Taylor v Taylor

3. there be a rehearing of the application of Marie Ellen Taylor for a transfer to her by Edward John Leo Taylor of his interest in the matrimonial home.

On or about 12th April 1975 the appellant, Mr. Taylor, was served with a petition issued under the Matrimonial Causes Act 1959 Cth, as amended, by his wife, the respondent, who sought a dissolution of the marriage between them and other relief. The appellant promptly consulted his solicitors and instructed them to defend the petition. Through their neglect no answer was filed, and the appellant was never informed of the date fixed for the hearing of the petition. It came on before Woodward J., sitting in the Family Law Division of the Supreme Court of New South Wales, on 5th August 1975 and was heard ex parte. Woodward J. pronounced a decree nisi for the dissolution of the marriage between the appellant and the respondent, and made orders for the custody and maintenance of the children of the marriage. He also ordered, under s. 86 of the Matrimonial Causes Act, that the appellant transfer to the respondent his interest in the matrimonial home at Edgeworth. When the appellant learned, later in August, that the decree and orders had been made, he instructed his solicitors to apply for their rescission but again, through the neglect of the solicitors, no action was taken.

Eventually, on 31st March 1976, the appellant made application to the Family Court of Australia for the variation of the orders for the transfer of the matrimonial home and for custody made by the Supreme Court on 5th August 1975. In lieu of the former order, the appellant sought an order for the sale of the matrimonial home and the division of the proceeds equally between the parties. Mischance continued to dog the proceedings. Because of a misunderstanding on the part of the respondent's solicitors, the respondent did not appear when the application came before Hogan J. in the Family Court on 2nd July 1976. Hogan J. proceeded ex parte and made the order which the appellant sought in relation to the matrimonial home and varied the order for custody. The evidence placed before Hogan J. by the appellant contradicted in material respects that which the respondent had given before Woodward J.

From the decision of Hogan J., the respondent appealed to the Full Court of the Family Court. Agreement was reached as to the manner in which the question of custody should be dealt with and the appeal proceeded solely in relation to the property question. The learned members of the Full Court reached the conclusion that Hogan J. had no jurisdiction to make the order which he had made. They accordingly allowed the appeal and set aside the orders of Hogan J. [9] .

It is a fundamental principle of natural justice, applicable to all courts whether superior or inferior, that a person against whom a claim or charge is made must be given a reasonable opportunity of appearing and presenting his case. Similarly in Commissioner of Police v. Tanos [2] , Dixon C.J. and Webb J. said that "it is a deep-rooted principle of the law that before anyone can be punished or prejudiced in his person or property by any judicial or quasi-judicial proceeding he must be afforded an adequate opportunity of being heard." 1. (1944) 68 C.L.R. 571, at p. 589. 2. (1958) 98 C.L.R. 383, at p. 395.

Statements to a similar effect abound, but I need add only one more, that of Jenkins L.J. in Grimshaw v. Dunbar [3] :

Be that as it may, a party to an action is prima facie entitled to have it heard in his presence; he is entitled to dispute his opponent's case and cross-examine his opponent's witnesses, and he is entitled to call his own witnesses and give his own evidence before the court. Prima facie that is his right, and if by some mischance or accident a party is shut out from that right and an order is made in his absence, then common justice demands, so far as it can be given effect to without injustice to other parties, that that litigant who is accidentally absent should be allowed to come to the court and present his case - no doubt on suitable terms as to costs, 1. [1953] 1 Q.B. 408, at p. 416.

There is no doubt that the appellant was not given an opportunity to be heard before the order, which seriously affected him in his property, was made by Woodward J. This was not due to any fault on the part of the respondent, or of course on the part of the judge, but nevertheless, to repeat the words of Jenkins L.J., common justice demands that the appellant should be allowed to present his case. The question is whether the Family Court is so shackled by the statutory provisions that govern its operations that it had no power to enable justice to be done in these circumstances.

Before the Full Court of the Family Court the appellant relied on the provisions of ss. 79A and 83 of the Family Law Act 1975 Cth, as amended. The latter section gives the court power to vary orders made in proceedings "with respect to the maintenance of a party". It is very doubtful whether this section is intended to apply to orders permanently altering interests in property, even such orders as may be designed in part to provide proper maintenance for the party in whose favour they are made. Section 79A (1) provides as follows:

Where, on application by a person affected by an order made by a court under section 79, the court is satisfied that the order was obtained by fraud, by duress, by the giving of false evidence or by the suppression of evidence, the court may, in its discretion, set aside the order The relevant order in the present case was made under the Matrimonial Causes Act, but by s. 3(2)(c) of the Family Law Act the latter Act applies to and in relation to the order as if it had been made under that Act. Since, if made under that Act, it could only have been made under s. 79, it seems right to conclude that s. 79A enabled the appellant to apply to have it set aside under that section. There is no reason to read false in s. 79A as meaning "wilfully false", particularly since fraud is separately mentioned in the section. There was therefore power in the present case to set aside the order made by Woodward J. if the Family Court concluded that it was obtained by the giving of false evidence. However, it would be surprising if the power of the Family Court to set aside the order depended on the fortuitous circumstance that the order had been obtained in the circumstances mentioned in that section, when the real ground on which application was made to set it aside was that the party affected by it had not been given an opportunity to present his case.

