Family Law Case Notes

to the Court pursuant to s370 of the Fair Work Act 2009 (Cth) (FW Act).

The applicant did so after the respondent made its own interlocutory application for orders including that the originating application be dismissed because it was not made within the time frame prescribed by the FW Act (Respondent’s Interlocutory Application).

Section 370 of the FW Act is concerned with matters involving taking a general protections dismissal dispute to court.

On the face of the documents, the originating application was lodged with the Court 28 minutes late.

The reason for the delay was provided by the applicant’s solicitor, who stated that he had determined that lodgement occurred at 3.58pm Brisbane time, which was 4.28pm in Adelaide time. The applicant’s solicitor believed that lodgement occurred prior to the closure of the South Australia Registry so that lodgement was within time (at [9]).

Besanko J did not accept this reasoning, including because the applicant’s solicitor did not produce the accounting records to which he referred (at [10]).

The Court did not accept that the application was filed within time (at [10]) but applied the well-known principles relevant to whether time should be extended (at [12]) and granted an extension of time (at [17]).

Section 570(2)(b) of the FW Act provides that a party may be ordered to pay costs only if the court is satisfied that the party’s unreasonable act or omission caused the other party to incur the costs.

In Hennessy v Barminco Limited (No 2) [2022] FCA 33 (27 January 2022) Besanko J ordered the applicant’s solicitor to pay half of the respondent’s costs of the Respondent’s Interlocutory Application because: there was no reason the originating application could not have been filed within time; the applicant only made his application for extension of time after the Respondent’s Interlocutory Application; and the explanation for delay was unsatisfactory (at [3]).

Nadia Stojanova is a barrister at the Victorian Bar, ph 0480 254 662 or email nadia.stojanova@vicbar.com.au. The full version of these judgments can be found at www.austlii.edu.au. Numbers in square brackets refer to a paragraph number in the judgment.

Craig Nicol and Keleigh Robinson Accredited family law specialists Editor and co-editor of The Family Law Book

Spousal maintenance – Consent order (made as part of property orders) that husband pay wife’s mortgage could only be a maintenance order

In Thorpe & Stirling [2021] FedCFamC1A 86 (15 December 2021) the Full Court (Aldridge, McEvoy & Altobelli JJ) allowed an appeal from a decision of Judge Kemp where a final consent order required the wife to sell a property and provided that she receive $430,000 of the sale proceeds on the basis that the husband would be guarantor and pay mortgage payments on a future loan of up to $500,000.

The order provided that the husband would continue to pay the mortgage until its loan balance was discharged. The husband refused to pay after the wife re-married, contending that the order was a spousal maintenance order that had no effect upon re-marriage per s 82(4) of the Act.

Considering the order (“Order 36”), the Full Court said (from [20]):

“ … [T]he husband’s liability under the mortgage remains until it is paid out. … [T]hat liability could … exceed what the husband otherwise received under the … orders ( … )

[26] … [P]roperty, as defined, is limited to existing property, whatever it may be (Stanford v Stanford [2012] HCA 52; … ), and does not extend to property that might be received in the future … [Section 79] does not empower the Court to make an order against property which does not presently exist but could be brought into existence by the exercise of borrowing capacity … ( … )

[36] … [H]is Honour found … the husband’s obligations under Order 36 ‘were likely to be paid out of the husband’s future income stream including his receipt of any … bonus payments’ ( … )

[37] Order 36 does not work an alteration of the interests of the parties in their property but rather creates an obligation which is separate to the division of that property.

[38] … [T]herefore, that Order 36 could not be an order made under s 79 of the Act … ( … ) [45] … Order 36 can be seen as being made as a spousal maintenance order …”

Property – Full Court holds that noncommutable disability income insurance payment is not “property” but a financial resource

In Tomaras [2021] FedCFamC1A 82 (13 December 2021) the Full Court (AinslieWallace, Aldridge & Watts JJ) dismissed an appeal from Judge Purdon-Sully’s decision in Tomaras & Tomaras & Anor (No. 2) [2019] FCCA 2830 .

