Cao & Trong - [2019] FamCA 336

FAMILY COURT OF AUSTRALIA

CAO & TRONG

[2019] FamCA 336

FAMILY LAW – PRACTICE AND PROCEDURE – notice of discontinuance – setting aside notice – notice filed by applicant in respect of the whole of the claims in his initiating application – grounds for setting aside notice of discontinuation – none prescribed by Family Law Rules – extensive review of authorities – discretionary consideration.
FAMILY LAW – PLEADINGS – not limited to third party claims – nature and purpose of pleadings – utility of statement of claim in a case of complex factual or legal contentions – extensive review of authorities.
FAMILY LAW – ORDERS – Self-Executing Orders – trial date vacated – husband ordered to file statement of claim within certain time – if he fails to comply wife’s application will be heard on an undefended basis.

Family Law Act (Cth) 1958, ss 38, 79, 119
Family Law Rules (Cth) 2004 ,r 1.09
Property Law Act (Vic) 1958, s 172

Achurch v R (2015) 253 CLR 141
Aon Risk Services Australia Ltd v Australian National University (2009) 239 CLR 175
Applicant A26 of 2002 v Minister for Immigration and Multicultural and Indigenous Affairs [2003] FCA 1050
Applicant NACT of 2001 v Minister for Immigration and Multicultural and Indigenous Affairs [2004] FCA 316
B Pty Ltd v K (2008) 39 Fam LR 488
Banque Commerciale SA v Akhil Holdings Ltd (1990) 169 CLR 279
Botany Municipal Council v Department of Arts Sport & Environment (1992) 31 FCR 412
Bourke v Bourke (2010) 43 Fam LR 139
Buckeridge & Buckeridge (No 2) (1981) 7 Fam LR 958
Castanho v Brown & Root (UK) Ltd [1981] AC 557
Chen & Chen (No 2) [2017] FamCA 285
Christodoulou v Disney Enterprises Inc [2006] FCAFC 183
Collins & Collins (1987) 11 Fam LR 382
Commissioner of Taxation v Worsnop (2009) 40 Fam LR 552
Dare v Pulham (1982) 148 CLR 658
Deputy Commissioner of Taxation v Kliman (2002) 29 Fam LR 301
Dougherty v Dougherty (1987) 163 CLR 278
Dylan and Bryson [2018] FamCA 269
Fowler v Renmark & Paringa District Hospital Inc (1988) 51 SASR 506
Friar & Friar (2014) 52 Fam LR 275
Gould & Birkbeck & Bacon v Mount Oxide Mines Ltd (in liq) (1916) 22 CLR 490
Gould & Gould; Swire Investments Ltd (1993) 17 Fam LR 156
Howtrac Rentals Pty Ltd v Thiess Contractors (NZ) Ltd [2000] VSC 415
Martin v Martin (2015) 54 Fam LR 548
Miller v Cameron (1936) 54 CLR 572
NACU of 2001 v Minister for Immigration andMulticultural and Indigenous Affairs [2004] FCA 1444
Owners of Cargo of the Kronprinz v Owners of the Kronprinz (The Kronprinz and The Ardandhu) (1887) 12 App Cas 256
Queensland v J L Holdings Pty Ltd (1997) 189 CLR 146
R v Essex Quarter Sessions Appeals Committee; Ex parte Larkin [1961] 3 All ER 930
R v Medway [1976] 1 All ER 527
R v Moore [1957] 2 All ER 703,
Rodgers & Rodgers (No 2) (2016) 55 Fam LR 167
Sali v SPC Ltd (1993) 67 ALJR 841
Spicer v Tuli [2012] 1 WLR 3088
Stanford v Stanford (2012) 247 CLR 108
Strahan v Strahan (2013) 50 Fam LR 434
SZFOG v Minister for Immigration and Multicultural and Indigenous Affairs (2005) 88 ALD 138
Tomlinson v Ramsey Food Processing Pty Ltd (2015) 256 CLR 507
Trustee for the Bankrupt Estate of Lasic v Lasic (2009) 41 Fam LR 369
UBS AG v Tyne [2018] HCA 45

APPLICANT:

Mr Cao

RESPONDENT:

Ms Trong

INTERVENOR:

Deputy Commissioner of Taxation

FILE NUMBER:

MLC

2555

2016

DATE DELIVERED:

27 May 2019

PLACE DELIVERED:

Melbourne

PLACE HEARD:

Melbourne

JUDGMENT OF:

The Honourable Justice Wilson

HEARING DATE:

3 May 2019

REPRESENTATION

COUNSEL FOR THE APPLICANT:

Dr R Ingleby

SOLICITOR FOR THE APPLICANT:

Westminster Lawyers Pty Ltd

COUNSEL FOR THE RESPONDENT:

Mr P Testart

SOLICITOR FOR THE RESPONDENT:

JK Lawyers

COUNSEL FOR THE INTERVENOR:

Mr H Mazloum

SOLICITOR FOR THE INTERVENOR:

Australian Government Solicitor

Orders

The husband’s application to set aside the notice of discontinuance filed 7 November 2017 is granted.
On or before 4pm 17 June 2019 the husband is to file a statement of claim in accordance with the Rules of the Supreme Court of Victoria setting out with full and proper particulars all allegations of facts on which he relies to support his claims, especially equitable clams, in real and personal property including choses in action.
Payment is to be made, from the controlled monies account, to the wife’s solicitors of the sum of $317 946.52, such sum to be released within seven days and such sum to be characterised as a partial property settlement order.
On or before 4pm on 3 June 2019 the parties bring in a minute that gives effect to these orders.
The trial date of 12 June 2019 is vacated.
This proceeding is to remain in my docket.
This proceeding will be heard for directions at 10am on 19 June 2019.
If the husband fails to provide a statement of claim in accordance with these orders (as to content and by the date ordered) this proceeding will go forward to trial on an undefended basis.
The further hearing on the question costs of and incidental to this application to will be adjourned to 19 June 2019.

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 Cao & Trong 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 MELBOURNE

FILE NUMBER: MLC 2555 of 2016

Mr Cao

Applicant

And

Ms Trong

Respondent

REASONS FOR JUDGMENT

introduction

Four issues fell for determination on the hearing of this interlocutory application. They were –
a)whether an order should be made setting aside the notice of discontinuance filed by the father on 7 November 2017;
b)if such an order is made, whether the trial of this proceeding on 12 June should be vacated;
c)whether the father should be ordered to file a statement of claim that sets out his claims in this litigation with precision; and
d)whether an order should be made in favour of the mother for litigation funding.

Synopsis

For the reasons that follow, in my judgment –
a)the father’s notice of discontinuance should be set aside;
b)the trial date should be vacated;
c)the father must file a statement of claim re-casting his claims in this case; and
d)a partial property order should be made.

