Brown and Murdoch and Ors

[2013] FamCA 757

FAMILY COURT OF AUSTRALIA

BROWN & MURDOCH AND ORS [2013] FamCA 757

FAMILY LAW – PRACTICE AND PROCEDURE – Application by interveners to be joined as parties to the proceedings.

Administration and Probate Act 1958 (Vic)
Family Law Act 1975 (Cth)
Judiciary Act 1903 (Cth)
Limitation of Actions Act 1958 (Vic)

Bigg v Suzi(1998) FLC 92-799
Friar & Friar[2011] FamCAFC 71
General Steel Industries Inc v Commissioner for Railways (N.S.W.)[1964] HCA 69; (1964) 112 CLR 125
Lindon v The Commonwealth (No 2)[1996] HCA 14; (1996) 70 ALJR 541

APPLICANTS: Mr Savva and Mr Gould as Executors of the Estate of the late Mr Brown

RESPONDENT: Ms Murdoch

INTERVENERS: Ms B, Ms C, Mr D, Ms E, Mr F

FILE NUMBER: MLC 9886 of 2010

DATE DELIVERED: 8 October 2013

PLACE DELIVERED: Melbourne

PLACE HEARD: Melbourne

JUDGMENT OF: Cronin J

HEARING DATE: 2 October 2013

REPRESENTATION

COUNSEL FOR THE APPLICANT: Mr Nicholson

SOLICITOR FOR THE APPLICANT: Schetzer Constantinou

COUNSEL FOR THE RESPONDENTS: Mr Testart

SOLICITOR FOR THE RESPONDENTS: Kennedy Partners

COUNSEL FOR THE INTERVENERS: Mr Isles and Mr Robertson

SOLICITOR FOR THE INTERVENERS: Tolhurst Druce & Emmerson

Orders

1. That Ms B, Ms C, Mr D, Ms E and Mr F are all joined as parties to the proceedings.

2. That save as to any issues of costs, the application in a case filed 27 September 2013 by the newly joined parties is dismissed.

3. That each of the applicant and the first respondent have leave to file further written submissions relating to the costs arising out of the injunctive orders made on 9 August 2013.  The applicant to file by no later than 4.00pm on 10 October 2013 and the response thereto by 4.00pm on 17 October 2013.

4. To the extent that the applicant and the first respondent do not agree as to how to deal with the affidavit of Mr M, leave is granted for the parties to seek a hearing on the discrete issue of that evidence.

5. That all applications for final orders be adjourned for hearing before Justice Cronin as the second case in the list commencing on 12 March 2014 at 10 am as a three day matter and that the evidence in chief of all witnesses be given by affidavit.

6. That by 4 pm on 31 January 2014 the applicant file and serve upon all other parties:

   (a)an amended application setting out with precision the orders to be sought;

   (b)the affidavits of evidence in chief of all witnesses including the applicant relied upon (noting that affidavits relied upon for previous hearings cannot be relied upon as evidence in chief); and

   (c)a financial statement that complies with chapter 13 of the Family Law Rules.

7. That the applicant pay all setting down and trial fees by 4 pm on 31 January 2014.

8. That by 4 pm on 7 February 2014 the first respondent file and serve upon all other parties:

   (a)an amended response setting out with precision what orders are being sought;

   (b)the affidavits of evidence in chief of all witnesses including the respondent relied upon (noting that affidavits relied upon for previous hearings cannot be relied upon as evidence in chief);

   (c)a financial statement that complies with chapter 13 of the Family Law Rules.

9. That by 4 pm on 14 February 2014 the second respondent file and serve upon all other parties:

   (a)an amended response setting out with precision what orders are being sought;

   (b)the affidavits of evidence in chief of all witnesses including the respondent relied upon (noting that affidavits relied upon for previous hearings cannot be relied upon as evidence in chief);

   (c)a financial statement that complies with chapter 13 of the Family Law Rules.

