BADER & SPINNER

Case •

[2020] FamCA 145

•

6 March 2020

FAMILY COURT OF AUSTRALIA

BADER & SPINNER [2020] FamCA 145

FAMILY LAW – PRACTICE AND PROCEDURE – adjournments – where enforcement proceedings with respect to the sale of the former matrimonial home have been on foot since September 2018 – where the wife has been ordered to provide vacant possession of the former matrimonial home and the husband is to have sole possession for the purposes of sale – where the wife has failed to comply with the order – where the wife’s application for an adjournment is denied.

FAMILY LAW – ENFORCEMENT OF ORDERS – warrant for possession – where there are orders requiring the wife to vacate the former matrimonial home – where the wife has failed to comply with the orders – where given the history of the proceedings there are no circumstances that would warrant the court not exercising its discretion to enforce the orders – where the husband’s application is successful and a warrant for possession is issued.

FAMILY LAW – PRACTICE AND PROCEDURE – bifurcation – where the husband seeks orders splitting the hearing of the wife’s 79A application and any property proceedings if the wife’s application pursuant to 79A is successful – where the grounds upon which the wife relies can be delineated from the facts underpinning the exercise of the discretion pursuant to s79A – where in all the circumstances there should be a separate hearing as to whether there are any grounds for setting aside or varying the orders.
Family Law Act 1975 (Cth) s 79, 79A, 102NA, 105
Family Law Rules 2004 (Cth) rr 1.04, 20.01, 20.53, 20.54
Federal Circuit Court Rules 2001 (Cth) rr 25B.62
In the marriage of Patching (1995) FLC 92-585
In the marriage of Ramsey (No. 2) (1983) FLC 91-323
Trustee of the Bankrupt Estate of Hicks & Hicks & Anor (2018) FLC 98-824
Yilmaz v Yilmaz [2014] FamCA 663
APPLICANT: Mr Bader
RESPONDENT: Ms Spinner
FILE NUMBER: MLC 6810 of 2015
DATE DELIVERED: 6 March 2020
PLACE DELIVERED: Melbourne
PLACE HEARD: Melbourne
JUDGMENT OF: Macmillan J
HEARING DATE: 10 February 2020

REPRESENTATION

COUNSEL FOR THE APPLICANT: Ms Tulloch
SOLICITOR FOR THE APPLICANT: Davis Zucco Lawyers
THE RESPONDENT: In Person

Orders

  1. Pursuant to Rule 20.54 of the Family Law Rules 2004 (Cth) (“The Rules”) a warrant for possession of the property situate at Property A Suburb H in the State of Victoria (the “Real Property”) shall be issued authorising an enforcement officer to enter the Real Property and give possession of the Real Property to the husband and the enforcement officer shall have the following powers:

    a.To enter and search the Real Property;

    b.To seize the Real Property;

    c.To eject the wife from the Real Property, she being the person who would not be legally entitled to be on that property pursuant to the orders made by the court on 19 November 2018; and

    d.To take possession of and secure against any interference of the Real Property which is subject to the warrant for possession.

  2. All question of costs in relation to the Application in a Case filed by the husband on 22 February 2019, the Amended Application in a Case filed by the wife on 1 March 2019 and the husband’s Application in a Case filed 16 April 2019 be reserved for determination in chambers.

  3. By 4.00pm on 27 March 2020 the applicant husband and respondent wife file and serve any written submissions in support of any application for costs arising out of or incidental to the Application in a Case filed by the husband on 22 February 2019, the Amended Application in a Case filed by the wife on 1 March 2019 and the husband’s Application in a Case filed 16 April 2019.

  4. By 4.00pm on 15 April 2020 the applicant husband and respondent wife file and serve any written submissions in reply to any application for costs.

  5. That any submissions as to costs should be limited to 10 pages.

  6. That the Application in a Case filed by the husband on 22 February 2019, the Amended Application in a Case filed by the wife on 1 March 2019 and the husband’s Application in a Case filed 16 April 2019 be dismissed and removed from the list of cases pending final hearing.

