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Citation: Bray & Poole [2026] FedCFamC1A 194

Financial Agreement Stays Set Aside, but Unexplained "Equal Contributions" and a Litigation-Conduct Kennon Adjustment Sink 65/35 Property Orders

In Bray & Poole [2026] FedCFamC1A 194, the Full Court (Williams, Jarrett and Behrens JJ) dealt with a husband's appeal against orders that set aside the parties' binding financial agreement and divided their net non-superannuation property 65 per cent to the wife and 35 per cent to the husband ([1]–[2]). The result was split. The order setting aside the agreement stands, because the hardship finding under s 90K(1)(d) was open, even though the primary judge had not made the reliance finding needed for the s 90K(1)(b) misrepresentation basis ([44], [49]–[50]). But the property orders (Orders 2–21) were set aside and the property application was remitted to a different judge. The primary judge had treated the husband's conduct of the litigation as Kennon conduct without characterising it, and had assessed contributions as equal without explaining how the husband's "overwhelming" initial contributions were reduced to parity ([80]–[81], [95]–[100]). The Commissioner of Taxation intervened on the treatment of tax penalties and interest, but the Court did not decide that ground ([5], [20]). All paragraph references below are to the judgment.

Why it matters: This is a practical lesson on three fronts. A financial agreement can be set aside for child-related hardship without a line-by-line accounting comparison ([41]–[42]). Litigation conduct is not automatically Kennon conduct or family violence: the judge must characterise the conduct, not just describe its impact ([76], [78]). And a judge who finds one party "overwhelmingly" made the initial contributions must explain why contributions nonetheless end up equal ([95], [97]).

🧩 Facts and Issues

The relationship and the agreement

  • The parties began their relationship in 2009 and signed a financial agreement on 26 August 2010, said to be made under s 90B of the Family Law Act 1975 (Cth) ([6]).
  • The agreement listed each party's "Separate Property" and divided the remaining "Shared property" equally. If it stood, the wife could make no claim on the husband's separate property, which the primary judge valued at about $818,720 at trial ([6], [37]).
  • The parties married in 2010 and have four children. When the agreement was made they had no children, and it made no provision for children ([7], [25]).
  • They separated on 11 July 2022. The children stayed in the wife's care, and she applied 14 days later to set aside the agreement and for property orders ([9]).

What the wife alleged

  • The wife relied on four bases to set the agreement aside: hardship (s 90K(1)(d)), unconscionable conduct (s 90K(1)(e)), undue influence, and misrepresentation and non-disclosure making the agreement voidable (s 90K(1)(b)) ([10]).
  • The wife alleged family violence by the husband throughout the marriage. The husband denied the allegations ([8], [51]). The primary judge accepted her evidence and found it "compelling" ([51]–[52]).
  • The case also raised the husband's claims that he held some property interests on trust for his sister, an alleged loan between them, and the treatment of his substantial tax liabilities, including penalties and interest ([11]).

The primary judge's decision

  • The agreement was set aside on two independent bases: hardship under s 90K(1)(d), and voidability under s 90K(1)(b) for misstatement of the husband's financial position. Undue influence and unconscionable conduct were rejected ([27], [31]).
  • Applying the pre-amendment property framework, which no one challenged, the primary judge assessed contributions as equal and divided the net non-superannuation property 65/35 in the wife's favour ([2], [12], [91]).

The appeal

  • The Amended Notice of Appeal had 16 grounds. Ground 5 and part of Ground 4 were abandoned ([3], [82]).
  • The Commissioner of Taxation intervened and supported the husband's challenge to the treatment of tax penalties and interest (Ground 10) ([5]).
  • The Court decided only Grounds 3 and 6 (the agreement), Ground 11 (Kennon) and Ground 12 with the sixth complaint in Ground 4 (contributions) ([4], [17]–[18]).

Issues

  • Was the hardship finding under s 90K(1)(d) properly made without an express comparison of the wife's net asset position with and without the agreement?
  • Did the primary judge make the reliance or inducement finding needed for misrepresentation under s 90K(1)(b)?
  • Was the Kennon finding sound, including the reliance on the husband's conduct of the litigation?
  • Were the reasons for assessing contributions as equal adequate?

⚖️ Applicable Law – Legislation, Regulations, Rules

  • Family Law Act 1975 (Cth) s 90B — the provision under which the financial agreement was said to have been made ([6]).
  • Family Law Act 1975 (Cth) s 90K(1)(b), (d) and (e) — the court may set aside a financial agreement that is voidable, where a material change in circumstances relating to a child means the child or the carer will suffer hardship, or for unconscionable conduct ([10], [24], [27]).
  • Family Law Act 1975 (Cth) s 90KA — the general law of contract applies to questions of validity ([27]).
  • Family Law Act 1975 (Cth) s 79(4) — the assessment of contributions, under which Kennon conduct may be taken into account ([69]).
  • Family Law Act 1975 (Cth) s 4AB — the definition of family violence ([75], [79]).
  • Family Law Amendment Act 2024 (Cth) — the final hearing began before the relevant amendments took effect, so the pre-amendment framework applied ([12], [70]).
  • Federal Proceedings (Costs) Act 1981 (Cth) ss 6(1) and 9 — costs certificates for appeals that succeed on a question of law ([108]; Orders 5–6).

