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News: Report of High Court Judgment O’C –v- O’C
O’C (C) –v- O’C (D) (2009) IEHC 248
High Court (Dunne J.) 14th May, 2009
- Judicial Separation and Family Law Reform Act 1989 - The Family Law Act 1995 - Consent Orders - Non compliance with some of the Terms of Settlement - Application to vary Consent Orders in the context of economic conditions - Property Adjustment Orders - Variation Orders - Proper provision
Facts
The Applicant mother initiated Proceedings seeking a Judicial Separation in respect of her marriage to the Respondent father. A number of properties were owned by the parties including the family home known as “Cluain Ard” and a property known as “The Rivers”, which was subject to a mortgage in favour of Anglo Irish Bank and in which the Respondent resided. There were six children of the marriage and at the time of the hearing before the High Court, four of the children lived with the Applicant while the remaining two children resided with the Respondent. The Judicial Separation Proceedings were Listed for Hearing on the 7th February 2008 whereupon the Proceedings were compromised and the terms were reduced to writing.
The Settlement included, inter alia, terms in relation to the payment of maintenance together with cross orders in respect of a number of properties owned by the parties pursuant to Section 9(1) of the Family Law Act 1995. A consent order was made whereby the Respondent would transfer his legal and beneficial interest in the properties known as The Rivers to the Applicant by the 1st October 2008 free from any encumbrance, together with a consent order directing the applicant to transfer the family home into the respondent’s sole name by such date. Consent orders were also made directing the applicant to transfer her interest in other properties to the respondent including declarations regarding entitlements to other commercial and investment properties and also share transfers.
It was submitted on behalf of the Respondent that he agreed to the terms of settlement on the basis of restructure borrowings with anglo Irish Bank regarding his own loans and securities, however Anglo Irish Bank subsequently withdrew from this arrangement in May 2008. The Respondent was therefore unable to transfer The Rivers to the Applicant from from the Mortgage to Anglo Irish Bank pursuant to the terms of settlement. The Applicant having discharged all of the obligations under the terms of settlement, refused to transfer the family home into the sole name of the Respondent.
[The Applicant initially issued a motion for attachment of the Respondent for his failure to comply with the terms of the consent order made 7th February 2008, however this relief was subsequently not pursued by the applicant].
The respondent sought an order setting aside the ancillary orders made on the 7th February 2008 or in the alternative discharging or varying the ancillary orders pursuant to section 18 of the Family Law Act, 1995.
The respondent also sought inter alia an order pursuant to section 9(1) of the Family Law Act 1995 directing the applicant to transfer the family home into joint names and the sale of the family home when the youngest dependent child attained 23 years of age. The applicant issued a further motion seeking an order pursuant to section 9(1) of the Family Law Act 1995 directing the respondent to transfer to the applicant his entire legal and beneficial interest in the family home.
Held by the High Court (Dunne J.) in granting the relief sought by the applicant:
1. That it was clear that the change in the respondent’s circumstances were such that he was no longer in a position to comply with the terms of the consent orders. The issue to be addressed was therefore whether the Court could make further property adjustment orders as requested by the parties or whether the Court might set aside vary or discharge the consent orders as requested by the respondent.
2. That the Court had jurisdiction to make a property adjustment order on more than one occasion having regard to the relevant legislation. Section 15(2) of Judicial Separation and Family Law Reform Act 1989 clearly stated that following the granting of a decree of judicial separation the court might make a property adjustment order on one occasion only save for certain circumstances. This provision was not retained in the amendment to the section by s. 9 of the Family Law Act 1995, therefore an order could be made on more than one occasion save in certain circumstances which did not apply to the current facts.
3. That the making of a property adjustment order pursuant to s. 9 of the Family Law Act 1995 was also subject to s.18(e) of the 1995 Act which clearly states that a property adjustment order may not be varied.
This provision applies notwithstanding the s.9 of the Family Law Act 1995 clearly states that such an order can be made on more than one occasion. The position was therefore that s.18 of the Family Law Act 1995 may not be invoked to vary a property adjustment order made; however a fresh application for a property adjustment order may be made on more than one occasion.
4. That agreements freely entered into by parties at arms length, who were properly advised, would generally be enforced.
5. That the criteria to be applied when considering an application to set aside or discharge a consent order were similar to those in the application to extend time to appeal a consent order, in particular that new events had occurred since the making of the order which invalidate the basis of the order, that such events should have occurred within a relatively short period of time after the making of the order; that the application should have been made promptly in the circumstances of the case, that the grant of leave should not prejudice third parties who had acquired the property for valuable consideration and in good faith.
6. That although the financial circumstances of the respondent had deteriorated since the consent terms, at the time the respondent entered into the consent terms his financial circumstances were already in decline and this change in circumstance represented a continuation of an existing trend rather than the occurrence of a new event. It was not appropriate to set aside the settlement in such circumstances.
7. That the court had jurisdiction to consider the application for further property adjustment orders in the context of the events which occurred. That the court was to have regard to the provisions of s.16(2) of the Family Law Act 1995 when deciding whether to make a property adjustment order. The court must also have regard to the terms of the consent order that was entered into by the parties which provide for the separation of the interests of the parties in a variety of properties wherein the applicant was to be left with an unencumbered asset having transferred her interests in all of the other properties of the parties to the respondent.
8. That the needs of the family as a whole must be considered. The family home was the only property to retain any realistic equity and given the precarious nature of the respondent’s financial circumstances, the needs of the applicant and the dependent children were most closely met by transferring the entire interest in the family home to the applicant.
The question remained as to whether it was appropriate to make an application seeking to set aside a consent order to the court which made the said consent order.
Obiter: The Court reserved its position regarding the manner in which the application should be heard as neither party had indicated that the matter should proceed by way of oral hearing; notice to cross examine had not been served and less issues of conflict than anticipated had arisen. Only one issue arose which might require oral evidence in relation to maintenance. It was held that there was an obvious dispute in relation to the affidavit of means of the respondent and in that respect it would be inappropriate to deal with the maintenance issue in the absence of oral evidence. As concessions had been made by the applicant in relation to maintenance payable the Court did not rule on that issue in the within case.
Raghnal O’Riordan S.C. and Margaret Heneghan B.L. for the applicant.
Inge Clissman S.C. and Peter Clein B.L. for the respondent.
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