  7. That the question of whether there are any grounds for setting aside or varying the final property orders made 26 August 2016 pursuant to s79A(1)(b) and/or (c) of the Family Law Act 1975 (Cth) be listed for hearing as a 3 day matter commencing 22 July 2020.

  8. The requirements of s 102NA(2) of the Family Law Act 1975 (Cth) will apply to any cross-examination occurring in the proceedings.

  9. By 4.00pm on 29 May 2020 the applicant wife file and serve upon all other parties all affidavits of evidence in chief of all witnesses relied upon in support and limited to the grounds of her application pursuant to s79A (1)(b) and/or (c) (noting that affidavits relied on for previous hearings cannot be relied upon as evidence in chief without leave).

10.By 4.00pm on 19 June 2020 the respondent husband file and serve upon all other parties all affidavits of evidence in chief of all witnesses relied upon in response to the wife’s application pursuant to s79A (1)(b) and/or (c) (noting that affidavits relied on for previous hearings cannot be relied upon as evidence in chief without leave).

11.By 4.00pm on 3 July 2020 the applicant wife file and serve any affidavit in reply to the affidavits of the respondent.

12.No party file any further material other than as provided by these orders without leave of the Court.

13.If either party takes objection to any of the evidence of the other party:

a.Any objection be taken no later than 14 days prior to the trial by service of a written notice on the solicitor for the other party;

b.The party so served shall notify the objecting party in writing no later than 7 days prior the trial of which objections so taken are the subject of agreement and which require determination.

14.All parties have leave to issue subpoenas for the production of documents by arrangement with the registrar docketed with the management of the file.

15.All parties have liberty to approach the registrar responsible for the management of the court file to vary the obligations under these orders to ensure readiness for trial.

16.Should any party fail to comply with these orders or the ensuing amending directions of the docketed registrar, the party who has complied may immediately thereafter file an Application in a Case supported by an affidavit seeking for the matter to proceed on an undefended basis.

17.The applicant pay all setting down and trial fees by 10 July 2020 or obtain the requisite waiver thereof.

18.The practitioners and/or the parties in the event that they are not legally represented file electronically to … a serve upon all parties by 4.00pm on 17 July 2020 the following:

a.A concise set of orders to be sought if different from those already filed;

b.A list of the applications and affidavits filed pursuant to these orders to be read and, if not, the whole affidavit, the relevant paragraphs relied upon;

c.A list of the parties’ respective legal and equitable interests in property and liabilities;

d.A bullet-point summary of argument in relation to the legal and factual issues in dispute.

19.Each party to provide to the Court at the commencement of the hearing, a statement setting out the costs incurred to that date and from what source those costs have been paid and what costs are expected to be incurred until the completion of the hearing.

20.The practitioners and/or parties in the event that they are not legally represented be at liberty to approach Justice Macmillan’s Associate via email for an urgent listing of the matter if required.

AND THE COURT NOTES:

A. That the requirements of s102NA(2) of the Family Law Act 1975 will apply to any cross-examination occurring in the proceedings on or after 10 September 2019;

B.   That the parties have each been advised by the court:

a.That pursuant to those requirements, neither party may cross examine the other party personally;

b.That pursuant to those requirements, any cross-examination of either party may only be conducted by a legal practitioner acting on behalf of the other party;

c.As to the availability of the Commonwealth Family Violence and Cross-Examination of Parties Scheme and the means by which they may apply to that scheme for the provision of a lawyer; and

d.That a copy of these orders will be provided by the Court to Victoria Legal Aid, which administers the said scheme.

Note: The form of the order is subject to the entry of the order in the Court’s records.

IT IS NOTED that publication of this judgment by this Court under the pseudonym Bader & Spinner has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).

Note: This copy of the Court’s Reasons for Judgment may be subject to review to remedy minor typographical or grammatical errors (r 17.02A(b) of the Family Law Rules 2004 (Cth)), or to record a variation to the order pursuant to r 17.02 Family Law Rules 2004 (Cth).

