Case Note - Callis & Callis [2019]
The case of Callis & Callis was heard by the Family Court in July 2019. The case involved an application by the Wife to set aside orders which had been made by consent on the basis that the Husband has not disclosed a superannuation policy.
This case is a good example of the consequences that can arise when party’s do not comply with their disclosure obligations and why it is so important for clients to have their documents prepared properly. The case shows how simple errors in preparing the paperwork or a misunderstanding of the law can have significant impact on the parties many years after orders have been made.
The Facts
The Husband and Wife separated in mid-2007 and entered into consent orders in 2010. The consent orders and Application for Consent Orders had been prepared by the Husband without the assistance of a lawyer.
Importantly,
the Application for Consent Orders did not include either party’s superannuation policy even though the Husband had two superannuation policies and the wife had one superannuation policy. The Husband’s main superannuation account was worth around $900,000 and the Wife’s around $40,000; and
the parties both signed a certificate to say they had received independent legal advice despite neither party actually receiving independent legal advice.
In 2011 the Wife told the Husband she had thought it unfair she did not receive anything from his superannuation. The Husband offered the Wife $5,000 which she did not accept. Two weeks later he offered her $10,000. The Wife accepted and the Husband sought legal advice to prepare a document confirming the arrangement. The party’s signed an informal agreement for the Husband to pay the $10,000.[1]
In 2016 the Husband decided to retire. At this time the Wife realised she was not fully aware of the value of the Husband’s superannuation policy.
The Wife sought to have the consent orders set aside due to the superannuation policies not being included in the Application for Consent Orders. The Wife admitted that she had known about the policy when she signed the Application, however it had “passed from her mind” when she signed the document.
The Law
The Wife relied on section 79A(1)(a) of the Family Law Act and argued that the exclusion of the superannuation policies amounted to a miscarriage of justice. Section 79A(1)(a) states: -
(1) Where, on application by a person affected by an order made by a court under section 79 in property settlement proceedings, the court is satisfied that:
(a) there has been a miscarriage of justice by reason of fraud, duress, suppression of evidence (including failure to disclose relevant information), the giving of false evidence or any other circumstance; or
the court may, in its discretion, vary the order or set the order aside and, if it considers appropriate, make another order under section 79 in substitution for the order so set aside. [Emphasis added]
The Family Court referred to a decision of Waterman & Waterman where the Court said: -
The consent to the order is itself part of the judicial process on which the court places reliance. If that consent is based on misleading or inadequate information, then there may be, in our opinion a miscarriage of justice either by reason of “suppression of evidence” or “by reason of any other circumstance.[2]
The Family Court went on to say that the non-disclosure of the Husband’s superannuation policy in the Application for Consent Orders amounted to a suppression of evidence. The Court also noted that it did not matter whether the non-disclosure was on purpose or inadvertent, the result was ultimately the same. From these passages it is clear that entering into orders without having all relevant information can provide the Court grounds to set aside consent orders.
The Court also found that the party’s affirming that they had received independent legal advice, when they had in fact not received any advice, amounted to a “a significant misrepresentation to the Court”.[3] The Court found that this fact was relevant to their consideration as to whether there had been a miscarriage of justice.
The Decision
The Court was satisfied that the failure to disclose and the party’s incorrect affirmation they had received legal advice amounted to a miscarriage of justice. The Court held that the consent orders should be set aside.
The Courts comments on financial disclosure
As a final note, the Family Court also made several comments on a party’s obligations to disclosure. The Court stated, “the obligation on parties to an application for consent orders to provide full and frank disclosure is thus well settled.”[4]
The Court referred to the decision of Suiker and Suiker[5] which also involved consent orders. In that case the Court said: -
In our opinion, the necessity for full and frank disclosure of financial matters to the Court and to the other party are basic to the process of the Court and the fundamental aims of the financial legislation contained in section 79 of the Family Law Act 1975.
In our view, these passages reinforce just how important a party’s disclosure obligations are.