📌 Precedents Relied On

  • Kuru v New South Wales (2008) 236 CLR 1 and Boensch v Pascoe (2019) 268 CLR 593 — when an intermediate appeal court should, and need not, decide every ground ([15]–[19]).
  • Fewster & Drake (2016) FLC 93-745 — the principles for hardship under s 90K(1)(d), including the need for "some comparison" and a causal link ([32], [41]).
  • Frederick & Frederick (2019) 60 Fam LR 1 — distinguished; it does not require a comparative accounting exercise ([41]).
  • Thorne v Kennedy (2017) 263 CLR 85 — undue influence and unconscionable conduct, applied by the primary judge ([27]).
  • Browne v Dunn (1893) 6 R 67, LC v TC (1998) FLC 92-803 and Rittman & Rittman (Costs) [2012] FamCAFC 151 — where evidence-in-chief is by affidavit, there is little purpose in mechanically "putting" one party's evidence to the other ([55]–[56]).
  • Precision Plastics Pty Ltd v Demir (1975) 132 CLR 362 — a judge is not bound to accept evidence merely because it is unchallenged ([58]).
  • Devries v Australian National Railways Commission (1993) 177 CLR 472 — limits on disturbing credibility-based findings ([59]).
  • Kennon v Kennon (1997) FLC 92-757, Martell & Martell (2023) 66 Fam LR 650 and Dajani & Dajani (2025) FLC 94-239 — conduct with a "discernible effect" that made a party's contributions more arduous can be taken into account; the focus is the effect on contributions ([69]).
  • Keating & Keating (2019) FLC 93-894, Benson & Drury (2020) FLC 93-998 and Maine v Maine (2016) 56 Fam LR 500 — expert evidence is not essential; the effect can be inferred from lay evidence ([62]–[63]).
  • Baranski & Baranski and Anor [2012] FamCAFC 18 — post-separation conduct may be relevant to contributions ([71]).
  • Pickford & Pickford (2024) FLC 94-230 — litigation conduct, without more, is not coercive and controlling behaviour or family violence ([77]–[78]).
  • Bennett and Bennett (1991) FLC 92-191 — the test for inadequate reasons ([83]).
  • Gronow v Gronow (1979) 144 CLR 513 and CDJ v VAJ (1998) 197 CLR 172 — weight is for the trial judge unless the result is "plainly wrong" ([92]).
  • Pierce & Pierce (1999) FLC 92-844 — the weight of initial contributions depends on their nature, size and relationship to the property at trial ([94]).

🧠 Analysis

Issue

When a primary judge sets aside a financial agreement and then divides the property, what findings and reasons are needed for each step: hardship, misrepresentation, Kennon conduct and the overall contributions assessment?

Rule

  • Hardship under s 90K(1)(d) must flow from the material change relating to a child. It means more than unfairness, and the evidence must allow "some comparison" and a causal connection ([32], [41]).
  • A misrepresentation makes an agreement voidable only if the misled party relied on it or was induced by it ([46]–[49]).
  • Kennon conduct must have had a discernible effect on the other party's contributions. Litigation conduct may be family violence if it falls within s 4AB, but the judge must characterise the conduct ([69], [76], [79]).
  • Reasons are inadequate if the appeal court cannot work out the reasoning ([83]). The weight given to initial contributions depends on the facts, and the task is to evaluate the whole course of contributions ([94]).

Application

The hardship finding survived without an accounting exercise

The husband argued the primary judge had to compare the wife's net asset position with and without the agreement ([34]). The Full Court rejected this. Read as a whole, the reasons showed the primary judge was "clearly cognisant" of the parties' comparative net asset positions ([39]).

Fewster requires only "some comparison", not "the comparative accounting exercise" the husband sought ([41]). The reasons covered the children's needs, the wife's income and expenses including school fees, the husband's finances, and the exclusion of his separate property ([36]–[37], [42]).

The hardship was not just a less favourable property outcome. Enforcing the agreement would leave the wife to meet "substantially increased demands on her resources from a materially smaller capital base", with the excluded assets a little over 22 per cent of the net non-superannuation pool ([42]). The husband had also conceded some hardship at trial ([40], [43]). Ground 3 had "no merit" ([44]).

The misrepresentation basis lacked a reliance finding, but that did not matter

The primary judge did not identify the false representations ([29]). Most appeared to be the husband's listing of property interests he later claimed to hold on trust, but the primary judge rejected those trust claims, so there was no operative misrepresentation there. One misrepresentation remained: the agreement said he owned 50 per cent of one property when he owned 33 per cent ([29]).

The wife's own case was that she signed because of pressure around the wedding, not because she relied on the husband's financial statements ([48]–[49]). With no evidence of reliance, it was "not at all apparent" that the requisite finding was made, even by inference. Ground 6 had merit ([49]).

