Property Disputes between the Parties to a Marriage: Problems of Dual Jurisdiction
| Published date | 01 September 1983 |
| Author | Dorothy Kovacs |
| Date | 01 September 1983 |
| DOI | 10.1177/0067205X8301300301 |
| Subject Matter | Article |
PROPERTY DISPUTES BETWEEN THE PARTIES TO
A MARRIAGE: PROBLEMS
OF
DUAL JURISDICTION
BY
DoROTHY
KovAcs*
When a marriage breaks down
if
the parties are unable to agree as
to
how
their assets are to
be
divided their disputes
may
currently
be
heard in two different court hierarchies applying two disparate sets
of
legal principles. Inevitably this position leads to forum shopping and
to the proliferation
of
legal proceedings which are
not
directed at
resolving the substantive issue between the parties.
It
produces uncer-
tainty, duplication, expense and delay.
Although
the problems associated
with dual jurisdiction in matrimonial property disputes arise both
before
and
after divorce, neither the Family Court
nor
the Supreme
Courts have yet, it seems, formulated policies which ought to be pursued.
Nor
have they been consistent
in
their choice
or
application
of
the
legal mechanisms that they enlist to break the deadlock.
It
is suggested
here that both the federal and state courts should aspire to the central-
isation
of
matrimonial property disputes,
so
far as is constitutionally
feasible, within the Family Court. With that objective in
mind
the
various legal devices currently
invoked
to resolve disputes about
jurisdiction are critically reviewed.
Some
techniques are suggested to
overcome problems which recur
in
the case law and a general approach
is proposed which, it is hoped, will achieve consistency in the aims and
in the legal principles adhered to
by
the courts in the future.
1 INTRODUCTION
The creation of the Family Court of Australia by the Family Law Act
1975 (Cth) (the Act) has introduced into Australian family law a dual
system of courts. The Family Courtt is invested with federal jurisdiction2 in
matters under the Act while the State courts retain jurisdiction in matters
between a husband and wife to the extent that there
is
no inconsistent
federal legislation3 regulating the same dispute.
This dual court system has created special problems in relation to property
disputes involving the parties to a marriage. While the Family Court may
proceed in relation to the matter by invoking wide discretionary powers so
as to do justice between the parties,4 quite different orders might result in
the event that the dispute were to be commenced in the State courts as a
proceeding under State law. A partnership dispute involving the husband
and wife will result in a State Supreme Court in automatic division of
property according to their partnership interests. The same dispute, mounted
in the Family Court as a proceeding to alter the interests of the parties in
* LLB (Melb), LLM (Monash); Senior Lecturer in Law, Monash University.
1 The Magistrates' Courts also have property jurisdiction under the Act but where
the property exceeds $1,000 in value the respondent may have the proceedings trans-
ferred
to
the Family Court under
s46(1).
For
convenience only the Family Court
will be referred to in the text.
2 S
31
Family Law Act, which
is
an exercise
of
the power
of
the Commonwealth
Parliament conferred by s 77(i) of the Constitution
to
define the jurisdiction of a
federal court in regard
to
the matter
ins
76(ii).
3 S 109 Commonwealth Constitution.
4 S
79
Family Law Act.
201
202 Federal Law Review
[VOLUME
13
the property, under s 79 of the Family Law Act,5 may result in very different
orders reflecting the Family Court's perception of the equities of the parties
which will depend largely on their respective contributions to the property
in dispute.
Concurrent federal and State legislation governing the property rights of
the parties to a marriage
is
not a new phenomenon.
It
has been a feature of
Australian family law since the enactment of the Matrimonial Causes Act
1959
(Cth).
However, while the State Supreme Courts were invested with
federal jurisdiction under that Act, the problem of dual court systems was
avoided. The Supreme Court judges exercised both State and federal juris-
diction. They might be wearing either "hat" in a given dispute. Nor
was
it
foreseen when the Family Court
was
created that there would be large areas
of unresolved jurisdiction.
It
was initially intended that all property disputes
arising within a marriage should be determined in the Family Court.6 It was
only after the Act was redrafted following the constitutional exposition by
the High Court
in
Russell v Russell; Farrelly v Farrelly1 that areas of
jurisdictional incompetence in the federal court were exposed. In the result
the Family Court
is
unable to hear a claim for a declaration of the parties'
property rights under s 78 for the alteration of their interests in their property
under s 79 of the Act until principal relief proceedings have been initiated.8
As in most cases the principal relief sought will be a decree of dissolution
of the marriage, there
is
in the twelve month separation period required to
establish the dissolution ground9 a significant gap in Family Court juris-
diction, during which time State jurisdiction
is
theoretically intact.
Waiting for principal relief
is
only one hiatus in the property jurisdiction
of the Family Court. Another occurs ironically
as
a result of a provision of
the Family Law Act, s 44 (
3),
which may cause the Family Court to decline
to hear a property matter by refusing leave to proceed more than twelve
months after decree nisi. Section 44
is
only a procedural provision but it
has produced a new gap in the exercise of federal jurisdiction. There was
no provision like it in the Matrimonial Causes Act. Family Court jurisdiction
may also prove insufficient where third parties such
as
mortgagees become
involved in proceedings between husband and wife.
10
Similarly a matter
such
as
a partnership or joint tenancy dispute or one
as
to the existence
of a caveatable interest may be regarded
as
having no special matrimonial
character and may properly be determined on State commercial law
principles even though the parties happen to be
or
have been married to
each other.
In the result the parties to a marriage may be involved in litigation in
two sets of courts. Extensive and expensive legal battles concerning juris-
diction before any attempt at resolution of the substantive issue between the
parties are now a common feature of family litigation.
It
is
proposed in
this article to review the now considerable jurisprudence of both court
systems concerning jurisdiction
in
property disputes between the parties to
5 Eg In the marriage
of
Elias (1977) 3
Pam
LR
11,496.
6 S
4(1)
(c)(ii)
as originally drafted in the Family Law Act 1975.
7 (1976) 134
CLR
495.
BS4(1)(ca).
9S48.
10
Ascot Investments v Harper and Harper (1981)
FLC
91-000.
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