There is no other provision of the Family Law Act, and nothing in the regulations thereunder, which empowers the Family Court to set aside an order of the kind now in question. It therefore becomes necessary to consider whether the Family Court has inherent power to set aside an order made against a party who had no opportunity to appear and present his case. In Reg. v. Forbes; Ex parte Bevan [4] Menzies J. dealt with the nature of inherent jurisdiction. He said:

"Inherent jurisdiction" is the power which a court has simply because it is a court of a particular description. Thus the Courts of Common Law without the aid of any authorizing provision had inherent jurisdiction to prevent abuse of their process and to punish for contempt. Inherent jurisdiction is not something derived by implication from statutory provisions conferring particular jurisdiction; if such a provision is to be considered as conferring more than is actually expressed that further jurisdiction is conferred by implication according to accepted standards of statutory construction and it would be inaccurate to describe it as "inherent jurisdiction", which, as the name indicates, requires no authorizing provision. Courts of unlimited jurisdiction have "inherent jurisdiction". He went on to consider whether the Industrial Court had inherent jurisdiction to make an order restraining the officers of a trade union from withdrawing money from the union's bank accounts and from transferring money or securities belonging to it to any person or organization and he said [5] : Such inherent jurisdiction as the Court may have, could not go beyond protecting its function as a Court constituted with the limited jurisdiction afforded by the Act. It follows from these statements that any inherent power of the Family Court to set aside its own orders will not be conferred, expressly or by implication, by the provisions of the Family Law Act, although the Act may contain provisions which negative the existence of any inherent power, and although the Court would not have any inherent power except such as might be necessary to enable it to do justice within the limits of the jurisdiction which that Act confers on it. 1. (1972) 127 C.L.R. 1, at p. 7. 2. (1972) 127 C.L.R., at p. 8.

In Woods v. Sheriff of Queensland [6] , Griffith C.J. said:

When an order is made ex parte, the court or judge making it may, upon application of any person prejudicially affected by the order, review and, if necessary, discharge it. This is a rule of natural justice. But, when a judgment or order is pronounced or made after hearing both sides, it is a general rule that the court which pronounced the judgment or made the order cannot reverse or vary it. As Griffith C.J. went on to point out, there are some exceptions to the last-mentioned rule. 1. (1895) 6 Q.L.J., at p. 164.

If the law is correctly stated by Griffith C.J. in the first sentence of the passage cited, the Family Court had power to set aside the order made by Woodward J., which, as I have indicated, is to be treated as if it had been made under the Family Law Act. The rule laid down by Griffith C.J. seems to me to be in accordance with justice and common sense; it enables a court to set matters right when there has been a failure to observe an essential requirement of natural justice. The judgment of the majority of the court in Cameron v. Cole [7] also recognize the existence of an inherent power of the kind suggested. In that case the Federal Court of Bankruptcy had made a sequestration order at an adjourned hearing of a creditor's petition. Through inadvertence, no notice of the date of the adjourned hearing had been given to the debtor and the sequestration order had been made in his absence. The Federal Court of Bankruptcy subsequently annulled the order and directed that the petition be re-heard and on the re-hearing a second sequestration order was made. The majority of this Court held that the Federal Court of Bankruptcy had jurisdiction to make the second sequestration order. Three members of the court held that there was inherent power to set aside the first sequestration order. Latham C.J. [8] , expressed the view that the Federal Court of Bankruptcy was not a superior court and that the failure to give notice of the adjourned hearing meant that the order made at that hearing was a nullity; he said [9] , that "the court could set aside the order under an inherent jurisdiction, but there was no necessity to do so". The judgment of Rich J. is particularly important. After the sentence which I have already quoted from his judgment, in which he stated that it is a fundamental principle that a person against whom a claim is made must be given a reasonable opportunity of appearing and presenting his case, he went on [10] :