Some relevant background material

In these reasons I refer to the applicant as the father or the husband and the respondent as the mother or the wife. On 24 March 2016 the father commenced this proceeding in which he sought orders so that he and the mother had equal shared parental responsibility for the three children of the marriage. The father also sought orders placing the names of the children on the airport watch list maintained by the Australian Federal Police. In support of his initiating application the father swore an affidavit made 24 March 2016. In it he deposed to the following –
a)he was born in Country DD and was in his late forties;
b)he commenced living with the mother in Country DD in 2003;
c)he and the mother arrived in Australia in 2004;
d)the father remained in Australia between 2004 and 2014 pursuant to a visa and in 2015 he was granted permanent residency;
e)since 2008 or thereabouts the mother has been an Australian citizen;
f)the father and the mother married in 2010;
g)their eldest child was born in 2004, their middle child was born in 2010 and their youngest child was born in 2013;
h)the former matrimonial home at in G Street, Suburb C was registered in the mother’s name “for asset protection purposes” (his words);
i)the father and the mother separated on 14 March 2016 following an incident at the former matrimonial home;
j)the father left the former matrimonial home on 15 March 2016, although he described the event as an eviction; and
k)the father has not returned to the former matrimonial home.
In his affidavit on 24 March 2016 the father addressed in some little detail the events of 14 March 2016. He made his affidavit 10 days after the event. As to the details of the incident he said the following –
a)having spent the day at the zoo, the applicant awoke from an afternoon sleep at 5pm to find that his dinner had not been prepared so he purchased a takeaway meal and ate it with his nanny and his two children but not with the mother;
b)the mother was in her bedroom;
c)one of the couple’s sons went into the mother’s bedroom;
d)about five minutes later (according to the father) the father entered the mother’s bedroom with a view to fetching the son to resume dinner;
e)the mother asked the father questions about a company called E Pty Ltd Australia Pty Ltd that the father established in 2012 and in which the father retained a minority shareholding;
f)the father told the mother he needed to speak to the majority shareholder in order to answer the mother’s questions about the company;
g)the mother then became angry and pushed the father onto the bed striking him at least 10 times to the head with the mother’s mobile telephone; and
h)police obtained a record of interview and statement from the father later that day.
On 17 March 2016 an interim intervention order was made against the father forbidding him from approaching the mother within 5 metres or communicating with her or approaching the former matrimonial home within 200 metres.
The father expressed his concerns that the mother was attempting to alienate him from his children. He cited a collection of events that preceded the 14 March 2016 event, namely –
a)following their return from Country P in December 2015 the mother behaved aggressively towards the father;
b)the mother travelled to Country JJ and Country BB in early March 2016;
c)the mother froze (his words) the couple’s joint bank account;
d)on 4 March 2016 the mother sent the father an email stating that she required him to leave the former matrimonial home by 11 March 2016;
e)the mother required the father to attend a meeting at the office of the mother’s solicitors at 11am on 11 March 2016, which he said he duly attended;
f)at that meeting the father, the mother and several of the mother’s solicitors discussed separation details including the division of assets; and
g)no agreement was reached at that meeting about the division of assets.
Some but not all of the information to which the father swore was supported by the evidence the mother gave. In this proceeding she made several affidavits including her affidavit sworn 6 May 2016. In that affidavit she deposed to the following –
a)the father befriended the mother in 2002 in Country DD when he was married to another person;
b)the husband and the wife in this case commenced a de facto relationship in 2003;
c)the mother worked in the field of information technology at the time and the father was a venture capitalist;
d)the father requested the mother to assist him to relocate to Australia so in 2004 they moved to Australia soon after which their first child was born;
e)the father initially worked in Australia under the terms of a visa but he was unable to renew that visa so (according to the wife) he persuaded her to marry him and after they married in 2010 the mother sponsored the father in 2012 leading to the grant in his favour of a permanent residence partner visa in 2015;
f)the father was facing investigation by the Australian Taxation Office in respect of overdue taxes of approximately $30 000 000;
g)the father obtained a Country DD passport in October 2015;
h)from October 2015 the father and the mother began living separately under the one roof;
i)the father is not an Australian citizen whereas the mother and the three children of the marriage are Australian citizens; and
j)two of the children have attended D School Suburb C campus.
So far as the events of 14 March 2016 were concerned, the mother addressed aspects of the incident in her 6 May 2016 affidavit. She swore to the following –
a)the father entered the mother’s bedroom to retrieve his mobile telephone, not to insist that one of the children return to his meal;
b)the father has girlfriends;
c)the father raised his voice at the mother telling her that he had requested the majority shareholder in E Pty Ltd to stop paying her fees of $3 000 per month;
d)she denied pushing the father on to the bed in the manner he alleged;
e)she suffered bruising and whiplash from the incident after the father grabbed the mother by the arms and shook her violently; and
f)she sought assistance from Victoria Police who issued a family violence safety notice against the father.
The mother exhibited to her affidavit the interim intervention order made on 17 March 2016. She said she visited Country BB for seven days to discuss with her business partner her sole agency in relation to marketing a beauty product. She admitted freezing the couple’s joint bank account upon learning that the father had withdrawn money from her personal account for his sole use. She said two large law firms had been retained by the father to negotiate with the Australian Taxation Office. The mother said the father had refused to provide financial support for the family since January 2016. The mother said the father had since 2004 been in Australia and driving, despite his having no Victorian drivers licence. The mother said that the ongoing education of the two eldest children at D School was in jeopardy.
When this proceeding was before the Federal Circuit Court of Australia, prior to its transfer to this court, his Honour Judge Riethmuller made orders on 18 May 2016 that addressed parenting and other matters. The day earlier, that is to say on 17 May 2016 the mother had issued an application in a case returnable on 18 May 2016 in which she sought an extensive array of property or financial orders. In support of her interlocutory application the mother swore an affidavit on 17 May 2016 in which she deposed to the following –
a)the mother was the registered proprietor of the former matrimonial home being the whole of the land described in certificate of title volume … folio …;
b)the mother was a shareholder in B Ltd; and
c)the pool of assets in this case included shares in E Pty Ltd, H Ltd, L Ltd (a Country JJ company), C Ltd (another Country JJ company), two motor vehicles, cash at bank, superannuation, household effects, various club memberships, paintings, carpets and jewellery.
The mother asserted that the assets enumerated above should be distributed to her because the husband “will have numerous other assets” (her words) overseas from which he will receive benefits. She said the father had at least three Country Q companies and that the father registered very few assets in his name. She said she had no real idea of the true value of the father’s net worth.
The father acknowledged several aspects of the mother’s contentions about his financial situation. He did so in his affidavit sworn 3 August 2016. He admitted –
a)he incorporated S Pty Ltd, a Country Q company in 2005 or thereabouts;
b)he owned 1% of the shares in the capital of E Pty Ltd Pty Ltd with the balance of the shares in the company being owned by R Pty Ltd, an entity owned and controlled by one Mr T;
c)the father and the mother jointly acquired real property in Country DD;
d)in 2004 the father purchased the land and improvements known as M Street, Suburb C for $1 200 000 and it was sold in 2005 for $2 600 000, the proceeds of which were applied in the acquisition of the former matrimonial home;
e)during the course of the marriage the husband and the wife purchased then sold the land and improvements known as F Street, Suburb C; and
f)the father had objected to the ATO’s assessment of tax liability for the year 2014.
The father and the mother addressed the involvement of nannies who assisted, it seemed to a significant degree, in the raising of the couple’s children. Precisely how the fees of those nannies were paid on an ongoing basis was not easy to follow. The mother asserted that she was a stay-at-home mother, without regular income, and the father pointed to a lavish lifestyle yet he was extremely scant in his details about the way he funded that lavish lifestyle and the mother, quite properly, pointed to very considerable deficiencies in the disclosure given by the father. One of the nannies ceased her employment on 2 August 2016.
Although the father asserted that the mother was romantically associated with a Country CC national who lived in Country BB named Mr V, the mother denied she was in any such relationship. In her affidavit sworn 5 August 2016 the mother asserted that –
a)the father constituted a trust the corpus of which was $2 000 000 for the benefit of the mother and the three children;
b)the father was a bankrupt in Country DD when he first met the mother; and
c)the ATO debt was a personal debt owed by the father rather than it being owed jointly, so she asserted.
On 8 August 2016 his Honour Judge Riethmuller granted leave to the Deputy Commissioner of Taxation (“DCT”) to intervene in the proceeding. That order was made by consent. His Honour ordered the transfer of the proceeding to this court and made other directions. On 5 October 2016 Registrar Mestrovic made consent orders, largely relating to the conduct of a conciliation conference.
On 11 October 2016 the mother filed an application in a case pursuant to which she sought orders compelling the father to –
a)make a financial statement that contained a truthful description of his local and overseas assets;
b)make proper disclosure;
c)pay the wife $15 000 per month by way of maintenance;
d)pay the mother $63 884.38 by way of reimbursement for the family’s living expenses; and
e)meet the costs associated with repairs to the former matrimonial home.
The return date for that application was 25 November 2016. On that date the father and the mother were each represented by Queen’s Counsel and junior counsel. The DCT was separately represented by counsel. The father had sworn a substantial affidavit the day earlier (24 November 2016) and sought to rely on it. The Honourable Justice Bennett did not hear the application in view of the fact that the parties had not complied with the filing deadlines for affidavits. Her Honour adjourned the applications to 10 January 2017. On that latter day, that is to say 10 January 2017, the Honourable Justice Cronin made orders by consent concerning the children spending additional time with the father and vacating the conciliation conference scheduled for 21 February 2017. His Honour adjourned the further hearing of the proceeding to 24 March 2017.
On 21 March 2017 the father made wholesale amendments to his initiating application. Those were recorded in the father’s second further amended initiating application. In it the father sought parenting orders to the effect that the children spend time with mother as agreed or as ordered along with other, more complicated orders for travel and time on school holidays. So far as financial orders were concerned, the father sought the appointment of a valuer, he sought orders relating to the mother’s motor vehicle together with orders relating to shares, orders for the sale of the former matrimonial home, orders to discharge sums due to the DCT and other relief.

