Barakat & Farid (No 2)

[2020] FCCA 3684

FEDERAL CIRCUIT COURT OF AUSTRALIA

Barakat & Farid (No 2) [2020] FCCA 3684

File number(s):

PAC 2275 of 2020

Judgment of:

JUDGE OBRADOVIC

Date of judgment:

24 November 2020

Catchwords:

FAMILY LAW – parenting - interim application – stay application pending outcome of appeal – reasons for granting stay of order not made out – application for stay of order refused

FAMILY LAW – practice and procedure – enforcement of interim orders.

Cases cited:

Aldridge & Keaton [2009] FamCAFC 106

Division:

Division 2 Family Law

Number of paragraphs:

39

Date of hearing:

24 November 2020 

Place:

Parramatta

Solicitors for the Applicant: 

Stewart & Associates

Appearing for the Respondent:

Ms Shea of Counsel

Solicitors for the Respondent: 

Somerville Legal

Solicitors for the Independent Children’s Lawyer:

Mark Macdiarmid Family Law Specialist

ORDERS

PAC 2275 of 2020

FEDERAL CIRCUIT COURT OF AUSTRALIA

BETWEEN:

MS BARAKAT

Applicant

AND:

MR FARID

Respondent

INDEPENDENT CHILDREN'S LAWYER

ORDER MADE BY:	JUDGE OBRADOVIC
DATE OF ORDER:	24 NOVEMBER 2020

THE COURT ORDERS THAT:

1.By consent, orders are made in accordance with the Minute of Order signed by the parties, initialled and dated by the Court today, placed on the Court file as attached hereto.

2.The application for stay of Orders 3, 4, 5 and 6 made on 2 October 2020 is dismissed.

3.Within 24 hours of the date of these orders, the Applicant Wife authorise J Lawyers to transfer the sum of $28,000 to her pursuant to Order 3 of the Orders dated 2 October 2020 and for such purposes, this order shall operate as an authority to J Lawyers without the requirement of any authority, direction or consent from the Respondent Husband.

4.Within 7 days of the date of these orders, the Respondent Husband and Applicant Wife do all things and sign all documents necessary:

(a)To authorise and direct J Lawyers, to transfer into the trust account of Somerville Legal, the balance of the funds held in the J Lawyers Trust Account; and

(b)To authorise and direct Somerville Legal to deposit the funds into a controlled moneys account on behalf of the parties pending further order.

5.Within 7 days of the date of these orders the Respondent Husband do all acts and things necessary to maintain comprehensive and compulsory third party insurance cover on the Motor Vehicle 1 (“the vehicle”)and to ensure that the Applicant Wife is listed as a driver of that vehicle on all relevant insurance policies.

6.Within 24 hours of the date of these orders, the Respondent Husband comply with Order 5 of the Orders made on 2 October 2020.

7.The Applicant Wife is to provide, by way of disclosure, copies of the following documents:

(a)All financial statements, records and all other documents in relation to Company T for the period from 1 January 2011 to date: including but not limited to email correspondence, income tax returns, notices of assessments, balance sheets, profit and loss statements, business activity statements, company records (including share register and company constitution), blank records (including cheque butts, bank statements, deposit books), contracts (including contracts for sale or purchase), agreements (including loan agreements), trust records (including trust deeds, deeds of variation, income tax returns, notices of assessments), superannuation records (including balance sheets, profit and loss statements, members statements);

(b)Details of any and all social media accounts related to Company T and operated by the Applicant Wife;

(c)Details of any and all email accounts related to Company T and operated by the Applicant Wife;

(d)All correspondence including but not limited to email correspondence, text messages, WhatsApp messages, social media messages and any other type of correspondence between the Applicant Wife and any person related to the sale of:

(i)Household items in the possession of the Applicant Wife from 9 March 2020 to date;

(ii)Furniture items in the possession of the Applicant Wife from 9 March 2020 to date;

(iii)Jewellery items in the possession of the Applicant Wife from 9 March 2020 to date;

(iv)Designer clothing, shoes and handbags in the possession of the Applicant Wife from 9 March 2020 to date; and

(v)Any other item in the possession of the Applicant Wife from 9 March 2020 to date.

