Re Jamie
[2013] FamCAFC 110 (31 July 2013)
(Bryant CJ, Finn and Strickland JJ)

Bevan & Bevan
[2013] FamCAFC 116 (8 August 2013)
(Bryant CJ, Finn and Thackray JJ)

Wallace & Stelzer and Anor
[2013] FamCAFC 199 (11 December 2013)
(Finn, Strickland and Ryan JJ)

Kane & Kane 
[2013] FamCAFC 205 (18 December 2013)
(Faulks DCJ, May and Johnston JJ)

Commissioner of Taxation & Darling and Anor
[2014] FamCAFC 59 (4 April 2014) 
(Thackray, Strickland and Murphy JJ)

In 2013–14, judges of the Family Court of Australia handed down judgments at both first instance and appellate levels. The decisions reflect the Court's expansive jurisdiction, the wide variety of issues that it addresses, and its position as a superior specialist federal court that deals with the most complex and serious family law cases.

A selection of significant and noteworthy judgments are published in this report. The Court recognises that the accessibility of its judgments to the public is important. It commits the resources required to ensure that every final judgment delivered is anonymised and published consistent with s 121 of the Family Law Act 1975 (Cth).

Virtually all judgments, after anonymisation, are published in full text on the Australasian Legal Information Institute (AustLII) website. There is a link to the AustLII site from the Court's website (www.familycourt.gov.au). Recent decisions are also published on the Court's website for a period of two months. This policy has enabled the Court to better respond to community interest and concerns about particular cases highlighted in the media and demonstrates the commitment of the Court to being open and accountable for its judgments.

Re Jamie

[2013] FamCAFC 110 (delivered 31 July 2013) (Bryant CJ, Finn and Strickland JJ)

Appeal—medical procedure which requires court authorisation—gender identity disorder

In this matter the Full Court considered the question of whether treatment for gender identity disorder is a medical procedure which requires court authorisation under its welfare or parens patriae jurisdiction pursuant to s 67ZC of the Family Law Act 1975 (Cth).

The child, 'Jamie' was aged almost 11 at the time of the first instance hearing and had been diagnosed with childhood gender identity disorder. Orders had been made by Dessau J to authorise Jamie's parents to consent, under the guidance of the treating medical practitioners, to commence stage one of the treatment of the disorder: namely to administer the hormone suppressant drugs which affect the onset of male puberty. The appeal raised the point of law as to whether the Court's authorisation was necessary for the parents to consent to the treatment or whether it formed part of their parental responsibility, with the orders made at first instance consequently being outside the Court's jurisdiction and requiring to be set aside.

The Full Court noted that of the two stages to the treatment process, stage one (the administration of medication) was found to be fully reversible while stage two had been found to be irreversible without surgical intervention. Stage two of the treatment would not be recommended for commencement until the child reached the age of around 16 years old.

The Full Court considered the Marion's Case and the subsequent use of the phrase of "special medical procedures", which Bryant CJ found to be unhelpful terminology [153] and should preferably be replaced with the expression "medical procedure which requires court authorisation."

The Full Court noted that in cases where there is disagreement between the parents, their child and/or treating medical practitioners, court authorisation would still be necessary [172]. However, in this case, the parents, child and doctors were all in agreement. Similarly, special considerations might well apply in a case where the child was under the legal guardianship of a government department or official [173].

It was held that the first stage of the treatment did not require court authorisation, in a situation where the child's parents and treating practitioners agreed on the proposed treatment [179].

Regarding stage two of the treatment, however, the Full Court noted that in Marion's Case the High Court had referred to the "significant risk of making the wrong decision" and the "particularly grave" consequences of a wrong decision in the context of certain irreversible medical procedures. The High Court had held that sterilisation was such a procedure and therefore required court authorisation [181]. The Full Court held that "such risks of a wrong decision and the grave consequences of a wrong decision must similarly exist in relation to stage two of the proposed treatment" [182]. Unlike Marion's Case, however, as the treatment would commence at around 16 years of age, it was possible that the child would be capable of giving her own consent to medical treatment in accordance with the test of Gillick competence. The Full Court held that if the child was "Gillick competent" and therefore able to fully understand and give informed consent to stage two, then she could consent to the treatment. However, the question of whether the child had Gillick competence would remain a matter for the Court to decide [186].

