Argyle and Argyle

[2010] FamCA 116

FAMILY COURT OF AUSTRALIA

ARGYLE & ARGYLE [2010] FamCA 116

FAMILY LAW – PROPERTY – Sale of property – Distribution of funds – Trust Account

Mullen & De Bry (2006) FLC 93-293
Waugh (2000) FLC 93-052

APPLICANT: Ms Argyle

RESPONDENT: Mr Argyle

FILE NUMBER: PAC 811 of 2007

DATE DELIVERED: 5 February 2010

PLACE DELIVERED: Parramatta

PLACE HEARD: Parramatta

JUDGMENT OF: Collier J

HEARING DATE: 5 February 2010

REPRESENTATION

COUNSEL FOR THE APPLICANT: Mr Kenny

SOLICITOR FOR THE APPLICANT: Mr Rowlandson

COUNSEL FOR THE RESPONDENT: In person

SOLICITOR FOR THE RESPONDENT: N/A

Orders

1. That the parties execute all documents and do all acts and things necessary to procure and complete a sale of the property situate and known as W property NSW being the whole of the land comprised in folio identifier … (hereinafter referred to as “the property”) on the following terms:

   a.If the husband does not agree that the property is to be listed for sale by private treaty with L. J. Hooker Real Estate Agents, he shall within seven days of the date of these Orders nominate an agent of his choice to have conduct of the sale.

   b.In the event the parties cannot thereafter within a further seven days agree upon the identity of the agent, the President for the time being of the NSW Chapter of the Australian Institute of Valuers shall make an election of one or other of the agents nominated by the parties.

   c.The parties shall endeavour to agree upon a listing price for the property.  In the event they cannot do so, the listing price shall be as determined by the agent once agreed upon or elected.

   d.In the event the husband does not agree that N Solicitors shall act for both parties on the sale of the property, he shall within seven days of the date of these Orders, nominate a solicitor of his choice to act on the sale. 

   e.In the event the parties cannot thereafter within a further seven days agree upon the identity of the solicitor, the President for the time being of the NSW Law Society shall appoint one or other of the solicitors nominated by the parties to act on the sale.

   f.In the event contracts for sale by private treaty have not been exchanged within sixty days from the date upon which the property is placed on the market or such other dates and/or times as the parties may in writing agree, the parties shall execute all documents requested by the agent for the sale of the property by public auction on the following terms:

   i.The auction to take place no later than ninety days from the date of these Orders or such other date as the parties may agree in writing;

   ii.The parties shall request the agent to appoint the auctioneer;

   iii.Failing agreement as to a reserve price for the auction, the parties shall request the auctioneer to recommend a reserve price for the purposes of the auction sale and shall accept such recommended reserve price;

   iv.The parties shall attend the auction sale and negotiate with the highest bidder in the event that the reserve price is not reached and shall accept the advice of the auctioneer as to the acceptance of a price less than the reserve price, either during or after the auction.

2. That the parties shall cooperate in every way with the agent in relation to the sale of the W Property by private treaty or by public auction including providing keys to the agent for the property.

3. That the parties shall execute all other documents necessary to complete the sale of the property.

4. That in the event that such contracts are not exchanged by way of private treaty or auction in accordance with these Orders, the parties thereafter have liberty to apply to the Court in relation to further orders to implement the sale of the Property, upon giving seven days’ notice to the other party and the Court.

5. That upon completion of any sale pursuant to these Orders, the parties cause the proceeds of sale to be paid in the following manner and priority:-

   a.To pay all real estate agent’s commission and expenses associate with the sale;

   b.To pay all legal costs and disbursements relating to the sale;

   c.To discharge the mortgage registered number … in favour of Perpetual Limited;

   d.In payment of monies owing to the New South Wales government pursuant to consent orders made in the Supreme Court of New South Wales Common Law Division on … 2008 in proceedings no. ….

6. That thereafter each of the parties be paid from the proceeds of sale of the property then remaining the sum of $100,000 to be taken into account by the trial judge as considered appropriate, whether by way of interim property settlement or otherwise.