10. That by 4 pm on 21 February 2013 the third, fourth and fifth respondents file and serve upon all other parties:

    (a)a response setting out with precision what orders are being sought and to the extent necessary, a statement of claim or issues to be so litigated;

    (b)the affidavits of evidence in chief of all witnesses including the respondent relied upon (noting that affidavits relied upon for previous hearings cannot be relied upon as evidence in chief);

    (c)a financial statement that complies with chapter 13 of the Family Law Rules.

11. That by 4 pm on 28 February 2014 the applicant and the first respondent file and serve any affidavit in reply to that of the affidavits of the second to fifth respondents.

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

13. That prior to commencement of the trial, the parties determine whether there are to be any rulings required arising out of objections to evidence and such objections be referred to in the parties’ outlines of case.

14. That all parties have leave to issue subpoenae for the production of documents by arrangement with the registrar docketed with the management of the file.

15. That 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,

    (a)The Court may relist the case requiring the parties to justify why it should not be taken out of the list; and

    (b)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. That the practitioners for the parties file and serve electronically to … by 4 pm on 11 March 2014 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 to be read and, if not the whole affidavit, the relevant paragraphs relied upon;

    (c)a list of assets and liabilities (to the extent relevant to that particular party);

    (d)a list of objections to evidence upon which rulings are required; and

    (e)a bullet-point summary of argument in relation to the issues in dispute.

18. That each party 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 funds have been paid and what costs are expected to be incurred until the completion of the hearing.

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

FAMILY COURT OF AUSTRALIA AT MELBOURNE

FILE NUMBER: MLC 9886 of 2010

Mr Savva and Mr Gould as Executors of the Estate of the late Mr Brown

Applicants

And

Ms Murdoch
Respondent

And

Ms B, Ms C, Mr D, Ms E and Mr F

Interveners

REASONS FOR JUDGMENT

1. These reasons deal with two issues. First, the opposed joinder of persons wishing to intervene in a property dispute and secondly, the setting down of all matters for trial.

2. I propose to join the persons who have sought to intervene for the reasons that follow. In addition, I will set all matters down for trial in March 2014 and make directions accordingly.

3. The Family Law Act 1975 (Cth) (“the Act”) and the rules of the Court, (the Family Law Rules 2004) determine how proceedings should be conducted.

4. In respect of the request for intervention, s 92 of the Act provides:

   ·In proceedings (other than divorce or validity of marriage proceedings), any person may apply for leave to intervene in the proceedings, and the court may make an order entitling that person to intervene in the proceedings.

   ·…

   ·An order under this section may be made upon such conditions as the court considers appropriate.

   ·Where a person intervenes in any proceedings by leave of the court the person shall, unless the court otherwise orders, be deemed to be a party to the proceedings with all the rights, duties and liabilities of a party.

5. To the extent that an intervener or person claiming so be so, is a creditor, s 79(10) of the Act provides as follows:

   ·The following are entitled to become a party to proceedings in which an application is made for an order under this section by a party to a marriage (the subject marriage):

   ·a creditor of a party to the proceedings if the creditor may not be able to recover his or her debt if the order were made;

   ·…

   ·any other person whose interests would be affected by the making of the order.

6. The Rules of Court similarly provide for the involvement of persons not directly related to the marriage. Chapter 6 provides:

   ·A person whose rights may be directly affected by an issue in a case, and whose participation as a party is necessary for the court to determine all issues in dispute in the case, must be included as a party to the case.

7. The basis upon which an intervention or a joinder should be allowed is to be determined on the basis of the prima facie position of the evidence presented by the person seeking to join. That evidence can rarely be tested at this preliminary stage. It is important for that person to point to the fact that their interests would be prejudiced in some way if they were not heard on the subject knowing at that time that by becoming a party, they have all of the obligations and liabilities that any other party carries including as to costs.

8. If a prima facie position is demonstrated, parties otherwise to the substantive proceedings may seek to point to the inadequacy of the evidence to support the prima facie position or alternatively, seek a summary dismissal of the application to join.

