In Bassett & Teale [2016] FCCA 2177, the parties had been involved in costly litigation as a result of a Binding Child Support Agreement (the “Agreement”) concerning their two children for the better part of six and half years.

Background

In 2009 the parties were in an apparent agreement that Mr. Teale was to pay child support pursuant to the prevailing Child Support Assessment provided by the Department of Human Services, formally known as the Child Support Agency.

As the years passed, however, passed the parties were in dispute as Mr. Teale was seeking to have the agreement deemed void or alternatively to have the agreement set aside. In addition, he was seeking leave of the court so that a Departure Order could be made. If granted he could pay the relevant amount in line with the assessment process, with an additional lump sump covering the remainder of the expenses for the children.

Alternatively, Ms Bassett was seeking orders, enforcing the existing Agreement along with arrears owed to her by Mr Teale.

 

Decision

The court was of the opinion that the Binding Child Support Agreement had relevant sections, however they could not be severed or isolated from the document. In other words, the agreement was to be read as a whole and could not be varied as per s 80CA of the Child Support Assessment Act (the “CSAA”).

Mr. Teale had gone on to argue that the parties did not have a meeting of the minds on the terms of the Agreement because there did not appear to be a common understanding on the terms “reasonable school fees” and “reasonable extra curricular activities”. He had alleged that the Agreement was to be questioned as to whether there ever was an agreement at law in existence. The very fact that the parties had been in dispute about the meaning of those terms indicates that they were not in agreement at all and more importantly they were not in agreement at the time of signing the document.

Ms Bassett’s solicitors had made submissions that it was not uncommon for the court to determine what is meant by “reasonable” when the parties cannot reach an agreement.  The court refuted this point, as the sole purpose of a binding agreement is to prevent the matter from entering the court system by a meeting of the mind of fundamental terms.

As a result because the parties had not agreed to fundamental terms which continued to remain ambiguous, the court declared the Agreement void. In addition, the departure order was granted pursuant to s 116(1)(b) of the CSAA.

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