Adamson & Korac (No 2)

Case [2022] FedCFamC1F 638

Federal Circuit and Family Court of Australia

(DIVISION 1)

Adamson & Korac (No 2) [2022] FedCFamC1F 638

File number(s): SYC 4996 of 2019
Judgment of: CAMPTON J
Date of judgment: 26 August 2022
Catchwords: FAMILY LAW – PROPERTY – Application in a proceeding to join the husband’s partner (or former partner) and a company as parties to the proceedings, and to have that company valued by the single expert forensic accountant – Where the wife contends that the husband’s partner (or former partner) operates the relevant company for the benefit of the husband – Where the wife discloses a prima facie arguable claim against the proposed additional respondents that could not be said “fanciful” – Where the costs of the valuation report is to be shared in unequal proportions between the parties.
Legislation:

Evidence Act 1995 (Cth) ss 50, 140

Family Law Act 1975 (Cth) ss 78, 79

Federal Circuit and Family Court of Australia (Family Law) Rules 2021 rr 2.50, 3.01

Cases cited:

Adamson & Korac [2022] FedCFamC1F 528

Briginshaw v Briginshaw (1938) 60 CLR 336; [1938] HCA 34

Ebner & Pappas (2014) FLC 93-619; [2014] FamCAFC 229

Equuscorp Pty Ltd v Glengallan Investments Pty Ltd (2004) 218 CLR 471; [2004] HCA 55

Hadjiloucas v Crean [1988] 1 WLR 1006

Hancock Family Memorial Foundation Ltd v Fieldhouse [No 3] [2010] WASC 223

Mais v Reid (1899) 5 ALR 202

Scott v Commissioner of Taxation (No 2) (1966) 40 ALJR 265

Sharment Pty Ltd v Official Trustee in Bankruptcy (1998) 18 FCR 449

Stanford & Stanford (2012) 247 CLR 108; [2012] HCA 52

Wayne & Dillon & Anor [2008] FamCAFC 204

Whitford & Whitford (1979) FLC 90-612
Division: Division 1 First Instance
Number of paragraphs: 76
Date of hearing: 10 August 2022
Place: Sydney
Counsel for the Applicant: Mr Sweeney
Solicitor for the Applicant: Farrar Gesini Dunn
Counsel for the Respondent: Ms Lioumis
Solicitor for the Respondent: Family Law Practice Australia Pty Ltd
Counsel for the second and third respondents: Mr Stapleton
Solicitor for the second and third respondents: Lander & Rogers

ORDERS

SYC 4996 of 2019

FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)
BETWEEN:

MS ADAMSON
Applicant
AND:

MR KORAC
First Respondent

C PTY LTD
Second Respondent

MS B
Third Respondent

order made by:

CAMPTON J

DATE OF ORDER:

26 AUGUST 2022

THE COURT ORDERS THAT:

1.The wife be granted leave pursuant to Pt 2.8 of the Federal Circuit and Family Court of Australia (Family Law) Rules2021 (Cth) to amend her final relief in accordance with her proposed Further Amended Initiating Application, being Exhibit 2, such Further Amended Initiating Application to be filed and served within seven days of the date of these Orders.

2.Pursuant to Pt 3.1 of the Rules, C Pty Ltd (“C Pty Ltd”) be joined as second respondent to these proceedings and Ms B be joined as third respondent to these proceedings.

3.The each of the husband, the second respondent and third respondent file and serve any Response to…

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Details
AGLC
Adamson & Korac (No 2) [2022] FedCFamC1F 638
Case
[2022] FedCFamC1F 638
Decision Date

CaseChat Overview and Summary

In the case of Adamson & Korac (No 2), the wife sought leave to amend her final relief, to include C Pty Ltd as the second respondent and Ms B as the third respondent. This application arose from ongoing proceedings concerning the distribution of funds held in trust. The court was required to decide whether the wife's application for leave to amend the relief was appropriate under the relevant procedural rules and whether the additional respondents should be joined to the proceedings.