Bevan & Bevan

[2013] FamCAFC 116 (delivered 8 August 2013) (Bryant CJ, Finn and Thackray JJ)

Appeal—property settlement—consideration of the High Court's decision in Stanford & Stanford(2012) 247 CLR 108

In this matter the wife appealed the trial judge's decision that it was just and equitable to alter existing property interests when the parties had largely lived apart for 18 years and the husband had told the wife she could retain the assets.

The Full Court considered the decision of Stanford, as it was submitted on behalf of the wife that the trial judge had applied it inappropriately. Bryant CJ and Thackray J considered the High Court's position regarding the four step process:

Although the High Court did not disapprove the four step process, we accept it was not approved either. Given the way the matter was resolved, there was no requirement for a pronouncement either way. However, the High Court's decision serves to refocus attention on the obligation not to make an order adjusting property interests unless it is just and equitable to do so. [65]

Their Honours summarised the three "fundamental positions" in Stanford and noted that the third "demands separate consideration of the preliminary question of whether it is just and equitable to make any order altering property interests before the need arises to consider the extent to which existing interests are to be altered and the manner in which that is to be done." [81]

At paragraph 86, their Honours declined to describe this separate enquiry as a "threshold" issue. However, the issues from s 79(2) and s 79(4) must not be conflated, although "they are intertwined because the text of the Act links them" [87].

Ultimately, their Honours held that,

In our view, it will be less likely that the separate issues arising under s 79(2) and s 79(4) will be conflated if judges refrain from evaluating contributions and other relevant factors in percentage or monetary terms until they have first determined that it would be just and equitable to make an order. [89]

The Full Court consequently found merit in the wife's ground of appeal that the trial judge had conflated the two questions.

Further, it was found that the trial judge erred in saying "there was 'no requirement to consider what representations the parties may have made during the marriage or subsequent to separation.' In our view, such representations clearly could be relevant in determining whether it was just and equitable to make an order adjusting existing interests." [111]

Having found merit in some of the grounds of appeal, their Honours stood the matter over, allowing the parties to make further submissions regarding redetermination of the matter.

After considering the parties' further submissions, the Full Court ultimately allowed the wife's appeal and re-exercised the discretion of the trial judge. In re-exercising the discretion, the Full Court found that it was not just and equitable to make an order altering the parties' existing property interests and therefore dismissed the husband's application for property settlement (see Bevan & Bevan [2014] FamCAFC 19).

Wallace & Stelzer and Anor

[2013] FamCAFC 199 (delivered 11 December 2013) (Finn, Strickland and Ryan JJ)

Appeal—financial agreements—the effect of the Federal Justice System Amendment (Efficiency Measures) Act (No. 1) 2009 (Cth)

In this matter the Full Court considered the effect of the Federal Justice System Amendment (Efficiency Measures) Act (No.1) 2009 (Cth) ("the 2009 amendments") on financial agreements entered into between 14 January 2004 and 4 January 2010. The 2009 amendments introduced changes to s 90G of theFamily Law Act 1975 (Cth) and the requirements for a financial agreement to be binding. The essential questions before the Full Court were, what were the provisions of s 90G(1) which applied to determine whether or not the financial agreement in this case was binding, and were those provisions complied with? To the extent that the 2009 amendments operate retrospectively, there was also a challenge to their constitutional validity.

In this case the husband and the wife executed a financial agreement on 29 September 2005, about a week before they were married in early October 2005. The agreement contained Recital W which set out that each party had received legal advice in accordance with requirements of s 90G(1)(b) as it stood in September 2005. Legal advisers' certificates of both the husband and the wife's lawyers were annexed to the agreement. The certificates were in the form as required by s 90G as it stood prior to amendments made in 2003. The certificates attached to the agreement therefore did not comply with the requirements of s 90G as it stood in September 2005.