At first instance, the Court dismissed the wife’s application for a property adjustment where there was no property other than the husband’s total and permanent disability insurance policy (“TPD policy”), which the Court held was not property, where the husband’s monthly payment under the policy was contingent upon his establishing an entitlement to payment each month.

Ainslie-Wallace & Aldridge JJ cited Crapp [1979] FamCA 17, Mullane v Mullane [1983] HCA 4, Marchant [2012] FamCAFC 181 and Pates [2018] FamCAFC 171 and said (from [80]):

“ … [T]he capitalised value of the pension is not property capable of division because no such property exists in that sum … The pension can only be regarded as a financial resource or income. … [T]here is no more than a right to receive the next payment provided the relevant disability continues ( … )

[82] A … difficulty arises in this case because there was no other property to be divided. If there was such property, then … the expected receipt of the payments could properly be taken into account as a financial resource in any property division under s 79 of the Act so as to allow the other party to receive more of that other property.

[83] The appellant submitted that as the TPD policy could be commuted and the respondent’s entitlements assigned, this case could be distinguished from those just discussed.

[84] … [S]uch a course would require the respondent and the insurer to

agree. … The evidence indicated that the insurer was amenable to such a course … However, as the respondent’s position was that he would never agree to such a course, there is no possibility of commutation ( … )

[93] … [W]e think that the husband’s insurance payments, when considered in light of the meaning of ‘property’ under the Act, should best be categorised as income.”

Children – Error in treating parents’ joint opposition to grandmother spending time with the children as an incident of parental responsibility

In Bonner & Chandler [2021] FedCFamC1A 81 (8 December 2021) Austin J, sitting in the appellate jurisdiction of the Federal Circuit and Family Court of Australia, allowed an appeal from a decision of the Magistrates Court of Western Australia, which dismissed a maternal grandmother’s interim application for time with her grandchildren.

The parents (whose marriage was intact) jointly sought the dismissal of the grandmother’s application.

The Court at first instance made findings that “the respondents have made a parental decision … [s]uch decision falls under the umbrella of parental responsibility”; that “[where] the parents [are] in an intact family making a parental decision which they have the authority … to make … this Court should be cautious in peering over the shoulder of functional parents …” ([20]).

Austin J said (from [23]):

“The Full Court has repeatedly affirmed that, in child-related proceedings, the parents of the subject children do not enjoy superiority over any other person who is keenly interested in the children’s welfare ( … )

[25] … [T]he magistrate’s reasons reveal the appellant’s application was dismissed essentially because the respondents jointly opposed the children spending any time with the appellant. The magistrate considered the respondents were entitled to make that decision as an incident of their parental responsibility for the children and strongly implied the legitimacy of their decision need not be scrutinised, much less countermanded. ( … ) The appellant … had standing under the Act to bring the proceedings … and so her application ought have been considered on merit; not dismissed just because the respondents opposed it. ( … ) … that other factors affecting the children’s best interests were pertinent and ought to have been considered. ( … )

[28] It could be that, even if the Act is applied correctly, the same result would ensue, but it cannot be said with certainty that the magistrate’s error of law had no influence upon the result. Accordingly, the error cannot be disregarded ...”

Property – Bankrupt appellant lacked sufficient interest to prosecute appeal

In Glover & Webster [2021] FedCFamC1A 69 (19 November 2021) the Full Court (Strickland, Ainslie-Wallace and Aldridge JJ) heard an appeal from a decision of Baumann J relating to a binding financial agreement (“BFA”).

The Court declared the BFA as binding and that it covered all assets of the parties. The de facto wife appealed, but was then made bankrupt.

The trustee in bankruptcy advised that pursuant to s 60(2) of the Bankruptcy Act 1966, he would not prosecute the appeal but that he did not oppose or consent to the appellant continuing the action.

The Court said (from [30]):

“Fundamental to the bankrupt being relieved of both his property for the benefit of his creditors is that the bankrupt has no financial interest in an appeal such that he may continue it in his own name after being made bankrupt.