FAMILY COURT OF AUSTRALIA AT MELBOURNE

FILE NUMBER: MLC 6810 of 2015

Mr Bader

Applicant

And

Ms Spinner

Respondent

REASONS FOR JUDGMENT

  1. This matter has a long and complicated history including various applications for enforcement of final property orders, an appeal and the wife’s application to set aside the orders pursuant to s79A of the Family Law Act 1975 (“the Act”).

History Of Proceedings

  1. On 18 September 2018 the husband filed an Application in a Case in which he sought inter alia orders that the wife provide him with vacant possession of Property A within 14 days, sole possession of the property to exclusion of the wife for the purposes of the sale and control of the sale.

  2. On 15 November 2018 the wife filed and served a Response to an Application in a Case. She sought inter alia orders that she continue to have sole use and occupation of Property A to the exclusion of the husband, that D Services be appointed as selling agent to sell Property A by auction on 16 February 2019 and that the husband pay the wife her half share of the various business accounts in the sum of $30,686.06.      

  3. On 19 November 2018 Judge Wilson as he then was ordered that on or before 5 January 2019 the wife provide the husband with vacant possession of Property A and that upon the wife vacating the property the husband have sole possession of the property to the exclusion of the wife for the purposes of effecting the sale of the property and sole control of the sale. Significantly for the purposes of the matters I must determine this order remains in force. 

  4. On 22 February 2019 the husband filed the first of two applications in the Federal Circuit Court of Australia seeking inter alia a warrant for possession of Property A pursuant to Rule 25B.62 of the Federal Circuit Court Rules 2001 (“the Federal Circuit Court Rules”).

  5. On 1 March 2019 the wife filed an Amended Application in a Case seeking leave pursuant to s79A of the Act to vary paragraphs 2-3, 5-6, 9 and 12-14 of the final orders made on 26 August 2016 and leave being granted orders inter alia that Property A be sold and the net proceeds of sale be divided as to 80 per centum to the wife and the balance to the husband.

  6. The husband’s Application in a Case filed 22 February 2019 and the wife’s Amended Application in a Case filed on 1 March 2019 were listed for hearing before Judge Wilson on 5 and 6 March 2019. On 6 March 2019 Judge Wilson made orders in the following terms:

    UPON HEARING Ms E Swart of counsel for the applicant and Mr A Sanbach of counsel for the respondent at trial I ORDER that by 4pm Thursday 7 March 2019 the parties submit a minute of proposed orders that give effect to these reasons.

    (Emphasis in Original)

  7. The matter was again listed for hearing before Judge Wilson on 6 March 2019. On that date the judge made orders in the following terms:

    1. The wife has leave to file and serve the amended application issued on 1 March 2019 pursuant to s 79A(1)(b) and/or s 79(1)(c) of the Family Law Act for an order that paragraphs 2-3, 5-6, 9 and 12-14 of the minute of final orders by consent made by this court on 26 August 2016 are varied.

    2.By  4pm  on  12 March 2019  the  wife  vacates  the  property  situate  at  Property A, Suburb H (“property”), and at that time gives vacant possession of the property to the husband.

    3.        Upon the wife vacating the real property, the husband has –

    a. sole possession of the real property to the exclusion of the wife for the purposes of effecting the sale of the sale property and;

    b.sole control over the sale of the real property including but not limited to  -

    i.determining the real estate agent to be engaged to conduct the sale (“agent”);

    ii.whether the real property is to be sold by way of a private sale or by further auction as may be recommended by the agent;

    iii.the terms and conditions of the sale and listing; and

    iv.the reserve price and/or the sale price.

    4.Upon the property being sold the net proceeds are to be held in trust by the David Zucco Lawyers on trust for both parties in an interest bearing account and no amount is to be disbursed without further order of the court or written agreement of the Parties.

    5.The question of the percentages by which the net proceeds of sale are to be divided is to be determined after a trial limited to whether the business previously conducted by Company C Pty Ltd (CAN …) was conducted in a manner that compromised the best price available being realised as was contemplated by order 12 of the orders made on 26 August 2016.

