Clauses
6. The Wife shall retain as her sole property and the Husband hereby relinquishes and forfeits any claim or entitlement in and to:-
(a) the Subaru motor vehicle.
(b) the former matrimonial home.
(c) the Wife's 56.2% interest as a tenant in common in the development land.
(d) the Wife's land at Crescent Avenue, Hope Island being Lot 315 on RP 81555 County of Ward Parish of Coomera Title Reference 17269035.
(e) the Wife's interest as beneficiary, creditor, or otherwise in respect of all property held by the Trustee of the Jensen Family Trust, including the land at Crescent Avenue, Hope Island.
(f) the Wife's jewellery, household furniture, contents and other personal property and effects.
(g) All of the household furniture and effects presently in the former matrimonial home at Carrara.
(h) any monies presently held by the Wife in bank accounts or in other investments.
(i) all other property now lawfully in the Wife's possession or control.
(j) her shares in Tocan Pty Ltd.
7. The Husband shall retain as his sole property and the Wife hereby relinquishes and forfeits any claim or entitlement in and to:-
(a) the Husband's property at unit 14 Mykonos 28 Old Burleigh Road, Surfers Paradise being Lot 14 in BUP 2938.
(b) the Husband's 43.8% interest as a tenant in common of the development land.
(c) the Husband's stamps and coins.
(d) the Husband's personal property and effects.
(e) any monies presently held by the Husband in bank accounts or in other investments.
(f) all other property now lawfully in the Husband's possession or control.
40 Even assuming that the "development land" alluded to in cl 7(b) of the financial agreement is the property at Hope Island the subject of the s 139ZQ notice, and noting that cl 7 of the financial agreement refers to Mr Jensen's stamps and coins, monies then held by Mr Jensen in bank accounts or in other investment, and all other property lawfully in Mr Jensen's possession or control:
· there was no reference in the financial agreement to properties at 5 Jempal Court Tanah Merah, 5 Rivervista Court Eagleby, 8 Rivervista Court Eagleby, or 2 Rebbechi Court Parkwood (contrasted with the claim in the respondent's Amended Defence and Cross-Claim);
· there was no reference in the financial agreement to the relinquishment by the respondent of her claims in relation to such properties (contrasted with the claim in the respondent's Amended Defence and Cross-Claim).
41 I note that Recital N refers to Mr Jensen being "the registered proprietor of certain other real property associated with his former mortgage lending dealings, but only as Trustee". It is unclear whether these properties are the four properties at Tanah Merah, Eagleby and Parkwood I have listed above, and which are referred to in paras 10h, 10(ia), 10j, 24i, 24k and 24l. However even if they were, the financial agreement states that those properties were not relevant to the financial agreement of the respondent and Mr Jensen.
42 In my view paras 10(ia), 10j, 24k and 24l of the Amended Defence and Cross-Claim in the Amended Defence and Cross-Claim do not accurately represent the claims relinquished or forfeited by the respondent as identified in the financial agreement. To the extent that the respondent pleads relinquishment and forfeiture of her claims in relation to the four properties at Tanah Merah, Eagleby and Parkwood the pleadings are untenable.
43 2. Second, even had such inconsistencies not existed between the terms of the financial agreement and the terms of para 10 and para 24 of the Amended Defence and Cross-Claim, I consider that the reliance by the respondent on her financial and non-financial contributions to the marriage as consideration for the transfer of the relevant properties is untenable. This is because the consideration pleaded by the respondent in para 10 and para 24 of the Amended Defence and Cross-Claim "depended on factors which cannot provide a basis for assessing the value of the consideration which was given" (Whitlam and Jacobson JJ in Lopatinsky (2003) 129 FCR 234 at 250). Lopatinsky (2003) 129 FCR 234 is clear authority that previous financial and non-financial contributions to a marriage do not constitute "consideration" (within the meaning of s 120 or s 121 of the Bankruptcy Act) for the transfer of property from a person who subsequently becomes bankrupt to his or her spouse.
44 Specifically, paras 10a, 10b, 10c, 10d, 10f, 10g, 10h, 10i, 24a, 24b, 24c, 24d, 24g, 24h, 24i and 24j of the Amended Defence and Cross-Claim plead facts relevant to the circumstances of the marriage of the respondent and Mr Jensen and the financial and non-financial contributions they have each made. In my view:
· Paragraphs 10a, 10b, 10c, 24a, 24b and 24c of the Amended Defence and Cross-Claim plead particulars relevant only to the marriage of the respondent and Mr Jensen. These factors do not constitute consideration or the value of it within the meaning of s 120 or s 121 of the Bankruptcy Act, or factors material to consideration given.
· Paragraph 10d and para 24d of the Amended Defence and Cross-Claim plead financial contributions to the marriage made by the respondent during the marriage. Any such contributions constitute past consideration, which in the absence of pleaded express or implied agreement to pay is no consideration for the transfer of the Broadbeach property or the Hope Island property to the respondent.
· Paragraph 10f and para 24g of the Amended Defence and Cross-Claim plead non-financial contributions made by the respondent to the marriage. These contributions do not constitute consideration for the purposes of s 120 or s 121 of the Bankruptcy Act or factors material to consideration given. In any event such contributions refer to past events which are not "consideration" within the meaning of s 120 or s 121.
