Court Satisfied of Miscarriage of Justice and Parties Had Impliedly Set Aside Property Consent Orders between the Parties

In the recent case of Waterman [2017] FamCAFC (8 February 2017) the wife appealed against Judge Newbrun’s dismissal of her application under section 79A of the Family Law Act (to set aside family law financial orders) in the Full Court (Bryant CH, Murphy J, and Kent JJ). The parties started living together as of 1983 and got married in 1991. They were separated between September 1998 and November 1999 before reconciling and finally separating in 2012.

The first time the parties were separated, a final order was made which required the sale of their house and sale proceeds to be equally divided. At this time, the parties had two children aged 7 and 4. The argument of the wife was for the order to be set aside due to suppression  of evidence by the husband.

Murphy J addressed the husband’s suppression of evidence through lack of disclosure.   His Honour stated that there was no evidence placed before the court as to the assets or financial resources of the husband not disclosed to the wife prior to the terms being signed. Additionally, his Honour found that the wife had not received advice as to the terms of s 79 and its effect.

The terms of s 79A (1) states that the specified ground of ‘suppression of evidence’ includes the ‘failure to disclose relevant information’. The duty to disclose is a duty owed both to the other party and to the court.

The Court referred to the case of Morrison & Morrison to emphasise the importance of disclosure between the parties in regards to all circumstances which may be relevant to the determination of their true financial position both presently and in the future. A failure to comply with this duty will result in miscarriage of justice.

His Honour found that the parties had not at all discussed the terms of settlement until the wife attended at the husband’s solicitors office. There was no discussion between the parties about the husband’s financial affairs in a way that could have disclosed to the wife their nature and extent.

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.

His Honour found that the wife did not read the terms of the proposed orders at the husband’s solicitors office. The wife also stated that after she signed the terms she did not go and get legal advice because she already had the court papers. Further, the wife states that she was mostly concerned about the children, and to ensure they would continue to live with her.

Overall, 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 was considered to amount to a miscarriage of justice.

Reconciliation

Murphy J stated that reconciliation is not sufficient for a finding that the parties had impliedly consented to the setting aside of a consent order regarding the parties’ property. His Honour referred to the case of O’Hurley & O’Hurley[2008] FamCAFC 57 to state that despite the absence of any express agreement or even consideration of the consequences of the resumption of cohabitation, the parties nevertheless intended to no longer be bound by the terms of those orders.

The relevant inquiry is whether the post-reconciliation circumstances over the time frame of the reconciliation establish an inference that the parties intended the orders to not being an end to their financial relationships and consequently, an end to a later determination of later contributions made within that relationship.

Kent J and Bryant CJ agreed 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 an order. It does not make any reference to implied consent.

The inability of the wife to have access to a remedy does not need to present itself as a miscarriage of justice. The Court considered 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.

The Court also considered 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 unrecognized. His Honours stated that this is not a matter of miscarriage of justice but a matter of implied consent. His Honour regarded this an error on the part of Judge Newbrun.

The appeal was allowed, the consent order set aside and the wife’s application for settlement of property listed for directions before another judge of the FCC.

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