Sarkar v Ainsworth
[2018] NZHC 1474
•20 June 2018
NOTE: PURSUANT TO S 169 OF THE FAMILY PROCEEDINGS ACT 1980, ANY REPORT OF THIS PROCEEDING MUST COMPLY WITH SS 11B, 11C AND 11D OF THE FAMILY COURT ACT 1980. FOR FURTHER INFORMATION, SEE
IN THE HIGH COURT OF NEW ZEALAND ROTORUA REGISTRY
I TE KŌTI MATUA O AOTEAROA TE ROTORUA-NUI-Ā-KAHU ROHE
CIV-2017-463-62 CIV-2017-463-63
[2018] NZHC 1474
UNDER the Family Proceedings Act 1980 and District Courts Act 1947 IN THE MATTER
of an appeal against a decision of the Family Court at Rotorua
BETWEEN
SARKAR
Appellant
AND
AINSWORTH
Respondent
Hearing: 13 March 2018 Appearances:
F M Gush for the Appellant J Briscoe for the Respondent
Judgment:
20 June 2018
JUDGMENT OF WOODHOUSE J
This judgment was delivered by me on 20 June 2018 at 3:00 p.m. pursuant to r 11.5 of the High Court Rules 1985.
Registrar/Deputy Registrar
……………………………………
Solicitors:
Ms F M Gush, Solicitor, Wellington
Mr J N Briscoe, Tompkins Wake, Solicitors, Rotorua
SARKAR v AINSWORTH [2018] NZHC 1474 [20 June 2018]
[1] This is an appeal from a decision of Judge J F Munro in the Family Court at Rotorua.1
[2] The appellant and respondent were married. They have one child, who I will refer to as “B”. Under s 169 of the Family Proceedings Act 1980 and ss 11B and 11C of the Family Court Act 1980, subject to exceptions, information identifying B cannot be published. It is for that reason that B’s name has been anonymised and pseudonyms have been used for the names of the appellant and respondent. This case may be reported and cited as “Sarkar v Ainsworth”. For convenience, I will also refer to the appellant as “the mother” and to the respondent as “the father”.
The proceedings and the issues
[3] There were two proceedings between the parties in the Family Court, as follows:
(a)One was a claim by the mother against the father to recover alleged arrears of maintenance and expenses payable for B, and for an order for specific performance of ongoing obligations. The father entered an appearance under protest to jurisdiction. He contended that New Zealand courts had no jurisdiction because the mother’s claim was founded on an order of a Japanese court which was unenforceable in New Zealand. He applied to strike out the claim on the jurisdictional grounds. The claim was struck out.
(b)The second proceeding was an application by the father for dissolution of marriage. Section 45(1)(a) of the Family Proceedings Act 1980 provides that an order for dissolution of marriage cannot be made if satisfactory arrangements have not been made for maintenance of a child of the marriage.2 The mother opposed the application on the grounds that this requirement had not been met. Her opposition was dismissed and an order for dissolution was made.
1 [2017] NZFA 5181. The case name has been omitted because it has not been anonymised. I will refer to this as “the Family Court judgment”.
2 The text of s 45(1)(a) is reproduced below at [35].
[4]There are two central issues on appeal:
(a)The first is whether the Judge erred in striking out the mother’s claim on the grounds that the Court had no jurisdiction.
(b)The second is whether the Judge erred in rejecting the mother’s contention that s 45(1)(a) applied and, in consequence, making the order for dissolution of marriage.
Background
[5] The mother and the father were married in 2000 and separated in 2010. B was born in 2002. B is a New Zealand citizen. At various times the parties lived in Japan and New Zealand, with both living in Japan after they separated. When the proceedings were heard in the Family Court the mother was living with B in Japan and the father was living in New Zealand.
[6] In 2013 the parties made an agreement under s 21 of the Property (Relationships) Act 1976 (the s 21 agreement). The relevant provisions of the s 21 agreement concern the father’s liability to pay maintenance for and expenses of B. Those provisions are as follows:
2.2[The father] shall pay Child Support and Spousal Maintenance to [the mother] to a total of NZ$5000 per month (“the Monthly Payment”), subject to a maximum of JPY450,000, together with:
2.2.1[B’s] Japanese school fees (currently NZ$465 per term).