9. A summary dismissal approach is also provided for in the Court’s rules.  Rule 10.12 provides:

10. A party may apply for summary orders after a response has been filed if the party claims, in relation to the application or response, that:

    (a)      the court has no jurisdiction;

    (b)the other party has no legal capacity to apply for the orders sought;

    (c)it is frivolous, vexatious or an abuse of process; or

    (d)there is no reasonable likelihood of success.

11. In this case, the applicant and respondent to the initiating proceedings joined together to argue that the interveners should not be joined and orally sought a dismissal of their application using the provisions just set out.

12. In my view, despite the fact that the evidence is vague and there is a potential for further claims to be made and although this may increase the costs and complexity of the case, I consider it is appropriate to join the relevant persons.

13. It is also pertinent to say that in respect of the three particular areas of intervention pursued here, any substantive orders proposed to be sought, would be against the original respondent rather than the applicant for reasons which I hope will shortly be clear. That in itself may lead to a curtailing of the role of the applicant wife in the proceedings in relation to those interveners. It goes without saying that the interveners can only get what they can from the respondent unless it is somehow (and it is currently not) evident that the applicant was a party to or should, in equity be responsible for, the claims, responsibilities or debts.

14. Because of the complexity of the issues, I propose to deal with them as best I can sequentially. Unfortunately, because of the very nature of the hearing, that requires some background.

Background

1. Mr Brown married Ms Brown.

2. In 1990, this Court made final property orders between Mr Brown and Ms Brown. He was to pay her $334,000 by weekly instalments of $900.

3. Mr Brown and Ms Brown had three children Ms E, Ms C and Mr F.

4. In relation to what I shall refer as the evidence about matters arising out of the first marriage, there is much contention. The facts that follow are asserted by a solicitor on instructions. Whether those facts are true remains a matter for trial. I am not making any findings about them today nor do I need to for the purposes of this judgment.

5. It is said that Mr Brown began making payments under the 1990 orders.

6. Ms Brown died in May 1992.

7. It is said that Ms B was the named executor of Ms Brown’s will.

8. It is now asserted by Ms B that she was subjected to bullying by Mr Brown as a result of which, she did not take out probate nor did anything further about the estate of Ms Brown.

9. Mr Brown married Ms Murdoch in February 2002.

10. From that marriage, there are two children aged 10 and 7. 

11. Mr Brown and Ms Murdoch separated in July 2010. 

12. Ms Murdoch is the applicant in the substantive property (and ancillary) proceedings before this Court.

13. In 2010, Mr Brown filed an application seeking property alteration orders with Ms Murdoch.

14. In February 2013, Mr Brown was diagnosed with pancreatic cancer.

15. In May 2013, Mr Brown died.

16. A variety of disputes then began culminating inter alia in an order made on 9 August 2013. On that day, the order included the following:

17. That (the executors) of the Estate of the Late [Mr Brown] be restrained from engaging the firm of [Firm X] and Mr [M], Solicitor of that firm from acting on behalf of the Estate in proceedings in the Supreme Court of Victoria in its probate jurisdiction.

18. I then made provision for costs submissions to be made and each side complied. Unfortunately, because of the electronic filing, they were not earlier brought to my attention.

19. I also ordered that the parties attend a “first day” hearing for the purposes of setting the property dispute down for trial.

The discrete interlocutory applications

1. On 27 September 2013, by application in a case,

   (a)Ms B sought leave to intervene in the property proceedings between Ms Murdoch and the Executors of the Estate of Mr Brown for the purposes of pursuing what was said to be the outstanding and unpaid funds due to Ms Brown from the 1990 orders;

   (b)Ms C along with her husband Mr D (the son-in-law of the late Mr Brown) sought leave to intervene in the same proceedings on the basis that Mr Brown had been lent money by them and it had not been repaid;

   (c)Ms E, Ms C and Mr F also sought leave to intervene on the basis of their interest under the will of Ms Brown but also Mr F specifically, on the basis that he may have a claim against his father’s estate on one of a variety of grounds including under ss 66L or 79 of the Family Law Act 1975 or indeed under Part IV of the Administration and Probate Act 1958 (Vic).

