Waterman & Waterman
[2017] FamCAFC 23
•8 February 2017
FAMILY COURT OF AUSTRALIA
| WATERMAN & WATERMAN | [2017] FamCAFC 23 |
| FAMILY LAW – APPEAL – PROPERTY – SECTION 79A – Whether the trial judge erred in dismissing the appellant wife’s application to set aside property orders made by consent in 1998 in circumstances where the parties reconciled in early 2000 before finally separating in 2012 –Where the Full Court held the trial judge erred in not finding that there had been the suppression of evidence through non-disclosure pursuant to s 79A(1)(a) and that the trial judge erred in finding that there was no miscarriage of justice – Where the Full Court found that, considering the circumstances that existed at the date of the consent orders, the only finding reasonably open was that justice had miscarried – Where the Full Court held pursuant to s 79A(1A) that, on an assessment of the circumstances of reconciliation, it could be inferred that the parties impliedly consented to the setting aside of the consent orders made in 1998 – Where the Full Court further held that the trial judge failed to identify what evidence of the parties was accepted, made inconsistent findings of fact and gave inadequate reasons – Leave to appeal granted – Appeal allowed – Order made pursuant to s 79A setting aside the consent orders made in 1998 – Direction made that the matter be listed for hearing in the Federal Circuit Court for the determination of s 79 proceedings – Costs certificates granted. |
| Family Law Act 1975 (Cth) Child Support (Assessment) Act 1989 (Cth) |
| Barker & Barker (2007) 36 Fam LR 650 Bigg v Suzi (1998) FLC 92-799 Black & Kellner (1992) FLC 92-28 Briese & Briese (1986) FLC 91-713 Byrnes v Kendle (2011) 243 CLR 253 Cawthorn & Cawthorn (1998) FLC 92-805 Drew & Drew (1985) FLC 91-601 Ebner & Pappas (2014) FLC 93-619 Gebert & Gebert (1990) FLC 92-137 Giunti and Giunti (1986) FLC 91-759 Harris v Caladine (1991) 172 CLR 84 Holland & Holland (1982) FLC 91-243 Liu & Liu (1984) FLC 92-211 Livesey v Jenkins [1985] AC 424 Lowe v Harrington (No 2) (1997) FLC 92-747 McCabe & McCabe (1995) FLC 92-634 Molier & Van Wyk (1980) FLC 90-911 Morrison & Morrison (1995) FLC 92-573 Oastler & Oastler (1993) FLC 92-390 O’Hurley & O’Hurley [2008] FamCAFC 57 Oriolo & Oriolo (1985) FLC 91-653 Patching & Patching (1995) FLC 92-585 Pelerman v Pelerman (2000) FLC 93-037 Prowse & Prowse (1995) FLC 92-557 Scribe & Scribe (2006) FLC 93-302 Sommerville & Sommerville (2000) FLC 93-042 Stanford v Stanford (2012) 247 CLR 108 Suiker and Suiker (1993) FLC 92-436 |
| APPELLANT: | Ms Waterman |
| RESPONDENT: | Mr Waterman |
| FILE NUMBER: | PAC | 749 | of | 2013 |
| APPEAL NUMBER: | EA | 55 | of | 2016 |
| DATE DELIVERED: | 8 February 2017 |
| PLACE DELIVERED: | Sydney |
| PLACE HEARD: | Sydney |
| JUDGMENT OF: | Bryant CJ, Murphy and Kent JJ |
| HEARING DATE: | 8 February 2017 |
| LOWER COURT JURISDICTION: | Federal Circuit Court of Australia |
| LOWER COURT JUDGMENT DATE: | 16 March 2016 |
| LOWER COURT MNC: | [2016] FCCA 562 |
REPRESENTATION
| COUNSEL FOR THE APPELLANT: | Ms Judge |
| SOLICITOR FOR THE APPELLANT: | Cameron Legal |
| COUNSEL FOR THE RESPONDENT: | Ms Christie |
| SOLICITOR FOR THE RESPONDENT: | McIntosh McPhillamy & Co |
Orders
Leave to appeal be granted.
The appeal be allowed.
The orders made by Judge Newbrun on 16 March 2016 be set aside.
In substitution of the said orders made by Judge Newbrun, it be ordered that pursuant to s 79A of the Family Law Act 1975 (Cth) (“the Act”) the orders made by consent by the Local Court on 11 December 1998 be set aside.
It is directed that the application by the wife for settlement of property pursuant to the terms of s 79 of Act be listed for directions before a Judge of the Federal Circuit Court other than Judge Newbrun.
There be no order as to costs.
The Court grants to the appellant a costs certificate pursuant to the provisions of s 9 of the Federal Proceedings (Costs) Act1981 (Cth) being a certificate that, in the opinion of the Court, it would be appropriate for the Attorney-General to authorise a payment under that Act to the appellant in respect of the costs incurred by the appellant in relation to the appeal.
The Court grants to the respondent a costs certificate pursuant to the provisions of s 6 of the Federal Proceedings (Costs) Act1981 (Cth) being a certificate that, in the opinion of the Court, it would be appropriate for the Attorney-General to authorise a payment under that Act to the respondent in respect of the costs incurred by the respondent in relation to the appeal.
The Court certifies that it was appropriate for counsel to be briefed in this matter.
IT IS NOTED that publication of this judgment by this Court under the pseudonym Waterman & Waterman 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).
| THE FULL COURT OF THE FAMILY COURT OF AUSTRALIA AT SYDNEY |
Appeal Number: EA 55 of 2016
File Number: PAC 749 of 2013
| Ms Waterman |
Appellant
And
| Mr Waterman |
Respondent
EX TEMPORE
REASONS FOR JUDGMENT
MURPHY J
The wife seeks leave to appeal orders made by Judge Newbrun on 16 March 2016. His Honour dismissed the wife’s application made pursuant to s 79A of the Family Law Act 1975 (Cth) (“the Act”) to “vary or set aside” orders for settlement of property made by consent on 11 December 1998.
Both parties contend that leave to appeal is required; each relies upon the decision of the Full Court in Ebner & Pappas[1] in so contending. That case involved an application for summary dismissal of a s 79A claim and the court held, in accordance with existing authority, that such an application was interlocutory. However the court went on to say, that “proceedings under s 79A, at least in so far as they seek to set aside existing property orders are interlocutory in nature and leave to appeal is required”.[2]
[1] (2014) FLC 93-619.
[2] At [33].
The husband contends that the appeal has no merit. However, on his behalf, it is conceded, with respect sensibly, that if contrary to that contention merit is found in the wife’s challenges, leave should be granted.
I propose then to address first the merits of the appeal.
The parties were in a relationship that spanned almost 30 years. They commenced cohabitation in 1983 and married in 1991. However, between then and when they separated finally in early 2012, they had separated for about 17 months commencing in September 1998. The parties have two children who were born in 1991 and 1994 and, accordingly, were aged seven and four at the time of the parties’ first separation.
The parties resumed a close relationship within a few months of the orders being made. His Honour found that the parties holidayed happily together with the children in November 1999; that “the parties reconciled at about this time” and “[the wife] and the children moved into a home unit with the husband … in about February 2000” (at [47]).