Both the father and the mother relied on an affidavit sworn by each on 21 March 2017.
In the father’s affidavit sworn 21 March 2017, the father mentioned that he had been charged with breaching an intervention order.
The father referred to the mutual intervention orders under which both parties operated. He swore that the mother occupied a home in Suburb HH with Mr V and he said it was unfair that the mother have should unfettered sole use of and occupancy of the former matrimonial home as well as a property in Suburb HH. The father asserted that despite the mother’s denial of the point, the mother was in fact in a relationship with Mr V who, so father said, was financially supporting her. The father said he had no capacity to meet the sums the mother sought.
In his 21 March 2017 affidavit, the father gave his address as N Street, Melbourne.
On 24 March 2017 the Honourable Justice Cronin adjourned the proceeding to 13 April 2017.
In the lead up to the court appearance on 13 April 2017 the mother filed three further documents. They were –
a)a second further amended application in a case;
b)her affidavit sworn 12 April 2017; and
c)an affidavit of Mr V made 12 April 2017.
The latter affidavit served to rebut the father’s assertion that Mr V was romantically associated with the mother. Mr V categorically denied the assertion or that he was in fact anything but platonically associated with the mother.
The legal representatives for the mother pressed for disclosure from the father. They did so in the following manner –
a)by filing a request directed to the father dated 28 October 2016 given under r 13.26 of the Family Law Rules for answers to 18 very precise questions (mostly in the form of interrogatories); and
b)by serving a further request for discovery dated 20 March 2017 on the father.
A dispute remained about whether the father’s discovery obligations had been properly discharged.
On 13 April 2017 a substantial interlocutory fight was dealt with by the Honourable Justice Cronin. In large measure it concerned the mother’s entitlement to sell shares in B Ltd so as to derive $305 000. The mother and father were each represented by senior counsel. The independent children’s lawyer was represented by junior counsel as was the DCT. Cronin J reserved judgment for a fortnight. In the upshot, his Honour made orders varying an injunction previously agreed between the parties so that the mother was permitted to sell shares in B Ltd to provide $305 000. In the course of his Honour’s reasons, Cronin J addressed the claim advanced by the DCT for payment of over $4 000 000. Senior counsel for the mother urged Cronin J to remove the DCT as a party to the proceeding on the basis that this court lacked power to make an order in respect of the father’s taxation liability. On that hearing Mr T.D.O.J North SC submitted that four leading authorities had made holdings to that effect, those cases being Commissioner of Taxation v Worsnop,[1] Trustee for the Bankrupt Estate of Lasic v Lasic,[2] Deputy Commissioner of Taxation v Kliman[3] and Rodgers & Rodgers (No 2).[4] Cronin J took the view that a decision about the status of the DCT as a party in this litigation should be left to the trial judge.
[1] (2009) 40 Fam LR 552
[2] (2009) 41 Fam LR 369
[3] (2002) 29 Fam LR 301
[4] (2016) 55 Fam LR 167
On 1 May 2017 the Honourable Justice Macmillan fixed this proceeding for trial on 20 November 2017 as a four day case.