If this principle be not observed, the person affected is entitled, ex debito justitiae, to have any determination which affects him set aside; and a court which finds that it has been led to purport to determine a matter in which there has been a failure to observe the principle has inherent jurisdiction to set its determination aside In such a case there has been no valid trial at all. The setting aside of the invalid determination lays the ghost of the simulacrum of a trial, and leaves the field open for a real trial He added [10] , that "in the absence of clear words, a statute should not be treated as depriving a court of the inherent jurisdiction possessed by every court to ensure that trials before it are conducted in accordance with the principles of natural justice". He held [11] , that the Federal Court of Bankruptcy was a superior court, and that a decision of a superior court cannot be treated as a nullity, but is, at worst, voidable, i.e., valid unless and until it is set aside. He criticized the judgment of Lord Greene M.R. in Craig v. Kanssen [12] , although he agreed with the conclusion reached in that case, where the court, exercising its inherent jurisdiction, set aside an order made against a party who should have been served, but who was not served, with process. However, Lord Greene M.R. referred to such an order as a nullity; Rich J. said (20) that this was true enough in the case of an inferior court, but misleading since the order in question was made by a superior court - "in the case of a superior court the distinction is between irregularities so fundamental as to create an unconditional right, ex debito justitiae, to have the judgment set aside, and non-fundamental irregularities as to which the court has a discretion". McTiernan J. was of a similar opinion to Rich J. [13] . Williams J., who dissented for reasons which do not concern us, also said [14] that a court has an inherent power to set aside an order which has been made against a person without that person having notice of the application. It is unnecessary to consider whether the criticism voiced by Rich J. of the language of Lord Greene M.R. in Craig v. Kanssen is justified. It is clear that the majority of the Court in Cameron v. Cole accepted that a court, whether superior or inferior, has inherent power to set aside an order made against a person who did not have a reasonable opportunity to appear and present his case. It seems immaterial in the present case whether the Family Court is regarded as a superior court or an inferior court. It is declared by s. 21 (2) of the Family Law Act to be a superior court of record, but it is of course a superior court of limited jurisdiction. In that respect it occupies a similar position to the Federal Court of Bankruptcy considered in Cameron v. Cole. No provision of the Family Law Act deprives the Family Court of this inherent power, except, perhaps in relation to a decree of dissolution of marriage (see ss. 55-59) - a question which I need not consider in the present case. 1. (1944) 68 C.L.R. 571. 2. (1944) 68 C.L.R., at pp. 583-586. 3. (1944) 68 C.L.R., at p. 586. 4. (1944) 68 C.L.R., at p. 589. 5. (1944) 68 C.L.R., at p. 589. 6. (1944) 68 C.L.R., at pp. 590-591. 7. [1943] K.B. 256, at p. 262. 8. (1944) 68 C.L.R., at pp. 598-600. 9. (1944) 68 C.L.R., at p. 607.

Since service of the petition was properly effected upon the appellant, it is not possible to regard the order made by Woodward J. as a nullity, whatever view is taken of the questions discussed in Cameron v. Cole. However, since the appellant in fact had no notice of the hearing, the court had inherent power to set the order aside. This power was a discretionary one, but there was no reason to refuse the appellant's application. The appellant had filed affidavit material which showed that the facts of the case were seriously in contest. The proper course was to set aside the order of Woodward J. and to reconsider the matter, as Hogan J. did.

In the Full Court of the Family Court Demack J. said that in his opinion further litigation to redress the wrong which the appellant had suffered should have been directed at his solicitors rather than at the other party to the marriage, lest the assets of the parties should be "squandered on endless litigation which is undertaken not for the benefit of the parties but to correct professional error". With respect it is not right to say that the litigation is not undertaken for the benefit of the parties; the application to set aside the order was clearly for the benefit of the appellant. However, with all respect, Demack J. fell into an error similar to that which led Fry J. to refuse to set aside a judgment in Burgoine v. Taylor [15] . In that case a defendant was not represented at the trial of an action because his solicitor was ignorant of the fact that the action had been transferred from one judge of the Chancery Division to another, and had therefore only watched the list before the former judge. Fry J. said [16] that the defendant would have a remedy against his solicitor for negligence, and he refused to set the judgment aside. The Court of Appeal had no difficulty in reversing his decision; indeed Jessel M.R. expressed surprise that the application to set aside the judgment had been opposed [17] . The application there was made under the specific provisions of a rule of court, and the decision thus throws no light on the question of power, but it supports the conclusion, which I should in any case have reached, that it is no answer to a party who asks the court to set aside an order made against him in his absence at a hearing of which he had no notice to tell him that he has a remedy against his solicitor. In such a case, assuming that there is a real question to be tried, justice requires that the order, having been made in breach of a fundamental principle of natural justice, should be set aside, and that the matter should be reconsidered on its merits.

1. (1878) 9 Ch. D. 1. 2. (1878) 9 Ch. D., at p. 3. 3. (1878) 9 Ch. D., at p. 5.

The order made by Hogan J. cannot stand, for the same reasons that require the order of Woodward J. to be set aside. The proper course for the Full Court of the Family Court was to have set aside both the order made by Woodward J. in relation to the matrimonial home and the further order made by Hogan J., and to have directed a re-hearing of the application by the respondent for a transfer to her by the appellant of his interest in the matrimonial home.

I have had the advantage of reading the reasons for judgment of Gibbs J., with which I am in agreement. Whatever power s. 79A (1) of the Family Law Act 1975 may fortuitously have conferred upon Hogan J., it is, rather, upon the substantial ground that the respondent husband was deprived of any opportunity to present his case that the original order, in so far as it relates to the matrimonial home, should be disposed of. For the reasons stated by Gibbs J. and in the light of the authorities which his Honour discusses, to which may be added Bailey v. Marinoff [18] and in particular the judgment of Gibbs J. in that case, I agree that Hogan J. had inherent jurisdiction, in the particular circumstances to vary that order.

Because of the vitiating circumstances which affected the proceedings before Hogan J. no less than the proceedings before Woodward J., there must be an order for re-hearing: I agree with the form of order proposed by Gibbs J.

