Case: Black &amp; Black [2008] FamCAFC 7
Outcome: cited
Fourth, I do not accept the submission of the respondent that the decision in Lopatinsky [2003] FCAFC 109 ; (2003) 129 FCR 234 is distinguishable because in Lopatinsky [2003] FCAFC 109 ; (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] FCAFC 109 ; (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 &amp; 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] FCAFC 109 ; (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] FCAFC 26 ; (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. (b) Alleged payment by the respondent and her mother for the Carrara property, resulting in the transfer of that property to the respondent by Mr Jensen was merely a transfer of the bare legal title