Within three months of the parties’ initial separation, orders were made by consent in respect of both parenting issues and settlement of property in the Local Court. In broad terms, the orders provided relevantly that the former matrimonial home be sold and after payment of sale costs and its mortgage, the net proceeds be divided equally. The orders also provided that each party retain a motor vehicle and, otherwise, their respective superannuation entitlements,[3] and chattels currently in their respective possession.
[3] Part VIIIB of the Act had not been enacted at this time.
The Wife’s Case as Pleaded at Trial
His Honour ordered that the wife file “Points of Claim”. At paragraph 17 of that document, the wife pleads that the husband “failed to provide full and frank disclosure of any information which went to financial matters”; particularises documents said to illustrate the contention; and asserts specifically that the husband “failed to provide disclosure of his superannuation interests”. The s 79A(1)(a) ground of “suppression of evidence” includes specifically “failure to disclose relevant information”.
At paragraph 19 of the Points of Claim a number of specific factual assertions are pleaded. At paragraph 20 it is asserted that a miscarriage of justice has resulted by reason of “each and all” of the matters previously pleaded in the Points of Claim. Although not pleaded as such in terms, those assertions can be seen to relate to the “any other circumstance” ground in s 79A(1). It is well settled that this expression refers to circumstances at the time the relevant orders are made and that the expression is not to be read ejusdem generis with the words that precede it in s 79A(1) but, rather, receive their “wide natural meaning”.[4]
[4] See, for example, Holland & Holland (1982) FLC 91-243; Liu & Liu (1984) FLC 92-211, per Nygh J.
Separately, it is pleaded in the alternative that the parties have consented to vary or set aside the orders within the meaning of s 79A(1A), their consent being implied from the parties’ resumption of cohabitation “and the circumstances of cohabitation”. It is not in doubt that consent within the meaning of the section can be implied.[5] If (implied) consent is established, the terms of the subsection make it plain that the court must nevertheless exercise a discretion whether to vary or set aside the orders.
[5] McCabe & McCabe (1995) FLC 92-634; Sommerville & Sommerville (2000) FLC 93-042.
His Honour found:
45.The family home was sold pursuant to the terms. Mr [A] acted for the parties on the sale. It was sold for $55,000.00. The wife states that she received her share of the proceeds of sale of the family home being some $6,000.00. The husband states that Mr [A] had deducted from the wife’s share of the proceeds of sale about $3,600.00, being a [phone] bill. The husband agreed that this was not mentioned in the terms of settlement. He agreed that when Mr [A] took the $3,600.00 out of the wife’s half proceeds of sale, he was acting on the husband’s instructions. [The husband] recalls receiving about $11,000.00, being his net share of the proceeds of sale.
Mr A was the husband’s solicitor. (He had died by the time of trial and there was accordingly no evidence from him. His file was not available and the husband deposes that he was unable to obtain documents “from the [bank]”, presumably relating to the mortgage). There was, it seems, no evidence before his Honour as to the amount owing on the mortgage at the time of the orders. The payment of the account, (from the phone company) was made on the unilateral instructions of the husband.
Manifestly, on the findings made by his Honour, the wife was not receiving half of the net proceeds of sale as the order provided. Equally, while not mentioned by his Honour, even had the account not been paid, the figures contained within the apparent finding reveal that the wife would not in any event have received her one half of the net proceeds of sale.
This anomaly was not the subject of any s 79A claim by the wife pursuant to s 79A(1)(c). Nor is the anomaly otherwise explored or explained in his Honour’s reasons.
The Reasons and the Wife’s Challenges On Appeal
The bulk of his Honour’s reasons (paragraphs [11] to [63]) appear under the heading “Evidence” and, as the heading would suggest, comprise a recitation of the parties’ evidence. Under the heading “Consideration”, six paragraphs ([64] to [69]) appear to be intended to comprise his Honour’s ultimate findings.
Ground 5 of the wife’s Amended Notice of Appeal asserts:
His Honour erred in failing to properly or adequately identify what evidence of each of the parties His Honour accepted particularly where such evidence was in conflict and His Honour failed to give adequate or proper reasons for accepting or not accepting either of the parties’ evidence but particularly so where such evidence was in conflict.
Implicit within the ground is an assumption, shared by me, that although given in the form of a recitation of the evidence, findings were intended to be made, and were in fact made, in the 52 paragraphs under the heading “Evidence”. Accepting that to be the case, I agree that there are conflicting findings central to the issues before his Honour and on this appeal. I will refer to some of those conflicting findings in more detail in a moment. As will emerge, I also agree that there is an inadequacy of reasons resulting therefrom as alleged in the wife’s ground.
The concluding six paragraphs of his Honour’s judgment open with the conclusion that “[t]he court is not persuaded that the wife has established there was a miscarriage of justice pursuant to s 79A(1)(a), in relation to the terms [of the consent order]”. Thereafter, his Honour quotes (at [65]) from the decision of the Full Court in Barker & Barker[6] at [123] where the Full Court quotes in turn from the decision of the English Court of Appeal in Livesey v Jenkins.[7] There, the Full Court emphasises the necessity to find both satisfaction of the relevant ground and a miscarriage of justice if s 79A is to be invoked. His Honour then, by “accept[ing] the husband’s submissions in relation to this issue” goes on to “note” a number of facts (at [66]). I consider that, despite quoting Barker, his Honour thereafter conflated two separate but related questions, namely, was a relevant ground established and, if so, was a miscarriage of justice caused thereby.
[6] (2007) 36 Fam LR 650.
[7] [1985] AC 424.
To the extent that his Honour addressed the pleaded ground of suppression of evidence through lack of disclosure, his Honour’s sole finding (at [66]) would appear to be:
a.no relevant evidence was placed before the court as to the nature or extent of any assets or financial resources of the husband not disclosed to the wife prior to the terms being signed. For example, the extent of the husband’s superannuation entitlement was not known, nor for that matter was the wife’s. There was no evidence of any undisclosed cash asset, held within a bank account, for example. It is not known whether the Local Court … was provided with any financial information by the husband or [his solicitor], which had not been previously disclosed to the wife;
Taken as bald statement of fact, the first part of that finding is, at least on one reading of it, simply not correct. His Honour’s findings include that:
·“ … neither party was aware of the extent of the other’s superannuation entitlement, however they each knew that the other had superannuation. Neither party was aware of the extent of their own superannuation entitlement” ([36]);
·“The husband had no specific recollection or knowledge that detailed financial disclosure was made to the wife by Mr [A] or anyone else” ([38]);
·“The husband did not recall signing any formal document called a Financial Statement setting out his financial affairs at the time the terms of settlement were signed by him” ([38]);
·“Prior to the terms being signed by the parties, the husband had never provided to the wife his Notices of Assessment from the Australian Taxation Office, including the income information referred to in those assessments (Exhibit A), nor had he told the wife what he was earning for those income tax years referred to in Exhibit A. The court notes that the Notices of Assessment of the husband referred to in Exhibit A span the years from 1991 to 1998” ([39]);
·“Prior to the terms being signed by the parties, the husband had never told the wife what superannuation benefits he had” ([40]);
·“The wife states that she did not receive any documents either before or after she attended Mr [A’s] office to sign the terms, which disclosed the husband’s assets, liabilities, or superannuation entitlements. The wife states that she was mostly concerned about the children, and to ensure that they would continue to live with her” ([44]).