On 5th August 1975 the Supreme Court of New South Wales (Woodward J.), after an ex parte hearing, granted the respondent wife a decree nisi for dissolution of marriage and made an order under s. 86 of the Matrimonial Causes Act 1959, as amended, for the settlement of property requiring the appellant husband to transfer to the respondent all his right, title and interest in the former matrimonial home known as No. 83 Fletcher Street, Edgeworth. The appellant was not represented at the hearing before Woodward J. His solicitor omitted to file an answer to the petition or any document indicating that the respondent's claim was disputed. The solicitor did not attend court and failed to inform the appellant of the hearing. Woodward J. dealt with the proceeding as an undefended matter.

On 13th August 1975 the decree became absolute. Shortly thereafter the appellant discovered that Woodward J. had made the decree nisi and other orders. The appellant took action to set aside the order made under s. 86 on 31st March 1976 when an application under the Family Law Act 1975 was filed on his behalf. In this application the appellant sought an order that the matrimonial home be sold and that the net proceeds of sale be divided between the respondent and himself.

This application came on for hearing before Hogan J. in the Family Court on 2nd July 1976. It also proceeded ex parte because on this occasion the counsel and solicitor acting for the respondent believed that the proceedings were in the Family Law Division of the Supreme Court and, on discovering that the matter was not listed for hearing in that Court on 2nd July 1976, took no action in the matter. The respondent herself attended the Supreme Court instead of the Family Court. In the result the appellant succeeded before Hogan J. who made an order that the property be sold and that the proceeds be divided equally between the two parties, that being the order sought in the application.

The respondent, when informed that the order had been made by Hogan J., appealed to the Full Court of the Family Court. The Full Court held that Hogan J. had no power to make the order which he had made because no such power was conferred by ss. 79A and 83 of the Family Law Act.

Section 79A, which came into operation on 1st July 1976, confers power on the court to set aside an order made under s. 79 for the settlement of property when the order was obtained "by fraud, by duress, by the giving of false evidence or by the suppression of evidence". On the petition and on the evidence led by the respondent in the Supreme Court and by the appellant in the Family Court there was a contest arising out of the respondent's allegation of cruelty. There was a contest between the parties as to their behaviour during the course of the marriage. The appellant in his evidence before Hogan J. gave an account of the marriage which differed from that given by the respondent before Woodward J. It was suggested that the respondent's evidence constituted "false evidence" and that therefore Hogan J. was empowered by s. 79A to set aside the property order made by Woodward J. Asche and Dovey JJ. rejected this submission, saying that there was nothing "to show that the wife had given wilfully false evidence or evidence that was demonstrably false". Demack J. held that the order made by Woodward J. under s. 86 of the Matrimonial Causes Act for the transfer of the matrimonial home, though continued in force by s. 3 of the Family Law Act, was not an order made under s. 79 of that Act. In his view it was therefore not an order which could be set aside under s. 79A.

Section 83 of the Family Law Act confers power on the court in "proceedings with respect to the maintenance of a party to a marriage", to discharge, suspend, revive or vary orders "with respect to maintenance". Their Honours held that s. 83 did not confer power to set aside an order made for the settlement of property and that the only power so to do was that conferred by s. 79A.

In my view the Full Court was correct in holding that s. 83 did not confer power on Hogan J. to set aside or vary the property order made by Woodward J. The section is confined to orders for maintenance. An order for the settlement of property is not an order for maintenance, even if the circumstances are such that it may be said to reflect in part an obligation of a spouse to maintain the other. What is more, certain sections in the Family Law Act are inconsistent with the notion that an order for the settlement of property is an order for maintenance. Thus the provisions of s. 82 relating to the cessation of maintenance orders upon the death of a party are quite inappropriate to orders made under s. 79. Furthermore, the existence of s. 79A, providing as it does for the setting aside of orders made under s. 79 and for the conditions on which such an order may be set aside, indicates that s. 83 has no application to orders for the settlement of property.

Section 79A came into operation one day prior to the hearing before Hogan J. It is not surprising that the appellant's application which was filed on 31st March 1976 did not refer to s. 79A or that the judge made no mention of it in the order which he made. The application merely sought the order which was actually made on the footing that the matter would be dealt with de novo by the Family Court and that the order of Woodward J. would be varied accordingly.

The Family Court is a superior court of record (s. 21 (2)) and the validity of the order made by Hogan J. is to be determined by reference to the power possessed by the court, notwithstanding that the order makes no reference to its exercise or to the making of an application for its exercise. There is, then, the question whether s. 79A can apply, having regard to its terms, to an order made under the Matrimonial Causes Act. The answer to this question depends upon the effect of s. 3 (2) (c) of the Family Law Act which provides:

(2) Notwithstanding the repeal effected by sub-section (1) [that is, the repeal of the Matrimonial Causes Act 1959 (as amended)] -

(c) a decree of the Supreme Court, or of a court of summary jurisdiction, of a State or Territory -

(i) made before the commencement of this Act in the exercise of jurisdiction invested or conferred by the repealed Act, or in a matrimonial cause or proceedings for a separation order instituted under the law of that State or Territory, being a decree that was in force immediately before the commencement of this Act;

shall have, or continue to have, effect throughout Australia, and, except in the case of -

(iii) a decree of nullity of marriage made on the ground that the marriage was voidable;

this Act applies to and in relation to the decree as if the decree had been made under this Act.