[33] This concept has been applied in the family law context. Whilst a bankrupt party can commence property settlement proceedings, in Guirguis & Guirguis [1997] FamCA 6 … the Full Court accepted that a bankrupt party cannot appeal property orders where the subject of the orders vests or will vest in the trustee in bankruptcy, because the bankrupt lacks sufficient interest.

[38] If the appeal from the declaration in this matter was successful, and the declaration set aside, then there would either be the re-exercise of the discretion, or a rehearing of the question of whether there was property not covered by the BFA, and if there was, then the … appellant could pursue an application pursuant to s 90SM of the Act seeking an entitlement to some or all of that property. However, as an undischarged bankrupt, any property that she thereby became entitled to would then vest in her trustee in bankruptcy as afteracquired property pursuant to s 58(1)(b) of the Bankruptcy Act.

[39] It follows … that the appellant does not have sufficient interest in the order the subject of the appeal to give her standing to prosecute the appeal. As the trustee does not wish to pursue it, the appeal must be dismissed.”

Children – Father unsuccessfully appeals order authorising mother to vaccinate child against COVID-19

In Dacombe & Paddison [2021] FedCFamC1A 103 (23 December 2021) Austin J (sitting in the appellate jurisdiction of the Federal Circuit and Family Court of Australia) summarily dismissed a father’s appeal against a consent order, which authorised the mother to arrange vaccinations of the parties’ daughter.

The Court said (from [8]):

“An appeal may be summarily dismissed if the appellant has no reasonable prospect of successfully prosecuting it (s 46(2)) [ed. of the Federal Circuit and Family Court of Australia Act 2021 (Cth)], even if it is not hopeless or bound to fail (s 46(3)) ( … )

[10] The father’s first contention – that he did not consent to the order – is false. …

[11] While it was the legal practitioners who confirmed the parties’ agreement, the father did not demur when the primary judge was informed of the compromise. …

[12] When the primary judge sought to formulate an order to properly reflect the parties’ agreement, the father even helped with the drafting ( … )

[14] [The father] … only disagreed with any form of government-imposed immunisation or treatment for the child, but the appealed order did not deal with any form of immunisation or treatment mandated by government because the parties agreed the child should be immunised ( … )

[16] … Ground 1 of the father’s appeal depends entirely upon his false contention that he did not consent to the appealed order. He did and now he cannot appeal the order on merit in the teeth of such consent. …

[17] … [Section] 51(xxiiiA) of the Constitution enables the parliament to make laws about the provision of medical and dental services (but not so as to authorize any form of civil conscription) ( … )

[21] … [T]he Constitutional impediment only affects the validity of federal legislation which enables the civil conscription of medical and dental services, upon which field the Family Law Act does not play. An

order made under the … Act which ensures a child’s receipt of … medical treatment is not caught by the prohibition ( … )”

Property – Applicant’s equitable trust claim fails as purchases were gifts – Respondent’s claim fails as there was no de facto relationship

In H, AW v K, S [2021] SASC 128 (11 November 2021) Bochner J of the Supreme Court of South Australia dismissed all applications after a 4 year relationship between a dual citizen of Australia and the USA (“the applicant”’) and a single mother who lived in Adelaide (“the respondent”).

The applicant sought a declaration that the respondent’s vehicle and bank balances were held on trust for him ([4]).

The respondent argued the dealings were gifts and [she] sought a declaration that the parties were in a de facto relationship.

The Court said (from [52]):

“The applicant agreed that [his] … communication [to the respondent] amounted to representations that he would provide for her … He denied … that the provision of financial support … or … any other gifts to her would be unconditional. ( … )

[59] … [T]he parties did not acquire any assets together … The respondent never visited the applicant’s house …, nor was she invited to do so. ( … )

[151] The applicant came to Adelaide [where the Respondent lived] between five and nine times each year during the relationship. The length of the visits varied, from less than twenty-four hours, to seven days ( … )

[193] … I consider that the parties’ relationship was not that of a couple living together on a genuine domestic basis. The evidence does not demonstrate ‘the merger of two individual lives into life as a couple’ … [I]t demonstrates two individuals living their separate lives and coming together seven or eight times each year for some shared time. It my view it is the time that was shared, rather than the lives.”

