Agnew & Agnew
[2024] FedCFamC2F 12
•12 January 2024
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 2)
Agnew & Agnew [2024] FedCFamC2F 12
File number(s): HBC 356 of 2021 Judgment of: JUDGE TAGLIERI Date of judgment: 12 January 2024 Catchwords: FAMILY LAW – property – enforcement application – where parties consented to final orders – where sale of property required by final orders has not occurred – where dispute arose as to listing price for sale and whether to accept an offer – where wife sought order for acceptance of offer received – orders made for sale of property with explicit terms as to process and basis for same – costs reserved Legislation: Family Law Act 1975 (Cth) s 106A
Federal Circuit Court and Family Court of Australia (Family Law) Rules 2021 (Cth)
Cases cited: Jones v Dunkel [1959] HCA 8; 101 CLR 298 Division: Division 2 Family Law Number of paragraphs: 49 Date of hearing: 20 December 2023 Place: Hobart Counsel for the Applicant: Ms K Foale Solicitor for the Applicant: Simmons Wolfhagen For the Respondent: The Respondent in person ORDERS
HBC 356 of 2021 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 2)
BETWEEN: MS AGNEW
Applicant
AND: MR AGNEW
Respondent
ORDER MADE BY:
JUDGE TAGLIERI
DATE OF ORDER:
12 JANUARY 2024
THE COURT ORDERS THAT:
1.The parties do all acts and things necessary for the immediate advertising and marketing of the property situated at B Street, Suburb D in Tasmania (“the property”) at offers between $1,200,000 and $1,360,000 by C Company and this Order act as authority from the parties to do so.
2.By early 2024, the parties make a joint counteroffer of $1,350,000 to the current offer on unconditional terms open for seven days.
3.If the property is not made subject to an unconditional offer within the range described in Order 1 by early 2024, and the person who has made the existing offer of $1,200,000 makes it unconditional on or after that date with completion of the purchase to be by early 2024, the parties are to accept that offer.
4.If the property has not sold by early 2024, the parties must accept any offer over $1,250,000 for the sale of the property.
5.If the property has not sold by mid-2024, the parties must accept any offer over $1,200,000 for the property to be sold.
6.In the event the property has not sold in accordance with Order 5 of these Orders, the parties have liberty to apply to Chambers in relation to further orders for sale of the property.
7.In accordance with Rule 11.55 of the Federal Circuit Court and Family Court of Australia (Family Law) Rules 2021 (Cth), a Registrar of the Court is authorised under s 106A of the Family Law Act 1975 (Cth) to sign and execute in the name of Mr Agnew all documents necessary in relation to offers or counteroffers for the sale and conveyance of the property, and any other document incidental to or necessary for the completion of the sale of the property in accordance with the Order of this Court dated 29 August 2023 and these Orders.
8.Simmons Wolfhagen have carriage of the conveyance of the property and to implement same as per the terms of the Order dated 29 August 2023 and the terms of these Orders, without further authority of the parties as to the distribution of funds.
9.Any Application in a Proceeding by the Applicant for indemnity costs to be paid by the Respondent is to be filed and served, along with supporting affidavit material, within 21 days of the date of these Orders.
10.The Respondent file and serve any response and affidavit material relied upon in respect of any Application in a Proceeding for costs referred to in Order 9 of these Orders within 21 days of being served.
11.The Applicant has leave to serve the documents referred to in Order 9 of these Orders on the Respondent by email to …@...
12.The hearing date for any application for costs referred to in Order 9 of these Orders will be listed for hearing on a date to be fixed.
Note: The form of the order is subject to the entry in the Court’s records.
Note: This copy of the Court’s Reasons for judgment may be subject to review to remedy minor typographical or grammatical errors (r 10.14(b) Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 10.13 Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth).
Section 121 of the Family Law Act 1975 (Cth) makes it an offence, except in very limited circumstances, to publish proceedings that identify persons, associated persons, or witnesses involved in family law proceedings.
IT IS NOTED that publication of this judgment by this Court under a pseudonym has been approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
REASONS FOR JUDGMENT
JUDGE TAGLIERI
This judgment concerns a dispute between the parties in relation to the terms and conditions of the sale of their former matrimonial home at B Street, Suburb D in Tasmania (“the property”).