The court examined the procedural rules under Part 2.8 of the Rules which governs the amendment of substantive relief sought at any time after a proceeding has been allocated dates for trial. The court found that the wife had complied with these rules for her application. Additionally, the court considered Part 3.1 of the rules concerning the joinder of parties, specifically Rule 3.01, which requires a person whose rights may be directly affected by an issue in the proceeding to be included as a party if their participation is necessary for the court to determine all issues in dispute. In this case, the wife argued that the additional respondents would be directly affected by the issues in dispute and their participation was necessary.

The court concluded that the wife's application for leave to amend her final relief was appropriate and granted the application to join C Pty Ltd and Ms B as respondents. The court also ordered that consent orders would be made in terms of Exhibit 10 and that a further report would be obtained from Mr J, with costs to be shared between the parties. The relief sought by Ms B and C Pty Ltd for security for costs was dismissed on terms.

In summary, the court granted the wife's application to amend her final relief to include additional respondents, ordered consent orders, and directed the procurement of a further report with specified cost-sharing arrangements. The relief for security for costs was dismissed on terms.

Orders

Orders of the court

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Background

Background to the litigation

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Evidence

Evidence Before The Court

For the reasons that follow, I will grant the wife leave to amend her final relief sought, and hence join C Pty Ltd as the second respondent and Ms B as the third respondent to the proceedings. Consent orders will be made in terms of Exhibit 10. Orders will be made as to a further report being obtained from Mr J, with the costs of that report to be paid in the first instance in the ratio of 65 per cent by the husband and 35 per cent by the wife (the wife’s share to be sourced from the funds held on trust for the parties pursuant to Order 4(h) made on 9 December 2020). The relief of Ms B and C Pty Ltd for security for costs will be dismissed on terms. The evidence The wife read and relied upon the following documents:(a)A Case Outline document filed on 29 July 2022, marked as Exhibit 1; (b)A proposed Further Amended Initiating Application filed on 29 July 2022, marked as Exhibit 2; (c)An Amended Application in a Proceeding filed on 29 July 2022; (d)Two affidavits of the wife, filed on 8 and 13 July 2022 respectively; (e)An affidavit of Mr R, filed on 8 July 2022; and(f)An Amended Minute of proposed injunctive relief sought by the wife as against Ms B and C Pty Ltd, being Exhibit 10. The husband read and relied upon the following documents:(a)A Case Outline document filed on 9 August 2022, marked as Exhibit 3;(b)An Amended Response to an Application in a Proceeding filed on 9 August 2022; (c)Two affidavits of the husband, filed on 8 and 19 July 2022 respectively. The proposed second and third respondents read and relied upon the following documents:(a)An Outline of Submissions Document filed on 10 August 2022, marked as Exhibit 4;(b)An Amended Response to an Application in a Proceeding filed on 9 August 2022; (c)An affidavit of Ms B filed on 9 August 2022 and exhibits thereto; and(d)An affidavit of Mr J filed on 9 July 2022. A number of documents, including schedules produced pursuant to s 50 of the Evidence Act 1995 (Cth) (“the Evidence Act”) were tendered into evidence. The affidavit of Ms B annexed 231 pages of exhibits. It was agreed that for the purpose of my determination, I would only have regard to those documents contained within the exhibits to affidavits that were identified during the course of submissions. The joinder applicationThe law Part 2.8 of the Rules prescribes the process to amend substantive relief sought at any time after a proceeding has been allocated dates for trial. That Part applies to the circumstances of this matter. There is no controversy that the wife has complied with the Part for the purposes of her application for leave to amend. Part 3.1 of the rules sets out the procedure for the joinder of a party to the proceeding. Rule 3.01 prescribes: 3.01 Necessary parties A person whose rights may be directly affected by an issue in a proceeding, and whose participation as a party is necessary for the court to determine all issues in dispute in the proceeding, must be included as a party to the proceeding.Example:If a party seeks an order of a kind referred to in section 90AE or 90AF of the Family Law Act, a third party who will be bound by the order must be joined as a respondent to the proceeding.

Decision

Reasons for decision

By way of Order 4 of the orders made by consent on 9 December 2020, those funds remain injuncted in that trust account until further order of this Court. Conclusion In those circumstances, having allowed the wife’s application for leave to amend her final relief, I will make orders in accordance with the compromise positon recorded in Exhibit 10.

Ratio Decidendi

Legal Principle Established

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