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Latest Notable Cases samples

This is a sample (posted 17 June 2018) of "latest notable cases", which is posted monthly with live links for members at the Members' Home Page under Members' Practice News. Also available at our Members' Home Page (along with our E-Book, our up-to-the-minute family law and child support practice news, our online forms and precedents and our free legal help line) is our online members' Archive of all our back issue indexed case notes (assembled by topic and with live links to AustLII), useful papers and client brochures.

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Property – Declaration that farm was held by third party on trust for wife’s company due to an inter-family agreement was in error – Trial judge had insufficient regard to the authorities as to an intention to create contractual relations – Scope of Family Court of Western Australia’s federal jurisdiction

In Camden Pty Ltd & Laue and Ors [2018] FamCAFC 91 (15 May 2018) the Full Court (Strickland, Murphy & Kent JJ) heard an appeal by a company (“Camden”) operated by the husband’s mother against an order made by Walters J of the Family Court of Western Australia (“FCWA”). Camden owned a farm (“Property B”) which the wife alleged belonged to her trust (“Barkers”) by virtue of an agreement made between the husband’s father (now deceased), the husband (now deceased), the husband’s mother (“Mrs Laue Snr”) and the wife in 2005.

As a preliminary issue, Walters J determined that an enforceable agreement had been made between family members as to the transfer of the property and declared pursuant to s 78 of the Family Law Act that the property was held on bare trust for Barkers. Camden appealed, arguing that the FCWA lacked jurisdiction and power to make the orders under contract law and that the determination as to the existence of an enforceable agreement between Camden and Barkers was in error.

The Full Court said (from [44]):

“The wife alleged, and his Honour found … that in March 2005 an agreement was entered into in respect of the sale of Property B and its business which agreement his Honour found to be between the husband, the wife, Mrs Laue Snr, Camden and Barkers. The agreement was found to have been formed partly orally and partly by conduct and was found to have transferred Property B to Barkers.

[45] … [A transfer] was signed but not registered … In exchange for the transfer by Camden, Mrs Laue Snr (who controlled it) was to receive a monthly stipend for life and the husband was to pay liabilities otherwise to be met from the husband’s father’s estate.

( … )

[49] It is contended that his Honour erred in finding that there was an enforceable agreement because it was not open to his Honour to conclude on the evidence that:

• there was an intention to create legal relations, such actions as were taken by the parties subsequent to the date of agreement were in consequence of informal familial arrangements;

• the terms of the agreement were sufficiently certain, there being no certainty, in particular, about the stipend that was to be provided (so as to provide ‘reasonable comfort’ to Mrs Laue Snr) and the expenses to be met by Barkers (in particular because the husband’s father’s will specifically provided for the payment of the expenses in any event);

• that the wife was a party to the agreement, there being no evidence of any oral statements made by or to her that signified that she was a party or agreed to any agreement.

( … )

[53] It is clear that:

‘ ... the search for the “intention to create contractual relations” requires an objective assessment of the state of affairs between the parties (as distinct from the identification of any uncommunicated subjective reservation or intention that either may harbour) ... Although the word “intention” is used in this context, it is used in the same sense as it is used in other contractual contexts. It describes what it is that would objectively be conveyed by what was said or done, having regard to the circumstances in which those statements and actions happened. It is not a search for the uncommunicated subjective motives or intentions of the parties.’ (Ermogenous v Greek Orthodox Community of SA Inc [2002] HCA 8 at [25])

(Footnotes omitted)

[54] If the parties’ intention is equivocal, evidence of subsequent conduct may be adduced to establish whether an agreement was concluded (Secola v McCann (No 2) [2011] WASC 342 at [18].

[55] The appellant contended before this Court that the following factors weighed against his Honour’s finding that the parties intended to create legal relations:

• That any arrangement or agreement between the parties was never reduced to writing in any format;

• The husband always considered he had a moral obligation to maintain his mother following his father’s death;

• The parties’ businesses had historically been operated independently of one another and only became entwined following the death of the husband’s father;

• That the agreement said to have been reached was reached in a social context and did not apparently involve any lengthy or serious discussions; and

• That Property B was the only substantial income-producing asset held by Camden and the agreement, as found, resulted in that asset being transferred outside of Camden.