"Decree" is defined by s. 4 (1) to mean "decree, judgment or order".

The order of Woodward J. was made on 5th August 1975 before the Family Law Act 1975 came into operation on 5th January 1976.

If the injunction contained in s. 3 (2) (c) is obeyed, then the order of Woodward J. is to be considered as if it had been made under the Family Law Act. Having regard to its subject matter it must be treated as if it were an order made under s. 79, that being the only source of authority in the Family Law Act for the making of an order for the settlement of property. Before the introduction of s. 79A the Family Law Act contained no express power to set aside an order made under s. 79 or, for that matter, any order for the settlement of property. Whether this Court or the Supreme Court of a State could set aside an order made under s. 79 by the Family Court on grounds similar to those expressed in s. 79A I need not explore. For present purposes it is sufficient to say that s. 79A filled a gap in the statute. Although the new section is expressed to apply to orders made under s. 79, in my opinion it applies also to an order made under the Matrimonial Causes Act which, if it had been made under the Family Law Act, this being the assumption that s. 3 (2) (c) of the Family Law Act requires us to make, would have been made under s. 79. The more limited construction given to s. 79A by Demack J. in the Full Court arms the court with a power to set aside its own property orders but not those made under the repealed legislation and continued in force under the Family Law Act. Such a restricted interpretation should not be accepted unless it be produced by the plainest language.

In my opinion, the words "false evidence" in s. 79A (1) do not mean evidence which is wilfully false. The subsection should be read according to its terms. To say that "false evidence" should be read as "wilfully false evidence" is to introduce a qualification not expressed by the provision: cf. s. 6H of the Royal Commissions Act 1902, as amended, which speaks of a witness "who knowingly gives false testimony". This interpretation is reinforced by reference elsewhere in s. 79A (1) to the separate grounds of fraud and suppression of evidence which would comprehend cases of wilfully false evidence.

At common law a judgment will be set aside if it has been obtained by fraud. In the exercise of this jurisdiction, it has been held that an applicant must show something more than mere perjury, i.e. new facts (Baker v. Wadsworth [19] ; Everett v. Ribbands [20] ). This tends to suggest that the words "false evidence" have been chosen deliberately and that they should be given their literal meaning.

1. (1898) 67 L.J.Q.B. 301. 2. (1946) 175 L.T. 143.

What s. 79A (1) does is to give the court a discretion to set aside an order when it has been obtained by false evidence. In such a case the court will be extremely reluctant to exercise its discretion in favour of setting aside the order unless something more appears than that false evidence has been given and has procured the making of the order. The importance of bringing an end to litigation and the evil of allowing cases to be retried on the same evidence are powerful deterrents against setting aside a judgment whenever it appears that it has been obtained by false evidence without more. Where, however, more appears, as, for example, that the judgment was obtained ex parte without the benefit of the evidence to be given by one of the parties, then the court will the more readily exercise its discretion in favour of setting aside the judgment. Then the setting aside of the judgment will not result in a retrial on the same evidence but in a trial on the evidence given by both parties.

There is, however, yet another obstacle and it is to be discovered in ss. 72 to 75 of the Matrimonial Causes Act 1959. The effect of these provisions was that once a decree absolute had been pronounced, the decree nisi on which it was based could not be attacked. However, ss. 72 to 75 were repealed along with the rest of the Matrimonial Causes Act by s. 3 (1) of the Family Law Act. The corresponding provisions in the Family Law Act are ss. 55 to 58. Their effect is similar.

Section 89 of the Matrimonial Causes Act 1959 provided that -

Except as provided by this section, the court shall not make an order under this Part in favour of the petitioner where the petition for the principal relief has been dismissed. It was the respondent's evidence in the proceedings before Woodward J. that the appellant now claims to have been false evidence justifying the grant of relief under s. 79A. The appellant's case is that the respondent's false evidence in the proceedings for the decree nisi brought about the making of the property order. In truth the respondent's evidence procured the pronouncement of the decree nisi, which was an essential prerequisite to the making of the property order. The respondent then claims that the appellant is, contrary to the statute, impugning the decree nisi because the decree nisi was obtained on the evidence which she gave that is now said to be false. The proceedings for principal and ancillary relief were, as I have already indicated, heard together and they resulted in orders granting principal and ancillary relief made at the one time. It matters not that the evidence alleged to be false was directed to the decree nisi, not to the making of the property order, for the property order could not be made in the absence of the decree nisi. The evidence given by the respondent to the extent to which it was directed to the decree nisi played a part in obtaining the property order because it established an essential prerequisite for the making of the latter order. The property order may accordingly be said to have been obtained by that evidence.

By presenting this case the appellant is not impugning the decree nisi. The appellant accepts the decree nisi and does not challenge it in any way. To say that the evidence on which the decree nisi was based was false evidence does not of itself involve a challenge to the validity or operation of the decree nisi.