It was of no consequence. The hardship finding was an independent basis, so the appeal against Order 1 was dismissed and the agreement remains set aside ([50], [102]).

The family violence findings were "unimpeachable"

The husband complained that many allegations were not put to him in cross-examination ([54]). The Full Court said that where evidence-in-chief is by affidavit, little purpose is served by mechanically "putting" one party's evidence to the other ([55]). He was on notice through the wife's affidavit and responded to it in his own ([57]).

A judge is not bound to accept evidence just because it was unchallenged, and his evidence was challenged by hers ([58]). Nothing showed the primary judge misused the advantage of seeing the witnesses ([59]). Her evidence alone was enough to show her contributions were more onerous; expert evidence is not essential ([61]–[62]). The finding about conduct during the marriage was "plainly open" ([60], [67]).

Litigation conduct must be characterised, not just felt

The primary judge also found the husband's conduct of the proceedings, including disclosure failures and numerous applications, made the wife's contributions as a carer more difficult ([52], [68], [74]).

That was a failure to apply proper principle. The primary judge had to characterise the conduct itself, not just its impact. Under the pre-amendment law that did not necessarily require a finding of family violence under s 4AB, but it did require an assessment of how the conduct was a relevant "course of conduct" under Kennon ([75]–[76]).

Pickford did not help the wife. Refusing to consent to orders, or asserting legal rights, is not family violence by itself ([77]–[78]). The Court accepted that delaying or vexatious conduct may be family violence if it falls within s 4AB, but the primary judge did not do that analysis ([79]). On the evidence, the Full Court was not satisfied the litigation conduct met the thresholds ([80]). Ground 11 succeeded "to that limited extent" ([81]).

"Overwhelming" initial contributions cannot quietly become equality

The primary judge found the husband "overwhelmingly made the initial contributions" and worked hard throughout the marriage, while the wife made the more significant homemaker and parenting contributions in difficult circumstances ([87]–[89]). The primary judge then assessed contributions as equal ([91]).

The Full Court accepted that different weighting alone is not error ([92]). But there was "a disconnect between the findings and the ultimate conclusion" ([95]). Pre-relationship property represented nearly a quarter of the net assets, and there was no attempt to analyse it as a proportion of the pool ([96]). An equal finding needed an explanation of why the initial disparity "ceased to be materially significant", and none was given ([97]).

A Kennon finding increases the weight of the wife's contributions, but it does not remove the need to recognise the husband's initial contributions properly, and here it was "infected" by the litigation-conduct error ([98]). The assessment was "plainly wrong" and the reasons inadequate ([99]).

What the Court did not decide, including the tax points

The remaining grounds, about trust interests, the inter-family loan, tax liabilities, wastage, add-backs and the enforcement orders, were not decided ([19], [103]). That includes Ground 10, on which the Commissioner of Taxation intervened. The Court expressed no view on those findings or submissions ([20]). The digest therefore says nothing about how the tax penalties and interest should be treated; that is for the rehearing.

Costs certificates rather than a costs order

The husband sought costs of $67,050, arguing the wife induced the error. The Court was not satisfied of that ([104], [107]). Because the appeal succeeded on a question of law, each party received a costs certificate under the Federal Proceedings (Costs) Act 1981 (Cth), excluding the intervener. The Commissioner did not seek costs ([106], [108]; Orders 5–6).

Conclusion

The appeal against Order 1 was dismissed, so the financial agreement remains set aside. Orders 2–21 were set aside, the property application was remitted to a different judge, and both parties received costs certificates (Orders 1–6; [100]–[102], [108]).

This judgment does not decide that the husband's trust or loan claims were right or wrong, how the tax liabilities should be treated, or what the final division should be. It does not overturn the findings about conduct during the marriage ([20], [60], [67]).

🧠 Take-Home Lesson

  • Hardship needs a comparison, not a spreadsheet. Under s 90K(1)(d), the reasons must show some comparison of the carer's position with and without the agreement, and a causal link to the child-related change ([41]–[42]).
  • Misrepresentation needs reliance. A false statement in an agreement does not make it voidable unless the other party relied on it or was induced by it ([49]).
  • Run every basis you have. The agreement stayed set aside because hardship was an independent basis, even though the misrepresentation basis was flawed ([50]).
  • Affidavit evidence puts the other side on notice. Mechanically "putting" every allegation in cross-examination is not required where evidence-in-chief is by affidavit ([55], [57]).
  • Litigation conduct is not automatically Kennon conduct or family violence. The judge must characterise the conduct itself, not just how it affected the other party ([76], [78]–[79]).
  • Explain the step to equality. If initial contributions are found to be "overwhelming", the reasons must explain why they no longer matter ([95], [97]).
  • Interveners do not guarantee a ruling. The Commissioner's ground was left for the rehearing because the appeal was decided on other grounds ([5], [19]–[20]).
  • Self-represented litigants and support workers: if you say the other side's litigation conduct made your contributions harder, be ready to show what the conduct was and why it is more than asserting legal rights ([72]–[79]).
"Describing the burden of litigation is not the same as characterising the conduct."
"Overwhelming initial contributions do not become equal without reasons."
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