2.2.2[B’s] medical expenses (averaging NZ$70 per month); and
2.2.3[B’s] gymnastic and swimming fees; and
2.2.4A half share of any other extraordinary and unforeseen expenses incurred for [B]
2.3The Monthly Payment to continue while [the father] remains in his current employment, or if he obtains other employment on a similar or higher salary. Thereafter at the option of either party Child Support will be paid under the Child Support Act 1991 or replacement legislation.
[7] In May 2014, when both parties were living in Japan, the father reduced the monthly maintenance payment from NZD 5,000 to NZD 1,800, or the JPY equivalent.
[8] The mother then made an application to the Chiba Family Court in Japan (the Chiba Court). On 4 July the mother and the father attended the Court and appeared before a Judge. The evidence of the nature of the hearing before the Judge, and of the effect of a written record of the outcome of that hearing, are central to the jurisdiction issue. The written record is referred to in the judgment under appeal, and had been referred to in the mother’s statement of claim, as an “order” of the Chiba Family Court. But there was no expert evidence on the legal nature of the document and it is by no means clear that it was an order. I will refer to the written record as “the Chiba Court record”.
[9] Some detail is required as to what is established by, or at least indicated by, the evidence in relation to the hearing at the Chiba Court. There was affidavit evidence from the mother (on the dissolution issue as well as the jurisdiction issue) but she did not attend the hearing. There was affidavit evidence from the father and he was cross- examined at some length. The hearing in relation to the mother’s claim was a hearing directed solely to the father’s application to strike out.
[10] The evidence of the mother and the father is consistent as to what occurred before the Chiba Court. The essence is that there was a discussion with the Judge and this resulted in an agreement that the father would pay the mother JPY 300,000 per month from July 2014. The mother contended that this amounted to an agreed variation of the liability under the s 21 agreement, and a variation which reduced the father’s liability from JPY 450,000 per month to JPY 300,000 per month.
[11] The father’s evidence in cross-examination on this is of some importance. He confirmed that he went to the Chiba Court on 4 July 2014 and he was addressed by the Judge with the mother’s lawyer translating. There was then the following evidence:
Q. Right, so what was explained to you?
A.Based on my income this is what I should pay, do I agree or not agree. And I said well based on my income I’m quite happy to pay that.
Q. And what else was explained to you about the order?
A. Nothing at all.
Q. Right but you did consent to it?
A. Absolutely, yeah.
Q. Did you sign a memorandum consenting?
A. I consented to it, yeah, yeah.
Q. Did you sign a document that you said that –
A. I, I’m pretty sure I must have, yes.
[12] Two English translations of the Chiba Court record were put in evidence by the mother. But neither translation indicates that the record is a court order.
[13] One translation is headed “Records (Executed)” followed by the words “Sharing of Marriage fee Case”. This is followed by purely formal matters of record, such as the date, the name of the Judge, and the names of the parties. The following is at the bottom of the first page:
Gist of Procedures, etc.
Conciliation was executed as per annexed paper, terms of conciliation.
[14] The second page is headed “Terms of Trials” followed by three paragraphs recording what was agreed. Omitting irrelevant detail, the paragraphs are as follows:
1.Adverse party will pay applicant 300,000 yen per month as sharing of marriage fee from July 2014 to when parties will live together or divorce. …
…
2.Both parties will deliberate about imposition of special expenses which will be incurred on educational and medical expenses for their child. …
3.Each party will pay one’s own amount of procedure costs.
[15] The second translation is headed “Conciliation (settled)” and immediately below that are the words “Case of Conciliation for sharing divorce costs”. This is followed by the formal matters of record. At the bottom of the page there is the following:
Outline pf [sic] proceedings etc.
Mediation was reached as stipulated in the attached mediation terms.
The second page is headed “Conciliation terms” followed by three paragraphs which relevantly provide:
1.The adverse party shall pay the sum of 300,000 yen per month every month on the last day of the month as their allotted share of living expenses, from July 2014 while the concerned parties live together or until they have divorced ...
2.Both parties concerned shall have a separate conciliation regarding the responsibility for special fees like education fees and medical fees for the child of the two parties [B] (born 14 May 2002).