· Paragraph 10g and para 24h of the Amended Defence and Cross-Claim plead financial contributions made by Mr Jensen to the marriage during the marriage. Any such contributions not only constitute past consideration, but are irrelevant for the purposes of identifying consideration given by the respondent for the transfer of the Broadbeach property.
· Paragraph 10h and para 24i of the Amended Defence and Cross-Claim identify properties legally owned by the respondent and Mr Jensen (and/or his associated companies) as at the date of separation. Paragraph 10h(vi)-(ix) and para 24i (xiii)-(xvi) plead joint ownership of properties at Tamah Merah, Eagleby and Parkwood. The inclusion of these properties is not explained despite there being no mention of them in the terms of the financial agreement. I have already noted this inconsistency earlier in the judgment in relation to paras 10(ia), 10j, 24k and 21l.
· Paragraph 10i and para 24j of the Amended Defence and Cross-Claim plead as consideration factors relevant to the relationship of the respondent with her son. These factors are partly past consideration, and in any event do not constitute "consideration" in the ordinary legal and commercial understanding of that term. Further, I am unable to see how these factors constitute material relevant to for the transfers of either the Broadbeach property or the Hope Island property.
45 In light of these findings, I do not accept the respondent's submission that the facts pleaded in these paragraphs are directly relevant to support the respondent's allegation that the respondent provided consideration to Mr Jensen for the transfer, being either in the form of the consideration for the transfer of the relevant properties, or the consideration being in the form of the forbearance to sue for spousal maintenance and the respondent's abandonment of her interest in various specified assets. Accordingly these paragraphs in the Amended Defence and Cross-Claim are untenable.
46 3. Third, I do not accept the submission of the respondent that the decision in Lopatinsky (2003) 129 FCR 234 with respect to the meaning of the phrase "consideration of less value than market value" was obiter. The Full Court in Lopatinsky (2003) 129 FCR 234 accepted the general proposition that forbearance to sue could constitute good consideration, but found that the approach of the primary judge in endeavouring to "value" the alleged consideration provided by Mrs Lopatinsky upon the basis of Mrs Lopatinsky's financial and non-financial contributions to the marriage in accordance with the criteria referred to in the Family Law Act was incorrect (at [101]-[102]). In light of these clear findings I do not accept the submission by the respondent that Lopatinsky (2003) 129 FCR 234 was distinguishable because no consent orders pursuant to s 79 of the Family Law Act had been entered in those proceedings.
47 4. Fourth, I do not accept the submission of the respondent that the decision in Lopatinsky (2003) 129 FCR 234 is distinguishable because in Lopatinsky (2003) 129 FCR 234 there was only an informal agreement whereby the wife had relinquished her entitlement to sue, whereas in this case the respondent and Mr Jensen had executed a financial agreement pursuant to the Family Law Act in which the respondent had expressly relinquished and forfeited any claims and entitlements to property in Mr Jensen's name as well as an entitlement to spousal maintenance. I take this view because:
(a) Although one of the reasons for the decision of the Full Court in Lopatinsky (2003) 129 FCR 234 was that there was no evidence to support a finding that Mrs Lopatinsky had promised to give up a claim under s 79 of the Family Law Act, in fact the primary reason - described by Whitlam and Jacobson JJ as "the short answer to this appeal" (at [101]-[102]) - was the incorrect view the primary judge had taken of the alleged consideration provided in the circumstances of the case.
(b) It is not in dispute that a binding financial agreement which is valid under the relevant provisions of Pt VIIIA of the Family Law Act has the effect of ousting the jurisdiction of the court in respect of certain matters covered by the agreement, including financial matters or financial resources to which a binding financial agreement applies: Black & Black [2008] FamCAFC 7 at [29]. However the simple fact of acknowledgment by one spouse in a financial agreement of the provision of consideration for the transfer of property does not mean that the alleged consideration is adequate for the purposes of s 120 and s 121 of the Bankruptcy Act if a transaction is subsequently challenged by a trustee in bankruptcy. As I noted earlier in this judgment, "consideration" in the context of the bankruptcy legislation has its ordinary legal and commercial meaning (Lopatinsky (2003) 129 FCR 234 at 249). The fact that the movement of consideration is acknowledged in a financial agreement does not give the consideration validity it would not otherwise have.
(c) Further, and in any event, as I have already found in Combis, Trustee of the Property of Peter Jensen (Bankrupt) v Jensen [2009] FCA 778, the transfer of property pursuant to a financial agreement does not equate to a transfer of property pursuant to Court order, as was the case in Mateo (2003) 127 FCR 217. The current legislative framework applicable to financial agreements contemplates that a trustee in bankruptcy may make application pursuant to both s 120 and s 121 of the Bankruptcy Act to set aside a transfer pursuant to a financial agreement executed by the parties. Similarly, it is open to the Court to review the nature of the consideration stated in a financial agreement. The Court is not in any way prevented from doing so by the fact that the financial agreement is enforceable as between the parties under the Family Law Act.