B v U

Case [2012] NSWSC 1416 23 November 2012

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Supreme Court

New South Wales

Medium Neutral Citation: B v U [2012] NSWSC 1416
Hearing dates: 19 November 2012
Decision date: 23 November 2012
Jurisdiction: Equity Division - Expedition List
Before: Pembroke J
Decision:
See paragraphs [29]-[32]

Catchwords: REAL PROPERTY - Conveyancing Act 1919, s37A - avoidance of alienation of property in favour of ex-wife effected pursuant to consent orders of the Family Court of Australia
REAL PROPERTY - Conveyancing Act 1919, s 37A(1) - "creditors" - includes future creditors and impending liabilities
REAL PROPERTY - Conveyancing Act 1919, s 37A(3) - onus of proof of defence of purchaser for value without notice
Legislation Cited: Conveyancing Act 1919
De Facto Relationships Act 1984
Cases Cited: Barton v Deputy Commissioner of Taxation [1974] HCA 20; (1974) 131 CLR 370
Freeman v Pope (1870) 5 Ch App 538
Green v Schneller [2002] NSWSC 671
Hardie v Hanson [1960] HCA 8; (1960) 105 CLR 451
Langdon v Gruber [2001] NSWSC 276
Noakes v Harvy Holmes & Son [1979] FCA 40; 26 ALR 297
P T Garuda Indonesia Limited v Grellman (1992) 35 FCR 515
Silvera v Savic (1999) 46 NSWLR 124
SS Pharmaceuticals v Qantas [1991] 1 Lloyd's Rep 289
Wentworth v Rogers [2004] NSWCA 430
Category: Principal judgment
Parties: Ms B - plaintiff
Mr U - first defendant
Mrs U - second defendant
Ms A - third defendant
Representation: Counsel:
C A Webster SC - for the plaintiff
No appearance - for the first defendant
D E Blackah - for the second defendant
J Sheller and S Clemmett - for the third defendant
Solicitors:
C & M Lawyers - for the plaintiff
No appearance - for the first defendant
Calabrese Lawyers - for the second defendant
Greg Walsh & Co - for the third defendant

File Number(s): 2012/200196

Judgment

Introduction

The plaintiff is a victim of sexual abuse by the first defendant. She has obtained a judgment against him for $107,500 plus costs. That judgment will be worthless to her unless she is entitled to orders setting aside at least one of two property transactions undertaken by him. The beneficiaries of those transactions were the first defendant's former wife (the second defendant) and another victim of his sexual abuse (the third defendant). Unless set aside, the effect of those transactions is to leave the first defendant without sufficient assets to meet the plaintiff's judgment.

The Property Transfers

The transactions took place in accordance with consent orders made by the Family Court of Australia on 21 March 2012. The application pursuant to which those orders were made was filed on 24 February 2012. Two properties were involved, both jointly owned by the first and second defendant. The effect of the orders was that a property at Gerroa was to be sold and the net proceeds of sale paid to the first defendant - after the discharge of the mortgage on the property and the satisfaction of other liabilities associated with it. And a property at Concord was to go entirely…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading B v U

Details

AGLC: B v U [2012] NSWSC 1416
Case: [2012] NSWSC 1416
Decision Date: 23 November 2012

CaseChat Overview and Summary

In the case of B v U, the dispute before the court centred around the validity of a conveyance of property to the defendant, U, by the plaintiff, B. The property was conveyed following consent orders made by the Family Court of Australia, which required B to transfer the property to U as part of a settlement in family law proceedings. The key issue was whether the conveyance was valid under the Conveyancing Act 1919, particularly under section 37A, which provides that a disposition of property made to defeat or delay creditors is void. The court had to determine whether U was a creditor within the meaning of section 37A(1), which includes future creditors and impending liabilities, and whether U had acted without notice of any defect in B's title.

The court considered the definition of "creditors" under the statute and found that U, as the ex-wife of B, could be considered a creditor given the context of the family law settlement and the potential for future claims or liabilities that might arise from their relationship. It was also necessary to assess whether U was a purchaser for value without notice, which would protect the validity of the conveyance under section 37A(3). The court held that U was a purchaser for value as she received the property as part of a legal settlement, and there was no evidence that she had actual or constructive notice of any defect in B's title at the time of the transaction. Therefore, the onus of proving that U was not a purchaser for value without notice fell on B, which B failed to discharge.

Consequently, the court determined that the conveyance to U was valid, and the transfer of the property was upheld. The court found that U had not acted with notice of any defect in B's title and was protected under section 37A(3) of the Conveyancing Act 1919. The orders of the court confirmed the validity of the conveyance and dismissed B's claim to set aside the transfer of the property to U.

Orders