3.Each party shall have joint responsibility for proceedings costs.
[16] The father made payments of JPY 300,000 for five months – until November 2014. The proceeding in the Chiba Court was terminated when the father failed to appear at a proposed "Divorce Arbitration" on 4 December 2014. He had returned to New Zealand.
[17] He did not make any further monthly payments after November 2014, either at the rate specified in the s 21 agreement or the reduced rate of JPY 300,000. He contended that he was unemployed and, in consequence, had no obligation to make monthly payments other than as might be required on an assessment under the Child Support Act 1991, pursuant to cl 2.3 of the s 21 agreement. He acknowledged that he had continuing liability to pay B’s expenses as specified in cl 2.2, but contended that the mother had failed or refused to provide him with necessary particulars and in consequence payments had not been made.
[18] The father’s position in the Family Court hearing, and in respect of his current financial circumstances, was recorded by the Judge as follows:
[14] [The father] was made redundant from his employment … in Japan on 19 October 2014. He returned to New Zealand and says that he has not been able to obtain further employment. He has not been in a position to file a tax return since then and his current status is unemployed. [The father] received a redundancy payment from [his employer]. He has invested in a business proposition with his son in Malaysia but does not provide any evidence of any return or income from that investment. [The father] relies on the provisions of the s 21 Agreement in terms of child support.
[19] At least in relation to jurisdiction, the Judge was not in a position to make findings of fact in relation to the father’s contentions that he was unemployed for the reason earlier noted: it was a strike out application.3
The mother’s claim
[20] The mother filed her claim in the District Court at Rotorua on 23 March 2016. The father’s application for dissolution had been filed in the Family Court at Rotorua the month before. An order was made in the District Court transferring the mother’s proceeding to the Family Court, and the father’s application to strike out the claim was heard in conjunction with his application for dissolution and the mother’s defence to it.
[21] The pleading of the mother’s claim, in which she advanced two alternative causes of action, is of importance. These are causes of action pleaded in an amended statement of claim filed on 21 July 2016.
[22] The amended statement of claim, in the background narrative, refers to the mother’s application to the Chiba Court and then pleads:
8.The application was dealt with by way of domestic relations conciliation proceedings (mediation).
9.On or about 4 July 2014 the Chibu [sic] Family Court sealed the terms of conciliation agreed by the parties (“the Order”).
10.The Order materially provided that the defendant would make monthly payments of 300,000 Japanese yen … (at the time approximately equivalent to NZ$3,365.00) to the plaintiff from July 2014 until such time as the parties either resumed living together or divorced.
[23] This part of the pleading, which leads to the prayer for relief on the first cause of action, records that the payments at JPY 300,000 were made from July to November 2014, that there were no further payments and that, at “January 2015” [sic] the arrears for 13 months totalled JPY 4.2 million (approximately NZD 54,400).4 There are
3 The mother did acknowledge that she had refused to provide any information as to B’s whereabouts or as to costs for B’s schooling and extracurricular activities, for reasons she explained: see the Family Court judgment, above n 1, at [21].
4 “January 2015” is an obvious typographical error. It should be January 2016.
claims for judgment in that sum and for an order for specific performance requiring the father to resume monthly payments at JPY 300,000 or the NZD equivalent.
[24] The second cause of action is for arrears of maintenance and expenses claimed to be owing under the s 21 agreement. The provisions of cl 2 of the s 21 agreement are set out in their entirety in the amended statement of claim. The s 21 agreement is defined as “the Separation Agreement”. Clause 2 of the s 21 agreement is defined as “the Maintenance Agreement”.
[25]The pleading of the second cause of action concludes with the following:
23.On 4 July 2014 the quantum of the Maintenance Agreement payments was varied by the Chibu [sic] Family Court Order from JPY450,000 to JPY300,000 (“the Court Order”).
24.The defendant remained liable to pay the additional expenses for [B] in accordance with Clauses 2.2.1 to 2.2.4.
25.The defendant complied with the terms of the Maintenance Agreement as varied by the Court Order until November 2014.
26.Since November 2014 the defendant has failed and or neglected to pay the plaintiff the monthly maintenance payments as well as the additional payments for [B].
