What Court and when?

The Australian court system is intricate. This is in large part due to our Constitution and the allocation of powers and responsibilities in relation to various matters between the Federal government and the State governments.

One clear example is in family law.

There are several courts - at both state and federal level - that deal with issues concerning families. Each court has jurisdiction to deal with specific types of cases, although there are several areas which overlap and certain matters could very well be heard in any number of courts.

For example, at a federal level, there is the Family Court of Australia and the Federal Circuit Court of Australia. Both courts have jurisdiction to consider property division and/or parenting disputes between separating married or de facto couples. Generally speaking the Family Court will consider the more specialised or complex types of matters. However, in New South Wales, the Local Court, District Court and Supreme Court also have jurisdiction to make orders under the Family Law Act in relation to property division. There are limitations on the orders that these courts can make - for example the Local Court and District Court can only consider property division cases that involve an asset pool under a certain amount ($100,000 in the Local Court and $100,000-$750,000 in the District Court). Additionally, the NSW Children's Court can make orders for the care and protection of children who are at risk of harm.

However, family law matters also provide another example where the respective jurisdictions of the federal courts and the state courts are further entwined. That is, where the same facts could result in different applications being made in either a federal court or a state court.

In yesterday's Sydney Morning Herald there was an article on this example of how the two jurisdictions interrelate.

In May of this year an order was made by the Supreme Court of New South Wales, upon an application made by a soon-to-be former mother-in-law (Ms McDonald), for the son-in-law (Mr Street) to pay her $540,729.92 plus interest and costs. Last month a garnishee order was made directing all of Mr Street's income to be paid to Ms McDonald in repayment of that debt.

It is understandable that Ms McDonald commenced her claim in that Court. Ms McDonald was claiming that she had loaned Mr Street monies when he was struggling to pay his mortgage and that Mr Street had failed to repay her those monies. That is, that Mr Street had breached a contract between himself and Ms McDonald. Ms McDonald was relying on the Supreme Court's common law civil jurisdiction.

Mr Street however has now sought an adjournment of the garnishee order to enable him to seek that the matter be transferred to the Family Court.

The ability of the Family Court to consider the matter is based on the breakdown in the marriage between Mr Street and Mrs Street, Ms McDonald's daughter. The Family Court, in exercising its jurisdiction to make property division orders between Mr and Mrs Street has jurisdiction to hear from third party creditors of the marriage, such as Ms McDonald.

The matters which the Family Court will consider in determining whether Ms McDonald is a third-party creditor of the marriage and therefore owed money from the matrimonial asset pool may be vastly different from those matters that the Supreme Court will have considered in determining a breach of contract matter.