Read in another way, the statement embraces, with respect, an apparent lack of understanding as to the nature of the duty of disclosure; the obligations cast upon parties accordingly; and the role of compliance with the duty of disclosure in informing parties’ consent to orders if they are to be assessed as just and equitable and made as orders as a result.
The case for the establishment of the ground of suppression of evidence through lack of disclosure was, in my view, compelling. Indeed, it was effectively conceded by the husband’s own evidence. I will say more of this issue in a moment, which relates to the first five of the wife’s 15 grounds of appeal, below.
At [66](b) of the reasons, in an apparently central finding, his Honour found that “the asset pool dealt with by the terms was quite modest”. I am unable to relate that finding to any pleaded s 79A ground. Nor, without more, am I able to understand, with respect, what his Honour considered to be the relevance of that finding to his ultimate conclusion that there had been no miscarriage of justice. The finding follows immediately upon the finding relating to disclosure. If his Honour intended to convey that, because the asset pool was “quite modest”, the duty of disclosure was in some manner truncated, or the obligations on the parties any less significant, I respectfully consider his Honour to be wrong as a matter of law.
In addition to that finding, his Honour also said, and apparently found as a fact, that “[t]he wife does not recall signing any application for the consent orders, in addition to the terms of settlement”.[8] His Honour refers to the fact that “[t]he relevant file of the Local Court … was not in evidence in this court’s proceedings” but that an affidavit from the Clerk of the Local Court where the orders were made was in evidence.[9]
[8] Reasons [35].
[9] Reasons [43].
His Honour found, referring to the speculation to which the Clerk of the Court deposes, that the consent orders “would have been made formally by the presiding Magistrate … in chambers and ex parte.”[10] There was no evidence before the trial judge as to the evidentiary basis upon which the “presiding Magistrate” could have reached a decision – necessary to be reached judicially – that the consent orders were “just and equitable” within the meaning of s 79 of the Act.[11] In that respect, as his Honour found, the wife had not received advice as to the terms of s 79 and the effect of the orders by reference to that section.[12]
[10] Reasons [43], quoting the Affidavit of Brian Tullock filed 13 July 2015, at paragraph 11.
[11] Harris v Caladine (1991) 172 CLR 84, particularly per Brennan J at 102-104.
[12] Harris, above, per Brennan J at 103.
In relation to the ground of “any other circumstance”, separately pleaded by the wife, it seems, at paragraph 19 of her Points of Claim, the totality of his Honour’s findings under the heading “Consideration” were:
c.the wife, during the course of her meeting with Mr [A] and the husband, had had the terms read to her by Mr [A] and the court is satisfied that she understood what her entitlements were under the terms, including relevant terms relating to the children. Mr [A] had told the wife that she needed to or should have the terms explained to her by someone else. The wife was aware of other solicitors that could have assisted her in this respect. She chose not to seek such assistance. She was aged 33 years at the time she signed the terms ([66]).
The wife contends on this appeal that in so finding, his Honour failed to consider a number of facts forming the basis of earlier apparent findings and that his Honour’s conclusion was not open to him on the evidence. I agree.
Having quoted a passage from the decision of the Full Court in McCabe & McCabe[13] at [67] of the reasons, his Honour concludes that “[t]he court is not persuaded that the wife has established [as she pleaded in the alternative] there was any implied consent to set aside the court orders”. His Honour (again) “accept[ed] the husband’s submissions” and “not[ed] inter alia” nine specific facts (at [68]). I will quote those nine facts a little later in these reasons. His Honour went on at [69] to “note” that:
… the parties resumed cohabitation from 2000 to 2012, however, in all of the circumstances, [the court] is not persuaded that implied consent to set aside or vary the 1998 orders has been established.
[13] (1995) FLC 92-634; (1995) 19 Fam LR 579, his Honour quoted from Fam LR at 582.
The wife contends that the conclusion there expressed was not open to his Honour on the evidence before him and, alternatively, that the conclusion is based upon factual premises inconsistent with other (apparent) factual findings made by his Honour. As will shortly be seen, again I agree.
I turn now to consider the specific issues raised by reference to the grounds. First, the pleaded s 79A ground and lack of disclosure.
The Pleaded s 79A Ground and Lack of Disclosure
The terms of s 79A(1)(a) make it clear that the specified ground of “suppression of evidence” includes the “failure to disclose relevant information”.
Importantly, the duty to disclose is a duty owed both to the other party and to the court. The duty is to make “full and frank disclosure of all information relevant to the case in a timely manner” (emphasis added).[14] The statements made by Smithers J in Briese & Briese[15] remain, with respect, as true today as they were then:
… a person in the position of the husband in this case has a positive obligation to set out at an early stage his financial position in a clear and comprehensive manner … The need for each party to understand the financial position of the other party is at the very heart of cases concerning property and maintenance.
[14] Rule 13.01 Family Law Rules 2004 (Cth).
[15](1986) FLC 91-713 at 75,180; The passage has been frequently cited with approval; See for example, Oriolo & Oriolo (1985) FLC 91-653; Giunti and Giunti (1986) FLC 91-759; Black & Kellner (1992) FLC 92-28.
Although frequently cited and quoted I consider it important to again refer to what the Full Court said in Morrison & Morrison[16]:
The constant emphasis of the cases is that in order for there to be a just and equitable and an appropriate order altering the interests of parties in their property there must be a full and frank disclosure between them of all circumstances which may be relevant to the determination of their true financial position both presently and in the foreseeable future.
[16] (1995) FLC 92-573, at 81,670.
Of considerable significance in this case, as it seems to me, the Full Court went on to say:
We take this opportunity once again to reinforce the view that the duty of disclosure is a basic duty. Ordinarily, a failure to comply with that duty will amount to a miscarriage of justice.
The Full Court quoted from Lord Brandon’s judgment in Livesey v Jenkins, above, which again has frequently been quoted, but again that statement should be repeated in the instant context:[17]
My Lords, once it is accepted that this principle of full and frank disclosure exists, it is obvious that it must apply not only to contested proceedings heard with full evidence adduced before the court, but also to exchanges of information between parties and their solicitors leading to the making of consent orders without further inquiry by the court. If that were not so, it would be impossible for a court to have any assurance that the requirements of [the relevant section of the English Act] were complied with before it made such consent orders.
[17] (1995) FLC 92-573, at 81,671.
In my view, seeking to respectfully adapt the words of the Full Court in Morrison:[18]
… The failure of the husband to disclose the true position robbed the wife of the opportunity of [her informed consent] … in [my view] the non-disclosure was of such magnitude that it amounted to a miscarriage of justice …
[18] At 81,672.