    6.This proceeding is listed for trial of the remaining issue on 14 October 2019 at 10:15am (for no more than two days)

    7.The parties’ costs are reserved

    (Emphasis in Original)

  8. On 2 April 2019 the husband filed a Notice of Appeal and on 10 July 2019 filed an Amended Notice of Appeal. On 3 September 2019 the husband’s appeal was allowed, Judge Wilson’s orders of 5 and 6 March 2019 were set aside and the wife’s Amended Application filed 1 March 2019 and the husband’s Application filed 22 February 2019 were remitted to the Federal Circuit Court of Australia for rehearing noting that the proceedings were now transferred to this Court.

  9. On 16 April 2019 the husband filed an Application in a Case seeking orders in similar terms to the orders sought in his Application in a Case filed 22 February 2019. It is those applications which are listed for hearing before me.

  10. At the Trial Management Hearing on 21 October 2019 orders were made by consent dismissing the wife’s Application in a Case filed 1 March 2019 and her Amended Response to Initiating Application. The wife was ordered to file and serve a further Initiating Application in relation to any orders she was seeking pursuant to s79A of the Act together with an affidavit setting out with particularity the evidence based upon which she said the orders should be set aside. In the event that the wife filed an Initiating Application as ordered that application was to be listed for a trial management hearing on 29 November 2019. The husband’s Applications in a Case filed 22 February 2019 and 16 April 2019 were otherwise listed for hearing before me on 10 February 2020.

  11. On 6 November 2019 the wife filed an Initiating Application and an affidavit in support as she was ordered to do. In that application the wife sought inter alia orders for the variation of paragraphs 5 and 9 of the final property orders pursuant to s79A (1)(b) and/or (c) of the Act and those orders be varied so that Property A be sold and the net proceeds be divided as to 80 per centum to the wife and the balance to the husband. Somewhat surprisingly given the history of the matter the wife sought interim orders for the preparation of a valuation of the business and orders requiring the husband and wife to execute documents in order to borrow $400,000 secured on the title to Property A and to be paid to the wife as a partial property settlement, albeit it may have been intended to proceed with this part of her application once the final orders had been set aside.

  12. On 5 February 2020 the husband filed a Response to the wife’s Initiating Application filed 6 November 2019 in which he sought final orders dismissing the wife’s application to set aside the final property orders and interim orders for the bifurcation of the wife’s application pursuant to s79A of the Act and her application for property orders in the event of the final orders being set aside. I will address that application later in these reasons.

  13. At the commencement of her case I was advised by the wife that she wanted the husband’s application adjourned as she suffers from anxiety and depression and she said was unable to properly represent herself. There was no evidence as to either the wife’s mental health or how that would impact upon her capacity to represent herself and I note that there have been other occasions when the wife has not had legal representation. She also said that she was in the process of engaging a family law specialist to act on her behalf. However, when I asked who it was she was proposing to engage to act on her behalf she told me that she had done some research but had not yet decided which solicitor she wanted to engage.

  14. The wife was legally represented when the matter was first listed for hearing before me and those solicitors continued to represent her up until they filed a Notice of Ceasing to Act on 24 January 2020. Those solicitors prepared the wife’s Amended Initiating Application filed 6 November 2019 and the affidavit setting out the basis of the wife’s case that the final orders should be set aside pursuant to the orders for filing directions made 7 October 2020. The wife also deposed in that affidavit that if she did not deposit funds into her solicitors trust account they would not be in a position to continue acting on her behalf. The wife’s evidence ignores the fact that pursuant to the orders she now seeks to set aside or vary she would be entitled to receive 50 per centum of the net proceeds of sale of Property A which is worth approximately $3 million and is unencumbered giving her access to the funds she says she needs to pay her solicitor. 