In the result, therefore, I am of the opinion that s. 79A empowered Hogan J. to set aside the order made by Woodward J. The Full Court of the Family Court was incorrect in concluding that his Honour had no jurisdiction or power to set aside the existing order.

However, a reading of his Honour's reasons for judgment does not convince me that his Honour was applying the provisions of s. 79A. His Honour appears to have concluded that the application was an application to vary the existing property order and to have acted on the appellant's evidence, without giving any consideration to the evidence given by the respondent in the Supreme Court, with the result that his Honour's order cannot now stand.

As this is an appeal from the Full Court of the Family Court it is for this Court to make the order that should have been made by that Court in the light of the circumstances then established to exist. The Full Court had the advantage of knowing that the appellant's failure to appear before Woodward J. was due to no fault on his part and likewise that the respondent's failure to appear before Hogan J. was due to no fault on her part. The Full Court should then have approached the case on the footing that it was prima facie the right of each party to have the proceedings heard in his or her presence and that justice to both parties required that each party should be entitled to present his or her case. As Jenkins L.J. said in Grimshaw v. Dunbar [21] :

a party to an action is prima facie entitled to have it heard in his presence; he is entitled to dispute his opponent's case and cross-examine his opponent's witnesses, and he is entitled to call his own witnesses and give his own evidence before the court. Prima facie that is his right, and if by some mischance or accident a party is shut out from that right and an order is made in his absence, then common justice demands, so far as it can be given effect to without injustice to other parties, that that litigant who is accidentally absent should be allowed to come to the court and present his case - no doubt on suitable terms as to costs, as was recognized in Dick v. Piller [22] . 1. [1953] 1 Q.B. 408, at p. 416. 2. [1943] K.B. 497.

Although the Family Court is a court created by statute it none the less possesses an inherent jurisdiction to set aside a judgment obtained by default. Three members of this Court (Latham C.J., Rich and Williams JJ.) concluded in Cameron v. Cole [23] that the Federal Court of Bankruptcy had an inherent jurisdiction to set aside its orders, notwithstanding that it was a statutory court and, further, that it was a court of limited jurisdiction. A jurisdiction to set aside its orders is inherent in every court unless displaced by statute. In my opinion the jurisdiction extends not only to the setting aside of judgments which have been obtained without service or notice to a party (Craig v. Kanssen [24] ) but to the setting aside of a default or ex parte judgment obtained when the absence of the party is due to no fault on his part. I can find no indication in the Family Law Act of an intention to displace this inherent jurisdiction.

1. (1944) 68 C.L.R. 571, at pp. 586, 589, 607. 2. [1943] K.B. 256, at pp. 262-263.

In my view, therefore, the Family Court should have set aside the property order made by Woodward J. (which has continued in force as if it were made under the Family Law Act) and that made by Hogan J. and directed a rehearing of the respondent's application in so far as it sought an order for the settlement of property.

On 5th August 1975, Woodward J. in the Family Law Division of the Supreme Court of New South Wales granted a decree nisi on Mrs. Taylor's petition under the Matrimonial Causes Act 1959 Cth, as amended, for dissolution of the marriage on the ground of her husband's cruelty and ordered the transfer of the matrimonial home to her by way of an order for settlement of property under s. 86 of that Act. Mr. Taylor's solicitor neglected to file any answer to the petition and did not inform Mr. Taylor of the hearing; as a result, the proceedings were heard in Mr. Taylor's absence and without any representation for him. Mr. Taylor became aware of the decree and order soon afterwards. He made no application concerning either until 31st March 1976 when he filed an application under the Family Law Act 1975 (which came into operation on 6th January 1976) in the Family Court of Australia (not "The Family Law Court of Australia" as the application described it) for an order to vary Woodward J.'s order by providing that the home be sold and the net proceeds of the sale be divided between Mrs. Taylor and himself. Notice of this application was served on Mrs. Taylor prior to 4th May 1976 and notice of hearing was served on her sometime prior to 1st July 1976. The application was heard by Hogan J. in the Family Court of Australia on 2nd July 1976. Mrs. Taylor was not represented. Her solicitor did not file any document in opposition and her solicitor and counsel thought the hearing was to be in the Family Law Division of the Supreme Court which she attended. Her legal representatives ascertained that the matter was not listed for that day in that Division and did nothing. Hogan J. made the order in accordance with Mr. Taylor's application, apparently thinking, as did Mr. Taylor's representatives, that the Supreme Court's order could be varied by the Family Court of Australia as the Supreme Court would have varied it (but for the Family Law Act) under s. 87 (1) (j) (i) of the Matrimonial Causes Act (see Zafiropoulos v. Zafiropoulos [25] ). The Family Law Act, however, did not contain a provision to the same effect. Mrs. Taylor learned of the order and appealed to the Full Court of the Family Court of Australia which allowed the appeal, holding that Hogan J. had no power to make the order.