2. The joinder orders were opposed by the wife Ms Murdoch and by the Executors of the Estate of Mr Brown.

An application by Mr M

1. Before dealing with those matters, it is necessary to digress and mention another application (this time oral) made on behalf of the solicitor Mr M mentioned in paragraph 29 above.

2. It was submitted on behalf of Mr M that he had been referred to in the injunctive orders without being heard and as a consequence, being a senior lawyer, he wished to have his version in affidavit form placed on the Court’s file. That course too was opposed by counsel for Ms Murdoch and by counsel for the Executors of Mr Brown’s Estate.

3. I ruled at the time that the evidence of Mr M was not being admitted into the proceedings but rather, his application was that the affidavit be simply placed on the Court file. In respect of counsel’s submission that Mr M had not been heard, I observed and now reiterate that the injunction was not against him but against the executors from using him for the probate application. Thus, the party to these proceedings affected by the injunction had been heard even if Mr M had not been directly. Counsel submitted that Mr M was a person affected by an order because he had a retainer with the executors and by the orders, his financial interest had been affected. Whilst that might be so, the duty to the Court overrode his financial interests.

4. Counsel for the executors observed (because it was not in evidence) that what Mr M said was disputed even if it was not that controversial and his clients had (or would) take the very matter of his filing the affidavit as a breach of privilege to the Legal Services Commissioner. It is unnecessary for me to comment on that.

5. The matter would have rested there except for one matter which I now address.

Further costs submissions concerning the injunctions

1. In paragraph 30 of these reasons, I referred to the respective costs submissions arising out of the injunctive orders. Counsel for Ms Murdoch observed that because of the material in the affidavit of Mr M, his client wished to make a further and additional submission about the costs. I permitted that but I also permitted the executors to make a further response. The difficulty which I foresaw was that on the discrete point (if relevant) of why the injunctive orders were necessary, there appears a conflict between Mr M and the executors and that might require a hearing at which Mr M’s affidavit  might become a critical fact in issue and the deponent may be required for cross-examination. I shall make provision in the orders for those various aspects.

The substantive trial

1. I return then to the substantive proceeding between Ms Murdoch and the Executors of Mr Brown’s Estate. There was a complaint made by counsel for Ms Murdoch that there had not been compliance with previous orders about the transfer of a motor vehicle, discovery and valuation. It was conceded by counsel for Ms Murdoch that demands had only very recently been made for compliance. I do not consider that the Court should become embroiled in those issues unless there is a need to. The parties always have the right to enforce orders and quickly so by arrangement with the registrar.

2. Nothing I heard about the ability of the parties (including the proposed interveners) to get ready for trial convinced me that this case should not be listed early in 2014. No-one disputed that.

3. Before doing so, it is necessary to deal with the application by the interveners.

The joinder issues

1. Counsel for the proposed interveners relied upon two affidavits. The first was by the solicitor instructed by the interveners and the other was by Ms B.

2. Eilish Cooke is the solicitor for the interveners. She deposed that she was instructed about the following:

   ·    Upon the death of Ms Brown, the instalments due by Mr Brown under the 1990 orders ceased;

   ·    Ms B was subjected to bullying and standover tactics by Mr Brown to deter her from taking out probate of the will of Ms Brown;

   ·    Mr Brown inter-meddled in Ms Brown’s estate and treated the assets as if they were his own;

   ·    Between September 2011 and January 2012, Mr Brown was lent $125,000 in five instalments of $25,000 (although the affidavit said five instalments of $125,000). That debt remains unpaid;

   ·    Ms C seeks copies of her childhood photos said to have been in the possession of Mr Brown at the time of his death;

   ·    Mr F is unable to adequately support himself and prior to his death, was supported financially by Mr Brown and there “may be” an “adult child maintenance claim” and further, there may be a claim by Mr F under the state legislation along with a request for personal memorabilia.

3. Ms B (referred to in her own affidavit as “[B]” ) deposed to the following facts:

   ·    After the 1990 orders, Ms Brown told her that Mr Brown was unreliable about making payments;

   ·    A will was made which she had typed and it was given to Ms E;

   ·    After Ms Brown’s death, Ms E said the family would deal with the money matters;

   ·    Shortly after the call from Ms E, Mr Brown telephoned and was aggressive and abusive telling her to stay away from the matter and she felt intimidated.