The notices of discontinuation

On 7 November 2017, at a time when he was represented by solicitors, the father filed a notice of discontinuance. In Part C of that document, the father indicated he was discontinuing –
a)the initiating application filed 24 March 2016;
b)the response to an application in a case filed on 16 December 2016;
c)the further amended initiating application filed on 24 November 2016; and
d)the second further initiating application.
On 30 November 2017 the mother also filed a notice of discontinuance. However, that was limited to the mother discontinuing the whole of the application made in her application in a case filed on 23 October 2017. In that application in a case the mother had sought –
a)leave to sell the former matrimonial home for not less than $2 850 000;
b)the caveats be removed from the title to that property; and
c)the sale price be paid in a particular manner.
On 20 November 2017 the Honourable Justice Macmillan made orders dismissing the proceeding in relation to parenting and her Honour adjourned the property aspect of the case to a date to be fixed. However, that did not dispose of the aspect of the case on which the DCT relied. In consequence, on 15 December 2017 the Honourable Justice Cleary made orders –
a)requiring the DCT to file its outline of submissions by mid December 2017;
b)for the father to file his submissions by 7 January 2018; and
c)for the wife to file her submissions by 15 January 2018.
Her Honour made two important notations to the orders of 15 December 2017. They were in the following terms –
(C)The matter before the Court today saw the Applicant Mr Cao file a Notice of Discontinuance of his application. The intervener, the Commissioner for the Australian Taxation Office wishes to pursue an argument in relation to whether or not the Court has power and jurisdiction to proceed against the property of the parties in circumstance where neither of the parties is presently asking the Court to make orders. A timetable has been agreed between the Respondent wife and the Intervener; that timetable has been adjusted to enable the husband to file any application which he now wishes to make or submission in respect to the submissions of the Intervener by a particular date in accordance with Orders 3 to 6 above.
(D)The Intervener asks, and the Respondent wife joined in the application, that the matter be allocated hearing time in February 2018, estimated ½ day to 1 day.
The mother duly filed submissions on 22 January 2018 in response to the DCT’s position in this litigation. Relevantly distilled, a fair encapsulation of the main points urged in those submissions were as follows –
a)neither the husband or the wife pressed for orders under s 79 of the Family Law Act;
b)the husband discontinued his application and the wife wished to discontinue hers;
c)no authority had been cited to support the DCT’s proposition that this court will compel parties to a marriage to finally settle property issues where neither seeks such relief from the court;
d)this court should not permit a creditor to press for final property settlement orders the purpose of debt recovery;
e)the wife did not owe a tax debt to the DCT whereas the husband did;
f)the wife disputed the DCT’s contentions that she enjoyed a luxurious lifestyle through the husband’s income and that their wife had the benefit of the husband’s failure to pay tax;
g)having regard to the fact that the husband and the wife no longer sought orders for the division of property, no basis existed on which the DCT as intervener could seek orders for the alteration of property interests;
h)under s 79(10)(a) of the Family Law Act, the DCT had to demonstrate that it was a “creditor” and that the creditor may not be able to recover the debt if, in the absence of the creditor, an order for the division of property was made under s 79;
i)nothing in s 79 suggested that once joined, a creditor has the ability to force the parties to settle property under s 79 if they do not wish to do so;
j)citing the decision of the High Court in Dougherty v Dougherty,[5] there was in truth only one proceeding being the matrimonial cause and the intervention by the DCT in this proceeding did not mark the commencement of a new proceeding;
k)the decision in Martin v Martin[6] represented the high water mark and was distinguishable because in that case Cronin J made orders in aid and enforcement of earlier orders and unlike in Martin, in this case DCT does not hold an order that the DCT is endeavouring to enforce; and
l)although the DCT is a party on the basis that he is an intervenor, the DCT does not thereby assume the right to press for orders for the division of property as if a party to the marriage because, as an intervenor, the DCT can only seek to influence the form of orders sought by the husband and wife under s 79.
[5] (1987) 163 CLR 278
[6] (2015) 54 Fam LR 548
Subsequent to the orders made by Cleary J, the dispute between the wife and the DCT was agitated on several occasions. The details of those appearances may be shortly stated in the manner described hereunder –
a)8 February 2018 – Cronin J adjourned all outstanding applications to 4 June 2018 for one day;
b)20 March 2018 – Cronin J vacated the orders made on 24 April 2017 so as to preclude the wife from selling further shares in the B Ltd and varied the orders made on 5 October 2016 to allow the wife to sell the former matrimonial home;
c)4 June 2018 – Cronin J adjourned the proceeding to 7 June 2018;
d)7 June 2018 – Cronin J heard argument about whether this court had jurisdiction to entertain the DCT’s application and other matters then reserved judgment;
e)20 June 2018 – Cronin J held that this court did, in fact and in law, have jurisdiction to hear the DCT’s amended application filed 1 June 2018;
f)10 October 2018 – Registrar Field ordered the DCT to file and serve a statement of claim in respect of the DCT’s trust claims and PLA claims as defined in the DCT’s amended application in a case filed 1 June 2018 and other orders;
g)20 December 2018 – Registrar Field fixed this proceeding for trial on 12 June 2019 and otherwise listed the proceeding for mention before Johns J on 10 May 2019; and
h)18 April 2019 – Registrar Field listed the matter before me on 3 May 2019.
Hence, unless otherwise ordered, according to those orders this proceeding will be tried on 12 June 2019.

The Intervenor’s case

As is apparent from the foregoing, the DCT has participated in this proceeding since July 2016. On 22 July 2016 when this proceeding was before the Federal Circuit Court of Australia the DCT filed a notice of intervention and an affidavit made on 19 July 2016 by Ms FF, a public servant employed by the Australian Taxation Office (“ATO”). In that affidavit, Ms FF stated –
a)the ATO undertook an audit of the husband’s taxation affairs over the period 1 July 2005 to 30 June 2012;
b)the ATO assessed the husband’s tax liability over the period 1 July 2005 to 30 June 2012;
c)ATO assessed the husband over that period for penalties;
d)as at July 2016 the husband was liable to pay taxation and penalties in the sum of $16 509 050.54; and
e)the failure by the husband to pay his tax related liabilities increased the gross value of the asset pool of the husband and the wife in this litigation.
In detailed written submissions dated 23 April 2018, the DCT’s solicitor set out the heart of the ATO’s contentions about the way and details of the DCT’s intervention in this litigation. In essence, the DCT contended that –
a)the DCT has an equitable interest in the former matrimonial home and shares; and
b)the transfer of the former matrimonial home from the husband to the wife was made with an intention proscribed by s 172 of the Property Law Act and was therefore void as was the assignment of debt owed to the husband by B Ltd in or about July 2014.
The amount said to have been due to the DCT by the husband was altered in May 2018, according to a later affidavit made by an authorised public servant, to $5 519 200. On 29 October 2018 senior and junior counsel for the ATO put their names to a statement of claim on behalf of the Commissioner of Taxation in accordance with the orders of Registrar Field. In the statement of claim the Commissioner asserted that the husband was indebted to the Commonwealth of Australia for tax related liabilities in the sum of $5 519 200 and that the husband did not own sufficient assets in his own name to satisfy his tax related liabilities. The Commissioner further contended –
a)on 7 December 2015 the husband transferred his interest in the former matrimonial home to the wife for no consideration;
b)the wife entered into a contract to sell the former matrimonial home for $3 750 000;
c)B Ltd owed the husband $289 620 as at 30 June 2014 which debt the husband assigned to the wife on 2 July 2014 for no consideration;
d)in January 2016 on the advice of the husband, the wife agreed to B Ltd converting its debt into more than $10 000 000 shares and the wife currently holds $9 920 513 B Ltd shares;
e)the Commissioner was not involved in discussions between the husband and the wife leading to the filing of notices of discontinuance nor in negotiations culminating in the entry into a binding child support agreement;
f)the Commissioner said the husband was the beneficial owner of the former matrimonial home; and
g)the transfer of the husband’s interest in the former matrimonial home to the wife was an alienation made with the intent to defeat creditors.