[26] The material part of the prayer for relief on the second cause of action is as follows:
A.Judgment for such sum as the Court shall determine;
B.An Order that the defendant resume making monthly payments to the plaintiff for the sums as specified in the Separation Agreement on such dates and for such amounts as the Court determines;
[27] The father filed notices of appearance under protest to jurisdiction in response to the original notice of proceeding and statement of claim, and in response to the amended statement of claim. The grounds of protest in the second notice, with some clarification added, may be summarised as follows:
(a)The foreign court order was unenforceable at common law because it was not a final judgment.
(b)Neither the District Court nor the Family Court has inherent jurisdiction to enforce a foreign court order.
(c)The order was unenforceable under the Reciprocal Enforcement of Judgments Act 1934.
(d)To the extent that the claim was for enforcement in New Zealand of maintenance order of a foreign court, the claim should have been brought in the Family Court under pt 8 of the Family Proceedings Act 1980. There was no jurisdiction under pt 8 because Japan is not a Commonwealth or designated country and is not a signatory to the Convention on the Recovery Abroad of Maintenance.
(e)To the extent that there was a claim for future child support of a child resident overseas, the claim should have been brought under pt 8 of the Family Proceedings Act or in accordance with the Child Support Act 1991.
The District Court judgment
Jurisdiction
[28] In the Family Court, on the jurisdiction issue, Ms Gush, for the mother, accepted that, if what is recorded in the Chiba Court record is a court order, there was no jurisdiction to enforce it in the Family Court, or in the District Court. The argument for the mother in the District Court, however, was that the Chiba Court record recorded an agreement which varied the s 21 agreement.
[29] The terms of the variation argued for the mother are not expressly recorded in the judgment, except for a submission that part of the agreed variation included an obligation on the father to return to the Chiba Court to finalise ongoing support. There was a claim for NZD 109,472.10 as the NZD equivalent of JPY 300,000 for 29 months.
[30] The Judge noted that Ms Gush acknowledged that “the Chiba Order” does not provide for ongoing support for B. There was nevertheless a claim for B’s expenses
in the second cause of action, so it is apparent that there was no argument that this claim was based on a variation.
[31]The Judge’s conclusion on the variation argument was as follows:
[26] There are difficulties with that submission. The Court must deal with the evidence before it and apply the law as it stands. There is no doubt that the Court lacks jurisdiction to enforce the Chiba Order. The amount owing of
$109,472.10 arises from an unenforceable overseas order. There is no evidence before the Court that the Chiba Order was effectively a variation of the New Zealand Order. There is no evidence of any link between the two. In any event the Chiba Order is effective only until the parties divorce.
[27] There is before this Court an application for Dissolution of Marriage. It must be dealt with in this Court. It can neither be adjourned indefinitely nor refused based on [the mother’s] desire for [the father] to return to Japan and engage in proceedings there. This Court has no jurisdiction to order [the father] to return to Japan and submit to proceedings there.
[32] The following paragraph in the judgment records the Judge’s conclusions on the status of the s 21 agreement and the father’s obligations under it. This served as an introduction to her discussion of the mother’s defence under s 45(1)(a) of the Family Proceedings Act. However, it also records conclusions bearing on my assessment of the jurisdiction issue. The Judge said:
[28] This agreement remains in force. In the current situation, the provisions for ongoing support of [B] remain available. [The father] has an obligation pursuant to this agreement to meet [B’s] ongoing costs. Clearly he cannot do that unless those costs are known. The obligation is on [the mother] to provide evidence of [B’s] costs to enable payments to be made. In relation to ongoing periodical payments, the agreement provides for assessment under the child support provisions under the Child Support Act.
[33]The Judge summarised her conclusions on jurisdiction as follows:
[31] For the reasons given, the protest to jurisdiction is upheld. There is no jurisdiction to enforce the Chiba Order, or to acknowledge the debt arising from the terms of that Order.
[34]The mother’s claim was struck out in its entirety.
