Varying and setting aside orders PDF

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VARYING AND SETTING ASIDE ORDERS S79A and 90SN Varying & Setting Aside Property Orders  If an order needs to be set aside or varied an application under s 79A is the source of power for this to happen.  Section 79A set outs the following:  (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  (b) in the circumstances that have arisen since the order was made it is impracticable for the order to be carried out or impracticable for a part of the order to be carried out; or  (c) a person has defaulted in carrying out an obligation imposed on the person by the order and, in the circumstances that have arisen as a result of that default, it is just and equitable to vary the order or to set the order aside and make another order in substitution for the order; or  (d) in the circumstances that have arisen since the making of the order, being circumstances of an exceptional nature relating to the care, welfare and development of a child of the marriage, the child or, where the applicant has caring responsibility for the child (as defined in subsection (1AA)), the applicant, will suffer hardship if the court does not vary the order or set the order aside and make another order in substitution for the order; or  (e) a proceeds of crime order has been made covering property of the parties to the marriage or either of them, or a proceeds of crime order has been made against a party to the marriage; S 79A and 90SN  The grounds set out in s79A(1)(a) the Court must be satisfied that there has been a miscarriage of justice by reason of various grounds which occurred at the time the order was made sufficient to warrant the exercise of the Court’s discretion to vary the Order.  Sections 79A(1)(b)-(e) involve grounds and circumstances which have arisen since the making of the Order. Fraud  For 79A applications, this is limited to a miscarriage of justice according to the law, and excludes miscarriages of justice for reasons unrelated to the judicial process: Clifton and Stuart (1991)  Fraud means “conscious wrong doing or some form of deceit” Byrne v Byrne (1965) and Taylor v Taylor (1979)  This can also include a deliberate misstatement of important information which was relied upon by the other party.  Fraud is not consistently defined in the FL Act, but the common law definition is established when it is proved that a false representation has been made knowingly, without belief in its truth; or recklessly or carelessly as to whether it be true or false, as follows:  “Fraud in this context consists of a false statement of fact which is made by one party to a transaction to the other knowingly, or without belief in its truth, or recklessly, without caring whether it be true or false, with the intent that it should be acted upon by the other party and which was in fact so acted upon” Derry v Peek (1889) as adopted by the Full Court in Green and Kwiatek (1982) Duress  Occurs where one party has induced the other to enter into a contract as a result of illegitimate pressure.

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The pressure does not need to completely overbear the will of the other party; it need only influence or deflect that will. The effect of duress is to restrict the will of a party by impacting upon their capacity to give consent.  Whilst duress is not defined in the Act, McHugh JA’s definition of duress in Crescendo Management Pty Ltd v Westpac Banking Corporation (1988) has been adopted as the test to be applied by Ryan FM in SH and DH (2003) as follows:  “A person who is the subject of duress usually knows only to well what he is doing. But he chooses to submit to the demand or pressure rather than take an alternative course of action. The proper approach in my opinion is to ask whether that pressure went beyond what the law is prepared to countenance as legitimate? Pressure will be illegitimate if it consists of unlawful threats or amounts to unconscionable conduct. But the categories are not closed.”  The party seeking to set aside or vary Orders must have been incapable of providing informed consent or of making an informed decision as a result of the conduct of the other party: Riley & Pateman [2000]  Case law has established that duress is less likely to be made out where the party seeking to set aside Orders had received independent legal advice, and were actively involved in negotiations: Morrison [1994] SH & DH (No.1) [2003]  Unlike section 90K and 90UM, which deal with the setting aside of financial agreements, equitable concepts of unconscionable conduct and mistake are not specific grounds upon which property orders can be set aside. Hiding Assets This must go beyond the mere giving of one-sided evidence and amount to willful  concealment of assets/liabilities which it was the party’s duty to put to the Court: Taylor v Taylor (1979)  The 2000 amendments to section 79A inserted the words “including the failure to disclose relevant information”, which expands the section.  Orders have been set aside under this ground where a party has failed to make full disclosure with respect to a marital asset (for example, the ownership or value of the asset), then disposed of the asset shortly after orders were made: Morrison (1995), Barker [2007], Pearce [2014]  Taylor v Taylor: “there is no reason to read ‘false’ in s 79A as meaning ‘wilfully false’, particularly since fraud is separately mentioned in the section.”  This goes to step 2: identify the pool of assets  It is important to verify the pool of assets before the parties sign consent orders or an order is made by the court.  Obtain financial disclosure such as bank statements, valuations, and obtain title searches and historical searches for real estate and companies. Section 79A(1)(b)/90SN(1)(b)  Orders may be set aside or varied where it is impracticable for an order to be carried out or impracticable for a part of an order to be carried out because of circumstances that have arisen since the order was made.  The contractual doctrine of frustration is often quoted to assist in the interpretation of this provision.  Should an intervening event occur after Orders are made, even if not caused by the fault or conduct of either party, and the terms of the Orders cannot be performed, then a court might order that the Orders be set aside.

