Camran & Camran
[2022] FedCFamC1F 1088
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 1)
Camran & Camran [2022] FedCFamC1F 1088
File number(s): BRC 4988 of 2022 Judgment of: BAUMANN J Date of judgment: 10 November 2022 Catchwords: FAMILY LAW – PRACTICE & PROCEDURE – Leave sought to proceed with property proceedings out of time Legislation: Family Law Act 1975 (Cth), s 44 ) Cases cited: Hall & Hall (1979) FLC 90-679
Sharp & Sharp [2011] FamCAFC 150
Whitford & Whitford (1979) FLC 90-612
Division: Division 1 First Instance Number of paragraphs: 15 Date of last submission/s: 10 November 2022 Date of hearing: 10 November 2022 Place: Brisbane Counsel for the Applicant: Mr Jeffrey Solicitor for the Applicant: AJ Family Law Solicitor for the First Respondent: Litigant in person Solicitor for the Second Respondent: Wallaceweir Lawyers ORDERS
BRC 4988 of 2022 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)
BETWEEN: MR CAMRAN
Applicant
AND: MS CAMRAN
First Respondent
MR STEELE AND MR MELFI AS TRUSTEES IN BANKRUPTCY FOR THE ESTATE OF MS CAMRAN
Second Respondent
order made by:
BAUMANN J
DATE OF ORDER:
10 NOVEMBER 2022
THE COURT ORDERS:
1.That pursuant to s 44(3) of the Family Law Act 1975 (Cth), the Applicant be granted leave to proceed out of time.
2.That these proceedings be adjourned for Directions Hearing before a Judicial Registrar at 10.30am on 8 December 2022 in the Federal Circuit and Family Court of Australia (Division 1), by Microsoft Teams.
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 10.14(b) Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 10.13 Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth).
Section 121 of the Family Law Act 1975 (Cth) makes it an offence, except in very limited circumstances, to publish proceedings that identify persons, associated persons, or witnesses involved in family law proceedings.
IT IS NOTED that publication of this judgment by this Court under the pseudonym Camran & Camran has been approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
EX TEMPORE REASONS FOR JUDGMENT
(Settled from the oral reasons delivered)BAUMANN J:
When the parties to this marriage, which was solemnised in early 2015, separated on a final basis in October 2017, there seemed to be modest assets available to the parties at the time. They had been in cohabitation prior to 2010 and the relationship was blessed with two children, X, who is now aged 12, and Y, who is now aged 10 years. Since separation the children have lived in an amicable equal time arrangement between the parents. The application brought by the husband, Mr Camran (“the husband”) seeks an order pursuant to section 44(3) of the Family Law Act 1975 (Cth) to, effectively, institute proceedings out of time.
Section 44(3) of the Act makes it clear that an application for property settlement must be commenced or instituted within 12 months of the date a divorce takes effect, in this case 25 August 2019. Accordingly, proceedings ought to have been brought by 25 August 2020, and with the Application having been filed on 29 April 2022 by the husband, it is clear that he is 20 months late. The Court, of course, has the power to extend the time but must have reference to section 44(4) of the Act, which provides that the Court shall not grant leave unless it is satisfied that “great hardship” would be caused to a party or child if leave were not granted.
The authorities make it clear that leave is not a mere formality (see Sharp & Sharp [2011] FamCAFC 150). A long line of authority commencing many years ago with Whitford & Whitford (1979) FLC 90-612 at 78146 and supported by Sharp, established that the applicant must, firstly, establish hardship and then before the discretion is exercised in favour of granting the extension, other factors arise for consideration, including:
(a)the length of the delay and the reasons for failing to institute in time;
(b)the applicant’s case demonstrating a reasonable claim to be heard by the court (see Hall & Hall (1979) FLC 90-679);
(c)the extent of the hardship as a mere loss of right to institute is not enough; and
(d)conduct of the applicant and the likely prejudice to the respondent by reason of the delay.
I shall deal with those factors on the evidence before me, which is represented in the parties’ affidavits, noting that the wife, Ms Camran, represents herself and prepared her affidavit as an unrepresented litigant. The wife was made bankrupt on her own petition effective early 2022 and Ms Wallace appears for the trustee who has provided some further information today about the bankrupt’s estate. The trustee will continue to have involvement in the case in the next stage as leave will be granted, for the reasons which I will now explain. Although the wife in her material asserts that the current effect of property which has been distributed has provided the husband with a significantly greater share of the property pool than she has received, that is disputed by the husband.
In her affidavit, the wife again goes so far as to say at paragraph 68 that the husband received the benefit of Motor Vehicle 1, Motor Vehicle 2, Motor Vehicle 3, a business, the B Company share investment, the C Company business (said to be worth $100,000), D Company (said to be worth $20,000) and Motor Vehicle 4, whilst the wife would say that she was left with all the credit card liabilities and a loan over Motor Vehicle 5. It is common ground that the parties did own a property in City E which after separation, which took place in October 2017, was sold. The parties dealt with any excess there and including also, it would seem, with the sale proceeds of one of the vehicles.