Paragraph [66(a)] of his Honour’s reasons quoted above suggests to me that his Honour considered that a lack of disclosure is relevant to the s 79A ground only if, in effect, it involves “hidden assets” or involves someone (the bank is quoted by his Honour) being disclosed information or documents that the other party has not. That is not the case; a failure to disclose at the heart of a s 79A case need not involve any deliberate attempt to defraud or deceive the other party, matters which are, in any event, embraced by s79A(1)(a) grounds. (I add that there is no suggestion in this case, at least in anything I have read, that the husband has here sought to deceive or defraud the wife or was in possession of what might be described as “hidden assets”). Rather, full and frank disclosure is required in the context of orders made by consent because it is essential to the consent of the parties being a free and informed consent.[19]
[19]See Morrison, above; As to the meaning of “informed consent” and the role of full and adequate disclosure within same, see Leland & Seward [2008] FamCAFC 82.
Again, although frequently quoted, it seems to me that what the Full Court said in Suiker and Suiker bears repeating in light of the arguments in this case:[20]
Under the Family Law Act 1975, the need for a resolution of disputes by negotiation and the consequent making of consent orders … is an essential part of the legislation and the rules … In our opinion, the necessity for full and frank disclosure of financial matters to the Court and to the other party are basic to the process of the Court and the fundamental aims of the financial legislation contained in section 79 of the Family Law Act 1975…
[20] Suiker and Suiker (1993) FLC 92-436, at 80,471.
Their Honours then cited a passage from the judgment of Dawson J in Harris & Caladine before going on to say:[21]
It is implicit in these passages that the consent to an order must be informed consent. The consent to the order is itself part of the judicial process on which the Court places reliance. If that consent is based on misleading or inadequate information, then there may be, in our opinion, a miscarriage of justice, either by reason of the “suppression of evidence” or by reason of “any other circumstance”.
(Emphasis added)
[21] Harris & Caladine (above), at 78,485 – 78,486.
That has led to the Full Court, in the context of this s 79A ground, referring to the failure to disclose matters “peculiarly within [the] knowledge”[22] of that party or omissions which knowingly engendered, or permitted, a mistaken understanding on the part of the other party.[23]
[22] Pelerman v Pelerman (2000) FLC 93-037, at 87,586.
[23] For example, Lowe v Harrington (No 2) (1997) FLC 92-747, at 84,095.
Fundamental to a decision to agree to terms designed to bring finality to the financial relationship at the end of a marriage is knowledge of the assets, liabilities, financial resources and financial positions of the parties to which the agreed terms pertain. Hence, in Barker, above, cited by his Honour, there was no free and informed consent where a husband failed to disclose that an offer had been made to him to buy real property at a price significantly higher than the valuation upon which the parties acted in reaching consent.
Seen in its proper light, the opening words of his Honour’s finding at [66(a)] in fact establish a lack of disclosure; there was “no relevant evidence was placed before the court as to the nature or extent of any assets or financial resources of the husband not disclosed to the wife prior to the terms being signed” precisely because there had been no disclosure by the husband of the nature, extent, and estimated value of any assets or financial resources. Nor, it might be observed, in a case where the orders provided that the wife was to receive half the net proceeds of sale of a mortgaged property, was there disclosure of the amount of the mortgage.
Here, knowledge of those matters in so far as, relevantly, they affected the husband were peculiarly within his knowledge; on his own evidence the wife knew nothing of them and they had not been discussed by the parties. Indeed, his Honour found, somewhat remarkably it might be thought, that the parties had not at all discussed the terms of settlement until the wife attended at the husband’s solicitor’s office at which time they were read to her by his solicitor for the first time. That is, on his Honour’s findings there was in fact no agreement between the parties prior to the wife’s attendance at the solicitor’s office where she was “told” what the terms of settlement were. In that respect, it should be observed that, in the orders themselves, no values (or estimates of value) are attributed to any assets, liabilities or resources dealt with by the orders.
We were taken by counsel for the husband to passages of the transcript appearing at pages 114 to 116. At transcript page 116, although the husband said that he thought that the wife had a copy of an agreement which he said had been reached between the parties, he conceded that he did not know how she had such a copy. I consider, by way of contrast, that the findings made by the trial judge are entirely accepting, in this respect, of evidence given by the wife which appears at paragraphs 27 through 31 of her affidavit of evidence-in-chief.
As I have said, in my view, I consider the evidence pointed unequivocally to the ground of suppression of evidence through lack of disclosure having been made out.
The Pleaded s 79A Grounds – “Any Other Circumstance”
To the extent that the ground of “any other circumstance” was pleaded before his Honour, noting that it was not pleaded as such in terms, his Honour’s rejection of this ground (to the extent that such a finding can be distinguished from a finding as to miscarriage of justice) at [66(c)] of the reasons quoted above appears to have five central planks.
First, the terms were read to the wife by the husband’s solicitor. Second, she understood “what her entitlements were under the terms”. Third, the solicitor said she should have had the terms explained to her “by someone else”. Fourth, the wife was aware of “other solicitors who could have assisted her in this respect” and, finally, that she did not seek such assistance despite being “aged 33 years at the time she signed the terms”.
The husband seeks to place reliance upon the fact (as it appears did his Honour) that the wife was given the opportunity to obtain advice and did not. His Honour found that she did not sign the orders when at the solicitor’s office but, rather, later before the Clerk of the Local Court. The Full Court has pointed out that parties of full capacity are free to enter bargains and should they choose to do so having eschewed legal advice, they may confront difficulties in later asserting that a miscarriage of justice should be founded on information that might have been gleaned from that advice.[24]
[24] See, for example, Gebert & Gebert (1990) FLC 92-137; Scribe & Scribe (2006) FLC 93-302.
However, the conclusion is founded on the party having “full knowledge of the circumstances”;[25] or the party “hav[ing] full knowledge of their entitlements, or the opportunity to acquire full knowledge of their entitlements”.[26] As it was put by the Full Court in Bigg v Suzi:[27]
… It is difficult to imagine any circumstances in which it would be enough to constitute a miscarriage of justice … for one party to consent orders to establish only that he or she entered into those orders under a mistaken belief, even about a relevant matter, which was neither induced by nor known to the other party…
(Emphasis added)
[25] Gebert, above, at 77,937.
[26] Scribe, above, at 81,104.
[27] (1998) FLC 92-799, at 84,983.
Any discussion about what the wife knew, or did not know, or understood, or did not understand, needs to proceed from the finding made by his Honour that:
28.The wife “wasn’t very good at school”. She was not a very good reader. She was slow at reading. She would get people to read documents to her. When the wife, in about 2011, began bankruptcy proceedings the husband read the questions in the document to the wife and she just answered the questions. After the wife’s separation from the husband in about December 1998, the wife’s sister filled out forms, on behalf of the wife, for the wife to claim child support payments. Before she signs a document now she always asks the person “Can you please simplify it to me.”
In addition it was apparently accepted by his Honour that the wife was treated for, relevantly, postnatal depression after the birth of the parties’ first child in 1994.
There was no discussion between the parties about the husband’s (or, more broadly the parties’) financial affairs in a way that could have disclosed to the wife their nature and extent. There had not even been any discussion about the actual terms of any proposed settlement, nor much less, the parties’ entitlements in respect of those terms and how those terms might reflect a just and equitable outcome by reference to known assets and resources with, at the very least, estimates of value.
