The applicant sought to set aside a separation agreement under s. 56(4) of the Family Law Act, alleging material misrepresentation and non-disclosure by the respondent regarding the valuation of a company.
The respondent had received letters of intent to purchase the company and was negotiating a buyout of his partner's interest while simultaneously negotiating the separation agreement with the applicant, without disclosing this information.
The court found that the respondent's failure to disclose this information constituted a material misrepresentation, both subjectively and objectively, and breached the duty of utmost good faith in family law negotiations.
The court exercised its discretion to set aside the entire separation agreement, declining to re-write it or address the oppression remedy under the Business Corporations Act at this stage.