  15. Significantly in my view that affidavit which sets out the basis of the wife’s application pursuant to 79A is also in essence the basis of her opposition to the husband’s application for the issue of a warrant of enforcement. So in so far as the wife opposes the husband’s application for a warrant for possession of the property her evidence, which was prepared when she was legally represented, was before the court. It is also the case that when the wife filed her Amended Initiating Application some three months earlier she was seeking orders for sale albeit it was her case she should remain in occupation of the property pending settlement of that sale.

  16. The husband filed his application seeking orders that the wife vacate Property A within 14 days so that he could have sole possession of the property to the exclusion of the wife for the purposes of its sale on 18 September 2018 and his first application for an enforcement warrant was issued on 22 February 2019.

  17. The purposes of the Family Law Rules 2004 (Cth) is described in Rule 1.04 as follows:

    The main purpose of these Rules is to ensure that each case is resolved in a just and timely manner at a cost to the parties and the court that is reasonable in the circumstances of the case.

  18. This enforcement phase of the proceedings has been on foot since September 2018. The wife until recently, including for the purposes of her answering material, had legal representation. Although the wife said she proposed to engage solicitors to act on her behalf she could not or would not tell me who she wanted to engage to act on her behalf or when she might do so. In my view after so many months and so many previous hearings the husband is entitled to have his application heard and determined. In all of the circumstances I determined that I should not accede to the wife’s application for an adjournment. Having told the wife that I did not intend to adjourn the matter I stood the matter down so that she could have some time to prepare her submissions.

Warrant For Possession

  1. Although the husband initiated these proceedings in the Federal Circuit Court of Australia pursuant to Rule 25B.62 of the Federal Circuit Court Rules (Cth) 2001, the matter having been transferred to this court the relevant rule is Rule 20.54 of the Family Law Rules 2004 (Cth) (“the Rules”). Pursuant to Rule 20.01 an order entitling a person to possession of real property is an enforceable obligation for the purposes of Chapter 20 of the Rules, which deals with the enforcement of financial orders and obligations. In this case the husband is seeking the enforcement of paragraphs 1 and 2 of the orders made by Judge Wilson on 19 November 2018. As previously referred to this order was not subject to appeal and remains in force.

  2. Rule 20.53 provides that a person may apply, without notice to the respondent, for an order requiring a person to sign documents pursuant to s106A of the Act, an order to enforce possession of real property and an order for the transfer or delivery of property by filing an Application in a Case and an affidavit. An order for possession of a real property can only be enforced by a warrant of possession if the respondent has had at least 7 days’ notice of the order which is sought to be enforced. In this case that order was made more than a year ago and I am satisfied that the wife has had the requisite 7 days’ notice.

  3. It was part of the wife’s case that the husband had not filed an Initiating Application. It was not easy to understand the basis of the wife’s complaint however I assume that her point was that the husband was seeking an order permitting him to have possession of Property A contrary to the terms of the final orders but that he had not filed an Initiating Application seeking to vary those final orders. The Federal Circuit Court of Australia and this Court have the power to make an order granting the husband possession of the real property and in in fact in this case that order has already been made.  It is that order the husband now seeks to enforce. Even if the court had not already made that order it would not have been necessary for the husband to file an Initiating Application for the purposes of varying the final orders as the orders he seeks are by way of enforcement rather than a variation of the final orders.

  4. The court has the power to enforce its orders (s105 of the Act) and has a discretion as to whether or not it should exercise that power in a particular case. Nygh J said in In the marriage of Ramsey (No. 2) (1983) FLC 91-323 (at [78-207] as follows:

    …The Full Court in the appeal in this case ((1983) FLC 91-301) held that the power of enforcement which the wife sought to exercise under sec. 105 was discretionary and not absolute and I am clearly bound by that decision. The question then arises whether circumstances have arisen in which it would be inequitable to enforce the original order.

    (Emphasis added)

  5. As Le Poer Trench J said more recently in Yilmaz v Yilmaz [2014] FamCA 663 at [183]:

    …In order to enliven the application of the discretion not to enforce an order, the fact or circumstance, accepted by the court as established, (arising out of the conduct of the parties in the intervening period), must give rise to the conclusion that it would be inequitable to now enforce the order, or a part thereof.  