The responses

1. It is convenient to encapsulate the submissions of counsel for Ms Murdoch simply in the following (noting that counsel for the Executors of the Estate of Mr Brown agreed with that position):

   · The debt claimed by Ms Brown’s estate was statute barred by virtue of s 79 of the Judiciary Act 1903 (Cth) in that s 79 picked up the provisions of the Limitation of Actions Act1958 (Vic);

   ·    There was no evidence about the debt but just assertion;

   ·    There was no evidence to support the claim of Mr F;

   ·    Nothing supported the claims for the recent debt.

The submissions of the interveners

1. Counsel for the proposed interveners agreed that his client was in effect, seeking a summary dismissal of the claim to intervene.

2. It was not conceded by counsel for the proposed interveners that the relevant provisions of the Judiciary Act did apply to these claims. He submitted that until such time as a defence was filed to any claim which raised the statute of limitations, the debt was not barred. In any event, he submitted, the application for leave should not be confused with the application for substantive relief.

The determinations

1. A persuasive reason why I ought not yet accept that the claim by the Estate of Ms Brown is statute barred is because the very words of S 79 of the Judiciary Act conclude that the State provisions apply “ in all cases to which they are applicable”. Without the concession earlier mentioned, I ought not conclude that the Victorian Statute does apply at this preliminary stage.

2. In addition, in respect of the limitation, authority suggests that it begins to run when the “cause of action” accrues. On an interlocutory application with untested evidence, I again find that it would not be appropriate to say that this claim is statute barred.

3. If I return then to Ms Murdoch’s claim that that intervener’s application should be summarily dismissed, it was not so much suggested that the Court did not have jurisdiction but rather that it could not exercise its power because of the statutory limitation. That is open to argument and therefore Ms Murdoch cannot succeed on that basis.

4. Can it be suggested that because of the statute of limitations point there was no reasonable likelihood of success? 

5. The power provided in the rules to summarily dismiss an application is to be exercised sparingly (see Friar & Friar[2011] FamCAFC 71). The focus was set out in Bigg v Suzi(1998) FLC 92-799 where the Full Court referred to the passage in Lindon v The Commonwealth (No 2)[1996] HCA 14; (1996) 70 ALJR 541 that I mentioned in discussion with counsel. There Kirby J expressed the test as requiring the applicant for summary dismissal to demonstrate, by reference to the opponent’s documents, that “the opponent lacks a reasonable cause of action or is advancing a claim that is clearly frivolous or vexatious”. For my purposes, although there has been other consideration of the test (see General Steel Industries Inc v Commissioner for Railways (N.S.W.)[1964] HCA 69; (1964) 112 CLR 125), that approach is sufficient. As Kirby J observed, a case which initially appears weak, after evidence and argument and extended time for reflection, will sometimes turn an apparently unpromising cause into a successful judgment.

6. Thus, it would not be appropriate to dismiss the intervener’s claim at this stage.

7. Because the interveners have a claim which may affect the entitlements of the Estate of Mr Brown, that claim must be permitted to be litigated for all of the reasons set out in s 79(10) and Chapter 6 of the Rules. The objection by the Executors of his Estate must also fail.

8. In relation to the claim or potential claim by Mr Brown, albeit I am uncertain just what head of power (if at all) the Court is being asked to exercise, I propose to allow him to intervene on the basis of the observation of Kirby J just mentioned.

9. In relation to the debt claim of the other children, by virtue of the matters set out above, they too must be given an opportunity to plead their proposal and to be heard on the basis that, as I understand it, Ms Murdoch is seeking a significant portion of the assets of either she or Mr Brown and there must be a possibility that those creditors may not be paid.

10. I shall make orders accordingly.

I certify that the preceding Sixty (60) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Cronin delivered on 8 October 2013.

Associate: 

Date:  8 October 2013