Keywords: Binding Financial Agreement – Ambiguous recital (purporting to define when the parties would be deemed to have separated) construed as referring to their actual separation date; determination by way of construction; section 90DA Family Law Act

The case of Cuo & Ming and Ors [2016] FamCA 495 (12 May 2016) concerned a complex property matter between Ms Cuo, “the wife” and Mr Ming, “the husband”.  The husband and wife sought equitable relief in terms of determining ownership of quite substantial property holdings.  The husband’s parents “the interveners”, intervened in the proceedings, and were seeking equitable remedies.  Benjamin J made a preliminary determination as to the meaning of a recital in a Binding Financial Agreement that set out the circumstances in which the parties would be considered to have separated.

Background

The couple started living together in 2005.  Whist still in a de facto relationship, they made a Binding Financial Agreement (“the Agreement”) in 2009 pursuant to s90UC and s90B of the Family Law Act 1975 (Cth)(the “Act”).  The Agreement was intended to deal with property matters should the couple separate either prior to or after marriage.  Recital “G” set out the circumstances that would determine the couple had separated. They married in February 2011 and separated on 7 June 2013.   Under the Agreement, the husband would pay the wife half the net value of the assets of a particular trust within thirty days of the separation.  The date that the couple had separated would affect the settlement amount the wife would receive from the husband.

What was the date of ‘separation’?

The recital stipulated that “the parties shall separate if either or both of them sign a statement to the effect that they have separated; are living separately and apart…”   It was, according to Benjamin J, “not clear and … capable of more than one construction.”

Both parties agreed that they had separated on 7 June 2013; which is when they started living apart.  This date was not in dispute and was corroborated in both their affidavits.  The husband applied for a divorce and the order was granted on 3 February 2015, taking effect on 4 March 2015.  Whilst the husband did not provide a separation declaration, the wife effected one on 23 March 2015, which was served on the husband’s solicitors three days later.  At court, the husband and wife both provided different dates of separation – the wife sought to have the date the declaration was served as the date of the separation, pursuant to the Recital.

Construction Principles

In considering how to construct the Recital, His Honour looked at the High Court decision in Mount Bruce Mining Pty Ltd v Wright Prospecting Pty Ltd [2015] HCA 37, which sets out the governing principles for interpreting contract terms. It is an objective test, and the rights and liabilities of the parties to a contract “are determined objectively, by reference to its text, context … and purpose.”   Another important consideration in determining how to construe a contract was that the parties “intended to produce a commercial result”, it, therefore, should be construed “so as to avoid it ‘making commercial nonsense’”.  A similar approach had been adopted earlier by the Full Court in Sanger & Sanger [2012] FamCAFC 210.

 Section 90DA

 His Honour considered: “the issue of construction is whether Recital G is facilitative as asserted by the husband and the interveners or whether it constructs another date, perhaps more akin to the application of s 90DA in terms of a declaration.”

The wife’s senior counsel adopted a narrow construction of the Recital.  He argued that the application of the provisions of s 90DA of the Act, specifically s 90DA(4) applied to the Recital.   He claimed that the most logical construction of the document would require recognising that the Agreement should begin to operate from the same time as the Act gave it “force and effect”.  Thus, the provision in the Agreement was activated when either party issued a separation declaration, in this case, the wife.  He further argued that this approach would avert any controversy as to the operation of s 90DA(1).

Section 90B

His Honour instead found favour with the construction of the Recital that was put forward by the counsel for the interveners.  The senior counsel argued that the wife’s interpretation of the Recital “flies in the face of common sense”, for, among other things, it would allow the actual separation to be “disconnected and temporally remote from the breakdown of the marriage” as required in s90B(2) of the Act.

Moreover, His Honour acknowledged that such a construction would also entail that the distribution of property, that follows the breakdown of a marriage, pursuant to s 90B(2) would only occur if one of the parties were to sign a document that fulfilled the requirements as set out in Recital G.

He went on to say that were such a literal interpretation of the Recital to be applied, then it would follow that separation could arguably occur through the issuing of a declaration, to satisfy the requirements of the Recital, but presumably without necessarily informing the other party.  His Honour felt that objectively, that could not have been the intention of the parties.  He accepted the arguments put forward by counsel for the husband and the interveners.  The document had been prepared as a Binding Financial Agreement to comply with s 90B(2) of the Act.

Ultimate Decision

The Agreement had been drafted to particularise the financial rights and liabilities of the husband and wife, in contract form, with conditions that applied if the parties separated.  Therefore it was intended to come into force after the actual separation.  In order to determine the meaning of the Agreement, His Honour also needed to consider objectively “what a reasonable party to such an agreement would have understood the recital to mean”.  It was to function in the context of the breakdown of the parties’ relationship.  Although some of the terms in the recital were ambiguous, His Honour felt that the “context and nature of the agreement was a relevant consideration”.  He, therefore, found that the parties had separated on 7 June 2013.