    (Emphasis in Original)

Discussion

  1. For the reasons which I will refer to I am not satisfied that there is any fact or circumstance which would give rise to the conclusion that it would be inequitable to now enforce the order for the husband to have possession of Property A to the exclusion of the wife for the purposes of its sale as ordered by Wilson J on 19 November 2018.

  2. In her Initiating Application the wife sought orders that Property A be sold and that she be entitled to 80 per centum of the proceeds of that sale. During the hearing before me she said she is now seeking 100 per centum of the equity and that she now wants to retain the property.   If as had previously been the case the wife was seeking the sale and that she retain all of the proceeds, then the question in terms of the matters I must determine by way of enforcement is when the wife should be required to vacate the property.

  3. However as the wife is now saying she wants to retain the property it is necessary to consider the basis of and the merits of her case pursuant to s79A and the impact of the sale upon any claim she may have. Doing the best I can based upon her affidavit filed 6 November 2019 it is the wife’s case that although at the time of the final orders the business she and the husband operated during the marriage was valued at not less than $257,750 and those orders required she and the husband to do all things necessary to sell the business including obtaining a renewal of the lease on the business premises, the husband withdrew approximately $187,500 from the business, continued trading without accounting to her for the income, allowed the lease to lapse and ultimately closed the business reopening that business at new premises in Suburb N.

  4. It is difficult to see in these circumstances how the wife could justify a claim for 100 per centum of the equity in the former matrimonial home even if her application pursuant to s79A was successful. In these circumstances and given what the wife says about her financial circumstances a sale would be inevitable. When I raised this with the wife she submitted firstly that the business was worth more that the value attributed to it by Mr F of G Company and that the valuation arrived at by Mr F was less than it would otherwise have been because of the husband’s failure to provide information that had been requested from him and in particular what she described as the cash docket books. Firstly I note that Mr F valued the business at between $286,000 and $357,000, and there being net tangible assets of $112,000 the value of the goodwill was between $174,000 and $245,000. Mr F then assessed the value of the husband and wife’s interest in the M Trust, which included the business value of between $286,000 and $357,500, at between $222,000 and $293,500 the mid-point being $257,750. These figures would likely have included the business bank account which was divided between the husband and the wife pursuant to Judge Wilson’s order made 19 April 2018.

  5. In his valuation Mr F stated that he had requested information and explanations relevant to significant aspects of his valuation and said that where that information was not supplied or the information not provided this limited the scope of his report. The information he did not have and his responses to not having that information were as follows:

    ·That he was not provided with a management account balance for the period ending 31 December 2015 as a result of which he had to have regard to the financial trading of the business for that period to determine the appropriate normalised earnings for the purposes of valuing the business. However he also said that in considering the valuation of the assets and liabilities not reflected in these values he relied upon the information as at 30 June 2015;

    ·Pages 2 and 3 of the December 2015 L Bank statements were missing however this only limited his review of the cash required to operate the business in that month; and

    ·As the lease for the business premises was due to expire on 3 March 2017 and the Husband had not at that time having entered into negotiations to renew that lease the future of the business was uncertain as a result of which Mr F said he had prepared the valuation on the basis of two scenarios, the first being that the lease was not renewed and the second being based upon the lease being renewed on the same terms and the current lease.

  6. I do not in these circumstances accept the wife’s submission that the business could not be valued as a result of the husband’s failure to provide documents or the basis upon which she asserts that it was worth twice as much than the figure arrived at by Mr F. There is no evidence to support that assertion. The wife’s submission also ignores the fact that having had the opportunity to consider Mr F’s valuation she still consented to the final orders.

  7. The wife also said that she had evidence in her possession which would back up her case that she should be permitted to retain Property A. The wife’s application to set aside the final property orders with respect to Property A pursuant to s79A of the Act has been on foot since 11 March 2019 and significantly for the purposes of the matters I must determine on 21 October 2019 she was ordered to file an affidavit setting out the basis upon which she was seeking to set aside or vary the final orders. In these circumstances it is reasonable to infer that if she had some evidence that would assist her case she would have already referred to that evidence in her affidavit or it would have been otherwise disclosed.

