No fiduciary duty owed to former client

Financial agreements – Principal of law firm prepared her own financial agreement and given legal advice by solicitor employed in her practice

In Connery & Sims [2025] FedCFamC1A 34 (6 March 2025) Christie J, sitting in the appellate jurisdiction of the Federal Circuit and Family Court of Australia, allowed a de facto wife’s appeal against a declaration that a financial agreement was not binding.

The de facto wife was a solicitor and a principal of her own practice. She had acted for the de facto husband in respect of his parenting dispute but ceased acting for him when the parties commenced a relationship. The de facto wife drafted the financial agreement and obtained legal advice from a lawyer employed in her practice ([24], [25]). The de facto husband obtained legal advice from another lawyer.

The primary judge found that the legal advice given to the de facto wife was not independent for three reasons:

1. As a prior fiduciary relationship existed between the de facto husband and the de facto wife’s firm in respect of the parenting dispute.
2. The solicitor who signed the certificate was an employee of the de facto wife’s practice.
3. The “quality of the legal advice suggests that it was not independent” ([26]).

After citing Hoult [2013] FamCAFC 109 and noting that the certificate of advice was “prima facie evidence of compliance with s 90UJ(1)(b) of the Act” ([51]) the Court said (from [58]):

“ … [T]he primary judge mistakenly concluded that a former client was owed a fiduciary duty. No fiduciary duty apart from confidentiality is owed to a former client. …

[59] … The question of the meaning to be attached to the expression ‘independent’ is to be drawn from its context. … [T]he intention of the legislature is that each party shall receive legal advice which is independent of the other party. ( … )

[61] … [T]he primary judge purported to assess the quality of the advice … It is well-settled that it is not the role of the Court to retrospectively assess the quality of the legal advice provided … ( … )”