Caffyn and Protz & Anor [
[2018] FamCA 499
•4 July 2018
FAMILY COURT OF AUSTRALIA
| CAFFYN & PROTZ AND ANOR | [2018] FamCA |
| FAMILY LAW – PROPERTY – STAY – Where the wife seeks a stay of two sets of orders pending the determination of her appeal against the latter set of orders – Where the earlier set of orders are consent orders in relation to the position of the liquidator – Where there is no basis to stay that set of orders – Where the latter set of orders are consent property settlement orders between the husband and wife – Partial stay ordered requiring a sum of money to be held in a controlled monies account pending determination of the appeal – Wife restrained from dealing with a property pending the determination of the appeal. FAMILY LAW – COSTS – Where the liquidator seeks that the wife pay his costs of the application – Where the wife was wholly unsuccessful in relation to her application to stay the orders involving the liquidator – Wife to pay liquidator’s costs on a party and party basis – Where the husband also seeks costs – Where the wife was successful in obtaining a partial stay of the property settlement orders made between the husband and wife – No order as to costs. |
| Family Law Act 1975 (Cth) Family Law Rules 2004 (Cth) |
| Trahn & Long(No. 2) [2008] FamCAFC 194 |
| APPLICANT: | Ms Caffyn |
| FIRST RESPONDENT: | Mr Protz (as Liquidator) and B Pty Ltd (In Liquidation) |
| SECOND RESPONDENT: | Mr Caffyn |
| FILE NUMBER: | PAC | 3892 | of | 2015 |
| DATE DELIVERED: | 4 July 2018 |
| PLACE DELIVERED: | Sydney |
| PLACE HEARD: | Sydney |
| JUDGMENT OF: | Rees J |
| HEARING DATE: | 3 July 2018 |
REPRESENTATION
| FOR THE APPLICANT: | Ms Caffyn in Person |
| SOLICITOR FOR THE FIRST RESPONDENT: | ERA Legal |
| COUNSEL FOR THE SECOND RESPONDENT: | Mr Heazlewood |
| SOLICITOR FOR THE SECOND RESPONDENT: | Lewarne & Goldsmith |
Orders
That the operation of Orders 2.1 and 2.2 made on 26 April 2018 be stayed in part.
That from any money to be paid to the husband pursuant to Order 2.1 or 2.2, the sum of $330,000 be held by the husband’s solicitors in a controlled monies account, pending the determination of the appeal filed by the wife on 22 May 2018.
That in the event that the wife’s appeal is dismissed, the sum of $330,000 held in the controlled monies account, together with any interest accrued on the account, shall be paid to the husband.
That in the event that the wife’s appeal is dismissed, she shall pay to the husband interest upon the said sum of $330,000 at the rate prescribed by the Family Law Rules, less any amount of interest actually accrued to the controlled monies account.
That pending the determination of the appeal filed by the wife, she is restrained from transferring, selling, encumbering, charging or otherwise dealing with the property at B Street, E Town (“the E Town property”) being the whole of the property in Folio Identifier … & ....
That pending the determination of the appeal filed by the wife, the husband may lodge a caveat against the title of the E Town property to notify the existence of Order 5.
That the wife pay the costs of the second respondent in relation to the stay application, as agreed or assessed, such payment to be made simultaneously with the settlement of the sale of the property at D Street, Suburb E.
That the husband’s application for costs of the stay application is dismissed.
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 Caffyn & Protz and Anor 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 SYDNEY |
FILE NUMBER: PAC 3892 of 2015
| Ms Caffyn |
Applicant
And
| Mr Protz (As Liquidator) and B Pty Ltd (In Liquidation) |
First Respondent
And
| Mr Caffyn |
Second Respondent
REASONS FOR JUDGMENT
Ms Caffyn (“the wife”) applies for a stay of certain orders made on 26 April 2018, pending the determination of her appeal against those orders. Her application is opposed by Mr Caffyn (“the husband”) and by the first respondent, who is the liquidator of a company which was the vehicle through which the husband’s business was conducted.
The matter was listed for hearing for four days commencing on 23 April 2018. The wife was represented by solicitors and counsel. On the first day of the hearing, the parties reached consent orders in relation to the position of the liquidator. Those orders provided, inter alia, for judgment to be entered in favour of the company in liquidation against the husband and the wife in the sum of $385,000.
The orders further provided for the judgment debt to be secured against a property D Street, E Town (“the E Town property”), owned by the husband and the wife. In the event that the husband and the wife had not sold the E Town property by 15 August 2018, the orders empowered the liquidator to sell the property and pay the judgment debt, plus specified costs and interest. The balance of the proceeds of sale was to be held in controlled monies, pending the resolution of the proceedings between the husband and the wife in respect of their property.
The hearing then proceeded with the cross-examination of the husband by counsel for the wife.
On 26 April 2018, the husband and the wife reached consent orders in relation to their outstanding property issues.
Those orders provided, inter alia, for the husband to transfer to the wife a property at B Street, E Town (“the E Town property”), for the E Town property to be sold and, subject to the orders made 23 April 2018, for the proceeds to be divided.
On 22 May 2018, the wife, now acting for herself, lodged a Notice of Appeal against only the orders made on 26 April 2018. The grounds of appeal relate only to the sale and distribution of the E Town property and to a declaration that, in the special circumstances of the case, grounds existed for a child support departure order. Relevantly, no appeal was lodged against the orders made 23 April 2018.
The orders sought in the appeal were stated to be:
1.15% adjustment in favour to the Wife (i.e. $1,330,000 to $1,660,000)
2.Proceeds of E Town to be divided as follows: $385,000 to the liquidator and balance of the proceeds to be split $436,000 to the Wife and $329,000 to the Husband.
3.The Husband and Wife to be equally responsible for outgoings to the E Town property until it is sold.