It can be seen by reference to the parties’ respective affidavits that there are competing contentions in respect of what was or was not said by each of them prior to the attendance at the solicitor’s office but, in that respect, in my view, his Honour’s findings in the reasons, to which I have earlier referred, pertain.
In addition, his Honour found as a fact that the wife did not, in any event, receive her entitlement under the orders. While s 79A(1)(c) was not pleaded as a specific ground of relief, the receipt by the wife of what would appear to be slightly more than half of her entitlement under the terms of the orders as a result of a unilateral instruction by the husband to his solicitor to do something not contemplated by the agreement, is, in my view at least, a highly relevant circumstance pertaining to whether justice miscarried within the terms of the section. (I pause to wonder how, if as seems the case, the solicitor was holding sale proceeds on trust pursuant to the terms of an agreement of which he was aware – and, as the husband asserts in his affidavit, was acting for both parties on the sale – he was able as a fiduciary to deal with the funds of one of the parties upon the instructions of the other. This issue was not pursued on the appeal and I say no more about it).
It is by no means clear to me that his Honour made any finding as to whether the ground of “any other circumstance” was made out. In any event, as I have said, I consider that if his Honour did consider such a ground it was conflated with a finding as to miscarriage of justice.
I turn now to consider whether justice miscarried within the meaning of the section.
The Finding that Justice Did Not Miscarry
Whether a s 79A ground is made out is a separate question to whether, if made out, it is productive of a miscarriage of justice.[28] Accordingly, many of the matters I have earlier referred to are also relevant in considering whether, as the wife contends, his Honour’s finding that there was no miscarriage of justice was not open to his Honour.
[28]Patching & Patching (1995) FLC 92-585; If each is established, the court must, also separately, consider whether the discretion should be exercised so as to set aside or vary the order; See, for example, Morrison, above.
Of course, “miscarriage of justice” refers to circumstances existing as at the date of the order.[29] In that respect, the wife contends that his Honour’s own findings are indicative of that conclusion. I repeat that it appears to me that many of the matters set out by his Honour in the narrative which considers the parties’ evidence under that heading are intended to be findings. Certainly, nothing said by his Honour would suggest otherwise.
[29] Holland & Holland (1982) FLC 91-243, citing Molier & Van Wyk (1980) FLC 90-911.
It is important to the wife’s argument that I set out at least a significant number of those findings in so far as they seem to me relevant to the issue of miscarriage of justice. I also reiterate, without repeating, the findings to which I have earlier referred including in respect of the wife’s literacy difficulties; the lack of disclosure by the husband; and the circumstances in which the “agreement” was proffered to the wife. Each and all are central to my conclusion that his Honour’s conclusion was not open to him or that his Honour failed to take account of relevant facts in reaching his conclusion.
In addition to those matters, his Honour found:
·The wife did not read the terms of the proposed order at the husband’s solicitor’s office (although as I have said he read them to her) (at [33]);
·His Honour found that “the wife understood the terms before and at the time of signing them” (at [33]). Leaving aside the circumstances in which that “understanding” had, for the first time, arisen, there is no finding, and could be no finding, that the wife could refer those terms to any “entitlement” she might have pursuant to the terms of s 79;
·The Clerk of the Local Court “did not give legal advice to the wife”. Noting that it was before him that the wife apparently signed the orders, his Honour found that he did not read the terms to her nor did he ask the wife if she understood the terms (at [34]). As a result of his Honour’s findings as to the wife’s lack of literacy, the conclusion must be that the first and only time the wife had the terms read to her was by the husband’s solicitor while the husband was present at the solicitor’s office;
·“The wife stated that after the terms were signed she did not go and get legal advice because she already had the court papers. She did not raise any issue with respect to the consent orders before 2014 because the parties got back together” (at [41]);
·“The wife states that she did not receive any documents either before or after she attended Mr [A’s] office to sign the terms, which disclosed the husband’s assets, liabilities, or superannuation entitlements. The wife states that she was mostly concerned about the children, and to ensure that they would continue to live with her.” (at [44]).
Taken together, in my view, the wife’s lack of literacy; the husband’s failure to disclose; the lack of prior discussion as to the proper entitlements and division of the proceeds of the home; the wife’s self-representation at the time the husband’s solicitor “told” the wife of the proposed orders; the circumstances in which that occurred at the husband’s solicitor’s office; the fact that the orders were read to her only once in those circumstances and that she did not have them read to her again; and the fact that she was not advised as to entitlements, all, in my view, amount to a miscarriage of justice in and about the making of the orders.
Those factors should be seen together with the fact that the wife did not in fact receive what the orders gave her, and factors in and about the making of the orders themselves including the fact that there was no evidence before the trial judge that an Application for Consent Orders[30] was before the magistrate prior to the making of the orders; nor any Financial Statement; nor any values or estimates of value in the orders themselves for the property that each party was receiving or the property and financial resources (including superannuation) which each party was retaining.
[30]Which requires, at least, estimates of value of the property concerned and assessments by the parties of their s 79(4) entitlements.
In my view, the only finding reasonably open on the whole of the evidence is that justice has miscarried.
I turn now to consider implied consent – that is, s 79A(1A).
The Finding That the Parties Did Not Impliedly Consent
The parties separated finally in 2012. At that time they had been cohabiting, on his Honour’s finding, for about 12 years following their reconciliation in early 2000. The parties had cohabited for about 15 years prior to their initial separation in 1998 (and had been married for about seven of those 15 years). When the parties divorced in June 2013, they had been married for 21 years and had cohabited for a total period of about 27 years.
Reconciliation is not, of itself, sufficient for a finding that the parties had impliedly consented to the setting aside of a s 79 consent order.[31] Rather, any such finding is made by reference to the miscellany of circumstances pertaining to the parties’ relationship by which the relevant intention is to be inferred.
[31] McCabe, above; Sommerville & Sommerville (2000) FLC 91-243.
As far as I can see there was no evidence before his Honour as to any formal or informal agreement in respect of the earlier consent orders. What was said by Coleman J, sitting as a single judge of appeal, in O’Hurley & O’Hurley[32] pertains equally to the instant case:
The case thus fell to be determined on the basis of whether the circumstantial evidence established as a matter of inference or conclusion that, despite the absence of any express agreement or even consideration of the consequences of the resumption of cohabitation so far as the [relevant consent] orders were concerned, the parties nevertheless intended to no longer be bound by the terms of those orders.
[32] [2008] FamCAFC 57, at [67].
In light of at least some of the arguments advanced by counsel for the wife, I consider it helpful to also refer to what Gummow and Hayne JJ said in the decision of Byrnes v Kendle,[33] a decision which I note was delivered some five years after the single judge decision of Carmody J to which counsel for the wife referred. Their Honours said this:
…In some situations, legal consequences do turn on actual intentions, as in the case of those charged with certain crimes. Ordinarily, however, the legal effect of a transaction does not depend on the parties' secret intentions, but on the outward manifestations of their intentions. For practical reasons, we disregard the parties' undisclosed states of mind. To be accurate, therefore, it is necessary, when dealing with the creation of a trust and its terms, to speak not of the settlor's intention but of the settlor's manifestation of intention.
