parties titled “Financial Agreement During Marriage” dated 27 July 2007 is set aside.
The proceedings are adjourned to a dated to be fixed by the Registry for directions in respect of financial proceedings.
Note: The form of the order is subject to the entry of the order in the Court’s records.
IT IS NOTED that publication of this judgment by this Court under the pseudonym Warrick & Mia has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
Note: This copy of the Court’s Reasons for Judgment may be subject to review to remedy minor typographical or grammatical errors (r 17.02A(b) of the Family Law Rules 2004 (Cth)), or to record a variation to the order pursuant to r 17.02 Family Law Rules 2004 (Cth).
| FAMILY COURT OF AUSTRALIA AT PARRAMATTA |
FILE NUMBER: PAC 845 of 2017
| Mr Warrick |
Applicant
And
| Ms Mia |
Respondent
REASONS FOR JUDGMENT
introduction
Mr Warrick and Ms Mia were married in 2007. Although they are now divorced, for convenience I will refer to them as “the husband”…
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Details
- AGLC
- Warrick and Mia [2018] FamCA 426
- Case
- [2018] FamCA 426
- Decision Date
CaseChat Overview and Summary
Loughnan J of the Federal Court of Australia considered an application to set aside a financial agreement made between Warrick and Mia. The dispute centred on the validity and enforceability of this agreement, which was titled “Financial Agreement During Marriage” and dated 27 July 2007.
The court was required to determine whether the financial agreement was valid and should be set aside. This involved considering the interpretation of contractual terms, the relevance of general law principles, and the application of statutory provisions governing financial agreements under the relevant Act. The court also had to consider the principles of contractual construction, particularly how the intention of the parties is to be ascertained objectively and the implications of the contra proferentem rule.
Loughnan J applied principles derived from Full Court decisions, notably *Kostres*, which clarified the application of sections 31 and 32 of the *Judiciary Act 1903* (Cth) in relation to the court's powers. The reasoning emphasised the broad definition of "property" under the Act and the importance of objective contractual interpretation, drawing on High Court authority such as *Calverley v Green* and *Toll (FGCT) Pty Ltd v Alphapharm Pty Ltd*. The court stressed that the terms of an agreement must accurately reflect the parties' intentions at the time of its making and be unambiguous, with any ambiguity to be resolved against the party seeking to rely on it where appropriate.
The court ordered that the financial agreement between Warrick and Mia dated 27 July 2007 be set aside. The proceedings were subsequently adjourned to a date to be fixed by the Registry for directions concerning financial proceedings.
The court was required to determine whether the financial agreement was valid and should be set aside. This involved considering the interpretation of contractual terms, the relevance of general law principles, and the application of statutory provisions governing financial agreements under the relevant Act. The court also had to consider the principles of contractual construction, particularly how the intention of the parties is to be ascertained objectively and the implications of the contra proferentem rule.
Loughnan J applied principles derived from Full Court decisions, notably *Kostres*, which clarified the application of sections 31 and 32 of the *Judiciary Act 1903* (Cth) in relation to the court's powers. The reasoning emphasised the broad definition of "property" under the Act and the importance of objective contractual interpretation, drawing on High Court authority such as *Calverley v Green* and *Toll (FGCT) Pty Ltd v Alphapharm Pty Ltd*. The court stressed that the terms of an agreement must accurately reflect the parties' intentions at the time of its making and be unambiguous, with any ambiguity to be resolved against the party seeking to rely on it where appropriate.
The court ordered that the financial agreement between Warrick and Mia dated 27 July 2007 be set aside. The proceedings were subsequently adjourned to a date to be fixed by the Registry for directions concerning financial proceedings.
Orders
Orders of the court
1.
The agreement between the parties titled “Financial Agreement During Marriage” dated 27 July 2007 is set aside.
2.
The proceedings are adjourned to a dated to be fixed by the Registry for directions in respect of financial proceedings.
Note: The form of the order is subject to the entry of the order in the Court’s records.
Background
Background to the litigation
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Evidence
Evidence Before The Court
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Decision
Reasons for decision
Later in Kostres the Full Court set out the terms of s 90KA of the Act and because of the reference to the Court having the same powers as the High Court in its original jurisdiction in relation to proceedings in connection with contracts or purported contracts, it set out sections 31 and 32 in Part IV of the Judiciary Act 1903(Cth) which is as follows:31 Judgment and executionThe High Court in the exercise of its original jurisdiction may make and pronounce all such judgments as are necessary for doing complete justice in any cause or matter pending before it, and may for the execution of any such judgment in any part of the Commonwealth direct the issue of such process, whether in use in the Commonwealth before the commencement of this Act or not, as is permitted or prescribed by this or any Act or by Rules of Court.32 Complete relief to be grantedThe High Court in the exercise of its original jurisdiction in any cause or matter pending before it, whether originated in the High Court or removed into it from another Court, shall have power to grant, and shall grant, either absolutely or on such terms and conditions as are just, all such remedies whatsoever as any of the parties thereto are entitled to in respect of any legal or equitable claim properly brought forward by them respectively in the cause or matter; so that as far as possible all matters in controversy between the parties regarding the cause of action, or arising out of or connected with the cause of action, may be completely and finally determined, and all multiplicity of legal proceedings concerning any of such matters may be avoided. Later, the Full Court in Kostres described the process and reasoning that should have been followed by the Federal Magistrate at first instance. In summary the Full Court found to the following effect:·It is important to keep in mind the wide definition of “property” under the Act and the subsection 79(4) regime;·General law principles are relevant. In Calverley v Green (1984) 155 CLR 242 (“Calverley v Green”) the High Court found that the acquisition of a property occurred by the purchase. As to the mortgage, the acquisition of the property resulted from the joint borrowing rather than from the subsequent payment of mortgage instalments;·In interpreting actual terms in a contract, the learned authors of Cheshire and Fifoot’s Law of Contract (9th edition) explain at 429 (Kostres [113]):The High Court has repeatedly emphasised that the court approaches the task of ascertaining the meaning of the parties’ expressions objectively. It is not interested in their subjective understanding, but applies the meaning that an objective outsider would attribute to the contract in the circumstances. ...·Later, at 429 to 430 the authors of Cheshire and Fifoot’s Law of Contract (9th edition) quote from the decision of the High Court in Toll (FGCT) Pty Ltd v Alphapharm Pty Ltd (2004) 219 CLR 165 at paragraph 40 (Kostres [114]):References to the common intention of the parties to a contract are to be understood as referring to what a reasonable person would understand by the language in which the parties have expressed their agreement. The meaning of the terms of a contractual document is to be determined by what a reasonable person would have understood them to mean. That, normally, requires consideration not only of the text, but also of the surrounding circumstances known to the parties, and the purposes and object of the transaction. (footnote omitted)·While common law principles of construction undoubtedly apply and can be used to avoid absurdity, the terms of the agreement must accurately reflect the intention of the parties at the time of the making of the agreement, and be unambiguous. In other words, the meaning to be given to expressions used in the agreement must be clear and their meaning certain (Kostres [127]). ·The contra proferentem rule requires that any ambiguity in the terms of a contract, is resolved against the party seeking protection where that is appropriate (Kostres [115]);
Ratio Decidendi
Legal Principle Established
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