Section 45(1)(a)
[35]Section 45(1)(a) is as follows:
45Arrangements for welfare of children on dissolution of marriage or civil union
(1)The Family Court shall not make an order dissolving a marriage or civil union unless it is satisfied that—
(a)arrangements have been made for the day-to-day care, maintenance, and other aspects of the welfare of every child of the marriage or civil union who is under the age of 16 years (or, in special circumstances, of or over that age) and those arrangements are satisfactory or are the best that can be devised in the circumstances; or
…
[36] In respect of the specified expenses for B, the Judge’s conclusions were recorded at [28], cited above. The Judge did not explicitly state that she was satisfied that those conclusions meant that there were satisfactory arrangements for “other aspects of the welfare of” B, but such a conclusion can be inferred.
[37] In relation to periodical payments of maintenance, the Judge held that the obligations of a liable parent under the Child Support Act 1991 constitute satisfactory arrangements in terms of s 45(1)(a). In doing so she applied the following observations in a decision of the Family Court in Greenman v Miller:5
[6] Although the amounts paid by the applicant for the maintenance of the children are clearly inadequate for the support of the children those payments satisfy his legal obligation to provide for the children in terms of the Child Support Act 1991 as those payments are made pursuant to a formula assessment made by the Commissioner in accordance with Part II of that Act. If the respondent considers that child support provided by the applicant is inadequate provided she establishes the grounds set forth in the Child Support Act 1991 she can apply under Part VIA of that Act for a departure from the formula assessment.
…
[8] As the legislature has in the Child Support Act 1991 provided for a comprehensive method to establish the amount a liable parent should contribute for the support of his or her children I do not consider it to be appropriate to use s 45 of the Family Proceedings Act 1980 to require a liable parent to pay more. If the respondent considers the amount paid by the applicant is inadequate and she can establish the ground for a departure from the formula assessment then the Child Support Act 1991 does provide an adequate remedy. However if she cannot establish a ground for a departure from the formula assessment then it would be wrong to use s 45 of the Family Proceedings Act 1980 to prevent the applicant from obtaining a dissolution of
5 Greenman v Miller [2003] NZFLR 97.
marriage. I am therefor satisfied that whilst and so long as the applicant pays child support as assessed under The Child Support Act 1991 then it is not possible for the respondent to claim that the amount assessed is inadequate and therefore the arrangements for the maintenance of the children referred to in the assessment are not satisfactory.
[38] In the discussion of s 45(1)(a) the Judge made no reference to the father’s liability under the s 21 agreement to pay NZD 5,000 per month, and there was no reference to this in her summary of the s 21 agreement (cited above at [32]). It appears that the Judge may have concluded that the father had no further liability for that monthly sum, notwithstanding the fact that the father had not provided any evidence of any income, as the Judge had earlier recorded.6
The jurisdiction issue: submissions on appeal
[39] Ms Gush submitted that the Judge was wrong to strike out the mother’s claim for want of jurisdiction because the mother was not seeking to enforce an order of a foreign court. The submission, in its effect, was that the jurisdiction issues advanced for the father, and upheld by the Judge, were irrelevant. Ms Gush argued that the mother advanced two causes of action which, in summary, were described as follows:
(a)A claim for arrears of maintenance under the s 21 agreement.
(b)A claim for arrears of maintenance “in accordance with the agreement reached by the parties at the Chiba Family Court on 4 July 2014”.
[40] Ms Gush submitted that the true nature of the claim being advanced by the mother was simply enforcement of a contract made in New Zealand and pursuant to the general civil law of New Zealand.7 The alternative causes of action, as described by Ms Gush in her written submissions on the appeal, were to enforce the s 21 agreement on its original terms, including the father’s liability for a monthly payment of NZD 5,000 (JPY 450,000) or, in accordance with the agreement reached at the Chiba Court, at the reduced rate of JPY 300,000 per month. Part of the quantum of
6 The Family Court judgment, above n 1, at [14], cited in this judgment at [18].
7 Section 21L(1) of the Property (Relationships) Act 1976 provides: “Remedies that, under any enactment or rule of law or of equity, are available for the enforcement of contracts may be used for the enforcement of agreements under section 21 or section 21A or section 21B.”
the claim was for NZD 5,000 for nine months following the date on which the father became redundant, because the father said in evidence that he had received a redundancy payment of NZD 136,000 which was nine months’ salary.