The parties separated in May 2007 and in August 2007 the husband commenced proceedings for a declaration that the agreement was not binding and, in the alternative, that the agreement be set aside pursuant to s 90K on the basis of fraud or unconscionable conduct on the part of the wife. While those proceedings were pending, the Full Court delivered its decision in Black & Black (2008) FLC 93-357 which relevantly held that strict compliance with s 90G was required for financial agreements to be binding. In response to Black & Black, and before the proceedings between the husband and the wife were determined, the 2009 amendments were introduced which, through changes to s 90G and the introduction of s 90G(1A), prospectively and retrospectively changed the requirements for a financial agreement to be binding. When the matter came on for trial, the husband raised issues of the statutory construction and constitutional validity of the amendments. Because those issues were raised, the Attorney-General for the Commonwealth intervened in the proceedings. Ultimately, the trial judge held that the financial agreement between the parties was binding.

On appeal the husband advanced a number of arguments. By the first argument the husband contended that the 2009 amendments, properly construed, could not operate retrospectively, with the effect being that the financial agreement between the husband and the wife did not strictly comply with s 90G as it stood when it was executed in 2005 and was therefore invalid. The essential submission put in support of this argument was that certain sub-items in items 8 and 8A of the transitional provisions of the 2009 amending Act were mutually inconsistent.

The husband's first complaint as to inconsistency related to items 8(1) and 8A(2). Counsel for the husband submitted that item 8(1) provides for s 90G, as inserted by the 2009 amendments, to apply to all financial agreements, but that the literal meaning of item 8A(2) is that agreements entered into between 14 January 2004 and 3 January 2010 are required to comply with s 90G(1)(b) as it stood prior to the 2009 amendments. The two items, the husband's counsel submitted, are incompatible and therefore both must be struck down as invalid. The Full Court accepted that there was an inconsistency between the two transitional provisions. However, the Full Court preferred the submission by the Attorney-General that the inconsistency could be overcome by reading item 8A(2) as operating in addition to item 8(1) and providing for additional circumstances in which a financial agreement can be binding.

The second complaint as to inconsistency related to items 8(6) and 8A(3). These items provide for the form of evidence as to receipt of legal advice that has to be provided by a party's solicitor for a financial agreement to be binding. The Full Court accepted that item 8A(3) can be read as a drafting error, and the inconsistency between the two transitional provisions is overcome if item 8A(3) is read as being omitted and therefore has no effect.

The husband also argued that the trial judge had erred in failing to find that the retrospective application of the 2009 amendments is unconstitutional because the effect of the amendments is in impermissible direction by Parliament to the court to apply the retrospective provisions of items 8 and 8A. The Full Court found that the retrospective aspects of the 2009 amendments do not direct the court 'as to the manner and outcome of the exercise of its discretion in a particular case'. Rather, the 2009 amendments establish 'a general legal regime concerning financial agreements which applied to all relevant individuals' and are not of an ad hominem nature. The Full Court therefore found that the 2009 amendments are not a usurpation of judicial power by the legislature, and are therefore constitutionally valid.

The Full Court further found that there was no merit in the husband's challenges to the trial judge's findings as to the adequacy of legal advice provided to the parties and his Honour's rejection of the husband's claim that the agreement was obtained by fraud or unconscionable conduct on behalf of the wife.

The Full Court, however, allowed the appeal in part in order to correct the commencement of the date from which interest was payable by the husband to the wife.

The husband sought special leave to appeal to the High Court. However, Hayne, Kiefel and Bell JJ refused the application, saying 'there is no reason to doubt the correctness of the conclusions reached by the Full Court'.

Kane & Kane

[2013] FamCAFC 205 (delivered 18 December 2013) (Faulks DCJ, May and Johnston JJ)

Appeal—property settlement—notion of special contributions found to predispose an outcome

In this matter the wife appealed the trial judge's property settlement orders which had the effect of dividing the parties' superannuation interests on a two thirds to one third basis in favour of the husband. The Full Court considered the wife's challenge to the trial judge's finding that the husband, by reason of 'special skills', had made a greater contribution to the parties' superannuation interests.

The Full Court allowed the wife's appeal, with May and Johnston JJ delivering a joint judgment and Faulks DCJ delivering separate reasons.

