If a party enters into consent orders which the party feels do not reflect the agreement of that party, can the orders be set aside? Can the party ‘get out of the orders?’
The general proposition appears to be ‘no’, unless:
a) there has been miscarriage of justice under s79A of the Family Law Act (Cth) 1975; or
b) the agreement itself underlying the orders can be invalidated itself in some way pursuant to the Court’s inherent jurisdiction.
Langford v Coleman
The case of Langford v Coleman 1992 16 FAM LR 228 is the starting point. This case suggests that there is a rule in family law that consent orders cannot simply be set aside, for example, on the grounds of mistake.
In Langford the Husband and Wife ran a florist shop. After separation the wife commenced proceedings for property settlement and orders were made (by consent) which (i) formally terminated the florist shop partnership between the husband and wife, (ii) confirmed the wife as sole proprietor of that business and (iii) indemnified the wife against certain debts including debts arising out of the florist shop business. The husband appealed, unsuccessfully from the orders, principally on the basis that there was a mistake in the interpretation of the indemnity and the wife should indemnify him against the debts arising out of the florist shop from the date upon which she had taken over the business as sole proprietor.
The Principle
In Langford, Nygh J (with whom the rest of the Full Court agreed), said:
‘the proposition that at least in matrimonial causes once any financial agreement reached between the parties is embodied in consent orders, it is to these orders alone that the Court must look. The Court cannot take into account whatever agreement might or might not have been reached between the parties which led to the making of the consent orders.
The authority for that proposition is found in the opinion of the Privy Council on appeal from Hong Kong in de Lasala v. de Lasala (1980) AC 546 at 560, where Lord Diplock said:
“Financial arrangements that are agreed upon between the parties for the purpose of receiving the approval and being made the subject of a consent order by the court, once they have been made the subject of the court order no longer depend upon the agreement of the parties as the source from which their legal effect is derived. Their legal effect is derived from the court order.”
That principle was applied by the English Court of Appeal in the case of Thwaite v. Thwaite, (1981) 3 WLR at 96 and I refer particular to the judgment of Lord Justice Ormrod, as he then was, at page 101, where his Lordship said:-
“The effect of eliminating the contractual basis of these consent orders should simplify the problems. If their legal effect is derived from the court order it must follow, we think, that they must be treated as orders of the court and dealt with, so far as possible, in the same way as non-consensual orders.”’
Exceptions to Langford – Getting Around the Principle
s79A
Although enacted before Langford, s79A of the Act does not seem to have been given any consideration.
Section 79A of the Act gives the Court a broad discretion and clearly sets out grounds where the court may vary an order. These include a miscarriage of justice by reason of situations including:
a) fraud;
b) duress;
c )suppression of evidence; or
d) any other circumstancei
Though it does not appear to expressly include a mistake, it appears possible that it would fit into the ‘any other circumstances’ provision.
In the Marriage of BF and DA Simpson
Langford does not seem to pay regard to the case of In the Marriage of B F and D A Simpson – (1982) 8 Fam LR 467, which, although only the decision of a single judge and prior to Langford, was not expressly overruled by Langford, contradicts it, and nevertheless sets out a different approach to the law.
In Simpson O’Leary AJ set aside orders made having found that there was a miscarriage of justice. In his words, ‘the fact that the agreement of compromise was void, and the orders made on it invalid, was a circumstance by reason of which there has been a miscarriage of justice.’ In Simpson the orders were found to be void for uncertainty.
In Simpson the Court applied the s79A framework and referred to the Cour’t’s inherent jurisdoction to set-aside consent orders as described in the High Court of Australia decision of Harvey v Phillips (1956) 95 CLR 235
Harvey v Phillips
Although Harvey was a personal injuries case, the High Court, consisting of Dixon McTiernan, Williams, Webb and Fullagar, cited the English case of Huddersfield Banking with approval:
The question whether the compromise is to be set aside depends upon the existence of a ground which would suffice to render a simple contract void or voidable or to entitle the party to equitable relief against it, grounds for example such as illegality, misrepresentation, non-disclosure of a material fact where disclosure is required, duress, mistake, undue influence, abuse of confidence or the like. The rule appears rather from positive statements of the grounds that suffice (cf Halsbury’s Laws of England, Vol 26, 2nd ed, pp 84, 85); but there is a dictum of Lindley LJ which is distinct enough: “. . . nor have I the slightest doubt that a consent order can be impeached, not only on the ground of fraud but upon any grounds which invalidate the agreement it expresses in a more formal way than usual . . . To my mind the only question is whether the agreement on which the consent order was based can be invalidated or not. Of course if that agreement cannot be invalidated the consent order is good”: Huddersfield Banking Co Ltd v Henry Lister & Son Ltd (1895) 2 Ch 273, at p 280.
Here the use of the phrase ‘not only of fraud but of any grounds which invalidate the agreement it expresses’ is most interesting. This, on the face of it, seems to contradict the decision in Langford. It also seems to extend the Court’s ability to void consent orders on any ground which would void the underlying agreement, which would include in some circumstances mistake, frustration of contract, and estoppel.
Conclusion
The decision in Langford is a sensible decision. Courts would be flung into chaos if orders were resiled from simply because one party sought to re-open the case. It would involve introducing new evidence to show why the consent orders ought to be impeached and place a huge strain on an already under-resourced jurisdiction, where parties are encouraged to reach agreements putting their disputes at an end.
Nevertheless in some circumstances it may be necessary to scrutinise the situation beneath the consent orders. While on the face of it, Langfordappears to dismiss this possibility, there appears to be authority available to circumvent the strict application its rule.
Marc Testart, Barrister
is79A(1)(a).
MyLearnedFriends 
Posted on May 15, 2011
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