[56] We find merit in these contentions. For reasons which follow we consider that reference to the reasons for judgment does not establish that the trial judge had any, or any sufficient regard, to the matters identified in the authorities in determining the issue of intention to create legal relations.

( … )

[59] [His Honour] … does not … make any ‘objective assessment of the state of affairs between the parties’ at this time, and nor does his Honour particularise any conversation or statements which led his Honour to reach that conclusion. His Honour does not address the family context in which the alleged agreement was reached. That assumes particular significance in circumstances where Mrs Laue Snr/Camden advanced the case that there was an agreement for the husband and wife to use Property B … but no agreement for transfer of title.

( … )

[65] The reasons for judgment do not illuminate how it could be said that the terms of the stipend were sufficiently certain to be enforceable.

( … )

[70] The reasons for judgment contain no precise findings about when and between whom discussions occurred, the detail of such discussions, and the fundamental terms agreed as being intended by all necessary and relevant parties to create a binding legal agreement, sufficient to support the conclusion of the trial judge about the existence and terms of the Property B Agreement.

( … )

[72] The appellant contends that the finding of the trial judge … that the wife was a party to the Property B Agreement is stated as a conclusion but unsupported by any fact upon which the conclusion could be based.

[73] As we have already observed, his Honour did not make any finding as to the existence of, or content of, any particular conversation or conversations between all parties to the contended agreement to which the wife was also a party. Nor did his Honour find agency between the husband and wife. The conclusion that the wife was a party is unsupported by any, or any sufficient, findings. We therefore find merit in the appellant’s contention.”

The Court allowed the appeal but rejected the appellant’s contention that the FCWA lacked jurisdiction to determine contractual matters, saying (from [173]):

“… [O]nce a matter is within the federal jurisdiction of a court, ‘Commonwealth and State laws, together with the common law of Australia, comprise a ‘single though composite body of law’ to be applied” … [Windeyer J in Felton v Mulligan [1971] HCA 39].

( … )

[177] The remedies to which the wife could have recourse were not restricted to Part VIIIAA of the Act; those provisions refer to proceedings for a specific matrimonial cause (proceedings for settlement of property under s 79 of the Act) with particular remedies associated therewith. Part VIIIAA and its remedies are not directed to different causes of actions which can be heard because they are part of the one matter.

( … )

[182] If the contractual claim in respect of the Property B Agreement was part of a single justiciable controversy, the FCWA could have recourse to ‘Commonwealth and State laws, together with the common law of Australia’ ‘as the matter in question requires’ …

( … )

[184] Here, if there is a single justiciable controversy, the consequence is that the FCWA is exercising federal jurisdiction to quell all controversies joined in the matter, including a contractual claim in which, if the contract is held to be valid, equitable remedies are sought.”

The Full Court found no error with the Court’s determination that there was a single justiciable controversy. The appeal was allowed and the order discharged without remitter, the issues in the s 79 proceedings remaining to be determined by the trial judge at the final hearing.

NOTE – A further 6 cases are summarised for members this month at our Members’ Home Page under “latest notable cases” under the following headings:

Property – Wife unsuccessfully appeals determination that unit trust controlled by husband but beneficially owned by his 99 year old father (its sole unit holder) was not property but a financial resource – “Control” of trust requires legal title to its assets

Children – Mother loses appeal against refusal of permission for her relocation to New Zealand – Trial judge’s reference to the Morgan & Miles “checklist” was not in error as it correctly paraphrased the relevant law

Property – Small pool – Wife’s superior marital and post-separation contributions (including her six years of primary care of the parties’ disabled child) undervalued by trial judge – Adjustment made for wife under s 75(2) (to take account of the cost of future care) was also inadequate

Child support – Appeal from AAT – “Financial resource” – Regular advances from paternal grandfather were a financial resource of the father for the purpose of calculating his child support income

Procedure – Matters relevant to an adjournment application – Wife granted adjournment of property trial two weeks before the hearing to enable her to join the husband’s parents and allege a constructive trust – Balance of prejudice

Publication of proceedings – Court enjoins non-party website moderator under s 68B of the Family Law Act from publishing particulars of parenting case – Alleged breach of s 121 referred to Australian Federal Police for investigation