Full Court of Family Court Considers Treatment of Allegations of Family Violence

Keywords: Children – Treatment of untested allegations of family violence at the interim hearing – Allegations should not be ignored because they are contested – Mother successfully appeals interim order discharging earlier order for supervision of father’s time – Trial judge also did not consider father’s consent to prior order
Allegations of family violence are increasingly common in parenting proceedings.  And, these allegations of family violence are often in dispute, making it challenging for courts to make decisions on the matter without the benefit of a trial.  In interim proceedings, courts tend to proceed with caution where any safety concerns for the children have been raised.

In the recent case of Salah & Salah [2016] FamCAFC 100 (17 June 2016) the Full Court of the Family Court (May, Ainslie-Wallace and Cronin JJ) heard the mother’s appeal against a Federal Circuit Court decision in a matter involving allegations of family violence.  There were three children concerned, aged five, four and three, the youngest of whom suffered from epilepsy, seizures and a developmental delay. The mother had been the primary carer of the children since separating from the father.

Background

Shortly after the mother had filed her application for parenting orders, which contained allegations of family violence by the father, an order was made by consent that “either one of the children’s paternal grandparents and/or the paternal aunt … [would] be present during the father’s time with the children …”

Subsequently, at a contested interim hearing a few weeks later in the Federal Circuit Court, Dunkley J discharged the consent orders and instead made an order that the father’s time with the children is unsupervised.  The mother appealed the decision, on the grounds that Dunkley J had not addressed the family violence issues correctly, and should also have had regard to the consent orders agreed to by both parties.

The Appeal

The Full Court held that pursuant to section 60CG of the Family Law Act 1975 (Cth) (“the Act”) when the Court is preparing to draft parenting orders, it is obliged to consider that any orders made will not place a person at risk of family violence.  The Full Court of the Family Court was of the view that had Dunkley J referred to section 61DA(3) that pertains to the presumption of equal shared parental responsibility as applying at interim hearings unless the court considers that the presumption is not appropriate in the circumstances, His Honour would have taken a more cautious approach in making interim orders.

Notwithstanding the fact that the allegations of family violence were both disputed and untested, His Honour would have, as a precautionary measure, applied section 60CG.

In interim proceedings, courts are often presented with conflicting facts, the veracity of which cannot be ascertained prior to a trial.  The Full Court acknowledged that Dunkley J did consider this and he also referred to the legislative pathway as set out in Goode & Goode (2006) FLC 93-286.  Nevertheless, they stated that findings in interim proceedings “should be couched with great circumspection”.

They referred to an earlier decision in SS & AH [2010] FamCAFC 13, where the majority of the Full Court had said:  “… It is not always feasible when dealing with the immediate welfare of children simply to ignore an assertion because its accuracy has been put in issue”.  Dunkley J had been faced with a similar dilemma in the present case.  When presented with quite serious allegations of family violence, his Honour was obliged to do more than ‘merely note the contention’ and should not ‘simply ignore an assertion because its accuracy had been put in issue’.

The problem in this case, is that although Dunkley J rightly noted that he could not, at that stage of the proceedings, make findings on the disputed allegations, he then went on to say that under those circumstances, the presumption for equal shared parental responsibility nevertheless still applied.

Dunkley J in making this inference had found that there was ‘no other evidence available to him, implying that there needed to be corroboration of the mother’s allegations, and therefore the presumption was not rebutted.  The Full Court felt this was an error, as family violence often occurs in the home, in private, and without witnesses.  Furthermore, Dinkley J had also erred when he had stated that findings could not be made ‘as to whether either party perpetrated family violence at an interim stage given conflicted evidence’ and therefore he concluded that “the civil standard of proof is met by neither”.

The Full Court regarded this conclusion as incorrect, and inappropriate in circumstances where disputed allegations of serious family violence are put forward at interim hearings.  His Honour erred, by neglecting to take note of allegations that he had previously considered ‘significant’, and by refusing to consider them at interim proceedings.

His Honour should have considered section 61DA(3) which sets out how the Court should approach the presumption of equal parental responsibility in interim orders, and that the presumption applies unless the Court believes it would be inappropriate.  The Full Court also felt that by discharging the consent orders, Dinkley J had effectively found that the allegations of family violence had not been proven at that stage and that the risk of family violence did not need to be taken into account at the interim hearing.  The Full Court said that His Honour had ‘ignored the allegations of family violence.  To do so was to perpetuate the error which has already been established”.

Accordingly, the appeal was allowed, and the orders were set aside.

New Family Court Case on Relationship between Family Law Parenting and Intervention Orders

Children – Relationship between family violence order and parenting order– Family Court of WA determines whether text messages sent by father to mother contravened violence restraining order or were sent in “an emergency” pursuant to its contact order.

In Monaco & Daniels [2016] FCWA 35 (27 May 2016) Walters J considered whether the father Mr Monaco had contravened a violence restraining order (“VRO”) by sending text messages to the mother Ms Daniels. Family violence orders are generally made under a prescribed law of a state or territory to protect a person or persons from family violence. When parenting orders are drafted, the court is made aware of any family violence orders, parenting orders can be made taking those into account, for example by having handovers in a public place.