7. That the balance then remaining from the proceeds of the sale of the property be deposited into a controlled money account to be operated by Rowlandson & Co on behalf of the wife and, on behalf of the husband, a solicitor nominated by the husband who within seven days from the date of these Orders indicates his acceptance to act in that capacity.  The money shall be held in such a controlled money account in the names of those solicitors as trustees for the parties. 

8. That in the event that either party shall fail, neglect or refuse to execute any deed, instrument or document to give validity and effect to these Orders and upon the other party filing an affidavit setting out such failure, neglect or refusal then a Registrar or Deputy Registrar of the Sydney Registry of the Family Court is hereby appointed pursuant to Section 106A of the Act to execute any such deed, instrument or document in the name of the party who defaults and to do all things necessary to give validity to the operation of the deed, instrument or document.

9. That pending further order the applicant wife have exclusive occupancy of the property.

10. That, within twenty-one days from the date of these Orders, the husband file and serve the following documents:

    a.Response to the wife’s application for final orders; and

    b.Financial statement.

11. That the parties attend upon a Financial Case Assessment Conference before Registrar Kimmorley at 11am on 13 April 2010 for the purpose of making orders and directions in respect of the substantive property dispute. 

12. Noted in accordance with order 1 of the Orders made 1 December 2009 that the husband’s address for service remains at P.O.Box ….

13. That the costs of both parties of today be reserved.

IT IS NOTED that publication of this judgment under the pseudonym Argyle & Argyle is approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth)

FAMILY COURT OF AUSTRALIA AT PARRAMATTA

FILE NUMBER: PAC 811 of 2007

MS ARGYLE

Applicant

And

MR ARGYLE

Respondent       

REASONS FOR JUDGMENT

Introduction and Background:

1. This matter comes before me today in respect of an application by the wife in these proceedings that by way of interim injunction the property at W (“the property”) be sold and the proceeds of sale be dealt with in a specific fashion.   Particularly she says that after sale and the paying of ordinary selling expenses, that the amount required to discharge the mortgage to Perpetual Limited be paid; and that an amount secured over the property by consent orders in favour of the New South Wales government should be paid.  The wife sought to then receive the sum of $100,000 from the proceeds.  She then sought that the balance then arrived at be placed in a controlled money account, awaiting the outcome of a final hearing.  

2. In the course of submissions before me, the wife’s position has altered slightly.  She now indicates that she would be happy for the husband also to receive the sum of $100,000 and for the balance of moneys to be held in an account in the name of two solicitors, one of whom is to be nominated by the husband.

3. The real issue here is whether or not I order a sale to proceed.  The situation, as I understand it, is that these parties are some $73,000 in arrears of mortgage payments in respect of the mortgage secured over the property in favour of Perpetual.  I have seen letters from the solicitors for Perpetual indicating that they have a writ of possession, a fact that is hotly disputed by the husband, but which I accept to be true, and that depending on what occurs today they will consider their position in respect of execution of that writ which would have the result of putting the mortgagee in possession and as mortgagee in possession entitle them to effect a sale.

4. The husband says that there is no great urgency, that he has stood them off up to this time, and he can stand them off for a further period.  Indeed, as I understand it, he says that I should not order a sale at this stage but rather should give him time in which to try and raise moneys to firstly pay off the arrears and subsequently negotiate to purchase the wife’s interest in the property.  He indicates so far as the moneys to pay the wife out are concerned these moneys would need be raised by way of further borrowing. 

5. He says that he proposes to challenge the consent orders which require payment of the sum of $350,000 to the New South Wales govenrment and if he is successful in that, that of itself will provide a fund from which moneys could be paid.  The difficulty there is that having started by assuring me a process to achieve this was underway, he now tells me that they are in the process of issuing a statement of claim to bring that about.

6. I am not satisfied that the mortgagees will wait indefinitely.  I am not satisfied that even if I were to grant the husband further time in which to endeavour to deal with the mortgagee and raise funds that the situation for his part would be no different on the next occasion.  However, I am satisfied it is highly probable that if I did put the matter over as the husband seeks to have me do, that on the next occasion the mortgagee would be in possession and in a position to proceed with a sale.