[41] Mr Briscoe, for the father, supported the Judge’s reasons for striking out the claim. In respect of the argument advanced for the mother on the appeal, the father submitted:
The s 21 agreement, on its original terms, remains in force as the Judge held, but under that agreement [the father’s] obligations to pay maintenance ceased when he lost his employment and any liability would arise only under the Child Support Act 1991.
The jurisdiction issue: evaluation
[42] The submissions for the mother on appeal require attention to several matters which may not have been the subject of submissions to the Judge. These include the following:
·The pleadings; which were not analysed explicitly by the Judge.
·Whether the Chiba Court record is a court order. The case in the District Court appears to have proceeded on the basis that it is a court order and, as earlier noted, that is how it is defined in the pleadings.
·Irrespective of the legal nature of the Chiba Court record, there is a central issue, arising on the second cause of action, whether the Chiba Court record was preceded by an agreement between the mother and the father which, in accordance with New Zealand law, amounts to an enforceable variation of their s 21 agreement.
[43] On analysis of these matters, and with some further considerations, I have come to the conclusion that neither of the causes of action should have been struck out.
[44] Ms Gush’s description in her submissions of the two causes of action is not entirely accurate.8 It is, perhaps, more apt as a description of alternative ways in which the second cause of action could be analysed, depending on the evidence adduced at a substantive hearing, preceded by any necessary discovery, inspection and other interlocutories. It is also possible – perhaps reasonably likely – that there would be need for expert evidence as to the legal nature and effect of what is recorded in the Chiba Court record and what preceded the making of the record.
[45] The second cause of action was a claim to enforce the s 21 agreement. There was an express pleading in this cause of action that the quantum of the monthly payment recorded in the s 21 agreement had been “varied by the Chibu [sic] Family Court order from JPY 450,000 to JPY 300,000”. I agree with the Judge’s conclusion that, if what is contained in the Chiba Court record amounts to an order of that court, that could not effect a variation of the s 21 agreement. This illustrates the point made above: a contention that there had been a variation of the s 21 agreement by court order diverts attention from the real issue. The real issue is whether there was jurisdiction to bring a claim seeking to enforce entitlements claimed to arise under the s 21 agreement. There plainly is jurisdiction for such a claim to be brought; this was not in issue.9
[46] One of the submissions for the mother on appeal amounted to an argument that, if there was no proper basis for having regard to the agreement reached between the parties at the Chiba Court, that did not mean that a New Zealand court had no jurisdiction to hear a claim to enforce the s 21 agreement on its original terms. It is unclear whether an argument to that effect was advanced in the Family Court and the Judge’s summary of the submissions indicates that it was not. I am nevertheless satisfied that it is a point of substance and one that should be addressed on the appeal. And I am satisfied that it is, in its essence, correct.
8 The submission is summarised above at [39].
9 Section 21 agreements are enforceable as contracts under the general law pursuant to s 21L of the Property (Relationships) Act 1976. They may also be enforced by court order under s 25 of the Property (Relationships) Act confirming what was agreed, followed by enforcement under s 33 of the Act. See: PES v DNS (2006) 25 FRNZ 863 (FC) at [17]-[24].
[47] The issue raised by the pleading, referring to variation of the s 21 agreement, read in the context of the statement of claim as a whole, is not one of jurisdiction at all. It is an issue which arises often enough on claims seeking to enforce a contract: were the terms of the original contract varied by agreement between the parties? The express reference to variation “by the Chiba Family Court order” was a distraction. This appeared towards the end of the statement of claim, in the pleading of the second cause of action. But the early paragraphs of the amended statement of claim, setting out a background narrative, plead that the mother’s application to the Chiba Family Court “was dealt with by way of domestic relations conciliation proceedings (mediation)” and that the Court then “sealed the terms of conciliation agreed by the parties”. That sealing of the terms of the agreement was defined as “the Order” and it is clear enough that that definition added to the confusion. However, there was an express acknowledgement by the father, in his evidence, that he had readily agreed to pay JPY 3,000 per month.10 This is a sum which he knew was less than what he was required to pay under the s 21 agreement. The mother also agreed to JPY 3,000 knowing there was the obligation to pay more under the s 21 agreement. It is readily arguable that there was an effective variation of the s 21 agreement.