The trial judge found that the husband, largely using funds in which the parties had an equal proprietary interest and to which they had made equal contributions, conducted diligent research and used skill 'in his decision to invest the parties' funds [which] was an inspired investment decision, manifesting considerable expertise.' The trial judge further found that 'the law does presently recognise a principle in which weight is attributed to the special skill of a spouse.'

On appeal, May and Johnston JJ held that the trial judge gave excessive weight to the husband's contribution to the parties' superannuation interests which resulted in orders that were not just and equitable in the circumstances of the case. In their discussion May and Johnston JJ noted Murphy J's decision in Smith & Fields [2012] FamCA 510 and agreed that,

...the notion of "special contributions" necessarily predisposes matters to an outcome that may not otherwise be available upon a proper assessment of all the contributions.

Their Honours went on to say, however, that,

No doubt in any particular case a judge might find that there is a contribution by one party (being financial or other than a financial contribution) which outweighs the others but it is essential that such conclusions reflect what the legislation demands.

In his separate reasons for judgment Faulks DCJ specifically rejected the notion of a 'special skills doctrine'. His Honour said,

To the extent that the trial judge believed himself to be obliged by authority to determine the division of the property of the parties by reference to some doctrine acknowledging "special skills" in my opinion ... he was mistaken. The Act does not require and in my opinion the authorities do not mandate, any such doctrine and if judgments of the Full Court of this Court might be thought to have espoused such a principle in my opinion, they should no longer be regarded as binding.
...It appears that his Honour may in the context of what he saw the law to be, have given an unacceptable weight to the "special skills" of the husband as he saw them to be.

Having found merit in the wife's appeal, the Full Court remitted the matter to a single judge of the Family Court of Australia for rehearing.

Commissioner of Taxation & Darling and Anor

[2014] FamCAFC 59 (delivered 4 April 2014) (Thackray, Strickland and Murphy JJ)

Appeal—implied obligation extends to third parties—Commissioner of Taxation not released from implied obligation by statute

In this matter the Commissioner of Taxation appealed from the trial judge's refusal to release him from an implied obligation not to use documents produced in litigation for a purpose not related to the respondents' Family Court proceedings in circumstances where the Court administrative staff granted the Commissioner access to the Court file after the use of the Commissioner's coercive powers.

The Full Court considered the Commissioner's arguments on appeal that the implied obligation does not bind strangers to litigation and, in the event that the obligation does extend to strangers to litigation, any implied obligation yields to inconsistent statutory provisions in the Income Tax Assessment Act 1936(Cth).

In response to the first argument the Full Court considered the High Court authority of Hearne v Street (2008) 235 CLR 118 and held,

The plurality in Hearne v Street accepted that the implied obligation extends not only to parties, but to "anyone else" into whose hands documents come, provided they knew the material was generated in legal proceedings.

...

The primary purpose of the [implied obligation] principle is to protect privacy and encourage frank disclosure in litigation. This purpose would not be fostered by reading down the principle.

In response to the Commissioner's second argument the Full Court applied the principle of legality and said that 'the implied obligation will not be abrogated by statute unless that abrogation is brought about by words of irresistible clarity.'

The Full Court considered the text of ss 166 and 167 of the Income Tax Assessment Act 1936 (Cth) and held that they were unable to find anything in those provisions which 'could be construed as "clear words" relieving the Commissioner from compliance with the implied obligation.' The Full Court also held that there was nothing in the legislation which gave rise to a necessary implication that the Commissioner was relieved from compliance.

The Full Court, however, allowed the appeal on the basis of a further complaint by the Commissioner that the trial judge had erred by imposing evidentiary requirements which were not necessary. The Full Court re-exercised the discretion and made a number of findings, including that the Commissioner was performing a public duty, was engaged in a substantial and targeted audit, the cogency of the evidence obtained would be the subject of scrutiny in any proceedings the Commissioner institutes and there were restrictions on the Commissioner's use of the documents. In those circumstances the Full Court released the Commissioner from the implied obligation. In doing so the Full Court said that it was not persuaded that 'relieving the Commissioner of the implied obligation in some cases is likely to result in any greater disincentive to parties to be frank with the Court.'