[33](2011) 243 CLR 253, at 275, quoting from ‘Scott and Ascher on Trusts’, 5th ed (2006), vol 1, Chapter 4.1.
In concluding, at [68] and [69], that the wife had not established that the parties impliedly consented to the setting aside of the orders, his Honour relied upon the following passage from the decision of the Full Court in McCabe, above:[34]
In cases of this nature conclusions about intention which should be attributed to the parties will depend upon the particular circumstances of each case. That material would not necessarily be confined to the initial decision to reconcile or, as in this case, to write to the Court. Their intention may crystallize into a more precise form as time progresses and as the parties’ reconciliation continues and they conduct their lives together, including their financial affairs, so that it becomes inconsistent with any other conclusion.
[34] Above, at 82,369.
His Honour thereafter listed nine specific facts at [68] which informed his ultimate conclusion as follows:
a.unlike the first period of cohabitation when properties were purchased jointly, the property at [O Street] was purchased in the husband’s name, and he solely met the mortgage repayments in respect of that property;
b.unlike the first period of cohabitation, the parties maintained separate bank accounts;
c.the parties did not purchase property together and contribute jointly to purchase repayments;
d.the husband set up his finances separate to that of the wife, as he had lost trust in her. He made regular and fixed financial payments to the wife on a fortnightly basis, which he could control. (In this context, the court notes the wife’s evidence that she was spending about $50.00 a week playing poker machines, at times utilising monies received from the Child Support Agency);
e.the wife received Centrelink benefits up until about 2006. The wife’s evidence was that she believed that she was entitled to the benefit because the husband wasn’t paying her sufficient money. Further, her evidence was that following the resumption of cohabitation she thought she was living as a single parent as she was the one providing for the children. Whilst the evidence establishes that the husband was in fact making regular fortnightly payments to the wife, following resumption of cohabitation (and continued to do so up until the final separation), it is apparent that the wife regarded such payments as insufficient to enable her to properly maintain the children. Indeed, from 1999 to 2002, on occasion the wife complained to the husband that the previous property settlement of 1998 “wasn’t enough”, with the husband merely telling her to go and see a solicitor;
f.the wife took out significant loans to pay for various expenses relating to the household and the children, unknown to the husband, which ultimately could not be serviced by her. The husband did not come to the wife’s financial rescue, rather, he recommended that she go into bankruptcy, which she did;
g.during the second period of cohabitation, it was common for the parties to holiday separately from each other and with the children;
h.the above circumstances, relating to the manner in which the parties conducted their finances in the latter period of cohabitation, do not indicate that the parties pooled their resources together for the benefit of themselves and the children, as submitted by the wife; and
i.as with the deterioration of the marital relationship in the first period of cohabitation prior to late 1998, the wife’s evidence, in particular, was that by about 2004, as far as she was concerned, the marital relationship had again significantly deteriorated, to the point where she was depressed and anxious, but “went along with it (the husband’s behaviour and demands upon the wife) for the children’s sake.”
As can be seen, his Honour refers to what appears to be uncontroversial evidence as to the wife’s representations to Centrelink and the receipt of benefits accordingly. His Honour earlier appears to make a finding in accordance with the wife’s evidence that:
47.… She kept her address as her brother’s address, at the direction of the husband, so that she could continue to receive Centrelink payments as the husband told her not to throw away her single parent pension. The husband told the wife that she should not disclose to Centrelink that they were together, because he would not be able to afford to give her any more money in addition to the child support payments he was paying to her.
(Emphasis added)
In light of that finding I have some difficulty in understanding the relevance of the finding quoted at [68(e)] above to a determination of whether the parties impliedly intended to set aside (or vary) the consent orders. Indeed, on one reading of his Honour’s quite specific findings, it supports the contention that a decision was made jointly within a resumed cohabitation and marriage by which funds available to the wife within that relationship could be maximised.
In a similar vein I have, with respect, considerable difficulty in understanding the relevance of the apparently central finding at [68(i)] quoted above. It was, and is, uncontroversial that the parties’ marriage was significantly less than happy and that it deteriorated to the point of separation on two occasions, the last one finally. By contrast, the central findings make no mention of the fact that the parties had a marriage which, however happy or unhappy, subsisted for 21 years within a cohabitation that spanned almost 30 years, the former a period during which the parties’ two children were raised.
It is convenient, I think, to refer to what Fogarty J said in Drew & Drew,[35] although noting that that was a case that involved the setting aside of a s 87 agreement. His Honour said:
The question then is whether the events that have happened since 1980 affect the validity or enforceability of the agreement. I might add that if they do not the parties will find themselves in a most curious position. Whilst the approval remains the parties may not validly institute proceedings in this Court under Pt VIII. However they may not institute property proceedings in any other court because such proceedings would constitute a “matrimonial cause” within the exclusive jurisdiction of the Family Court. Thus, although they have jointly owned property, namely the matrimonial home, and other assets which the wife says have been acquired jointly by them during the 2½ years of their resumed and still existing marriage no court would have jurisdiction to determine their rights arising from those circumstances. This would apply equally to the husband’s application for an order under sec. 78.
At least these problems would exist in such a case as this where the parties have remained married throughout. Different considerations may apply in a case where the parties resumed cohabitation after divorce and had not remarried. In that case the financial issues may not be referable to the prior marriage relationship and may not be a matrimonial cause, but rather may be referable to the de facto relationship and fall to be determined by the State law applicable.
[35] (1985) FLC 91-601, at 79,862.
The remaining seven of the nine facts apparently central to his Honour’s conclusion relate to what might broadly be called the parties’ financial interrelationship (or asserted lack thereof). Their central underlying premise is the “separateness” of the parties’ financial lives despite their reconciliation. Counsel for the husband, before us, sought to place considerable emphasis upon that “separateness”. Counsel pointed out that the parties, subsequent to their reconciliation, did not own any real property in joint names. That was to be contrasted, counsel contended, with the position in respect of two real properties prior to their first separation. Similarly, there was no mortgage in joint names as there had been prior to the parties’ first separation.
In addition, counsel contended that, again, contrary to the position that pertained prior to the parties’ first separation, the parties did not maintain a joint bank account. After their reconciliation the parties each had their own bank accounts. Prior to their first separation each of the parties could draw on the joint bank account so as to meet expenses associated with their cohabitation, et cetera. Finally, counsel referred to the fact that the husband was paying child support subsequent to the reconciliation and thereafter paid an amount, to which I will refer shortly, which he referred to in his affidavit as a “spousal payment”.
Notably absent, with respect, from the ultimate findings made by his Honour, to which I have just referred, is any mention of the nature, type and extent of the parties’ respective contributions made by each of them in accordance with their “unstated assumptions”[36] during the course of their relationship both before and after separation.
[36]Using that expression in the same manner in which it is used in Stanford v Stanford (2012) 247 CLR 108, 122.
