FAMILY LAW – application to restrain a solicitor – change in the legal test while the judgment reserved – test now is “might conclude” – refinement not revolution – application granted.
Yunghanns v Elfic Ltd (unreported Supreme Court of Victoria, Gillard J, 3 July 1998)
Division:
Division 2 Family Law
Number of paragraphs:
179
Date of last submissions:
2 December 2022
Date of hearing:
15 December 2021
Place:
Melbourne
Counsel for the Applicant:
Mr A. Panna of senior counsel
Solicitor for the Applicant:
D Lawyers
Counsel for the First Respondent:
Mr C. Twidale
Solicitor for the First Respondent:
Vernon Da Gama And Associates
Counsel for the Second and Third Respondents:
Mr D. Mort
ORDERS
MLC 496 of 2021
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 2)
BETWEEN:
MR BANSAL
Applicant
AND:
MS MATHAI
First Respondent
MR MATHAI
Second Respondent
MS B MATHAI
Third Respondent
order made by:
JUDGE O'SHANNESSY
DATE OF ORDER:
21 March 2023
THE COURT ORDERS THAT:
1.D Lawyers (“the Solicitors”), by itself and its servants, employees or agents thereof, be restrained from acting for, working for, aiding or otherwise assisting the Applicant in relation to, or otherwise in connection with, this proceeding.
2.The Solicitors’ Principal, Ms D, be and is permitted to participate as a witness in these proceedings.
3.Further hearing of all extant applications is listed for directions on Monday 15 May 2023…
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.
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Details
AGLC
Bansal & Mathai [2023] FedCFamC2F 307
Case
[2023] FedCFamC2F 307
Decision Date
CaseChat Overview and Summary
The question the Court must decide is whether one party should be prevented from retaining the solicitor of his choice after objection by other parties. The question arose in a property dispute after the short marriage between the Applicant Husband, Mr Bansal (the Husband), the First Respondent Wife, Ms Mathai (the Wife), and the Second and Third Respondents, Mr Mathai (the Wife’s father) and Ms B Mathai (the Wife’s mother) (the Wife’s Parents). The Wife’s Parents were joined to these proceedings on 13 April 2021. The matter came before the Court on 15 December 2021 listed as an Interim Defended Hearing on the Application in a Case filed by the Wife’s Parents on 17 August 2021 to restrain the Husband’s solicitors, D Lawyers (the Solicitors) and their Principal Solicitor, Ms D, from acting on his behalf. The Wife filed a similar application on 6 September 2021. The parties have competing versions of the arrangements around the purchase of a dwelling in Suburb C (the Property) in the name of the Wife’s Parents, which was used for about 6 ½ months as the matrimonial home of the Husband and the Wife. The total purchase costs of the Property were $901,965 and it is common ground that, whatever was agreed, the Husband and the Wife put in or contributed a total of $100,000 and the Wife’s parents contributed, by borrowing or directly, the balance. The parties also have competing accounts of a meeting held on 25 February 2020 between the Solicitors, the Husband, the Wife and the Wife’s father (the Meeting). After the Meeting, a draft loan document (the draft agreement) was prepared by the Solicitors. The Property is now said to be worth about $960,000, more or less. The question of who is entitled to that increase has contributed to this litigation. The Court found that the solicitors should be restrained from acting for the husband, and that the wife and her parents’ applications should be granted. The Court found that the solicitors had a duty of loyalty to the wife and her parents, which continued after termination of the retainer, and that the solicitors had breached that duty by continuing to act for the husband. The Court also found that the administration of justice required the solicitors to be restrained from acting for the husband. The Court noted that the Full Court of the Federal Circuit and Family Court of Australia had recently handed down the decision of Charisteas & Charisteas (2022) FLC 94-109, which provided guidance on the test for restraining a solicitor. The Court found that the test was whether the Court might conclude that the solicitors would be likely to act in a way that would be inconsistent with their duty to the court. The Court found that the solicitors would be likely to act in a way that would be inconsistent with their duty to the court by continuing to act for the husband and giving evidence about the meeting and the draft agreement. The Court noted that the solicitors’ evidence was untested and that the parties’ competing versions of the meeting and the draft agreement were untested. The Court found that it was not necessary to determine which, or any, version occurred on the hearing on the papers. The Court found that the solicitors should be restrained from acting for the husband and that the wife and her parents’ applications should be granted.