(e)Full financial disclosure on the sale/s of item/s referred to in paragraph (d) above, including but not limited to exact sale/s amount/s, type of payment/s (cash/eft or otherwise) and to whom the item/s were sold.

(f)The tenancy application and tenancy agreement in respect of the Applicant Wife’s current place of residence.

8.Grant leave to the Respondent Husband, without prejudice, to withdraw the application as contained in paragraphs 6 and 7 of the amended application in a cased filed on 18 November 2020.

9.The Notice of Objection – Subpoena filed on 29 October 2020 by Mr Farid in relation to the Subpoena issued on 16 October 2020 to Company U is withdrawn and the parties are granted general access to view the material produced by Company U.

10.The Notice of Objection – Subpoena filed on 29 October 2020 by Mr Farid in relation to the Subpoena issued on 16 October 2020 to Company S is stood over on a date to be advised.

11.The Notice of Objection – Subpoena filed on 13 November 2020 by Mr Farid in relation to the Subpoena issued on 4 November 2020 to Roads and Maritime Services is stood over on a date to be advised.

12.The listing of the matter on 27 November 2020 is vacated.

13.List the matter for directions at 2:15pm on 22 February 2021.

14.The parties are to file a jointly drafted agreed statement of issues 7 days prior to the directions hearing, together with an agreed minute of order for the further progress of the matter.

15.The competing costs applications are stood over to the conclusion of the proceedings.

16.Grant leave to the parties to seek to have the matter restored to the list on 7 days’ notice.

THE COURT NOTES THAT:

A.The Respondent Husband foreshadows an application for this judicial officer to be recused from hearing the matter further.

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

REASONS FOR JUDGMENT

(Ex Tempore; Revised from Transcript)

JUDGE OBRADOVIC:

1. Before the Court today is an amended application in a case filed by the respondent husband to the substantive proceedings, Mr Farid. 

2. The orders which are pressed today are a stay of orders 3, 4, 5, 6(a) and 6(j) of the orders made by this Court on 2 October 2020, pending the hearing of the appeal which the husband has filed on 30 October 2020. The husband also presses paragraphs 2, 4, 5, and 8 through to 11 of that amended application in a case. 

3. The husband filed the first application in a case on 6 October 2020. That application in a case sought the stay of order 5 made on 2 October 2020. Following the filing of that application it appears that on 6 October 2020 an amended application in a case was filed, and then a further amended application in a case was filed on 18 November 2020, which is the application that is relied on today. The further amended application filed on 18 November 2020 was filed subsequent to the husband appealing the orders of this Court made on 2 October 2020. 

4. In the middle of the husband's applications in a case the wife filed an application in a case on 21 October 2020 seeking for the enforcement of the orders made on 2 October 2020, in particular, the enforcement of the order for the motor vehicle to be made available to her and for the spousal maintenance order to be complied with. 

5. Today the hearing proceeded on the basis that the husband's application was heard first and, then, depending on the outcome of that application, the wife either pressed or did not press, and would be successful or would not be not successful, in relation to the orders that she sought. 

6. The principles applicable to stay applications are well known, and the Court only need to consider, for example, the Full Court's reasons in Aldridge & Keaton [2009] FamCAFC 106 where those principles are summarised. For the benefit of the parties the relevant principles include the following considerations:

   (a)The onus to establish a proper base for a stay is on the applicant for the stay; 

   (b)It is not necessary for the applicant to demonstrate any special or exceptional circumstances;

   (c)A person who has obtained judgment is entitled to the benefit of that judgment;

   (d)A person who has obtained judgment is entitled to presume that the judgment is correct.  The mere filing of an appeal is insufficient to grant a stay;

   (e)The bona fides of the applicant, and a stay may be granted on terms that are fair to all of the parties, and this may involve the Court weighing the balance of convenience and the competing rights of the parties;

   (f)Whether not granting a stay would render the appeal nugatory.  That at times is a substantial factor in determining whether or not the stay should be granted;

   (g)Some preliminary assessment of the strength of the proposed appeal, that is, whether the appellant has an arguable case; and

   (h)The period of time in which the appeal can be heard and whether existing satisfactory arrangements may support the granting of the stay for a short period of time.