The dispute came before me for determination pursuant to the wife's enforcement application which was initially filed 21 September 2023 and subsequently amended. Interim orders were made by consent on 2 October 2023 because the parties agreed that the property should be listed for sale at offers over $1,380,000. Thereafter, the property continued to be marketed for sale, but a contract for sale has not yet been entered into.
The wife now pursues further orders in her enforcement application because an offer has been received for $1,300,0000, subject to certain conditions (“the conditional offer”).[1] The husband has refused to sign the contract of sale relating to the conditional offer.
[1] An Amended Enforcement Application was filed by the wife on 2 November 2023 and her Outline of Case (Enforcement Hearing) filed on 20 December 2023.
THE DISPUTE
The wife seeks an order for acceptance of the conditional offer of $1,300,000. She also seeks consequential orders that if the property has not sold as at early 2024, then the property be sold by auction.
Furthermore, she seeks an order that the conditional offer be executed pursuant to s 106A of the Family Law Act 1975 (Cth) (“the Act”) by a Registrar of the Court given the husband’s refusal to sign the contract. Other practical and mechanical orders are also sought, including as to the conduct of the conveyancing in respect of the sale.
By his response,[2] the husband opposes all orders sought by the wife in the amended enforcement application. He also opposes the orders set out in the wife’s case outline. Instead, he seeks orders that the listing price for the property be $1,350,000. Further, that if a contract of sale is not executed prior to 30 December 2023, the sole agency agreement with C Company that commenced in late 2023 should expire and the parties instead be required to execute a sole agency agreement with F Company.
[2] Response to an Application in a Proceeding filed 1 December 2023.
The husband also seeks orders for the wife to transfer the property to him alone if he is able to pay the sum of $1,630,000 to the wife prior to any contract of sale for the property being entered into. I observe that this order sought is inconsistent with the terms of previous orders that were made by consent on 29 August 2023 when he was represented by Senior Counsel.
THE ENFORCEMENT HEARING
On 20 December 2023 I conducted a hearing of the wife’s amended enforcement application by which orders were sought as identified in the case outline filed on 20 December 2023. The husband did not oppose the wife’s reliance on the terms of the amended enforcement application or case outline.
Ms Foale appeared as counsel for the wife. The husband was not legally represented and confirmed that he was prepared to proceed with the hearing representing himself. He stated he was unable to afford the legal fees for the hearing, but had assistance from a solicitor to prepare documents he relied upon and had received some advice.
The wife relied on affidavits affirmed by her on 23 August 2023, 21 September 2023 and 11 December 2023. These were read into evidence unopposed and the husband did not cross‑examine her on this evidence.
Evidence of Mr G
A registered valuer, Mr G, also gave evidence in the wife’s case. Mr G is a recognised expert witness and confirmed his compliance with the Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) in relation to expert witnesses. His affidavit of 28 November 2023 was taken as read unopposed. The affidavit annexed a detailed and comprehensive valuation report outlining Mr G’s inspection of the property, review and assessment of comparative area sales, market trends and methodology for arriving at his opinion that the current market value of the property “as is” is $1,350,000.
Mr G had also been asked to comment on the orders sought by the wife in her amended application. He offered a qualified statement that no market evidence was available upon which he as an expert witness could provide an opinion as to the “appropriateness of the stepdown timetable for sale” as reflected in the wife’s amended application. He added that research he had undertaken relating to the Suburb D and Suburb H residential areas over the past 12 months indicated that there were limited sales below $1,000,000 and those sales were generally inferior properties to the former matrimonial home.[3]
[3] Affidavit of Mr G filed 18 November 2023 annexing Valuation Report on page 32.
Mr G further outlined the benefits of the property and the adverse impacts on its value. He opined that if presented on the open market with realistic pricing and appropriate marketing by an experienced real estate agent who regularly operates in the location, he would expect the property could be sold within approximately 60 to 90 days. Further, when commenting in his report on orders sought by the wife, Mr G stated:[4]
Unfortunately, when properties are incorrectly listed, it can have an impact on the marketing and potential purchasers are driven away. A reduction in the listing price can also have an impact on the offers presented by potential purchasers as they may think the vendors are after a “quick” sale and under market offers can made [sic] in that instance.