The wife’s approach to the commissioner

Between April 2018 and April 2019 or thereabouts the wife contended that the Commissioner’s intervention in this litigation has been an abuse of process. She has argued that the court should stay the Commissioner’s application, especially having regard to the fact that in November 2017 the husband filed a notice of discontinuance and in the same month the wife announced that she no longer pressed for property alteration orders.
However, from April 2019 the wife has argued this proceeding should proceed on an undefended basis on the grounds that the husband has not filed trial material that was due on 1 March 2019. Conversely, the wife has filed a very detailed trial affidavit sworn 3 April 2019. In it she set out in considerable detail all matters she sought to advance in her claims in this case for property division. Self-evidently, the wife has fundamentally re-cast her approach to this litigation as her previous approach of not wishing to proceed has been repudiated in unqualified terms. She swore in her affidavit made 1 May 2019 that the husband currently owes over $133 000 in child support arrears. In addresses before me on 3 May 2019, the wife’s counsel contended that the husband is not currently in Australia, that he is unlikely to physically return to Australia, that if he does enter Australia he will be prevented from leaving Australia by reason of the significant child support arrears he currently owes and that if he is permitted to prosecute his case in this litigation he will be giving evidence remotely, probably by telephone.

The application on 3 may 2019

It will be recalled that this proceeding has been fixed for trial in June. It will also be recalled that the husband filed a notice of discontinuance on 7 November 2017 in respect of the entire proceeding and that the husband had not complied with directions given by Registrar Field for the filing of trial material. In addition, the wife deposed to the husband telling her, in effect, that he had no intention of participating in this proceeding.
Against the lengthy factual backdrop that has been narrated above, the husband filed an application in a case on 1 May 2019 in which he sought two orders, namely –
In the event leave is required the Husband have leave to withdraw the Notice of Discontinuance filed on 7 November 2017.
Such further or other orders as this Honourable Court shall deem appropriate.
In support, the husband swore an undated affidavit. Expressed most briefly, in that undated affidavit the husband swore as follows –
a)he filed the notice of discontinuance when he had been engaged in settlement discussions and reached an in-principle agreement to resolve the issues between him and the wife;
b)on the basis of that agreement he “sought to withdraw” (his words) his court application and was informed that the wife would be doing the same;
c)when he filed the notice of discontinuance he was unrepresented so his previous solicitors prepared the notice and sent it to him to sign, which he did;
d)he failed to appreciate that upon his executing the notice of discontinuance, that may not dispose of the entirety of this litigation as the wife’s claims and the Commissioner’s claims in it continued;
e)the husband proposed to sell shares held by the wife to meet his debts due under child support obligations;
f)on 15 November 2017 the husband signed a binding child support agreement;
g)on 12 February 2018 the husband signed a second binding child support agreement;
h)the basis on which he entered into two child support agreement was misrepresented to him and, according to the husband, it would be unjust for him not to be heard in the litigation;
i)he is living overseas;
j)he is attempting to advance litigation in the AAT with respect to his tax liabilities;
k)he regretted that he had not acted “sooner to obtain legal advice so he could understand (his) position in the Family Court proceedings” (his words);
l)since 21 March 2018 he has retained new solicitors; and
m)he would suffer prejudice if he lost the opportunity to be heard in this case.
The wife opposed the husband’s application argued before me on 3 May 2019. In essence, she contended –
a)no explanation for the husband’s delay in participating in this proceeding was given;
b)he offered no indication of the orders he would be seeking if permitted to participate again in this litigation;
c)if he is permitted to participate the trial date will almost certainly be lost;
d)the wife needs litigation funding; and
e)the husband owes over $133 000 in child support arrears.
The Commissioner said the husband should be returned to the litigation.
By way of overview, in my view the justice of this situation is achieved by orders that allow the husband to participate in this litigation but on very strict terms. That will torpedo the trial date. However, I will retain control of this proceeding and any delay to the commencement will not be significant. The wife’s litigation funding needs to be addressed urgently. I will require counsel for the parties to bring in a minute that gives effect to these reasons, specifically –
a)An order setting aside the husband’s notice of discontinuance;
b)ordering the husband, within 21 days, to file a statement of claim indicating the relief he seeks and the property to which that relief applies;
c)ordering the husband to pay to the wife the sum of $317 946.52 by way of litigation funding within 14 days;
d)unless all steps mentioned in the three preceding sub-paragraphs are done strictly according to their terms, this proceeding will go ahead as an undefended trial on a date to be fixed.

The notice of discontinuance

Dr Richard Ingleby of counsel for the husband advanced the thesis that the Family Law Rules made no provision for a party’s withdrawal of a notice of discontinuance. Dr Ingleby contended that by force of s 38(2) of the Family Law Act, the Rules of the High Court of Australia were applicable so far as they were capable of application. He said the Rules of the High Court made no provision for a party’s withdrawal of a notice of discontinuance so r 1.09 of the Family Law Rules became applicable. That rule was in the following terms –
If the court is satisfied that:
(a)a legislative provision does not provide a practice or procedure; or
(b)a difficulty arises, or doubt exists, in relation to a matter of practice or procedure;
it may make such orders as it considers necessary.