7. The evidence in support of the stay application is, in one respect, very limited.

8. In this instance the onus, or the burden, is on the husband to convince the Court that the stay should be granted, and the husband needs to convince the Court he has an arguable case on appeal.

9. The notice of appeal is annexed to the husband's affidavit filed on 18 November 2020, and the notice of appeal alleges that this Court erred on the facts, in that:

   (a)it did not sufficiently analyse the facts in circumstances of the case; 

   (b)it did not adequately analyse or take into account paragraph 56 of the family consultant's report; 

   (c)the mother's alleged criminal behaviour; 

   (d)the mother's alleged neglect or abuse of the children; 

   (e)the children's relationship with the father, and the prima facie evidence of a substantial debt to a third party or the parties; 

   (f)the Court did not adequately take into account material considerations; 

   (g)the Court failed to consider, weigh or assess the evidence on each of the relevant matters and then indicate the relative weight the Court attaches to each of those matters and how all of those matters balance out; 

   (h)the Court did not adequately consider whether it was just and equitable to make the orders and did not adequately consider whether it was otherwise proper to make the orders. 

10. In one sense, even though it is an allegation that there was an error on the facts, it is really an allegation that there were insufficient reasons for some of the orders that were made on 2 October 2020. 

11. The next ground of appeal is that this Court erred in law, in that:

    (a)it failed to follow the strict legislative pathway; 

    (b)acted upon a wrong principle; 

    (c)did not sufficiently analyse the facts or circumstances of the case; 

    (d)did not adequately analyse or take into account the views expressed by the child, or any factors that the Court thinks are relevant, and the weight it should give to the child's views; 

    (e)the nature of the relationship of the child and each of the child's parents; 

    (f)nature of the relationship of the child with other persons; 

    (g)likely effect of change; 

    (h)attitude to the child; 

    (i)responsibilities of parenthood; 

    (j)family violence; 

    (k)any family violence orders;

    (l)whether it would be preferable to make the order that would be least likely to lead to institution of further proceedings; 

    (m)any other fact or circumstance;

    (n)the benefit of the child having a meaningful relationship with both of their parents; 

    (o)whether any safety guards could be ordered;

    (p)whether significant and substantial time is in the child's best interests; 

    (q)the matters set out in section 67ZBB of the Act; 

    (r)any orders under section 69ZW; 

    (s)third party rights; 

    (t)third party debts and obligations, and concerns that it was foreseeable at the time of making the orders that it would not result in the debts not being paid in full and, therefore, that it would not be just and equitable in all of the circumstances;

    (u)that the Court placed insufficient weight on the evidence relating to paragraph 56 of the family consultant's report; 

    (v)the mother's alleged criminal behaviour; 

    (w)the mother's alleged neglect or abuse relating to the children; 

    (x)children's relationship with their father; 

    (y)prima facie evidence of a substantial debt to the third parties;

    (z)The Court failed to consider, weigh and assess on the evidence each of the relevant matters and then indicate the relevant weight the Court attaches to each of those matters and how those matters balanced out; 

    (aa)did not adequately consider whether it was just and equitable to make the orders made;  did not adequately consider whether it was otherwise proper to make the orders made. 

    (bb)it is alleged that the decision of this Court was plainly unreasonable or unjust; 

    (cc)the trial judge was biased; 

    (dd)the trial judge failed to afford the appellant procedural fairness. 

12. There are no particulars provided as to how the judge was biased or how the judge failed to afford the appellant procedural fairness. 

13. I should also say before going onto the next point that in order to succeed in respect of part of the appeal that does not relate to the parenting orders, the husband needs to convince the Full Court that leave to appeal should be granted before the appeal is heard.  It may be that those matters are dealt with at the same time by the Full Court or it may be that the application for leave to appeal is dealt with first.  Those are matters that are not known at this stage. 