Mr. Taylor contends that Hogan J.'s order can be justified on either of two bases. Firstly, that Woodward J.'s order was an order with respect to maintenance within s. 83 of the Family Law Act which confers on the court power "to discharge, suspend, revive or vary orders with respect to maintenance". The order, however, was for the alteration of property interests including settlement of property but the Act draws a distinction between orders for settlement of property and orders with respect to maintenance. If the terms of a property order are affected by the terms of an order with respect to maintenance, or by the fact that no order has been made with respect to maintenance, this does not make it an order with respect to maintenance. The difference in legislative treatment of property and maintenance orders is due to strong policy considerations in not reopening property orders after time for appeal has elapsed.

Secondly, Mr. Taylor contends that Woodward J.'s order, even if it is one of settlement of property, could be set aside and the second order made under the express provisions of the Family Law Act. Section 79A provides (by amendment which came into operation on 1st July 1976):

(1) Where, on application by a person affected by an order made by a court under section 79, the court is satisfied that the order was obtained by fraud, by duress, by the giving of false evidence or by the suppression of evidence, the court may, in its discretion, set aside the order and, if it thinks fit, but subject to sub-sections 79 (2) and (4), make another order under section 79 in substitution for the order so set aside.

(2) In the exercise of its powers under sub-section (1), a court shall have regard to the interests of, and shall make any order proper for the protection of, a bona fide purchaser or other person interested.

Section 79 deals with orders for alteration of property interests. The effect of the transitional provisions is that the Supreme Court's order is to be treated as an order under s. 79. Section 79A therefore enables the Supreme Court order to be set aside in the circumstances referred to in the section. On 2nd July 1976, Mr. Taylor gave evidence before Hogan J. which differed from that given by his wife before Woodward J. This evidence was not directed towards s. 79A; the judge, Mr. Taylor and his representatives were apparently unaware that s. 79A had come into operation. However, Mr. Taylor contends that Hogan J.'s order may be sustained on the basis that s. 79A was complied with.

Section 89 of the Matrimonial Causes Act provided that "the court shall not make an order under this Part in favour of the petitioner where the petition for principal relief has been dismissed". Mr. Taylor contends that the evidence on which the decree nisi was based was false and, therefore, the order for property settlement was obtained on false evidence. This should be rejected. Section 79A should not be interpreted to allow the integrity of a decree to be underminded by allowing the evidence on which it was based to be subjected to review under s. 79. "Where the court is satisfied that the order was obtained by false evidence" means that the court is satisfied that the order would not have been obtained but for the false evidence. This permits review of the evidence on which an order was obtained, but does not permit inquiry into whether a decree nisi for dissolution was obtained by the giving of false evidence. A claim that evidence on which an order was based was false is permissible under s. 79A even if this also was evidence on which a decree nisi was based, but it is not permissible to come within s. 79A by showing that a decree nisi was obtained by false evidence. Such a collateral inquiry into the foundation of a decree for dissolution is inconsistent with the provisions designed to protect the integrity of a decree for dissolution. A decree nisi may be appealed (s. 55) or rescinded on the ground of miscarriage of justice (s. 58) but there is no appeal from a decree absolute (s. 93). Mr. Taylor's argument that he is not impugning the decree nisi is unacceptable. The contention that the order was obtained by false evidence because the decree nisi was obtained by false evidence directly involves the proposition that the decree nisi should not have been granted. The decree nisi is merged in the decree absolute. Even if a decree for dissolution were liable to direct attack, a collateral attack such as this would not be permissible (see Hinton Demolitions Pty. Ltd. v. Lower [No. 2] [26] ). Even more, such an attack cannot be made indirectly when the decree cannot be attacked directly. The order cannot be sustained under s. 79A.

A second reason why the order cannot be sustained under s. 79A is that Hogan J. did not purport to make any order setting aside Woodward J.'s order under s. 79A; he was not asked to do so, and even if he had been, he would have had no power to do so until the application had been served on Mrs. Taylor and she had been given an opportunity to be heard. Setting aside an order because of circumstances referred to in s. 79A is an exercise of power distinct from power to vary an existing valid order because it is just to do so, for example, if there are changed circumstances. It would be quite wrong in the absence of a party to treat an application to vary as sustaining an order setting aside a decision on the ground of the absent party's false evidence.

A third reason is that even if s. 79A were available, no court has held that the conditions in s. 79A are satisfied. The Full Court of the Family Court of Australia was not asked to apply s. 79A on the basis that it was of the opinion that the requirements of the section were satisfied; rather, there was an attempt (as in this Court) to justify Hogan J.'s order on that basis. However, the Full Court considered that the order could not be justified under s. 79A as there was no false evidence. It considered that false evidence meant "wilfully or demonstrably false". Mr. Taylor's counsel conceded in this Court that the Full Court did not "make any finding or draw any conclusion as to whether the evidence had been false" other than it was not wilfully or demonstrably false. They held he had no other power to make the order. It is not possible, on this appeal, to determine that the requirements of s. 79A were satisfied. However, Mr. Taylor's counsel contended somewhat reluctantly during argument (after invitation from this Court) that there is an inherent power in the Family Court to set aside Woodward J.'s order and redetermine the question.