Background

Ms Daniels and Mr Monaco began a relationship in 2003 and married the following year. They were the parents of Child A born in 2006. They finally separated in April 2011. Their relationship was described by the court as “volatile”. In November 2011, a VRO was made in a Magistrates Court, pursuant to the provisions of the Restraining Orders Act 1997 (WA). The “person protected” was Ms Daniels, and the “person bound by this order” was Mr Monaco. The VRO did not permit any contact between the parties “save and except” as provided for in a parenting order. The parenting order, made in 2013, stipulated that the parties would “only communicate with each other in relation to issues concerning [Child A’s] welfare by writing either in a communication book to be provided by [Ms Daniels] or by email and, in the event of an emergency, by SMS text message”.

The Communications between the Parties

On the morning of 18 May 2013, Mr Monaco alleged that he was at the police station at 9.45 am where the handover was due to occur at 10 am. He received a call from the mother’s phone at 10.23 am. He did not answer it but listened to the message left by child A asking what time they were meant to arrive.

In reply, the father sent the following SMS: “10 am!!” He received a second call which he let ring through to his voicemail. The message was from Child A saying that she was on her way. Shortly thereafter, the mother sent an SMS: “do not text me …”

The father left the station and sent a further SMS: “You will need to drop her off to me at Woolworths …” The mother responded: “No – I don’t feel safe doing that”.

The mother texted the father at 10.51 am saying: “Child A is waiting”. The father replied: “Where??” and received a text from the mother saying they were at the police station. Ms Daniels argued that these messages breached the VRO whilst it was Mr Monaco’s contention that the messages were sent in an emergency, permissible under the parenting orders.

Family Violence Orders and Family Law Orders

Although the VRO prohibited Mr Monaco from communicating or attempting to communicate “by whatever means” with Ms Daniels, it had been made subject to the parenting orders.

In those circumstances, His Honour felt there should not have been any inconsistencies in the duties/obligations between the two documents. And although section 68P(2)(a) of the Family Law Act 1975 (Cth)(“the Act”), required that inconsistency between these orders be specified,

His Honour felt that in this case, it was not strictly necessary as these obligations had been set out in the VRO. Correspondingly, explanations are set out in sections 68P(2)(b) and (c) did not apply. And pursuant to section 68P(4) any failure to abide by the VRO did not invalidate the parenting orders. Additionally, section 68Q(1) of the Act provided for the invalidity of the VRO insofar as it was inconsistent with the parenting orders.

Definition of “Emergency”

The Court then considered whether Mr Monaco’s text messages fell into the category of an emergency as allowed for by the family orders.

Walters J examined three dictionary definitions of the word. In the Macquarie Dictionary “emergency” means “an unforeseen occurrence; a sudden and urgent occasion for action”. The Oxford English Dictionary defines it as “the arising, sudden or unexpected occurrence (of a state of things, an event, etc.) a juncture that arises or ‘turns up’, esp a state of things unexpectedly arising, and urgently demanding immediate action”. The Merriam-Webster Dictionary also defines it as requiring “immediate action”.

The Alleged Breaches

In Walter J’s opinion, under the circumstances, Mr Monaco’s first text message “10 am!!” was authorised by the parenting orders as it was sent in a context that could be described as “a state of things unexpectedly arising and urgently demanding immediate action”. Walter J found that Ms Daniels had evidently been running late for the handover, which was to be the first overnight visit since the orders. She had not advised him she was delayed, and Mr Monaco was understandably anxious.

He received a call from her phone, which he did not answer, but upon listening to the message, found that Child A had called to clarify the handover time. It was at that point that he sent the first message.

Walters J accepted that Mr Monaco had not intended to communicate directly with Ms Daniels, although he would have been aware that his message would have been passed on to her. In fact, the intended recipient had been Child A. His Honour did not place any weight on the two exclamation marks, noting that “they indicate no more than a degree of frustration on Mr Monaco’s part”.

The second message, however, His Honour conceded could not be described as having been sent in an emergency, but was on the part of the father an attempt to alter arrangements, and was directed at Ms Daniels, and not Child A. His Honour was equally not convinced that the third text message “Where??” could be described “as having been sent in the event of or as a result of an emergency.”

His Honour determined that the alleged breach of the VRO resulted from these three short SMS messages, of which two were “innocuous”. He concluded that:

“with the exception of Mr Monaco’s text message commencing “You will need to drop her …”, the communications between Mr Monaco and Ms Daniels on the morning of 18 May 2013 were authorised, justified or excused by the provisions of para 9 of the parenting orders.

His Honour concluded that, on the morning in question, the communications between the parties “were authorised, justified or excused” by provisions in the parenting orders. “The first text occurred as a result of or in the event of an emergency, and the third text message was sent after Ms Daniels had effectively given permission to Mr Monaco to contact her on her mobile phone on that occasion.”