14. What is known from the bar table, and not because it is disclosed in any of the evidence, is that the appeal books have not yet been prepared, that the husband will be seeking leave to file an amended notice of appeal, and that the transcript of the proceedings before this Court has only very recently been ordered and is not yet available.  It is not known when the appeal will be heard, but it is also not known when the leave to appeal will be heard.  There is no indication in the husband's material as to any of these matters which are relevant considerations or part of the relevant considerations for the Court as far as the stay application is concerned. 

15. The husband, at the commencement of the hearing today, notified the Court that he was not pressing a stay of the parenting orders, and by consent there was some additional orders made in relation to injunctions or, rather, the parties not denigrating each other as a result of some of the material which had recently been filed in the proceedings.

16. One of the issues which I must consider is the strength of the proposed appeal. The appeal appears on its face to be arguable, i.e. it is not an appeal that on its face appears to be vexatious or in any way not bona fide.

17. The husband's primary submission to this Court on a stay application is that the wife appears to have failed to comply with her obligations of full and frank disclosure. It appears on the evidence in the husband's case that the wife has at times operated a business known as Company T, and that she had earnt money through the operation of that business, and that the husband does not know whether she has a capacity to earn money through that business or in a similar way.

18. This was submitted, in circumstances where the parties were married for a period of some 14 years, and where it was said from the bar table that the husband and the wife had some discussions early in 2019 about the wife carrying on a business.  Those discussions are not the subject of any sworn evidence in the husband's affidavit, any of the affidavits filed in support of the stay application, or any of the affidavits filed earlier in the proceedings that the court was taken to.

19. Certainly, at the hearing of this matter on 17 September 2020, when the orders which the husband now appeals were made, the husband, through his counsel at the time, made submissions to the Court that the wife did have a business.  So, certainly, it appears to the Court, as at 17 September 2020, the husband at least had a suspicion of the wife conducting a business.

20. Notwithstanding those submissions made from the bar table, the husband did not at that point in time put on any evidence as to his belief that the wife had an earning capacity as a result of carrying on a business, or that she had earnt money through that endeavour.

21. The husband in his affidavits which have been filed in support of the stay application does not explain in any way. It was not until 18 November 2020, that this information came before the Court, when an affidavit of Mr V was filed in these proceedings.  Nor does he explain in any of his evidence how he came to know about Mr V’s alleged business dealings with the wife and when he came to know about those.  Those matters are said only to address the bona fides of the applicant in the stay application, and to address the strength of the husband's foreshadowed application to the Full Court to rely on evidence that was not relied upon at the interim hearing on 17 September 2020.

22. In relation to order 3 made by this Court on 2 October, that being an order for interim spousal maintenance, a lump sum of $28,000 is to be paid from moneys held in the trust account of J & Associates, those moneys being the proceeds of sale of the former matrimonial home. The husband says to this Court that the reason why that order should be stayed is because the Court is not fully appraised of the wife's earning capacity, and that there is a suspicion that the wife mislead the court in relation to her earning capacity, in relation to her previous income, and her current ability to earn money and support herself.

23. The highest that Mr V's evidence takes the Court is that on or about 4 February 2020, prior to the parties' separation, the wife received a sum of $2,000 for what appears to be providing advice and purchasing some furniture on behalf of third parties, those third parties being the deponent of that affidavit and his wife, who is not a witness in the husband's case.

24. While not objected to, the affidavit of Mr V contains evidence which is not admissible, being hearsay evidence.  Even if the Court was to have regard to the hearsay evidence contained in that affidavit, it is still evidence which, as I have indicated, at its highest shows that the wife received a payment of $2,000 in February of this year.  What that, then, goes to is a capacity to earn an income of $2,000 over a four to five month period.

25. There is no evidence of the wife engaging in any fraudulent activity or of the wife affirming an affidavit which was untruthful.  The obligation of the wife to provide full and frank disclosure may be the subject of cross-examination at final hearing, and whether or not she has complied with that obligation for full and frank disclosure may be the subject of some findings depending on what evidence the husband leads at final hearing, and depending on what evidence the wife gives at final hearing. 