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Eg: super balance has dropped so significantly since Covid19 that there are not enough funds to satisfy a splitting order.  However, if the Orders can be performed but results in a potentially different outcome from what was intended by the parties, then it is less likely a court will set aside the Order  In Greenwood and Greenwood 2009, the husband applied to have orders by consent set aside in the following circumstances:  The offer of finance contemplated in the orders was withdrawn by the bank;  The unforeseeable events of the global financial crises and of record floods had resulted in a significant reduction in the value of the properties;  The combination of the above factors made it impracticable for him to carry out the order; and  It was proper to construe the agreement between the parties leading to the consent orders as a contract between the parties, which contract was in turn, subject to contractual principles, including frustration. As execution of the orders in their terms had become to the husband commercially impracticable and where his fundamental assumptions had become in the course of events, invalidated, then the provisions of s79A had been made out.  The wife applied to have the husband’s section 79A application summarily dismissed. The trial judge allowed the wife’s application, stating  …In my view, the husband’s grievance, in reality, is that he may now not receive a fair and just and equitable portion of the property, but even that is not the test. His grievance is that, with the benefit of hindsight, it has proven to be commercially unprofitable to agree to pay the wife a fixed lump sum.  If the good rains had doubled the value of the property and if the wife’s expectation of receiving a 40 per cent share became a mere 20 per cent entitlement, she could not avoid her bargain by use of s 79A. Changes of fortune after a bargain is struck and final orders made do not constitute impracticability and do not otherwise constitute a ground to set aside orders properly made by this court.” Section 79A(1)(c)//90SN(1)(c) 

Where a person has defaulted in carrying out an obligation imposed on the person by the order and, in the circumstances that have arisen as a result, it is just and equitable to vary the order or to set the order aside and make another order in substitution for the order.  GAUDRY, RJ (No 1) (2004)  Orders were made providing that a property was to be sold and the proceeds divided between the parties, however,  before the property could be sold, the husband had it demolished.  The Orders were varied so that upon the sale of the property, the wife would receive an increased amount of the proceeds to counter the diminution in value of the property caused by the husband’s actions in demolishing it. Section 79A(1)(d)//90SN(1)(d  Orders may be set aside if, since the making of the Orders, a material change in circumstance has occurred (being circumstances relating to the care, welfare and development of a child of the de facto relationship) and as a result of the change, the child or the carer of the child will suffer hardship if the court does not set the financial agreement aside.  Simpson and Hamlin 1984  found that “the court must consider in the exercise of its discretion whether [the] hardship is of such a serious nature and results in such inequity that it can only be

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rectified by the extreme step of setting aside or varying an existing order of the court”. Exceptional circumstances must be “outside the normal vicissitudes of life” – for example, a change in where a child lives would not usually be considered an exceptional circumstance. Eg: child becomes profoundly disabled and the cost of caring for the child is significantly increased...