In submitting that this court possessed a discretion to make such order as it considered necessary, Dr Ingleby took me to Australian and English authorities one of which emerged from the end of the last century. It is useful to survey those authorities.
As long ago as February 1887, the House of Lords held in Owners of Cargo of the Kronprinz v Owners of the Kronprinz (The Kronprinz and The Ardandhu)[7] that an order for discontinuance does not amount to a release of claims. Observations to like effect have been made in one other decision of the House of Lords in Castanho v Brown & Root (UK) Ltd[8] as well as in Australian decisions including Botany Municipal Council v Department of Arts Sport & Environment[9] and SZFOG v Minister for Immigration and Multicultural and Indigenous Affairs.[10] In the Court of Appeal of England & Wales, Lewison LJ held in Spicer v Tuli[11] that a second proceeding may be commenced on the same facts as an earlier proceeding that is discontinued rather than dismissed. In UBS AG v Tyne[12] Nettle and Edelman JJ (in dissent on the outcome of the appeal) addressed the authorities referred to immediately above.
[7] (1887) 12 App Cas 256
[8] [1981] AC 557
[9] (1992) 31 FCR 412
[10] (2005) 88 ALD 138
[11] [2012] 1 WLR 3088
[12] [2018] HCA 45
To state that the discontinuance of a proceeding does not amount to a release of claims gives no insight into the factual and legal basis for the exercise of the judicial discretion to permit the setting aside of a notice of discontinuance. Dr Ingleby brought to my attention the decision of Baumann J in Dylan and Bryson.[13] My reading of that decision offered no illumination into the circumstances when the discretion is properly exercised. Certain judicial statements offer fact-specific illustrations of the making of an order setting aside a notice of discontinuance. For example, in Fowler v Renmark & Paringa District Hospital Inc,[14] Cox J set aside a notice of discontinuance that had been filed in error. A similar course was adopted by Mansfield J in the migration case of Applicant A26 of 2002 v Minister for Immigration and Multicultural and Indigenous Affairs.[15] In Applicant NACT of 2001 v Minister for Immigration and Multicultural and Indigenous Affairs,[16] Jacobsen J held that the court in an appropriate case has inherent power to set aside a notice of discontinuance if it is necessary to do so to prevent injustice.
[13] [2018] FamCA 269
[14] (1988) 51 SASR 506
[15] [2003] FCA 1050
[16] [2004] FCA 316
In Christodoulou v Disney Enterprises Inc,[17] the Full Court of the Federal Court of Australia referred to a line of authority to the effect that the Federal Court had inherent jurisdiction to set aside a discontinuance or abandonment of a proceeding if the act constituting the discontinuance or abandonment was a nullity in the eyes of the law by reason of fraud or mistake. That line of authority included several English decisions such as R v Moore,[18] R v Essex Quarter Sessions Appeals Committee; Ex parte Larkin[19] and R v Medway.[20] The Full Court also cited authority to the effect that the power extends beyond cases of fraud or mistake because the court has power to set aside a discontinuance or abandonment whenever the interests of justice dictate that such a course is appropriate. In that line of authority is Applicant NACT of 2001, NACU of 2001 v Minister for Immigration andMulticultural and Indigenous Affairs[21] and Applicant A26 of 2002.
[17] [2006] FCAFC 183
[18] [1957] 2 All ER 703
[19] [1961] 3 All ER 930
[20] [1976] 1 All ER 527
[21] [2004] FCA 1444
To my mind, analysing the circumstances surrounding the filing of notice of discontinuance for fraud or for abuse of process or for mistake fails to recognise, as the High Court recognised in UBS that even if a notice of discontinuance is filed, the claims recorded in the litigation thereby discontinued survive as no release of the claims was affected by the filing of the notice of discontinuance. It seemed to me that the Honourable Justice Gordon in UBS accurately stated the point where her Honour said the following –
This appeal is concerned with an alleged attempt to raise or re-litigate issues that were said to have been the subject of earlier proceedings. Where a party attempts to raise issues in successive proceedings, that conduct may be assessed as an abuse of process if it is contrary to the principle of finality: that is, that “controversies, once resolved, are not to be reopened except in a few, narrowly defined, circumstances”. This fundamental principle protects “parties to litigation from attempts to re-agitate what has been decided”.
In this case the husband has not sought to raise in successive proceedings controversies that have been resolved. No adjudication has been pronounced on the issues in this case except to the extent that Cronin J ruled on a jurisdictional issue that arose from the Commissioner’s contentions in the intervenor’s application. The principle of finality espoused by the High Court in Tomlinson v Ramsey Food Processing Pty Ltd[22] and Aon Risk Services Australia Ltd v Australian National University[23] is not applicable. Accordingly, the observations of the High Court in Achurch v R[24] about the principle of finality protecting parties to litigation from attempts to re-agitate what has been decided is inapplicable as nothing (beyond Cronin J’s decision mentioned earlier) has been decided.
[22](2015) 256 CLR 507
[23](2009) 239 CLR 175
[24](2015) 253 CLR 141
In debate with Dr Ingleby raised with him four propositions that seemed to me to be relevant in any assessment of whether an order should be made setting aside the notice of discontinuance. The four propositions to which I now turn to do not appear to be grounded in authority yet they seem to go to whether the justice of the situation favours the making of the order setting aside the notice of discontinuation. They were these –
a)whether a valid explanation is given why the notice of discontinuance was filed in the first place;
b)whether any prejudice is occasioned to either party by the grant of an order setting aside the notice of discontinuance or, conversely, by the refusal to grant such an order;
c)whether in all the circumstances it is just to set aside the notice of discontinuation; and
d)whether on discretionary grounds an order should be made setting aside the notice of discontinuance.
Dr Ingleby seemed to embrace that formulation as he said –
I agree with you 100 percent.[25]
[25] Transcript of proceedings 3 May 2018, Page 7, Line 6
Dr Ingleby made a collection of very helpful submissions by way of development of those points. To the first, namely, a valid explanation for the filing of the notice of discontinuance in November 2017, Dr Ingleby submitted that the husband filed the notice as he thought the litigation had been resolved. In fact, as has been recorded above the more detailed circumstances leading to his filing the notice of discontinuance emanted from his belief that a resolution had been reached on property matters. Dr Ingleby said that irrespective of the filing of the notice, in any resolution of the litigation it was necessary for the parties to appear before a justice of this court to persuade that judge of the justice and equity of the compromise. It seemed to me that when properly analysed, that contention amounted to the proposition that the notice was wholly ineffective in any event because even if it was correctly underpinned by a valid and legitimate compromise, any such compromise needed court approval without which it was ineffective in fact or in law.
That argument was correct so far as it addressed the need for any compromise to be approved by the court. Whether the husband was to be accepted in his version of events that he was unrepresented at the time and that he simply signed a document prepared for him is largely irrelevant. It seemed to me that the father offered a valid explanation for his filing the notice of discontinuance.
Next it became necessary to consider whether any prejudice would be occasioned by either party by the setting aside or the refusal to set aside the notice of discontinuance. Taking the husband’s position first, he submitted that he would be prejudiced by the refusal to set aside the notice. He said he wanted to participate further in the litigation. He referred to the dispute with the ATO and how the AAT had adjourned its hearing until a date after this court had dealt with the husband’s liability. Dr Ingleby said one issue was whether the liability to the Commissioner was joint and another was whether the Commissioner who was said to be owed a very large sum took priority ahead of the husband and wife in the division of assets in this case. Further, the husband had indicated in late-filed affidavit material that he intended to apply to set aside the binding child support agreement that he executed. Dr Ingleby frankly conceded that the father was the subject of a departure prohibition order such that if he were to enter the limits of the Commonwealth he could not leave without a release from that departure prohibition order.
In short compass, the father said he would be prejudiced by being shut out of this case at this time.
On behalf of the mother, Mr Testart submitted that the prejudice she would suffer if the husband were permitted to return to this litigation outweighed any prejudice he asserted. Mr Testart said –
a)the husband had taken no effective steps in this litigation since filing the notice of discontinuation;
b)despite the imminence of the trial in June of this year the husband had not filed trial material;
c)the claims the husband said he wished to agitate at trial had not been formulated even at this late stage;
d)the husband owed her very considerable sums in unpaid child support amounts;
e)the wife’s legal representatives were owed large amounts that could not be accessed while the status of this litigation was in a state of flux; and
f)the husband should not be granted an indulgence having regard to his overall dilatory approach to the conduct of this litigation.
Mr Testart drew my attention to the observations of the High Court in Aon in highlighting that I should consider the stage the litigation had reached and the extent of proposed amendments.
Mr Testart submitted that I should refuse the husband’s application to set aside the notice of discontinuance and that the trial should go ahead on 12 June but on an undefended basis.
I am not attracted to that submission. It must be remembered that the wife also filed a notice of discontinuation, albeit of a more limited nature than was the husband’s unconditional notice.