[4] Affidavit of Mr G filed 18 November 2023 annexing Valuation Report on page 33.
The above comment appears to be directly related to the initial listing of the property at offers over $1,560,000,[5] which was contrary to the recommendation of Ms J, and the subsequent reduction of the listing price to $1,350,000 pursuant to the Orders made by consent on 2 October 2023.[6]
[5] Affidavit of Ms J filed 18 October 2023 on page 2.
[6] Order 1(a).
Given the state of the evidence I sought to clarify his views in relation to how a sale of the property at market value would likely be achieved. Mr G stated that the average time on market for the sale of Suburbs D and H properties was 40 to 70 days. He noted that he would not normally, as part of this type of valuation, address which method of sale might be more desirable depending on the nature of the property. However, Mr G said that he felt comfortable commenting on this based on his analysis of comparable sales. He considered that a single agent and a sale by private treaty was more likely to achieve sale at market value.
Mr G also acknowledged that the property was unique compared to other properties, as were the nature of improvements and structures to properties in residential areas. He maintained that it was best to use a comparative sales methodology to give a market value for this property. He also confirmed comments in his report about the rate of sales in the area slowing.
Evidence of Ms J
The wife also relied on an affidavit affirmed by Ms J on 18 October 2023. Ms J is the real estate agent and director of C Company, which was jointly engaged by the parties under a sole agency agreement to market the property for sale. Ms J gave evidence by telephone at the hearing.
The husband cross-examined Ms J regarding the initial sole agency agreement with C Company that the parties had jointly signed at a listing price of $1,570,000 or over. Ms J agreed that such an agreement had been made, but said this had eventuated due to a disagreement between the husband and wife about the listing price and that, as a compromise, the parties had signed a sole agency agreement simply to get the property listed.
Ms J explained that the husband had initially wanted the property listed and marketed at offers over $1,850,000, but she had declined to do so as she “would look absolutely stupid in front of everybody in the real estate world” as it was so far off the market value. Ms J went on to say that the market had changed significantly in the last 12 months and the price the property may have attracted 12 months ago was not the same as now.
The husband sought to cross-examine Ms J about her personal relationship with the wife, but ultimately withdrew that line of questioning. This was not before Ms J had said that she had been friendly with him prior to becoming acquainted with the wife.
The husband also challenged Ms J about her experience and results selling properties in the Suburb D and Suburb H area. Ms J stated that she had considerable experience across the Region K area and gave details of the number of properties she had sold and what sale prices they had attained.
In re-examination, Ms J stated that the condition of the property was an issue, including that the paintwork, carpets and blinds throughout the property were dated and this would deter purchasers who wished to live in the property straight away. Ms J also confirmed that there was currently an offer of $1,250,000 from a prospective purchaser, subject only to finance and a building inspection.
COMPETING CONTENTIONS OF THE PARTIES
Counsel for the wife submitted that the nature of the property was such that there was a limited market and the number of potential purchasers for the property was reduced. She submitted that the property had been on the market for 70 days with four open homes and many prospective purchasers inspecting it, but only one offer had been received. She argued that there was a real concern that the only offer that had been made would be lost, noting that it was within the range of sales of similar properties in the area as demonstrated by Mr G’s evidence.
Noting that there were orders made by consent that the property be sold, Counsel submitted that the real issue was what a reasonable time was for the property to be on the market before it is sold.
Counsel emphasised that the purchaser who made the conditional offer of $1,250,000 was a keen buyer and continued to watch the property. As such, she submitted that this offer was the most realistic prospect for sale of the property to ensure compliance with the Court orders. Counsel also submitted that the market was volatile and if sale had not been achieved within the timeframe set out in the amended application, an auction should proceed.
I explored the terms of an auction with Counsel should the Court be minded to make orders as sought by the wife, in particular how the reserve would be set. Following discourse, counsel submitted that the reserve should be $1,250,000 and that it would be appropriate for a further order that any offer within 10 per cent of the reserve be accepted by the parties.