As to the trust claim, the Court said (from [214]):

“ … [T]his evidence leads me to the conclusion that the moneys given to the respondent … were a gift. … [A]ny statements made by the applicant that the moneys should be used for rent, clothes and other expenses were no more than indicative of his motive … They did not serve to impress the funds with a trust.” Children – Hague Child Abduction Convention – Order for production of solicitor’s file set aside, given its irrelevance to habitual residence

In Sterling [2022] FedCFamC1A 3 (27 January 2022), the Full Court (Austin, Berman & Harper JJ) allowed an appeal from a decision of Williams J, where a mother had travelled to Germany with the parties’ daughter for a holiday, but then communicated to the father that she would not return to Australia and unsuccessfully sought parenting orders in a German Court.

The German Court applied the Hague Convention on the Civil Aspects of International Child Abduction and found that the daughter was habitually resident in Australia and that Australian courts had exclusive jurisdiction. The father then successfully applied for orders for the return of the child, for which the father engaged a German lawyer.

Before the child’s return, the father issued parenting proceedings in Australia, where the Court scheduled a discrete hearing as to whether the Court had jurisdiction pursuant to s 111CD of the Act.

In those proceedings, the mother contended that the father had waived privilege to his German solicitors’ file, whereas Williams J ordered that it be produced. The father appealed, to which the Full Court said (from [23]):

“The application of ss 111CD(1)(a), 111CD(1) (b) or 111CD(1)(f) depends upon whether or not the child is habitually resident in either Australia or Germany ( … )

[25] Given the singular contentious issue affecting the exercise of Australian jurisdiction was the identification of the child’s place of habitual residence, it begged the question of how the file of the father’s German lawyer could be relevant ( … )

[32] As an entirely factual question, the determination of the child’s place of habitual residence could not conceivably be materially influenced by any communication between the father and his German lawyer concerning the prior German proceedings. ( … )

[34] Regardless of whether the father waived his legal professional privilege by his conduct, which is another issue by which the parties were distracted, there was no need to compel his surrender of the confidentiality he reposed in the lawyer/ client communications.”

Property – Contributions assessment of 65 per cent in favour of the wife contained error as trailing commissions remained a joint contribution

In Candle & Falkner [2021] FedCFamC1A 102 (23 December 2021), the Full Court (McClelland DCJ, Berman & Harper JJ) allowed an appeal from a decision of Foster J in a case involving a 13 year marriage where the parties established and operated a residential home lending business (C Pty Ltd). After litigation, in 2010 the husband received a payout from a third party on the condition that he resign as director, after which the wife was sole director and conducted operations of the company.

The Court assessed the wife’s contributions at 65 per cent, finding that from 2010 onwards, the wife had “overwhelmingly contributed to the evolution of the current asset pool through her ongoing management of C Pty Ltd” ([38]). The husband appealed.

The Full Court said (from [82]):

“We are … persuaded that the primary judge failed to take account of relevant contributions of the husband.

[83] It was common ground that C Pty Ltd was a joint enterprise of the parties from inception until March 2010, when the husband ceased to be a director. … [T]he business of C Pty Ltd produced an income stream for the benefit of the parties from trailing commissions, which continued for an average of five to six years. It followed that some trailing commissions continued past 2010, and thus some of the income produced by C Pty Ltd post-2010 must be seen as the result of the parties’ joint efforts in the business before 2010 ( … )

[90] The husband argued that the ultimate result of 65 per cent to the wife could only be justified by ignoring the husband’s contributions to the business of C Pty Ltd … after December 2010 ( … )

[92] … [H]is Honour assessed contributions by reference to his detailed findings about the course of contributions … The problem is that nowhere in those paragraphs is there any mention of specific contributions by the husband to C Pty Ltd … after 2010. Consequently, we are unable to conclude his Honour took those contributions into account, despite, or even because of, the reference to [the husband’s] ‘minimal contributions’ in … the reasons. …

[93] Once it is accepted that the primary judge failed to take account of contributions by the husband to C Pty Ltd … even if more modest than those of the wife, the percentage assessment of 65 per cent in favour of the wife is unsafe and cannot stand.”