It is a fundamental principle of justice that a party affected must have the opportunity to be heard before any order is made against him (unless there are special circumstances, such as urgent preservation orders). The Family Court of Australia, as a federal court, is (as the Supreme Court, as a court vested with federal jurisdiction in matrimonial causes, was) vested with the judicial power of the Commonwealth under Ch. V of the Constitution. An implication should be drawn from Ch. V of the Constitution and from our judicial history that such a basic principle is to be applied in the exercise of that judicial power.

If Mr. Taylor had no opportunity to be heard (by reason of some fault attributable to the court or Mrs. Taylor) then the right to have the case reopened (at least unless some factor such as acquiescence made the order immune from challenge) would derive from the implication of fundamental justice which would be applicable irrespective of any provision of the Family Law Act. However, the fact that Mr. Taylor was not heard by Woodward J. was not because he had no opportunity to be heard. It was not the fault of Mrs. Taylor nor of the Court. The order was made regularly. There was no breach of the fundamental principle of justice. However, there is a longstanding principle that an order made against an absent party may be set aside where the absence is not the fault of the other party or the Court (even where the absence was the absent party's fault), or where the absence is excusable, and considerations of delay, acquiescence or prejudice are not countervailing. For example, see Reg. v. London Quarter Sessions [27] ; Wiseman v. Wiseman [28] .

1. [1956] 1 All E.R. 670, at pp. 635-676. 2. [1953] P. 79, at p. 96.

A rule may be recognized that where (in the exercise of federal jurisdiction) an order has been made against a person who, through his own fault (or without the fault of the court or the other party) has not availed himself of an opportunity to be heard, the court may in its discretion set aside the order and allow the matter to be reheard. Such a rule may properly be characterized as a federal common law rule of judicial power. This rule should be excluded only by unmistakable language, that is, express words or necessary implication. Section 79A does not contain language unmistakably evincing an intention to exclude such a common law rule. The discretion to reopen should be applied only with caution. Factors to be considered are the presence or absence of some real explanation for failure to use the opportunity to be heard, delay, acquiescence, prejudice to the other party.

The Family Court of Australia was not asked at first instance or on appeal to invoke any common law power to set aside the Supreme Court's order. No court has given consideration to the matters which affect the exercise of discretion to do so. Although I consider there is a discretion in the Family Court to set aside the Supreme Court's order, no opportunity has been given to either party to present evidence and argument on whether that discretion should be exercised.

An order by this Court directing that the Supreme Court's order be set aside is making Mrs. Taylor suffer again what Mr. Taylor suffered in the Supreme Court and which she suffered in the Family Court, that is, she will be subjected to an adverse order without being heard on the question of whether the order should be made. For the first time, this Court is holding that the Family Court has power, in its discretion, to set aside the Supreme Court's order (apart altogether from s. 79A). Mr. Taylor has not asked any court to exercise the power; whether this Court can or should exercise the power if now asked is at least dubious. If it does, an opportunity should be given to both parties to tender evidence and to be heard on the question of its exercise (for example, Mrs. Taylor may have entered into commitments on the faith of the Supreme Court's order). This Court should not do anything to fetter any exercise of the Family Court's discretion. The considerations which affect the exercise of common law discretion to set aside an order may (and I think they do) differ from those which would have affected the exercise of discretion under s. 87 (1) (j) (i) of the Matrimonial Causes Act. It is open to Mr. Taylor to apply to the Family Court to set aside the Supreme Court's order, either under the federal common law power or under s. 79A (but it seems that this would now require the leave of the Family Court (see s. 44 of the Act)).

In this matter I have had the advantage of reading the reasons for judgment prepared by my brother Mason. I agree with those reasons and there is little that I wish to add.

In the proceedings before Woodward J. in the Supreme Court of New South Wales under the Matrimonial Causes Act 1959, the applications for principal and for ancillary relief were heard together and the evidence placed before him does not appear to have been presented in a manner which distinguished between the issues to which it was directed, though some matters are plainly relevant to one issue and not the other. It does not appear to me to matter whether the evidence now said to be false was relevant only to the claim for dissolution or to both claims or only to the claim for ancillary relief. The order for dissolution was a condition precedent to the making of the property order, but that does not mean that an attack on the making of the latter involves impugning the former. It does however follow that evidence directed exclusively to the claim for dissolution contributed to the making of the property order because without the decree nisi no property order could have been made.

The principle that parties to litigation are entitled to be present and heard, either in person or by a duly authorized legal representative, is of fundamental importance and involves the consequence that, where through no fault of his own, a party is deprived of that entitlement, prima facie any order of a court made against him may be set aside by that court. I can see no basis for confining the application of that principle to cases where there has been a failure to serve the process or give other appropriate notice. No doubt in other cases it may often be that terms as to costs would be imposed on the applicant. There is nothing in the Family Law Act 1975 to deprive the Family Court of that inherent power save that s. 58 effectively limits the period within which an application to set aside a decree nisi may be made. The present case is unusual in that each party, through no fault of either, suffered the fate of having orders made in his or her absence. There is no circumstance which distinguishes one mishap from the other, and each order so obtained should be set aside.

I would make an order in the form suggested by my brother Mason.