On the trial judge’s findings, in the period prior to the first separation the wife worked for a period of about six months after the birth of the parties’ first child until ill health forced her to cease work (at [22]). There can be little doubt that the wife was accorded (by reference to the parties’ “unstated assumptions”) the role of the predominant homemaker and parent – the husband, on his case and the trial judge’s findings, “working long hours” and “often going to the [a recreational venue]” on Saturdays and “participat[ing] in … competitions” (at [23]). Interestingly, despite asserting that “as the years went on we lived more and more parallel but separate lives”, the husband goes on to depose that “I worked long hours and when I wasn’t working or at footy I was looking after the kids”.[37]
[37] Affidavit of Evidence of the husband filed 10.4.2015, paragraph 114.
Subsequent to the resumption of cohabitation, the wife resumed the same role, and made contributions of the same type, for the approximate 12 years that the parties cohabited. His Honour found for example:
52. During the parties’ relationship spanning the period both before and after the terms were entered into, she did most of the house work. Even when she was working full-time she still did her household chores. In 2003 for about three months the wife worked as a cleaner, from 7:00am to 10:00am. In about 2006 the wife went back to work, working weekly work hours variously between 16 hours to 40 hours per week. She worked variously in a chicken shop, motel, and a roadhouse, earning between $15.00 and $22.00 per hour …
…
59.After the parties reconciled they shared a bedroom, the wife did most of the household chores, and at times she mowed the lawn.
Similarly, the findings at [68(a)] and [68(c)] refer only to payments in respect of one aspect of the 12 year cohabitation, namely the property in which the parties and children resided. His Honour makes no mention of his earlier findings in respect of other aspects of that cohabitation and the support of the children. In the latter respect, both parents had as their primary duty the duty to maintain their children.[38] On his Honour’s findings, the husband paid the mortgage and utilities. As has been seen, that fact is central to the ultimate findings in [68(a)] and [68(c)] of the reasons. Yet, nowhere within those findings is consideration given to findings in respect of other payments made by the wife from a fixed sum given to her by the husband which, on his evidence, did not increase over a period of ten years from 2003 to 2012 (despite increases in the husband’s income during that time).
[38] s 66C of the Act; s 3 Child Support (Assessment) Act 1989 (Cth).
Before dealing with his Honour’s findings in that respect, I should refer to the fact that the husband deposed that “immediately after separation” in 1998 he was “assessed for child support at around $287 per fortnight”. Despite, he says, difficulty in paying that sum, he agreed to pay $300 per fortnight so as to even out fluctuations in the assessment resulting from overtime earned. The husband deposes that he continued to pay $300 per fortnight after reconciliation in 1999 until 2003 (which he calls “the child support payments”) and $330 per fortnight from then until 2012 (which he calls “the spousal payments”).[39]
[39] Affidavit, paragraphs104-105.
The husband deposes (as his Honour also records) that his “financial independence from [the wife] … was very important … That is why [he]chose to continue to pay [the wife] a fortnightly amount after [they] became a couple again in 2003 - 2012”[40] (noting, of course, that his Honour found that reconciliation occurred at the end of 1999). The husband goes on to depose that “I regarded this payment as a form of spousal payment to [the wife]”.[41] Nowhere in deposing to the “financial arrangements from 1998 to 2012” under that heading in his affidavit does the husband refer to any payments made by him in respect of the household’s, and in particular the children’s, day to day necessities and expenses. Importantly as it seems to me, in that regard his Honour found:
52.… With her income [from the employment referred to earlier in the paragraph] she paid for, inter-alia, groceries, the children’s clothing, school uniforms, school fees, school photos and excursions, children’s tutoring, presents, veterinary bills, car expenses, various items of furniture and white goods. She also paid for the children’s specialist medical bills and medication as [one of the children] was a type 1 diabetic, and her own medication for her underactive thyroid and anxiety and depression. The husband paid the mortgage repayments, electricity, council rates and telephone accounts.
(Emphasis added)
[40] Affidavit, paragraph 107 (emphasis added).
[41] Affidavit, paragraph 107.
His Honour also found, and again, importantly in my view:
54.In about April 2011 the wife filed a debtor’s petition to become bankrupt. She had a few loans for about $15,000.00 that she could not service. She was discharged from the bankruptcy in April 2014.
55.Following the parties’ resumption of cohabitation the husband made regular fortnightly payments to the wife which money she could do with as she pleased; she could spend it on the children, groceries, buying things for the house, going to the movies.
…
59.… The wife did make a financial contribution to the running of the house, including payment of various children’s expenses, paying in part for groceries, dog bills, lawnmowing.
60.Whilst the wife lived with the husband after their resumption of cohabitation and up to February 2012, the wife obtained loans … that she could not service. She had used the loans on the children, living expenses, a bedroom suite, a few things for the house, and holidays with children ... She approached the husband for financial assistance to pay out the loans. The husband refused to assist her. The husband recommended to the wife that she file a debtor’s petition to become a bankrupt which she did. The husband had no knowledge of what loans the wife had at the time of her bankruptcy.
61.… The husband conceded that he kept paying the wife money every fortnight, $330.00, as he could control that, and there were no conditions to that money. He stated that in the second period of cohabitation he controlled the finances more.
62.The husband stated that of bills that the wife had of her own between 2003 and 2012, he had paid one with his card. He stated that he paid for her accounts with [Store N] for the things that she had purchased.
I should say that, in light of those findings, and the totality of his Honour’s findings read as a whole, I have some difficulty in understanding the relevance of his Honour’s reference to the expenditure by the wife of $50 per week on poker machines – something which, she at least, plainly considered entertainment. That might be thought to be all the more so in light of the husband’s own evidence that the wife “would head off to the Pokies while I drank with my footy mates”[42] (albeit that the husband alleged that the wife went out more than him). No mention or finding is made by his Honour of any amount that the husband might have spent per week going to the pub with his footy mates.
[42] Respondent’s affidavit at paragraph 111.
As I have earlier pointed out, his Honour found that the parties’ reconciliation subsisted for almost as long as their original cohabitation and ultimately formed part of a lengthy cohabitation and marriage during which two children were raised. In addition, his Honour made findings as to the nature of the parties’ relationship both before and after the first separation and consent orders:
·“The family home was sold pursuant to the terms [of the consent orders]” ([45]). However at least some of the orders were not carried into effect. Fundamentally, the wife did not receive 50 per cent of the net proceeds of sale ([45]);
·“The wife moved into a three-bedroom house [upon separation in 1998] … with the children. She withdrew about $2,500.00 from her superannuation fund on the basis of hardship to pay for some white goods. The children spent time with their father every weekend from Friday afternoon until Sunday afternoon. The parties had a cordial relationship and could talk to each other. Occasionally they had sexual relations” ([46]);
·Upon reconciliation in about November 1999, “[the wife] and the children moved into a home unit with the husband at [Property C] in about February 2000” ([47]);
·The home to which the parties and children moved thereafter was a home in which “the husband actively involved the wife in the process of looking for a property. The husband thought that the more the wife looked with him and felt part of the process the greater the chance of the wife would move the children back in with the husband” ([49]). Of course, the wife and children had already, on his Honour’s findings, moved back in with the husband;
·“The husband located a property at [O Street] for sale. The parties looked through the property. The wife liked the property and said to the husband, “if you buy it I’ll move the kids back in.” The husband did not talk to the wife about how he would be able to afford the mortgage repayments” ([50]).