  8. There is also no evidence which suggests that if the wife’s application pursuant to s79A was successful and if the property had been sold and the proceeds divided that the court would not be able to make whatever payment might be required by way of orders pursuant to s79 of the Act.

  9. In all of the circumstances I am not satisfied that the wife having made an application to set aside or vary the final orders pursuant to s79A of the Act some months after the order granting the husband possession of the property for the purposes of sale was made by Judge Wilson would be a reason for the court not to exercise its discretion to enforce that order. And particularly so in circumstances where the wife has consistently sought the sale of the property and her claim in the event that the orders were to be set aside or varied would appear to be limited.

  10. In so far as the wife’s case is that the court should not make the order the husband seeks because she does not have the money to reaccommodate herself I note as submitted by counsel for the husband that as previously referred to both the husband and the wife received $36,500 from the business bank account pursuant to orders made by Judge Wilson on 19 April 2018 which the wife could have used to find alternative accommodation for herself, and the wife having remarried in March 2017, her new husband who lives with her in Property A.  

  11. I also note that had the wife complied with the orders when she was required to do so she would arguably have had access to at the very least her share of any deposit prior to having to move. The wife cannot now rely upon the fact that she will not have the funds to reaccommodate herself and her new husband almost 4 years after the final orders were made and over 12 months since she was first ordered to vacate the property.  

  12. Even if the wife is able to establish that there are circumstances which have arisen since the order was made which make it impracticable for the order to be carried out or that the husband has defaulted in carrying out the obligations imposed upon him by the final orders the court has a discretion as to whether it should or should not exercise its discretion to set aside or vary the final orders. It does not follow as the wife seems to think that those orders in their entirety will be set aside particularly in circumstances where the grounds she relies upon are limited to what she says has happened in relation to the business. The wife has not in my view explained why it would be that she would be entitled to all of the husband’s share of Property A given the value of the business compared to the likely value of the property.

  13. The court is also entitled to consider the party’s circumstances since the final orders were made in determining whether it should exercise its discretion to set aside the orders. Those circumstances in this case include the fact that the wife and for part of the time her new husband have had the benefit of living in Property A to the exclusion of the husband leaving the husband without the benefit of his entitlements pursuant to the final property orders.

  14. It was on this basis that counsel for the husband submitted, in my view with some force, that even if the wife’s application to set aside the orders were to succeed, her claim to 100 per centum of the equity in Property A or for that matter 80 per centum, appears, given the basis of her claim, fanciful.

  15. Although in her Initiating Application filed 6 November 2019 the wife proposed that she be appointed as trustee for the sale at the very least, she now appears to be wanting to further delay it. In these circumstances and given the history of the matter I have little confidence that she will either vacate the property as she has been ordered to do or that even if she were permitted to remain in the property that given the history of this matter she would facilitate the sale. 

  16. These are enforcement proceedings and the husband has been waiting since the final orders were made on 26 August 2016 to realise his entitlements. In circumstances where the wife has failed to comply with the orders made by Judge Wilson on 19 November 2018 requiring her to vacate the property I am satisfied that given the history of the proceedings the court should exercise its discretion to enforce the order made by Judge Wilson in favour of the husband for possession of Property A. In these circumstances I propose to accede to the husband’s application and issue a warrant for possession.

Bifurcation

  1. The determination of an application pursuant to s79A involves a number of steps. They are whether the applicant has established a ground based upon which the court has the discretion to set aside or vary the orders, whether the court, a ground having been established, should exercise that discretion to set aside or vary the orders, and having exercised that discretion what if any orders it should make pursuant to s79 of the Act. Although the court has a discretion as to whether to split a hearing as the Full Court said in Patching and Patching (1995) FLC 92-585 at [81795] “… it is generally preferable to deal with all of the steps in the one hearing” that is hear both the application pursuant to s79A and the application for orders pursuant to s79 if the orders are to be set aside or varied. However as the Full Court also said (at [81,795]) “…there will be cases where it is convenient to divide the procedure into several hearings; - eg where there is a discrete issue under the first or second step and the property circumstances of the parties are complex.”

