Defaulting on orders can be disastrous – FamCAFC 77

In Blackwell & Scott [2017] FamCAFC 77 (28 April 2017) the parties obtained consent orders for an equal division of their property. Under the consent orders Mr Blackwell was required to pay Ms Scott $130,000 within 90 days of the date of the orders in exchange for the Ms Scott transferring to the husband all ofher right, title and interest in an investment property. This represented an equal distribution of property between them.

Mr Blackwell delayed payment for 13 months. During that time the investment property’s value increased by hundreds of thousands of dollars. As a result, Ms Scott received far less than half the property pool. Ms Scott commenced an application to have the consent orders set aside. That application was successful before the trial judge.

Mr Blackwell appealed. Under section 90SN of the Family Law Act 1975, the court can vary or set aside property orders for various reasons, including of the circumstances of the default mean that the effect of the orders are no longer just and equitable. Judge Aldridge said in the appeal:

Thus whilst it is entirely correct to say that the husband’s default did not case the house price to rise, that is not the relevant enquiry. The relevant enquiry is whether the circumstances have arisen as a result of the husband’s default that would make it just and equitable to reconsider the earlier orders. The circumstances that arose were that, as a common-sense proposition, the wife received significantly less than an equal division of the property and the husband received considerably more. That difference resulted directly from the husband’s delay in complying with the orders.

As a result of his delay, Mr Blackwell was required to pay Ms Scott hundreds of thousands more than the $130,000 he was required to pay under the original consent orders.