The husband made submissions to the effect that an order for sale at $1,250,000 would be selling the property undervalue and would place him in a position of extreme prejudice and detriment due to the terms of the Court orders and the binding financial agreement (“the BFA”), which required him to pay the sum of $1,630,000 to the wife.
I observed to the husband that the obligation to make the payment of $1,630,000 arose pursuant to the BFA, which was enforceable as a result of his abandonment of his earlier application to set aside the BFA and also instructing his counsel to ask the Court to make consent orders on 29 August 2023. The husband made no response to this, but instead emphasised Mr G’s opinion about the value of the property being $1,350,000, close to the agreed listing price arising from the consent order made on 2 October 2023.
I invited the husband to comment on Counsel’s submissions about a reasonable timeframe for sale of the property in view of the Court’s earlier orders for it to be sold. No meaningful response was received.
I asked the husband if he would consent to signing the contract containing the conditional offer of $1,250,000 if a 48-hour clause was also included in the contract of sale. After the hearing was stood down to allow the husband to obtain advice, he simply stated that he did not agree to this.
EVALUATION
Pursuant to the amended enforcement application, the Court’s jurisdiction and function is to determine how to ensure compliance with and practical implementation of orders already made on 29 August 2023, consequent to the abandonment of the husband’s application about invalidity of the BFA due to his alleged incapacity.[7]
[7] Court file HBC1038/2022, which was consolidated with this proceeding.
It is important to emphasise that with the abandonment of the application referred to in the preceding paragraph, there is no occasion to entertain the order sought by the husband at paragraph 4 of his response, by which he seeks that the wife transfer the property to him at an undefined and imprecise point in time.
Based on the unchallenged expert opinion of Mr G, the Court finds that the current market value of the property is $1,350,000. I accept all of Mr G’s views as they are unchallenged.
Accepting the evidence of Mr G about the slowing of the Suburb D and Suburb H market, which also accords with the general tenor of Ms J’s evidence, I doubt that there is likely to be an unconditional offer made on the property for its current market value, particularly because it has now been on the market since late 2023 and only one offer received, which was below that value.
Although the husband challenged the experience and ability of Ms J, his reservations are unsubstantiated as there is no probative evidence that she is incapable of discharging her duties as an agent. Further, it is significant that the husband agreed to C Company being engaged,[8] and instructed Ms J from time to time,[9] from which I infer he had confidence in her capabilities and experience.
[8] Order 2 of the Orders made 29 August 2023 by consent.
[9] See, for example, emails attached to Affidavit of Ms Agnew filed 21 September 2023 on pages 28 to 32.
Based on the consistent evidence of Mr G, Ms J and the husband, I find that the property is unique, which is likely logically to mean it will be in demand to a smaller number of prospective purchasers with particular needs and wants. Therefore, I find that it will likely take longer than average for it to sell at market value and this was always likely to be the case regardless of what price it was initially listed for sale. However, Mr G’s views about the listing price, referred to at [11] of these reasons, were not challenged and I accept that these are highly relevant to what the Court must decide.
I infer the parties have not jointly instructed the agent, Ms J, to make any counteroffer to the current prospective purchaser. This inference is made based on Ms J’s oral evidence and because the affidavits filed say nothing about counteroffers to the current conditional offer. To this end, one or both parties have acted to their potential detriment.
When the Court made the consent orders on 29 August 2023 for the sale of the property, I expressed concern as to whether there should be mechanical orders made for the sale beyond that stated in paragraph 2 of the consent minute. Both counsel appearing at the time assured me that it was unnecessary and the parties would agree on these matters. Unfortunately, both counsel were wrong.
The finalisation of financial relations between previously married parties is an imperative of the provisions of Part VIII and VIIIA of the Act, even more so where final orders have been made. The parties reached agreement about their property and assets, reduced that agreement into a written BFA in mid-2022 when they were both legally represented, and the husband abandoned his challenge to the enforceability of that BFA in late 2023. Given this history and the imperative discussed above, I have no doubt that there should be as few delays as possible in sale of the property and compliance with the terms of the BFA and Court orders.