The Law to be Applied:

1. This is, of course, a matter where an injunction is sought in relation to proceedings between parties in this Court.  The Full Court in the matter of Mullen & De Bry (2006) FLC 93-293 looked at what was required before an interim injunction was made. Their Honours in that decision dealt with the requirements originally posed in the decision of Waugh (2000) FLC 93-052. Their Honours in Mullen & De Bry (2006) FLC 93-293 clearly set out the test to be applied for the granting of an injunction. I am satisfied that the line of authority in Mullen & De Bry (supra) can apply to a mandatory injunction requiring the doing of an act in the same fashion it can apply to an injunction to prevent the doing of an act.

Discussion and Conclusion:

1. In this case, I am satisfied that, on the evidence before me, there is absolutely no prospect of this property being retained, so that either party can have the opportunity of purchasing the interest of the other.  To my mind, that which is required is a process by which the worth of the asset can be maximised.  It must be clear to anyone with experience of property markets in this State, that the parties are far more likely to achieve the best price for the property if it is marketed in an appropriate, timely and satisfactory fashion rather than the property going to auction with the reserve to be determined with reference to the amounts of money owed and secured against it.  In the event of such an auction there is to my mind the very real probability that the true value of the property would not realised.  Accordingly, to allow that to occur could well and truly diminish the value of the property in the hands of the parties.

2. It is unfortunate that the property seems to hold such a personal attachment for the husband.  The only comment I make about that at this stage is this is a property that on a previous occasion he was prepared to transfer the property to the wife and assume full liability for the mortgage thereafter.

3. I have heard extensively from the husband who has not filed an affidavit nor any response in these proceedings, notwithstanding being given the opportunity to do so when the matter was adjourned from 1 December at his request so that he could attend to these matters.  The application before me is that of the wife filed on 30 November and supported by her own affidavit sworn and filed the same day and an affidavit of her solicitor, Mr Rowlandson, also sworn that day.  I have read that material.  I have heard what has been said by counsel for the wife and by the husband. I am satisfied the property cannot be saved, notwithstanding that the husband wishes to be given the opportunity to endeavour to do so.  The wife concedes that there is no possibility, other than sale, that will maximise the parties’ opportunity of coming out of this matter as best they can. 

4. I am satisfied that in this case the test is one of balance of convenience. I am satisfied that in this case it is appropriate in all the circumstances to order that the property be sold and marketed in the most sensible way to achieve the maximum price.

5. The question then is what I do in respect of any sale proceeds.  What is proposed, in fairly normal terms, is that upon sale, the expenses of selling be paid, that the mortgage be discharged so as to stop it running against the parties, that the order in favour of the New South Wales government be satisfied and, as now conceded by the wife, both of the parties should receive the sum of $100,000 by way of interim property settlement. 

6. I will then order that the balance of the moneys thus arrived at be invested and held in a controlled money account operated by Mr Rowlandson, and a solicitor nominated by the husband, as trustees for the parties. 

7. I propose to order that the parties agree upon a listing price for the property within 21 days. Thereafter if they cannot agree it should be fixed by the agent.

8. I am satisfied that the agent LJ Hooker Real Estate is an appropriate agent.  However, if the father wishes to submit the name of another agent within 7 days, he may do so, and if the parties cannot agree, then the President, for the time being, of the NSW Chapter of Valuers is to appoint one or other of the suggested agents, rather than make a general appointment.

9. The wife suggests N Solicitros be instructed to act on the property.  I have no doubt the father will find fault with them and accordingly I will endeavour to make the same order that within 7 days he is to notify a solicitor of his choice.  If agreement cannot be reached, then the President, for the time being, of the Law Society of NSW will select one of the two named solicitors, rather than make a general selection to determine the solicitor having carriage of the sale.

10. I will slightly amend order 2.4 to provide that the 60 days contemplated therein, that is required to move to an auction, shall commence to run from the time the property is actually placed on the market and listed.  I will make orders that require an auction.  I will allow the agent who is appointed or agreed to nominate the auctioneer and if the parties cannot agree upon a reserve price, then that reserve price shall be as determined by the auctioneer and the provisions for further negotiations, if the reserve price is not reached, shall be taken into account.

I certify that the preceding seventeen (17) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Collier.

Associate: 

Date:  24 February 2010