[48] In noting these matters I am not intending to record a conclusion that there was what in law would amount to a legally effective variation of the s 21 agreement. It may not. But the issue raised by the pleadings was one that I consider the Family Court had jurisdiction to address, and which the Family Court (or the District Court) was bound to address on the merits. The father’s application was an application to strike out. The fact that it was an application to strike out on jurisdictional grounds does not in my judgment alter the requirement, on a strike out application, to assume that the facts pleaded by the plaintiff are true.11
[49] The mother pleaded that she and the father orally agreed that he should pay her JPY 300,000 per month and that this was a variation of his existing liability under the s 21 agreement to pay JPY 450,000 a month. Pleadings of fact which are demonstrably speculative and without foundation are not required to be assumed to be true, but the mother’s contentions, on the pleadings and the present evidence, are a long way
10 See above at [11].
11 Attorney-General v Prince [1998] 1 NZLR 262 (CA) at 267.
removed from that. If the correct conclusion, in fact and in law, following a substantive hearing on the merits, is that there was no agreement between the parties which effected a binding variation of the s 21 agreement, the court would have to determine, on the merits, whether the father has liability for arrears under the s 21 agreement on its original terms, and whether there should be an order for specific performance in respect of future obligations for monthly payments.
[50] There are substantial issues of fact relating to the father’s past and any future liability for monthly maintenance payments under the s 21 agreement, varied or unvaried, which have not been addressed. The father contended that his only liability would be on an assessment under the Child Support Act, but there was no evidence to support this.
[51] As Ms Gush noted, as part of a proceeding leading to a determination on the merits, the mother would be entitled to full discovery and production of documents to establish, amongst other things, what the father’s actual income was after he had been made redundant from his employment in Japan in October 2014. This would also require consideration of a question whether the redundancy payment, which the father himself said was calculated as nine months’ salary, amounts to “salary” in terms of cl 2.3 of the s 21 agreement. And the words in cl 2.3 – “other employment on a similar or higher salary” – require interpretation in light of full evidence. As the Judge recorded, the father said that he had invested in a business in Malaysia, but had not provided any evidence of any return or income from that investment.
[52] Notwithstanding the absence of proof, the position taken by the father, and supported by submissions on appeal by Mr Briscoe, was that the father’s only liability under the agreement will be pursuant to the Child Support Act 1991 if he, or the mother, chooses to seek an assessment under that Act. That is not a position that can be taken on the basis of the assertions advanced on a strike out application. What is more, it involves the father advancing one provision relating to maintenance obligations in the s 21 agreement. He is entitled to advance the provisions of cl 2.3. But they must be assessed having regard to the maintenance obligations as a whole, construed in the context of the s 21 agreement as a whole, following a substantive hearing on the merits.
[53] The second cause of action included a claim to recover the expenses for B, and for an order for specific performance in that regard, as well as a claim for alleged arrears of monthly maintenance and an order for specific performance in that regard. The claim for expenses was not a claim pleaded as being subject to variation, whether that is to be construed as a claim to variation pursuant to an agreement between the parties, or variation pursuant to an order of the Chiba Court. That part of the claim should not have been struck out for this further reason.
[54] The first cause of action is directed solely to matters arising from the appearance before the Chiba Court. But the claim, as pleaded, is not a claim to enforce a court order, notwithstanding use of the word “order” to define the Chiba Court record. The pleadings refer expressly to an agreement between the parties. For the reasons set out in relation to the second cause of action, if what occurred did not amount to a court order, the record is a record of an agreement between the mother and the father. On ordinary principles, there was jurisdiction to determine a claim founded on that alleged agreement. That would, amongst other things, give rise to issues as to the consequences of that agreement for the s 21 agreement. But those are not issues bearing on jurisdiction of the court to determine the claim. The first cause of action is possibly superfluous, if the second cause of action is analysed as outlined in the preceding discussion, but that would not provide grounds to strike out the first cause of action for want of jurisdiction.
[55] For these reasons I am satisfied that the claim should not have been struck out. The order striking it out will be set aside and the matter remitted back to the Family Court for determination of the claim on the merits in that court or, if deemed appropriate, in the District Court.
