JAB v the executors of the estate of the late MST

Unreported Citation:

[2022] QSC 226

EDITOR'S NOTE

In this complex recent matter, a number of issues arose relating to the distribution, after the breakdown of a de facto relationship, of the property of the parties where one was deceased. The plaintiff sought equitable relief in the Supreme Court contending there was a constructive trust over certain real property. The Court held that it was unable to entertain the proceeding since the Commonwealth courts had exclusive jurisdiction to determine the property interests of the plaintiff and the deceased, as the equitable relief that the plaintiff sought fell within the definition of a de facto financial cause within the Family Law Act 1975 (Cth).

Wilson J

21 October 2022

Briefly, the plaintiff and the deceased had been in a de facto relationship which broke down prior to his death. The defendants are executors of the deceased estate. [1]. In 2002 the deceased purchased a property. [2]. Notwithstanding that it was in his name alone, the plaintiff sought:

(a) A declaration that she was entitled to be registered as the sole proprietor of the property pursuant to the transfer executed by the deceased on 12 March 2016.

(b) In the alternative, a declaration that the defendants as the executors of the estate of the deceased held any right, title and interest they may have in the property upon trust for her and the deceased in equal shares, or, alternatively, in the proportions of their contributions to the property.

The defendants argued that there was never any joint endeavour [8] and further that the deceased had not only not executed the transfer but the signature on it was not his. [9].

Earlier proceedings between the parties for property division in the relevant Commonwealth courts

The plaintiff had previously brought proceedings relating to the property the subject of the current proceedings in the Federal Circuit Court. [37]. The proceedings were dismissed on appeal (albeit the Federal Circuit Court would have had jurisdiction to determine the plaintiff’s application if it had been instituted in time). [41].

The jurisdiction issue

Section 39A Family Law Act 1975 specifies that proceedings in de facto financial causes (i.e. relating to the distribution, after the breakdown of the de facto relationship, of the property of the parties or either of them) may only be brought in:

(a) the Federal Circuit and Family Court of Australia (Division 2); or

(b) the Supreme Court of the Northern Territory of Australia; or

Section 39A(5) clarifies that a de facto financial cause that may be instituted under the Act must not, after the commencement of s 39A, be instituted otherwise than under its provisions.

Section 39B of the Act confers jurisdiction in relation to de facto financial causes upon:

(a) the Federal Circuit and Family Court of Australia (Division 2); and

(b) the Supreme Court of the Northern Territory of Australia;

with respect to matters arising under the Act in respect of which de facto financial causes are instituted under the Act.

Subsection (2) further provides that each court of summary jurisdiction of each referring State is invested with federal jurisdiction with respect to matters arising under the Act in respect of which de facto financial causes are instituted under the Act.

Her Honour noted that Farrall v Money [2012] QCA 262 and Massalski & Riley [2021] FamCAFC 116, wherein the courts held that proceedings of a similar nature were only to be dealt with by the Commonwealth courts, provided some support for the defendants’ position. Her Honour took the view that the plaintiff’s claims for relief were de facto financial causes as they concerned the distribution, after the break down of the de facto relationship, of the plaintiff and the deceased’s property, or the property of either of them. [90]. It followed that they also fell within the exclusive jurisdiction of the Commonwealth Courts. [86]. In her Honour’s view the plaintiff had sought to circumvent the result of the prior decision of the Full Court of the Family Court by “cherry picking” a single property from the asset pool and seeking orders exclusively in respect of that individual property. [87]. She noted that that practice did not result in the matter escaping the meaning of a de facto financial cause. [92].

Unfortunately for the plaintiff, she had been in a position to bring the claim pursuant to the Family Law Act 1975 de facto regime in the Commonwealth courts had she met the time limitations under that regime. [96]. Nor was it the case that the plaintiff’s claim had subsequently lost its character as a de facto financial cause due to the outcome of the proceedings before the Full Court of the Family Court of Australia (see Emerald v Emerald [2018] FamCAFC 217). It remained a de facto financial cause and fell within the exclusive purview of the Commonwealth courts. [98]. As such the plaintiff was left without any forum in which to bring her equitable claims. [99]. Disposing of the matter, her Honour pithily stated:

“The plaintiff’s failure to litigate her cause of action within the legislative bounds of the FLA does not mean that the exclusive jurisdiction of the FLA did not exist, whereby she can re-litigate her cause of action in this Court under a rebadging of what is essentially the same claim”. [103].

Disposition

The Supreme Court of Queensland did not have jurisdiction to determine the proceedings and the plaintiff’s claim was dismissed.

A Jarro