However, it is also relevant that the property is not an average or typical residential property and therefore it can be envisaged that a longer than average period may be reasonably be required, and hence allowed, for its sale to occur. Further, because the effective marketing of the property has likely been adversely impacted by the initial listing at offers over $1,600,000[10] and the current listing price is still above its market value, it can reasonably be inferred that some potential purchasers may have been deterred.
[10] Discussed at [13] and [14] of these reasons.
The conditional offer of $1,250,000 is within 10 per cent of the market value of the property. I consider this to be within a reasonable tolerance given the slowing market as described by Mr G and the smaller number of likely potential purchasers because of the property’s unique qualities. Accordingly, if the conditional offer were made unconditional it ought to reasonably be accepted.
The parties could potentially secure a better offer from the prospective purchaser who made the conditional offer, given the purchaser can be regarded as “keen” in view of Ms J’s evidence.
I consider that a reasonable timeframe for securing a sale of the property in all the circumstances is a further two months and the Court will make orders with a view to achieving that outcome. There will be orders as follows:
(1)The parties do all acts and things necessary for the immediate advertising and marketing of the property situated at the property at offers between $1,200,000 and $1,300,000 by C Company and this Order act as authority from the parties to do so.
(2)By early 2024, the parties make a joint counteroffer of $1,260,000 to the current offeror on unconditional terms open for seven days.
(3)If the property is not made subject to an unconditional offer within the range described in Order 1 by early 2024, and the current offeror at $1,250,000 makes it unconditional on or after that date with completion of the purchase to be by early 2024, the parties are to accept that offer.
(4)If the property has not sold pursuant to order 4 by early 2024, the parties must accept any offer over $1,300,000 for the sale of the property.
(5)If the property has not sold by mid-2024, the parties must accept any offer over $1,150,000 for the sale of the property.
The reduction in the amount of offers to be accepted as referred to at subparagraph (4) and (5) above remain, in my view, within a reasonable tolerance and range of the current market value of the property in view of the comparative sales discussed in Mr G’s report.
I do not propose to make orders for sale by auction. I have been persuaded by the views of Mr G that private treaty is the preferable method of sale. Further, as I infer there will inevitably be additional costs imposed on the parties if the sale were to occur by auction, I consider there is no merit in such course.
There is also no merit in making an order appointing another agent to market and sell the property given the reasons above at [35]. Further, the historical knowledge Ms J has of this matter, her likely rapport with the current offeror and legal complexities related to sale being pursuant to court orders warrant her continued engagement. In addition, I can reasonably infer based on my own legal experience and knowledge that involving another agent would probably cause additional expense, such as further advertising costs and potentially additional commissions. Further noting the history of dispute, the parties are unlikely to agree the identity of the alternate agent, leading to further proceedings and costs.
Ms L of F Company, the other agent suggested by the husband, was not called or prepared to attend Court according to the husband’s statements at the hearing. This was despite my request that the real estate agents be available for the hearing. From this I infer that she was unlikely to have offered any further or better opinion about how the property could be sold at current market value or would not have assisted the husband’s case.[11] Accordingly, the husband has failed to persuade me that I should make the order he seeks at paragraph 3 of his response.
[11] Jones v Dunkel [1959] HCA 8; 101 CLR 298.
As there is a chance that the property will not be sold by mid-year, there will be a further order giving liberty to apply in relation to the amended enforcement application. As the husband has not engaged a lawyer, I am satisfied that Simmons Wolfhagen should have conduct of the conveyancing of the sale of the property.[12] I am also satisfied that I should make an order authorising the Registrar of the Court to sign contracts, agreements, offers and counteroffers as required to give effect to the court orders. This will ensure delays are avoided.
[12] Paragraph 3 of Orders sought in Wife’s Case Outline filed 20 December 2023.
The wife has sought an indemnity costs order. Before I determine the issue of costs, I will afford the husband the opportunity to be heard regarding the same and it is likely I will require evidence about the amount of costs incurred and the reasons for same, noting the concerns expressed in these reasons at [37] and [38].
I certify that the preceding forty-nine (49) numbered paragraphs are a true copy of the Reasons for Judgment of Judge Taglieri. Associate:
Dated: 12 January 2024
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