Webster v Webster S14/1999 [1999] HCATrans 378 (8 October 1999)

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry

Sydney No S14 of 1999

B e t w e e n -

LEONIE ANGELIQUE WEBSTER

Applicant

and

IAN EDWARD LEON WEBSTER

Respondent

Application for special leave to appeal

GAUDRON J

KIRBY J

TRANSCRIPT OF PROCEEDINGS

AT SYDNEY ON FRIDAY, 8 OCTOBER 1999, AT 12.20 PM

Copyright in the High Court of Australia

MR D.E. GRIEVE, QC: May it please your Honours, I appear with MR G. RICHARDSON, SC, for the applicant. (instructed by Barkus Pearson)

MR M.D. BROUN, QC: I appear for the respondent. (instructed by Stuart Fowler & Associates)

MR GRIEVE: By section 79(1) of the Family Law Act the Family Court is empowered to make:

such order as it considers appropriate altering the interests of the parties in the property -

of them or either of them. And by subsection (2), it may only do so if:

it is satisfied that, in all the circumstances, it is just and equitable to make the order.

By subsection (4), it is bound to take seven stipulated matters into account. The fifth is stated to be:

(e) the maters referred to in sub-section 75(2) so far as they are relevant.

Section 75 is, in terms, by subsection (1), expressed to be primarily referable to the exercise of "jurisdiction under section 74", that is to say, "In proceedings with respect to the maintenance". Some of the matters referred to in section 75(2) are only apposite to the question of maintenance. For example, (h), (j), (k) and (n). Indeed, (n) introduces, if it were apposite to section 79, an element of circularity which cannot obviously have been intended.

The question we submit is of public importance is the true extent of the interrelation between these two subsections.

GAUDRON J: Well, what is your submission on that?

MR GRIEVE: Our submission on that is that section 75(2), when imported into section 79, does not operate to confer upon the Family Court a discretion at large without regard to the impact of its findings under subsection - - -

GAUDRON J: Well, that is not very precise. You say that it is not excluded from the discretion that was being exercised in this case.

MR GRIEVE: No. We say that in this particular case the findings under subparagraphs (a) and (b) were such as practically to deny the existence of any section 75(2) discretion.

GAUDRON J: Why?

MR GRIEVE: Because those findings exhausted the justice and equity required by section 79(2). The point that we endeavour to advance as the special leave point is that section 75(2) is not of invariable application. It is not a subsection which must be brought in for consideration by the Family Court in every case. Yet, it appears that is the approach that the Family Court has chosen to take in this case.

GAUDRON J: Yes. Well, your submissions do not go so far as to say that that is impermissible generally. You go so far as to say "should not have happened in this case". But how does that raise the question of special importance.

MR GRIEVE: I am sorry, I have not put the point very well. The point that we wish to contend is that in certain cases it is impermissible to go so far as to invoke section 75(2).

GAUDRON J: Well, what are those cases?

MR GRIEVE: Those cases are where, having dealt with the matters in subparagraphs (a) and (b) and, perhaps, (c), the court has - - -

GAUDRON J: Of section - - -

MR GRIEVE: Of section 79(4), the court has, as it were, reached a conclusion that is just and equitable as required by section 79(2) so as not to require or allow itself to go the next step of giving some sort of top-up under section 75(2).

The court appears to have taken the view in this case and, as we understand it, in most, if not all cases, that it is duty bound, notwithstanding the result of the section 79(4)(a), (b) and, perhaps, (c) inquiry, notwithstanding the result of that inquiry, it is bound to go on and inquire into the section 75(2) considerations.

KIRBY J: Why is that not a sensible construction of the Act, given that it, in a sense, is like sentencing, that you go through the particular steps but then you look back and see the general principles?

GAUDRON J: And I would have thought the use of the word "shall" makes it clear that that is the correct interpretation.

MR GRIEVE: In our submission, the word "shall" in 79(4) is qualified by the language of subsection (2):

shall not make an order.....unless satisfied -

et cetera. Our submission comes to this: that if satisfied at the end of the (b) or perhaps (c) inquiry, that an order is just and equitable, then that is where the court stops. To develop the analogy of sentencing, the rule there proceeds in a reverse direction, that the court cannot impose, for example, a custodial sentence without having first exhausted all of the earlier inquiries.

KIRBY J: That is true, but you will know that many of the principles of sentencing are incompatible or inconsistent.

MR GRIEVE: Quite.

KIRBY J: So that you then have to get to the end of the process and consider whether the net result of your analysis has led you to something which is out of kilter with what is just in the particular case.

MR GRIEVE: In our submission, if - - -

KIRBY J: Why is that not how this Act is structured?

