Chung v Yang[2021] QDC 68

DISTRICT COURT OF QUEENSLAND

1. [1]
   The applicant and the respondent were in a de facto relationship from about 2011 until 2017. On the 10^th of May 2018, the respondent instituted proceedings in the Federal Circuit Court of Australia (FCCA) for property settlement.  Interestingly, the orders sought in that application were: 

1. (1)
   That within seven days, the respondent repay the applicant $191,789.47. 

2. (2)
   That the respondent do all acts within 30 days to return the properties that belong to the applicant including precious jewelleries, electronic items, clothing and other personal accessories as listed in annexure A. 

3. (3)
   That the parties do all acts to sell the car, and the proceeds of the sale will be split 50 per cent to the applicant and 50 per cent to the respondent. 

2. [2]
   It must, of course, be remembered that the identification of the parties in that case was different from here. The applicant in that case is the respondent here, and the respondent in that case is the applicant in the matter before me.

3. [3]
   The applicant in these proceedings filed an affidavit in those proceedings in response to the application. It is unnecessary to set out the conflicting views identified in the affidavits filed, other perhaps than to observe that there appears to have been a real factual contest in that Court.

4. [4]
   On 13 November 2019, an order was made in the FCCA setting the matter down for conciliation conference on 3 December 2019. On that day, both parties were legally represented. An agreement was reached, effectively:

3. (1)
   That the applicant in those proceedings discontinue her application.

3. (2)
   That the respondent in those proceedings discontinue his response and also, it seems, an application in that case filed on the 6th of November 2018.

3. (3)
   That each party bear its own costs.

5. [5]
   The respondent has then filed these proceedings claiming:

3. (1)
   A declaration that the defendant holds on trust for the plaintiff by way of resulting trust:

3. (a)
   the sum of $191,789.47 (being the monies making up the inheritance pleaded in the statement of claim);  and

3. (b)
   any accretions on the sum in subparagraph 1(a) of the claim, by way of interest;  and

3. (2)
   An order requiring the defendant to transfer to the plaintiff the assets identified in paragraph 1 of this claim.

3. (3)
   In the alternative, equitable compensation in the sum of the value of the assets identified in paragraph 1 of the claim, for the defendant’s breach of trust.

3. (4)
   For damages in the amount of $9000 for conversion by the defendant of the plaintiff’s 2009 Holden Commodore motor vehicle.

3. (5)
   Damages in the amount of $21,500 for conversion by the defendant of the plaintiff’s personal effects pleaded in the statement of claim.

6. [6]
   The plaintiff also sought interest and costs. It can be seen that the respondent appears to be seeking orders relating to the same property the subject of the Federal Circuit Court of Australia litigation, though somewhat differently characterised.

7. [7]
   The applicant has filed an application seeking orders for a declaration pursuant to rule 16(a) of the UCPR that this proceeding has not, for want of jurisdiction, been properly started, and an ancillary order setting aside the claim and statement of claim. He also seeks alternative orders and orders for costs on an indemnity basis.

8. [8]
   The application really involves consideration of the terms in section 39A(5) of the Family Law Act, which commenced on the 1st of March 2009.  That section, relevantly, provides: 

“Instituting proceedings

3. (5)
   A de facto financial cause that may be instituted under this Act must not, after commencement of this section, be instituted otherwise than under this Act.” 

9. [9]
   It is clear from consideration of the Act and from the decision of the Court of Appeal in Farrall v Money [2012] QCA 262 that if the respondent’s claim in this Court falls within the ambit of a “de facto financial cause” as the term is used in section 39A(5) and as defined in section 4 of the Family Law Act, that this Court has no jurisdiction to hear the matter.  In section 4 of that Act, a de facto financial cause is defined to include: 

3. “(c)
   proceedings between the parties to a de facto relationship with respect to the distribution, after the breakdown of the de facto relationship, of the property of the parties or either of them.” 

10. [10]
    It is not here disputed that the applicant and the respondent were in a de facto relationship which broke down prior to the institution of the FCCA proceedings and which continued in duration for a period in excess of two years.

11. [11]
    The respondent opposes the application on the basis that at the time of the conciliation conference in the FCCA, the respondent believed that as the matter concerned the determination of the existence of a resulting trust and not a de facto financial cause, the proper forum was this Court.

12. [12]
    Counsel further submitted that the December 2019 orders provided that the respondent and the applicant discontinue the matter and that each party bear their own costs. The parties adhered to the orders and, it is said, there was no reference to a separate written or oral agreement containing additional terms, including any release of the applicant from future claims. It was further submitted the respondent was not aware of any such document containing any terms whether made in writing or orally, and that no such terms had been particularised by the applicant. Finally, it said that the parties are, therefore, not bound by any property settlement terms and the respondent did not relinquish her rights to any future claims by the discontinuance.

13. [13]
    He next submitted that the funds of $191,789.47 which had been inherited by her were held in the parties’ joint account by way of a resulting trust or, alternatively, constructive trust and that consequently they “did not form part of the property pool of the de facto relationship”, this Court has jurisdiction to determine the existence of such a trust. He further submitted that the action with respect to other property in dispute was a claim in tort for conversion and, by reason of section 68 of the District Court of Queensland Act, within the jurisdiction of the Court. 

14. [14]
    In my view, the fundamental error in such a submission concerns the contention that the claim in this Court, does not come within the definition of a “de facto financial cause” within the Family Law Act.  It is, I conclude, a proceeding between the parties to a de facto relationship with respect to the distribution, after the breakdown of the de facto relationship, of the property of the parties or either of them.  I should add, that in this case, the facts of a de facto relationship, its duration of at least two years and its ceasing after the 1^st of March 2009, are undisputed. 

15. [15]
    Such facts have been described as jurisdictional facts by Murphy J, in the decision of Fenton v Marvel (2013) 51 Fam LR 142.  I mention that because in some matters that come before the Court, the existence of the de facto relationship, its cessation after the 1st of March 2009, or its continuation for a period of two years might need to be considered by a Court in deciding whether or not there is jurisdiction.  At paragraphs 49 to 58 of his Honour’s judgment, his Honour helpfully summarises the law in respect of those matters including, for example, such things as aggregation of periods and the need to establish not just that there was a relationship, but a de facto relationship.  Courts in considering such matters, might need to turn their mind to that case.

16. [16]
    I should mention also, a decision of Scanlon v McLeay [2018] QDC 17, which was relied on by counsel for the respondent.  That case involved the breakdown of a de facto relationship.  The trial judge in that matter made declarations in respect of property the subject of the application.  It seems, although it was not clearly set out, that the facts of that case would have meant that the application of the jurisdictional facts, as considered by Murphy J in Fenton v Marvel (supra), would have meant that that matter was within the jurisdiction of Courts exercising powers under the Family Law Act. 

17. [17]
    It does not appear from consideration of the judgment that such matters were the subject of discussion or argument before the trial judge.

18. [18]
    In the circumstances, I think that the better view is that, consistent with the approach of the Court of Appeal in Farrall v Money (supra), the cause of action sought to be litigated in this matter is a de facto financial cause.  Accordingly, I determine that this Court does not have jurisdiction to deal with the matters the subject of the claim.  In the circumstances, I will strike out the claim and statement of claim. 

Orders:

1. It is declared that the proceeding has not, for want of jurisdiction been properly started. 

2. The claim and statement of claim should be set aside. 

3. The plaintiff is to pay the defendant’s costs of the proceeding on the standard basis.