C Lawyers & Boulos
[2021] FamCAFC 39
•26 March 2021
FAMILY COURT OF AUSTRALIA
C Lawyers & Boulos [2021] FamCAFC 39
Appeal number(s):
EAA 25 of 2021
File number(s):
PAC 772 of 2017
Judgment of:
ALDRIDGE J
Date of judgment:
26 March 2021
Catchwords:
FAMILY LAW – APPEAL – APPLICATION IN AN APPEAL – Where the primary judge summarily dismissed the applicant’s interim application for injunctions – Where the first respondent was paid funds out of consent property settlement orders – Applicants assert they hold a lien over funds received by the first respondent for legal fees owed – Real risk that the funds would not be available should the appeal succeed – Injunction granted against both respondents in order to preserve funds pending hearing of the appeal – Application granted.
Cases cited:
Norton & Locke (2013) FLC 93-567; [2013] FamCAFC 202
Division:
Appeal Division
Number of paragraphs:
15
Date of hearing:
23 March 2021
Place:
Sydney
Counsel for the Applicant:
Mr Othen
Solicitor for the Applicant:
C Lawyers
The First Respondent:
Self-represented litigant
Solicitor for the Second Respondent:
Zahr Partners
ORDERS
EAA 25 of 2021
PAC 772 of 2017APPEAL DIVISION OF THE FAMILY COURT OF AUSTRALIA
BETWEEN: C LAWYERS
Applicant
AND: MS BOULOS
First Respondent
MR ZAMAN
Second Respondent
ORDER MADE BY:
ALDRIDGE J
DATE OF ORDER:
23 MARCH 2021
ORDERS MADE ON 23 MARCH 2021:
1.The second respondent husband shall not pay the monies due to the first respondent wife pursuant to Order 4 of the orders made on 3 March 2021 (“the Consent Orders”) in the Federal Circuit Court proceedings ‘PAC 772 of 2017’, except to pay or to cause to be paid the whole of the amount under Orders 4(a) and 4(b) of the Consent Orders to the trust account of C Lawyers, the same to remain invested on behalf of the wife pending further order, and otherwise not to be withdrawn without the written consent of the appellant and respondents.
2.To the extent the first respondent wife has received any payment from the second respondent husband pursuant to Order 4 of the Consent Orders, she shall not deal with those funds in any manner whatsoever other than to pay the funds to the trust account of C Lawyers, the same to remain invested on behalf of the first respondent wife pending further order, or otherwise with the written consent of the appellant and respondents.
3.The first respondent wife is to file and serve an affidavit within seven (7) days hereof, setting out what funds, if any, she has received from the second respondent husband pursuant to the Consent Orders, when the funds were received, what has happened to those funds and the present location of any funds still held by the first respondent wife.
4.The parties are granted liberty to apply on 48 hours’ written notice to the Appeal Registrar and to the other parties.
5.The costs be reserved.
Note: The form of the order is subject to the entry in the Court’s records.
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 17.02 Family Law Rules 2004 (Cth).
IT IS NOTED that publication of this judgment by this Court under the pseudonym C Lawyers & Boulos has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
REASONS FOR JUDGMENT
ALDRIDGE J:
INTRODUCTION
These are the reasons for the orders made by me on 23 March 2021.
By an Application in an Appeal filed on 18 March 2021, C Lawyers (“the applicants”) sought a series of injunctions to preserve funds which they asserted were owed to them by Ms Boulos (“the first respondent”) pending the determination of the appeal. The applicants acted as the solicitors for the first respondent in property settlement proceedings against the second respondent, Mr Zaman (“the second respondent”) in the Federal Circuit Court of Australia. The applicants asserted that they hold a lien over funds to be received by the first respondent to secure the payment of legal fees owed to them by her.
On 17 February 2021, the first respondent terminated the applicant’s retainer.
On 3 March 2021, a judge of the Federal Circuit Court of Australia made consent property settlement orders between the first and second respondents, which provided for the second respondent to retain a property at Suburb B free from any claim from the first respondent. He was however obliged to pay to her $100,000.00, with the first $65,000.00 to be paid within three months, and the balance within six months of the orders.
The applicants became aware that the first and second respondents proposed to approach the Court to make property settlement orders by consent. They filed an application to intervene in the proceedings to seek orders to protect their position and to enforce their claimed lien. That application was summarily dismissed by the primary judge on 18 February 2021. On 18 March 2021, the applicants filed Notice of Appeal against that decision.
APPLICATION FOR THE INJUNCTIONS
The application for the injunctions came before me on 23 March 2021. The first respondent appeared for herself with the assistance of her brother as an interpreter. Ms Hariri, solicitor, appeared for the second respondent and indicated that her client submitted to any order that the Court may make, other than an order for costs.
After some discussion, the first respondent indicated that she did not seek an adjournment of any kind and preferred that the matter be finalised on that day.
It is well established that any court has an implied power to preserve the subject matter of a dispute. That is so even though an element in that dispute may be the issue of jurisdiction, see for example Norton & Locke (2013) FLC 93-567.
No reasons were provided by the primary judge, although I was informed without objection that the transcript reveals that her Honour dismissed the application summarily because of the applicant’s failure to refer to the relevant rules in the application, and because the substantive application lacked any merit whatsoever.
According to the evidence called on behalf of the applicants, the first respondent entered into a series of costs agreements with the applicants, each of which granted the applicants a lien over any funds or assets the first respondent may receive from the property proceedings so as to ensure payment of their fees for acting for her in the property proceedings. It is also well established that such a lien, sometimes more correctly described as a charge, arises by the operation of equitable principles. The evidence is that the unpaid legal fees and disbursements, including interest, payable pursuant to the costs agreements and to the invoices which have been sent to the first respondent are in the sum of $165,835.82. There is no dispute that that sum has not been paid.
For her part, the first respondent did not challenge these matters but asserted that the fees were excessive, that they should be assessed and that in any event, she had reached an agreement with the applicants that they would accept $40,000.00 in full satisfaction of the claimed fees. Each of these may be so, but, to my mind they do not prevent the making of an interim order to preserve the funds at this stage. They are matters that can be dealt with in due course.
Accordingly, I am satisfied that the applicants have made out a prima facie case that their application should not have been summarily dismissed and that they have an arguable appeal.
The evidence disclosed that the first respondent is on Centrelink benefits and has a number of significant debts. There is every likelihood that the funds will be dissipated if an injunction is not made. Accordingly, the balance of convenience favoured making the orders sought, so as to preserve the subject matter of the appeal.
During the hearing of the application, the first respondent indicated that the funds had in fact already been paid to her by the second respondent. Ms Hariri confirmed that to be so. The applicants said they were not in a position to accept that this was in fact the case. Accordingly, an oral application was made to expand the relief sought to include orders against the first respondent herself in the nature of a freezing order, to preserve the funds that may be in her hands pending the hearing of the appeal.
For the above reasons I was satisfied that that order should also be made, because otherwise there was a real risk that the funds would be not be available should the appeal succeed.
I certify that the preceding fifteen (15) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Aldridge.
Associate:
Dated: 26 March 2021
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