1. In terms of the stay application, the evidence contained in Mr V's affidavit is not of itself basis to make a finding that the wife had mislead the Court in any way in terms of the evidence which she presented to the Court, and in terms of the submissions which were made on her behalf at the interim hearing on 17 September 2020.

2. The reason why the spousal maintenance order was made was explained in the Court's Reasons for Judgment which were published on 2 October 2020, and those reasons start at paragraph 20 and go through to paragraph 42 at least, and do encompass the various findings that the Court made under the heading Interim Property Distribution and include regard to the of the husband's capacity to pay.  I, therefore, do not propose to stay the orders for the payment of spousal maintenance.

3. In respect to the stay application of order 4 made on 2 October 2020, that is the order for the payment to the wife of $100,000 being in essence a partial property distribution which was to be categorised at final hearing or settlement of the matter, that order has already been executed in that the moneys have been transferred to the applicant, or as nominated by the applicant pursuant to the order made by the Court.

4. The injunctive relief which is now sought by the husband in respect of the balance of the funds which were transferred pursuant to order 4 is based on the same evidence in support of the stay of order 3 and is based on and the same arguments which have already been dealt with by the Court.

5. The reasons for the interim property distribution, that is for order 4 made on 2 October 2020, are contained in paragraphs 43 to 69 of the Court's reasons for judgment published on 2 October 2020. They do include a consideration of the alleged debt to Mr K, and the husband's contention that the moneys, which are contained or were contained at the time of the interim judgment in J & Associates' bank account, were for the payment of an alleged debt by the husband to his brother, Mr K, and/or the company, Q Pty Ltd. Those matters were certainly considered by the Court in its Reasons for Judgment, and a number of findings were made. 

6. The basis for the injunctive relief is not made out in relation to the balance of the moneys transferred to the wife pursuant to order 4 on 2 October 2020.

7. In relation to the stay application of order 5, that is, for the delivery of the Motor Vehicle 1 from the husband to the wife, the initial basis of that application has not been made out. The husband has not demonstrated that he and/or the company of which he is the sole director of would be in breach of the mortgage contract if the order is not stayed.

8. Indeed, it appears that the husband, perhaps due to an erroneous understanding of his obligations pursuant to that chattel mortgage contract, has not done all things necessary in order to give effect to order 5 of the Court made on 2 October 2020.  It appears on the evidence in the husband's case that he has the capacity to ensure that that order is complied with and that his obligations pursuant to the chattel mortgage contract are also complied with.  The application for a stay of that order is not made out.

9. Lastly, in respect of the stay application for order 6(a) and (j), it was submitted that those documents are not relevant and that is why a stay application should be made.  That application is also not made out.  The documents appear to be relevant. 

10. In any event, whether or not documents are relevant or whether or not they can be produced is not an appropriate basis for a stay of the order pending an appeal, which is why the stay application was brought in the first place.

11. Therefore, the application for stay of orders 3, 4, 5 and 6 of the orders made on 2 October 2020 is dismissed.

12. Next, the wife makes an application for in essence enforcement of the orders made on 2 October 2020. That is for the payment of the spousal maintenance order and for the delivery of the Motor Vehicle 1.  The solicitor for the husband in his submissions to the court has made appropriate concessions in relation to that application, and that is if the stay application is not granted, then the orders made on 2 October 2020 stay.

13. In those circumstances, the orders which the wife seeks in paragraph 4 is an appropriate order to be made, and that is for those funds to be immediately transferred from the account of  J & Associates to the applicant wife.

14. Orders 7 and 8 are sought by the wife in her minute of order are really machinery provision orders to protect the husband, if nobody else, to ensure that he does not face any difficulties as a result of the Court orders made 2 October 2020.  I therefore make orders in accordance with paragraphs 7 and 8 of the wife's minute of order.

I certify that the preceding thirty-nine (39) numbered paragraphs are a true copy of the ex tempore Reasons for Judgment of Judge Obradovic.

Associate:

Dated: 24 November 2020