Mr Testart was correct in his contentions about the husband’s approach to this litigation. Specifically, I agree that –
a)the husband commenced his case as a parenting case;
b)at no stage has the husband identified the way he now says the case should progress as a property division case;
c)the tax liability is in the husband’s sole name;
d)disclosure by the husband to date has been deficient;
e)the case includes assets located in Country JJ and elsewhere internationally;
f)no valuation evidence has yet been adduced in respect of overseas assets; and
g)the wife has expended a large sum in costs to date.
In debate Mr Testart addressed the relevance of the tax liability. He said the Commissioner sought recovery of approximately $5 000 000 and the pool of assets in this case was presently in the vicinity of $3 000 000.
Mr Testart pressed his client’s application for litigation funding. He sought $400 000, the sum of $80 000 of which to be applied in the meeting day-to-day expenses and the sum of $320 000 to be held in trust by her solicitors on account of costs and disbursements. No dispute arose about there being $3 400 000 in a controlled monies account. No party disputed the authority of Strahan v Strahan[26] as providing a proper basis for the making of the order for a partial property settlement in the sum sought by Mr Testart. In the passages that follow I have addressed the partial property settlement.
[26](2013) 50 Fam LR 434
Returning to the prejudice and who was most likely to suffer the greater hardship in the orders to be made on this application, I am of the view that the greater hardship will befall the husband by refusing an order setting aside the notice of discontinuance. In my view –
a)any hardship to the wife can be cured by procedural orders;
b)the wife herself filed a notice of discontinuance so it may be inferred that at one stage at least both parties recognised that their disputation had been resolved, irrespective of how erroneous that view may have ultimately been;
c)the husband through responsible counsel tells me he wishes to put in issue property division in this case;
d)to hear only from the wife on an undefended basis in the way Mr Testart submitted would present a highly unbalanced set of circumstances;
e)it is likely that evidence of the full property pool will be put before the court if the husband is permitted to participate in this litigation; and
f)the Commissioner is pressing for payment of a very substantial sum and the husband should be permitted to put before the court whatever he may be advised in any endeavour to meet the Commissioner’s claims.
In making those observations I recognise that the husband has been less than diligent in his approach towards the conduct of this litigation. His explanations that he has been consumed with the litigation in the AAT was unpersuasive. It is a common occurrence that litigants in this court deal concurrently with litigation in other courts and tribunals. A proceeding in this court does not simply stop merely because a litigant is involved at the same time in litigation in another forum. It seems to me that on its proper analysis, the husband’s application for an order setting aside the notice of discontinuance and his expressed wish to re-engage in this case should be likened to a last-minute amendment application to which the principles expressed in Aon apply. Gone are the days where case management principles predominate a consideration of all issues in the manner held in Sali v SPC Ltd[27] or Queensland v J L Holdings Pty Ltd.[28]
[27] (1993) 67 ALJR 841
[28] (1997) 189 CLR 146
Finally, it seemed to me to be relevant to assess, in the overall, the justice of the situation advanced by the husband. To some extent, his position has already been considered when addressing the prejudice to be occasioned to the husband or to the wife by acceding to the husband’s requests. Several things must be said. First, the trial cannot proceed on 12 June. Next, a partial property settlement order should be made the effect of which will serve to ameliorate the current financial distress under which the wife presently labours. Next, the husband must identify precisely how he recasts his case to assert property division claims under s 79 of the Family Law Act. In my view he must file a statement of claim, with property particulars, setting out the case he advances under s 79. He must identify in precise terms the property concerned (in Australia and internationally), the basis of his claim to that property (especially any claim to an equitable interest) and he must state his assertions about contributions. I will give him 21 days to file that statement of claim. The husband must thereafter address all discovery issues, namely those that he has failed, refused or omitted to address thus far together with any new discovery issues that arise from the claim he proposes to advance in the statement of claim I have mentioned above.
In view of the husband’s previous approach to orders of this court, I entertain very real doubt that the husband will comply with the matters raised above. If he does not comply with the orders for the filing of a statement of claim or in respect of discovery then I may very well accede to Mr Testart’s contention that this proceeding should be heard on an undefended basis.
Lest there be concerns about the wisdom or otherwise of ordering pleadings, it is beyond argument that in an appropriate case pleadings may be ordered. The Honourable Justice Macmillan discussed many of the lead authorities on the subject in Chen & Chen (No 2).[29] Several propositions may be stated from those authorities. The High Court held in Dare v Pulham[30] that pleadings serve a number of functions. As was held in Gould & Birkbeck & Bacon v Mount Oxide Mines Ltd (in liq),[31] pleadings furnish a statement of the case sufficiently clear to allow the other party to meet it. In Miller v Cameron,[32] the High Court held that pleadings define the issues for decision in the litigation and thereby enable the relevance and admissibility of evidence to be determined at trial. Relief is generally confined to that available on the pleadings, as the High Court held in Banque Commerciale SA v Akhil Holdings Ltd.[33]
[29] [2017] FamCA 285
[30] (1982) 148 CLR 658
[31] (1916) 22 CLR 490
[32] (1936) 54 CLR 572
[33] (1990) 169 CLR 279
For more than 20 years, in this court pleadings have been ordered sparingly, usually being confined to cases where to persons were joined as third parties or strangers to the marriage relationship. In those cases pleadings served to set out the nature of the claim and the basis of it, as was held by Fogarty J in Gould & Gould; Swire Investments Ltd.[34] That course was consistent with the observations in Buckeridge & Buckeridge (No 2)[35] and Collins & Collins[36] as well as Friar & Friar.[37] The rationale for the conventional orthodoxy of conducting litigation in this court without pleadings was explained by the Full Court of this court in B Pty Ltd v K.[38] There, the court (Faulks DCJ, Coleman & Warnick JJ) held that in the usual run of applications for alteration of property interests or parenting orders, the fact of marriage and in property cases a history of contributions to and acquisition of property is sufficient to make the existence of a cause of action apparent. The phrase “cause of action” was written in quotation marks by the Full Court. That may be because in litigation in this court a property division application is rarely described as a cause of action. Yet where a claim is made against a party who is a stranger to the marriage relationship the nature of the claim including the factual and legal basis for it frequently raises equitable principles or common law concepts rendering the appellation “cause of action” more appropriate. In Bourke v Bourke,[39] Murphy J described the wife’s statement of claim against a third party as a pleading. Murphy J also described the wife’s statement of claim as “an odd document consisting of assertions of fact as well as statements of opinion and assertion”. His Honour stated that where specific causes of action are pursued against third parties pleadings have an important and highly useful role in defining and confining the issues for determination by the court. In this case, it will be recalled that Cronin J ordered the intervenor to file a statement of claim.
[34] (1993) 17 Fam LR 156
[35] (1981) 7 Fam LR 958
[36] (1987) 11 Fam LR 382
[37] (2014) 52 Fam LR 275
[38] (2008) 39 Fam LR 488
[39] (2010) 43 Fam LR 139
The fact that the case law on pleadings is largely referrable to claims made against third parties does not mean that pleadings cannot be ordered as between applicant and respondent if the circumstances of the case require that. In Chen Macmillan J was concerned with a case where the parties consented to a statement of facts and contentions being supplied rather than formal pleadings. In the course of her Honour’s consideration of the issue, her Honour specifically addressed the question whether a formal statement of claim would overcome deficiencies in a statement of facts and contentions. Ultimately, her Honour took the view that by reason of the want of personal knowledge of information to which the wife was privy any deficiency (if one existed) in the statement of facts and contentions would be unlikely to be remedied by a statement of claim because she was not armed with the requisite knowledge to do better than was done in her statement of facts and contentions. In those circumstances the Honourable Justice Macmillan took the view that no purpose would be served in requiring the wife to file and serve a statement of claim. Yet her Honour at no stage denounced the notion of a statement of claim being ordered. Further, in the opening passages of her Honour’s reasons, her Honour spoke of the complexity of the case involving multiple parties, properties and entities. The same might fairly be said in this case. To that list may be added the fact that several companies formed or operating in Country JJ and Country DD are involved, real estate is also relevant in the State of Victoria as well as in Country DD and a large body of complex documentation is involved. The time has come for the claims that the husband wishes to advance in relation to property issues to be cast precisely as to facts and relief sought. In my view the magnitude of the case and the complexity of it warrants ordering the provision of pleadings. As Macmillan J mooted in Chen & Chen, pleadings in accordance with the Rules of the Supreme Court of Victoria are warranted and I so order.