[56] It may be noted that the substance of the result of this appeal, with the claim reinstated and remitted back for hearing, could have been achieved by the mother’s filing a new proceeding and statement of claim, with the latter addressing the deficiencies of the existing statement of claim and pleading the alternative claims outlined by Ms Gush. Given my conclusions on the existing claim that, of course, is unnecessary and also means that there is no added cost for the commencement of a fresh proceeding.
[57] The existing statement of claim should probably be amended. The preceding discussion indicates what may amount to deficiencies. However, I consider it would be inappropriate for this Court to make directions in that regard. There were no submissions on appeal directed to amendment of the pleadings. Amendment is a matter best left for determination in the court of first instance and following any necessary interlocutory applications, either by the mother or by the father, in respect of the pleadings.
Section 45(1)(a) of the Family Proceedings Act: submissions and evaluation
[58] On s 45, Ms Gush did not argue that Greenman v Miller was wrongly decided, but that it is distinguishable from the facts of the present case and for that reason should not have been applied by the Judge. She argued that it is distinguishable because in the present case there has been no assessment under the Child Support Act 1991 and, if there is, the father will be assessed as having no income because he has no New Zealand taxable income. She submitted that Greenman v Miller is also distinguishable because this is a case where the father’s liability should be assessed in accordance with Japanese law. Ms Gush advanced various reasons, including an argument that “the father submitted to the Japanese legal process” and he should return to Japan for that process to be completed.
[59] Ms Gush submitted that, in the circumstances outlined in her submissions, a decision of the Family Court in Church v Church (No 2) should be applied.12 The decision in that case has no application for two reasons. The first is that it was a decision made before the Child Support Act 1991 came into force. The second is that the applicant for dissolution of marriage in that case argued that there were satisfactory arrangements because, at the hearing of the application, the applicant had consented to an interim order for maintenance of $20 per week. Judge Inglis QC held:13
[The] court cannot be bound by any agreement reached between the parties under pressure of a deadline to meet the requirements of s 45(1), but is obliged to satisfy itself that any such agreement, or any proposal advanced by the parties or either of them, meets those requirements. It is not a question of what is acceptable or convenient for the parties.
12 Church v Church (No 2) (1990) 6 FRNZ 118 (FC).
13 At [120].
[60] The agreement for payment of maintenance and expenses for B in this case is quite different from the agreement in Church v Church and the interim maintenance order that followed. This is because the s 21 agreement in this case is a considered agreement entered into on legal advice to each party in accordance with the requirements of the Property (Relationships) Act and because it was not an interim arrangement.
[61] I am not persuaded that there was any error by the Judge in applying Greenman v Miller. As noted in the preceding discussion of the jurisdiction issue, there is a question still to be determined whether the father’s liability for maintenance for B is limited to liability under the Child Support Act, but that unresolved issue does not bear on the question under s 45 whether there are satisfactory maintenance arrangements. There will be such liability, if cl 2.2 of the s 21 agreement does not apply. I agree with Judge Robinson’s opinion in Greenman v Miller that the court cannot conclude that arrangements in accordance with an Act of Parliament are not satisfactory arrangements. An element of Ms Gush’s argument was that arrangements cannot be “satisfactory” if the result will be that no maintenance will be paid. That would be the consequence of the Act, not of the arrangements.
[62] There was a further argument for the mother that the arrangements are not satisfactory because the evidence established that the father avoided liabilities or obligations. This was said to be demonstrated in a number of ways, ranging from the reduced payments of monthly maintenance in May and June 2014 and the father’s failure to return to the Chiba Court in December 2014. It may be that in some cases the evidence relating to breach of obligations to pay maintenance pursuant to a maintenance agreement, or court order, is such that the court would be justified in concluding that the arrangements made are not satisfactory. But I am not persuaded that there was any error by the Judge in her approach on the facts of this case.
[63] In consequence, I am satisfied that the mother’s appeal against the order for dissolution should be dismissed.
Result
[64] The appeal against the Family Court order striking out the appellant’s claim is allowed and the respondent’s application to strike out the claim is dismissed. The proceeding is remitted to the Family Court for determination.
[65] The appellant is entitled to 2B costs on the strike out application in the Family Court and on this appeal.
[66]The appeal against the order for dissolution of marriage is dismissed.
[67]Costs on the dissolution appeal are to lie where they fall.
Woodhouse J
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