On 6 June 2018, the wife filed an application seeking to stay the operation of the orders for the sale of the E Town property, the distribution of the proceeds and the child support declaration.
The wife’s application was opposed by the husband and the liquidator.
In relation to the application for the stay, the Full Court in Trahn & Long(No. 2) [2008] FamCAFC 194 said:
38.These principles, both in the general law and in respect of parenting proceedings, are well settled (see The Commissioner of Taxation of the Commonwealth of Australia v Myer Emporium Limited (1986) 160 CLR 220 at 230; Alexander v Cambridge Credit Corporation (1985) 2 NSWLR 685. Jennings Constructions Limited v Burgundy Royale Investments Pty Ltd (1986) 161 CLR 681; Clemett and Clemett (1981) FLC 91-013; JRN & KEN v IEG & BLG (1998) 72 ALJR 1329 at 1332). The authorities stress the discretionary nature of the application which should be determined on its merits. Principles relevant to this matter included the following:
·the onus to establish a proper basis for the stay is on the applicant for the stay however it is not necessary for the applicant to demonstrate “special” or “exceptional” circumstances;
·a person who has obtained a judgment is entitled to the benefit of that judgment;
·the person who has obtained a judgment is entitled to presume the judgment is correct;
·the mere filing of an appeal is insufficient to ground a stay;
·the bona fides of the applicant;
·a stay may be granted on terms that are fair to all parties – this may involve a court weighing the balance of convenience and the competing rights of the parties;
·a weighing of the risk that an appeal may be rendered nugatory if a stay is not granted – this will be a substantial factor in determining whether it will be appropriate to grant the stay;
·some preliminary assessment of the strength of the proposed appeal - whether the appellant has an arguable case;
·the desirability of limiting the frequency of any change in a child’s living arrangements;
·the period of time in which the appeal can be heard and whether existing satisfactory arrangements may support the granting of a stay for a short period of time; and
·the best interests of the child the subject of the proceedings.
The stay is not ordered as a matter of right and the onus is upon the applicant for the stay, in this case the wife, to establish the proper basis.
At the commencement of the hearing, I asked the parties to address the proposition that, having regard to the orders sought by the wife in the appeal, an appropriate outcome would be that the distribution of the proceeds of sale of the E Town property, after the payments due to the liquidator, be stayed, but on the basis that the husband remained entitled to interest on his portion of the money, as specified in the orders of 26 April 2018, until the date of payment.
Although it was not clear from the wife’s submissions, it appeared that she now sought to stay the sale of the E Town property and to continue to receive the income produced by it, pending determination of the appeal. That is not the position advanced in the Notice of Appeal and ignores the existence of the orders of 23 April 2018.
On behalf of the husband, it was submitted that if a stay were granted, the stay should only be in relation to that specified sum of $330,000 (in accordance with order 1 sought in the appeal) which is the adjustment sought by the wife. Further, it was submitted that if there were a stay of the distribution of the proceeds of the sale of the E Town property, then there should also be a restraint on the wife’s dealing with the unencumbered E Town property.
As I understood the submission, the restraint on the wife’s dealing with the E Town property was to ensure that any order for the payment of interest to the husband could be enforced against that property, it being assumed from the wife’s submissions that she may have spent any funds she received from the sale of the E Town property.
I propose to deal briefly with those factors set out in Trahn & Long which are relevant to this determination.
·The wife has not established any ground to stay the orders for the sale of the E Town property. The orders she seeks in her appeal are confined only to the distribution of the proceeds of the sale.
·The appeal is against orders made by consent in circumstances where the wife was legally represented, the affidavit material upon which each of the parties relied had been received into evidence and there had been substantial cross-examination of the husband. A preliminary assessment of the grounds of appeal, which make no challenge to the orders made on 23 April 2018, does not disclose a strong case.
·In the event that the appeal is unsuccessful, the husband will have been kept out of a substantial portion of his entitlement for many months. He should be entitled to interest in those circumstances.
·The husband should have security for any interest which may be payable. The only security available is the property at E Town.
Having regard to all of those factors, I propose to stay the operation of Orders 2.1 and 2.2 made on 26 April 2018 to the extent that the sum of $330,000 from the amount payable to the husband will be placed in a controlled monies account by the husband’s solicitors, pending the determination of the appeal.
In the event that the appeal is unsuccessful, then the wife will pay interest to the husband, on the sum of $330,000, from the date of the settlement until the payment of the said sum to the husband. The rate of interest will be the rate prescribed from time to time by the Family Law Rules 2004 (Cth) but any interest paid on the controlled monies account will be deducted from the amount payable by the wife.
The wife will be restrained from dealing with the property at E Town until such time as her appeal has been determined and the husband will be entitled to lodge a caveat against the title of the E Town property to give notice of this restraint.
Costs
The liquidator seeks costs of this application.
The wife has been unsuccessful in staying the orders for the sale of the E Town property.
Relevantly, there is no appeal against the orders of 23 April 2018 which permit the liquidator to sell the E Town property. In those circumstances the wife’s application to stay, as between the husband and the wife, the orders for sale is misconceived.
The wife should pay the costs of the liquidator in relation to the stay application on a party and party basis as agreed or assessed.
The husband also seeks costs.
The financial circumstances of the husband and the wife, consequent upon the operation of the orders made 26 April 2018, and the pending appeal, are in a state of flux and it is not possible to determine what funds each may currently have available.
The wife has been successful in obtaining a partial stay of the orders of 26 April 2018, albeit with conditions.
I have not been made aware of any offers of settlement in relation to the stay application.
I do not consider that, in those circumstances, any order for costs should be made.
I certify that the preceding twenty-nine (29) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Rees delivered on 4 July 2018.
Associate:
Date: 4 July 2018
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