There is some degree of uncertainty, in my view, on the evidence as to the extent to which the husband’s contributions, at least post-separation, were used towards the maintenance, improvement and preservation of the only substantial asset remaining, being a property at F Street. That is because there is little evidence at this stage as to what rentals were paid on that property (the tenant having vacated the property earlier this year) and how that rental was used to offset some of the expenses on the modest mortgage, which I am told today stands at approximately $270,000. Some allowance for that contribution and the offset tax benefit may need to be made in determining what is just and equitable.
The wife clarified her position today to effectively say that she just wants the matter finished. She does not wish to be involved in conflict and to her credit the parties have resolved their parenting issues. However, before the Court can make any orders other than that they each retain 50% of the proceeds of the net proceeds of sale of the F Street property jurisdiction to do so must be enlivened. Whereas the evidence before me at this stage is that the only creditor in the bankrupt estate who had lodged a proof of debt appeared to be the Australian Taxation Office in a sum of slightly over $10,000, Ms Wallace informed the Court today that subsequent to that affidavit proofs of debt have been lodged by financial institutions who allege that the wife had significant credit card liabilities at the time of her bankruptcy exceeding $100,000.
The wife conceded such today and her own evidence suggests that she was living on credit cards for some time prior to her bankruptcy. In fact, the wife quite honestly indicated to the court that was one of the motivations for filing a debtor’s petition to relieve herself from those payments. So although the trustee’s finalisation of the bankrupt estate might be delayed if leave is given and the parties are unable to negotiate a sensible distribution of the net proceeds of sale, with the property now on the market, I regard such a delay as short and in the circumstances outweighed by the benefits of allowing the husband to pursue a claim, a claim which in some ways the wife in her affidavit says she may contest, but, ultimately, may not.
The Court is required to consider if hardship would occur if leave were not granted and I am satisfied that in the circumstances of this case and in the nature of the claim made by the husband, although disputed by the wife, hardship would occur within the meaning of the Act and the authorities. I am satisfied that there is an adequate explanation for the delay in commencing proceedings. Although the husband says he was not aware of the time limit, and, of course, ignorance of the law is no excuse, it does seem that the parties, consistent with what they had done post-separation with their children, sought to resolve the matter.
An informal agreement signed by the parties and dated 17 May 2021, which I note is outside the time limit for the commencement of proceedings in any event, provided that the husband would take over the property at F Street and the responsibility for the mortgage. Of course, that agreement has no binding effect and the husband should have no comfort that he will necessarily achieve such a result now. That is a matter for another day. With a view to perfecting an arrangement which was set out in part in the informal agreement, a financial agreement, which was said to comply if signed with the provisions of the Act, was prepared by the solicitors retained by the husband and sent to the wife on or about 16 September 2021.
She took advice and for whatever reasons the document was never signed. As early as January 2022 the wife indicated that she was contemplating bankruptcy, it seems to me at least, because of the mounting credit card debts. In summary:
(a)I am satisfied that the length of the delay and the reasons for failing to institute in time by the husband are adequately explained;
(b)I believe the Applicant has demonstrated a reasonable claim to be heard;
(c)I am satisfied that the hardship that could be caused to the husband, but also possibly the wife if the right to institute is denied, is real for this couple with limited resources; and
(d)I cannot see really any prejudice to the wife in granting leave in circumstances where the trustee will abide the order of the Court and whatever appropriate and just and equitable division of the nett pool is made it is likely to enable the cost of the bankruptcy, maybe the creditors to be discharged and there may still be some funds available for the wife. Although that would depend on the sale.
The wife indicated she does not expect to get anything, having already, it seems, accepted that her bankruptcy has expunged her credit card liabilities. If the Court was of the view that there was no real equity in the property, then the Court may not have been persuaded on balance and the exercise of discretion to grant leave. However, without any valuation of the property, which is situated somewhere in the G Region, at least one of the appraisals by a local agent suggested the property could have a value as high as $600,000. If that were to be the case and the market will be tested with its sale, then there could be upwards of $300,000 equity in the property before distribution.
For these reasons, leave is granted pursuant to s 44(3) of the Act for the institution of proceedings by the Applicant husband. What I propose to do is to assign this matter to a Judicial Registrar on a date to be fixed for further case management of the matter. That will not involve, it seems to me, a requirement to have the property valued. That will obviously be determined by the market. I can indicate to the parties that it is likely that what they will be required to undertake is a conciliation conference.
It will obviously be important to determine the statue of the self-managed superannuation fund. It is a little uncertain to me what it is. It may not affect the trustee so much, but it does affect what orders are just and equitable. I am not going to say anything more about values of businesses, cars going here, there and everywhere. You can sort all that out. I would be very surprised if this case cannot resolve in a consent arrangement, which, of course, the trustee will be involved in, if the trustee wishes to do so.
It will remain in Division 1 only because I am not sending it back to Division 2 and if per chance it does not resolve, well, no doubt, as Queensland Case Management Judge for both Divisions in Queensland, you will be seeing me again. I will be disappointed if I have to see you again and I should not need to.
I certify that the preceding fifteen (15) numbered paragraphs are a true copy of the ex tempore Reasons for Judgment of the Honourable Justice Baumann. Associate:
Dated: 10 May 2023
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