MR GRIEVE: In our submission, if one is applying the sentencing analogy and one goes through the process of bond, fine, et cetera, the process being up the incline, so to speak, and let us assume that one, at the stage of "fine" says, "That is appropriate. I need not go further. I need not consider a custodial sentence.", in that sense, the analogy holds. We submit that once the court - - -

KIRBY J: I have led you into this and it is not a particularly good analogy because here we are dealing with a statute and most of the sentencing principles, though not all of them, in the federal sphere are matters of common law but this is a problem with discretions which are harnessed discretions, that if you simply stick to the little bits and pieces, that you do not come back and look at the overall. That is what the just and equitable obligation seems to do and that does not seem a bad sort of principle.

MR GRIEVE: Understood, but our point is, with respect, this, that if one pauses at the end, let us say, of the inquiry under section 79(4)(b), if one pauses at that point and looks at the totality of the position and finds that the requirements of justice and equity dictated by section 79(2) are then and there met, by looking at the matter in its totality, in our submission, why the need, if any, to go further?

GAUDRON J: But is there, in fact, that finding? There is not that finding, is there?

MR GRIEVE: Well, in our submission, there was at the primary stage and in the intermediate appeal the absence of reasons as to why their Honours took the next step or the paucity of reasons as to why their Honours took the next step - - -

GAUDRON J: Disparity. They gave their reasons: "disparity", bringing you straight into section 75(2)(b).

MR GRIEVE: If that is the true reason, and I accept, with respect, that certainly that would appear to be so if one has regard to 128 of the book, that arguably takes the matter beyond the ambit of the discretion under section 75 in any event. In our submission, the disparity that arose did not arise by reason of the marital relationship, it was not a disparity which arose from - - -

GAUDRON J: It arose by reason of the property settlement that was to be made.

MR GRIEVE: Indeed.

GAUDRON J: If regard was not had overall to the income, et cetera, of each of the parties.

MR GRIEVE: No, no, no. In our submission, with respect, the disparity arose by reason of the fact prior to the proceedings the wife had effectively inherited a very, very substantial estate from her late father. That is where the disparity came from. It did not, thus, arise out of the marital relationship, and the extent to which the court may have taken that disparity into account, arguably it was acting beyond power in light of what this Court said in Dougherty. And perhaps could I just hand up to your Honours copies of the decision in Dougherty 163 CLR 275. The passage in question is at 286. The reference is there made to the definition of "matrimonial cause" which, by amendment of 1983, includes:

proceedings between the parties to a marriage with respect to the property of the parties to the marriage or either of them being proceedings -

(i) arising out of the marital relationship.

Chief Justice Mason, and Justices Wilson and Dawson commented as follows:

This paragraph requires that proceedings between the parties to a marriage with respect to property should arise out of the marital relationship. By this means a limit is imposed upon the jurisdiction of the Family Court to make an order under s 79 where the parties are parties to a marriage. Proceedings of that kind which do not arise out of the marital relationship do not constitute a matrimonial cause -

et cetera.

Now, if their Honours were saying, in effect, "We regard ourselves as entitled to exercise our discretion under section 75(2) because by reason of the fact that one of the parties to these proceedings is an heiress who has inherited a very substantial sum of money and there therefore exists a disparity in the relative wealth of the two parties - - -"

GAUDRON J: That is not what happened. The court went through 79 matters; came to the conclusion that when one had regard only to (a), (b) and (c) and (d) perhaps, it was nonetheless not just and equitable and one therefore ought to have regard to the matters referred to in 75(2).

MR GRIEVE: Yes. And the only matter which they appear to have had regard to was subparagraph (b) which, rather like (n), is circular and, in our submission, really only has proper application to matters of a maintenance character rather than matters of a property character. To read it otherwise is simply to revisit the matters raised by section 79(4)(a) and (b). In our submission, that is the question of importance. The sections are, of course, invoked every day of the week in the Family Court and I am told by my instructing solicitor and junior who both specialise in that jurisdiction that the uncertainties that attend to the so-called section 75(2) factors are such as to make significant contribution to the lack of resolution of these matters by compromise and that is why, in our submission, the time has come for there to be some guidelines to be laid down by this Court as to the manner in which that discretion ought to be exercised. May it please your Honours.

GAUDRON J: We need not trouble you, Mr Broun.

There is no error of principle to be discerned in the approach taken by the Full Court in the circumstances of this case. Accordingly, special leave is refused.

MR BROUN: Costs, please, your Honours.

MR GRIEVE: Yes, we have acknowledged that.

GAUDRON J: You have acknowledged that?

MR GRIEVE: Yes.

GAUDRON J: It is refused with costs.

The Court will adjourn to take the matter of Cheng, Cheng and Chan.

AT 12.35 PM THE MATTER WAS CONCLUDED