  2. As Murphy J said in Trustee of the Bankrupt Estate of Hicks & Hicks & Anor (2018) FLC 98-824 having referred to the inherent difficulties in bifurcating s79A and s79 proceedings:

    212A separate issue in my view relates to what issues should form what part of the proceedings if it is contended for good reason that, contrary to the general practice, proceedings should be bifurcated.

    213.The first of the preconditions for s79A relief engage questions which are essentially factual: what ground or ground for relied is contended for and what facts are said to establish that ground. The second and third component of s79A relief are discretionary: what facts are said to engage the exercise of the s79A discretion to vary or set aside and, if that discretion is exercised to do either, what facts engage the discretions as to what order or orders, if any, should be made in their stead.

    214.This case highlights how facts relevant to establishing miscarriage of justice in respect of a” any other circumstances” can be relevant in the exercise of the s79A discretion.[30] In other cases, the factual inquiry necessary to establish a ground and the miscarriage of justice caused by it can be delineated from facts relied upon as underpinning the exercise of the s79A discretion. In those cases, the argument for bifurcation might be seen to be stronger. That is markedly less so where, as here, the same or similar factual contentions inform each.

  3. Counsel for the husband sought orders splitting the hearing of the wife’s s79A application from any proceeding pursuant to s79 that might follow if the wife were successful on the basis that the husband should not be put to the expense of both the wife’s application pursuant to s79A and the necessary preparation for an application for property orders pursuant to s79 of the Act, given what she submitted was the unlikely prospect of the wife’s application being successful.

  4. The wife’s case at its highest based upon the evidence she has put before the court is that the husband did not do what was required of him to renew the lease and that he withdrew funds from the business undermining its viability, traded without accounting to the wife and subsequently closed the business without first taking steps to sell it. In so far as she asserts that the valuation prepared by Mr F was flawed she has not adduced any evidence in support of that assertion notwithstanding the orders were made requiring her to file an affidavit deposing to the basis of her application to set aside the orders. It would seem however based upon her submissions, albeit Mr F does not suggest that this limited the scope of his valuation, that it is her case that the husband did not provide Mr F with the cash docket books.

  5. The husband for his part says that he can explain what happened in relation to the business and that his actions were bona fide. Whether his evidence is accepted or the wife’s evidence is accepted these are in my view discrete factual issues which can be delineated from the discretionary issues that follow once a ground is established. I agree with counsel for the husband that the threshold question of whether there are grounds for setting aside or varying the order  will be significantly cheaper and determined more quickly in this case than if the entirety of the matter were to be dealt with at one hearing. Although I have had regard to the possibility of there being two hearings in all of the circumstances of this case I am satisfied that I should accede to the husband’s application for bifurcation.

  6. I had already tentatively set aside three days for the hearing this matter commencing on 4 May 2020 however given the requirements of s102NA(2) of the Act I am concerned that the matter will not be ready to proceed on that date. Accordingly I propose listing the question of whether there are any grounds for varying or setting aside the final property orders pursuant to s79(1)(b) and/or (c) of the Act on 22 July 2020. This time takes into account the fact that s102NA(2) applies and the wife needs time to apply to the Commonwealth Family Violence and Cross Examination of Parties Scheme. The wife was ordered to file an affidavit setting out the evidence upon which she says the orders should be set aside or varied. I propose to make directions for the wife to file any further affidavits upon which she seeks to rely in support of her application pursuant to s79A(1)9B) and/or (c) of the Act. Any further affidavits are to be limited to the evidence in support of the grounds upon which she relies. I will also make orders with respect to the husband filing any affidavits in reply, any reply by the wife and general trial directions.

I certify that the preceding forty-six (46) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Macmillan delivered on 6 March 2020.

Associate: 

Date:  6 March 2020

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Yilmaz & Yilmaz [2014] FamCA 663