Just as the relevant “inference or conclusion fell to be considered … despite the absence of any express agreement or even consideration of the consequences of the resumption of cohabitation”[43] so, too, the relevant inference fell to be considered despite any self-serving assertions of the parties as to their categorisation of the relationship.
[43] O’Hurley, above, [67].
Final orders for settlement of property are, by their nature, designed to “finally determine the financial relationships between the parties to the marriage and avoid further proceedings between them”[44] – the so-called “clean break principle”.[45] The relevant inquiry, as counsel for the husband sought to emphasise, is whether the post-reconciliation circumstances over the time frame of the reconciliation establish an inference that the parties intended the orders to not bring an end to their financial relationships and, consequently, an end to a later determination of later contributions made within that relationship.
[44] Section 81 of the Act.
[45] See, for example, Cawthorn & Cawthorn (1998) FLC 92-805.
I am unable to see on the totality of findings made by his Honour how it was reasonably open to his Honour to conclude in 2016 that the parties did intend to bring an end to their financial relationships by the 1998 orders.
Despite the assertions of the husband, and contrary to the central premise for his Honour’s conclusions, and a central premise of the arguments skilfully put by his counsel before us, the evidence and findings cannot in my view be seen as pointing to a post-reconciliation separation of financial lives. Rather, that evidence and those findings point to a “separateness” in responsibility for meeting expenses from the joint resources of both parties, albeit that the proportion in which those resources were sourced to the income of one or both altered from time to time. The fact that the husband, on his own case, abdicated to the wife responsibility for meeting expenses, other than the provision of accommodation, associated with the day to day necessities of the parties and, crucially the children, from an amount which he determined and controlled (and which did not increase for 10 years) does not, in my view, indicate to the contrary.
Rather than intending that orders made some 14 years before final separation should determine finally their financial affairs, the inference emerging inescapably, in my view, from the totality of the findings made by his Honour is that the parties intended those orders should no longer apply such that, when orders were made finally determining their financial relationships, (or there was an agreement to that effect) they would, or should, accommodate the contributions of all types made by each of them in the nearly 30 years of their cohabitation.
In our respectful view, his Honour was in error in concluding to the contrary. By way of corollary, I also accept the contention that, in light of the findings made throughout the judgment, his Honour’s reasons were inadequate to explain his Honour’s ultimate conclusion.
Conclusions
Having regard to the reasons which I have just outlined, my conclusions are as follows.
In my view the appeal has merit. As I have earlier indicated, it is accepted by counsel for the respondent husband that, if we should so conclude, leave to appeal should be granted. Accordingly I would order that the applicant be granted leave to appeal, and that the appeal be allowed and that the orders made by Judge Newbrun on 16 March 2016 be set aside.
Despite the decision in, for example, Oastler & Oastler[46] his Honour upon, I gather, the invitation of the parties, bifurcated the proceedings so as to deal only with the question of whether the earlier consent orders should be set aside. The wife’s application for settlement of property remains to be determined by the Federal Circuit Court.
[46] (1993) FLC 92-390.
It will be clear that I, at least, consider that his Honour erred in failing to find that the pleaded s 79A grounds were established; erred in finding that there was no miscarriage of justice; and erred in finding that the parties had not impliedly consented to the earlier orders being set aside. It follows that I am satisfied of two of the three elements required if the orders are to be set aside; the separate question of whether, as a matter of discretion, the orders should be set aside remains.[47]
[47] See, for example, Prowse & Prowse (1995) FLC 92-557; Morrison, above.
Sensibly, I do not understand either party to suggest that the parties should incur the time and expense of remitting that single question to the Federal Circuit Court.
It will be clear from what I have already said that I consider it clear that the discretion should be exercised so as to set aside the orders. Without repeating unnecessarily what I have already said, important factors in reaching that conclusion in respect of the discretion include:
· the wife’s entitlement pursuant to the orders is a small cash sum resulting from a unilateral instruction of the husband to solicitors holding (on his case) monies jointly for the parties to deduct an amount not provided for in the orders;
· the wife then, and this court now, is unable to ascertain from anything disclosed by the husband the values of any property or superannuation dealt with in the orders;
· superannuation interests are now susceptible to splitting orders whereas they were not at the time of the orders; and
· the orders purport to deal with s 79 considerations by reference to a period of cohabitation of about 15 years when the parties ultimately cohabitated for nearly 30 years and made such contributions as they each made over the whole of that time.
I will hear submissions in relation to the question of costs.
KENT J
I agree with the orders proposed by Murphy J and with his Honour’s reasons for those orders.
BRYANT CJ
I, too, agree with the reasons of Murphy J and the orders proposed, and wish only to add one matter.
Murphy J referred to the decision of Fogarty J in Drew & Drew, which he noted was a case involving an application to set aside an agreement made pursuant to s 87 of the Act rather than an application under s 79A. As part of the citation referred to by Murphy J, Fogarty J said in Drew & Drew at 79,862:
The question then is whether the events that have happened since 1980 affect the validity or enforceability of the agreement. I might add that if they do not the parties will find themselves in a most curious position. Whilst the approval remains the parties may not validly institute proceedings in this Court under Pt VIII. However they may not institute property proceedings in any other court because such proceedings would constitute a “matrimonial cause” within the exclusive jurisdiction of the Family Court. Thus, although they have jointly owned property, namely the matrimonial home, and other assets which the wife says have been acquired jointly by them during the 2½ years of their resumed and still existing marriage no court would have jurisdiction to determine their rights arising from those circumstances.
That is the same position that the wife would face in this case as a result of the trial judge’s orders. Counsel for the husband said that this was not a relevant consideration because it related to an issue of miscarriage of justice which was not a matter which arose under s 79A(1A). I agree that
s 79A(1A) does not include as part of its requirement that there be a miscarriage of justice. The section refers to the Court having the ability, with the consent of the parties, to set aside or vary the order. It does not also make any reference to implied consent which, of course, is the subject of much of the jurisprudence that has been referred to.
However, the inability of the wife, after a long period of time and making of contributions, to have access to a remedy does not need to present itself as a miscarriage of justice. It is rather one of the circumstances to which the Court should have regard, in my view, when considering whether consent can be implied. In my view, the Court is required to consider all of the circumstances of the behaviour of the parties which might reasonably lead it to imply consent and the circumstances that the mutuality of the financial agreement between the husband and wife to each make contributions as outlined by Murphy J is one of those matters.
It would be, in my view, unreasonable or unconscionable for the Court not to take account of the fact that without any remaining remedy, the contributions which both parties made, and particularly the wife, with the agreement of each of them during their cohabitation, would be unrecognised. It is not, in my view, a matter of miscarriage of justice. It is a relevant factor going to the issue of implied consent and his Honour, in this case, had no regard to it at all. I regard that as also an error on the part of his Honour.
Accordingly, there will be orders as proposed by Murphy J.
I certify that the preceding one-hundred and five (105) paragraphs are a true copy of the reasons for judgment of the Honourable Full Court (Bryant CJ, Murphy and Kent JJ) delivered on 8 February 2017.
Associate:
Date: 21 February 2017
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