My view in relation to pleadings being available beyond third party claims is forfeited by s 119 of the Family Law Act. That section permits a party to a marriage to commence a proceeding against the other in contract or in tort. The range of tort is there unspecified. Conceivably, a claim for damages for assault can be brought, as can a claim for false imprisonment, a claim for defamation or for negligent misstatement or indeed a claim the pure economic loss in negligence. A statement of claim in any such claim would be wholly necessary. Likewise, if a claim for breach of contract were alleged the composition of the contract would need to be identified as Gillard J canvassed in Howtrac Rentals Pty Ltd v Thiess Contractors (NZ) Ltd.[40] It must not be forgotten that in Stanford v Stanford,[41] the High Court said that in a property division case the existing legal and equitable interests of the parties must be identified. Community of ownership has no place in the common law. In this case it seems to me that the complex tangle of real and personal property in Australia and internationally must be identified and the existing legal and equitable interests in that property must be set out. A statement of claim is the best way to do that.
[40] [2000] VSC 415
[41] (2012) 247 CLR 108

PARTIAL PROPERTY ORDERS

The wife made an affidavit on 1 May 2019 in support of her application for a partial property order. In it she stated that despite her application for property settlement orders, the Commissioner had intervened claiming approximately $5 000 000 and that based on the value of assets in the case, even the Commissioner’s claim will not be met in full.
The wife stated that as at 30 April 2019, that is to say on the day of her affidavit, the husband owed $133 085.36 in child support arrears and that the Child Support Agency had obtained a departure prohibition order against the husband. She stated that in her view it was doubtful the husband would return to Australia to prosecute this proceeding.
In her 1 May 2019 affidavit the wife also stated that in April 2017 the Honourable Justice Cronin had ordered that $305 000 be provided to the wife from the sale of shares in B Ltd, such sum being made up of $237 000 for legal costs and $68 000 for living expenses. She said she raised $16 534.50 from the sale of those shares. She said that in March 2018 the orders previously made by Cronin J were varied so that she was authorised to sell the former matrimonial home, which she did. She stated she raised $3 684 408.32 from the sale of the former matrimonial home and applied that amount –
a)to her legal representatives as to $134 152.19 for past costs and disbursements;
b)as to $92 287.81 for future costs and disbursements; and
c)as to $3 457 968.32 to a controlled monies account.
The wife deposed to her solicitors telling her that they cannot continue to represent her without regular sums being paid to them for costs and disbursements. She said that to date she had incurred costs and disbursements of $1 120 400 of which she has paid $520 860.45 and that fees of $599 539.55 remain outstanding.
She sought $317 946.52 to be released from the controlled monies account to enable counsel’s fees to be paid as well as her solicitors’ preparation fees to be met. She said her income was limited to the sum of $2 000 per month that she received from the husband together with Centrelink benefits of $628 per month. She said her estimated monthly expenses were $17 043 of which the amount she pays in rent per month of $5 213 is a large component. She said she estimated she needed $80 000 for living expenses to trial.
The wife’s solicitor affirmed an affidavit on 1 May 2019 in which she substantiated the sums to which the wife deposed. The wife’s solicitor further affirmed that if the husband was permitted to re-join the proceeding and trial dates were extended, then the wife may require further funding. The wife’s solicitor stated that she was unable to continue to act for the wife unless $317 946.52 was paid to her firm.
Several propositions emerged from the material filed on behalf of the wife in relation to her application for further litigation funding.
First, her dispute with the husband is part only of the costly skirmishing in which she is presently embroiled. The dispute with the Commissioner continues and is likely to command a great deal of her focus in the months to come, irrespective of the ongoing disputation she has with the husband.
Second, only when the husband properly pleads his claims in this case upon his filing of the statement of claim that I have ordered him to file will the wife (and, for that matter, the court) have any real conception of the magnitude, detail and legal basis of the claims he asserts, especially in relation to his interests in assets overseas.
Third, the legal expenses which the wife has already incurred coupled with those she is likely hereafter to incur are considerable yet in my view they are far from exceptional in a case of this factual and legal complexity.
Fourth, her need for the sum she seeks cannot be seriously denied.
Fifth, she is likely to be ordered an amount substantially greater than the sum she seeks when final orders are made dividing the assets in this case.
Sixth, of the sums claimed, the outstanding sum for child support is large and it has been unpaid for a long time.
Seventh, the wife will be seriously disadvantaged especially in her dispute with the Commissioner if, by reason of a refusal of her application for litigation funding, her legal representatives cease their representation of her.
It might fairly be said that the wife’s lifestyle is lavish. For example, she lives in a very affluent suburb in Melbourne when something more modest might suffice. Her children are schooled at an expensive private school when a school of more modest cost would suffice. Those arguments may be the subject of challenge at trial and if they are, it will undoubtedly be relevant to explore how lifestyle choices during the marriage and after separation were joint decisions. In any event, whatever may be said about lifestyle choice issues, on the material before me on the application for litigation funding the mainstay of expenses for which the wife seeks funding relate to past and future legal expenses. Those directly bear on her needs in this case. It must not be overlooked that the wife will be fighting this trial on two fronts – against the husband and against the Commissioner, the latter being a well-resourced institutional litigant. She will require legal assistance on each front.
For those reasons I accede to the wife’s application for litigation funding in the sum sought.

SUMMARY OF ORDERS PROPOSED

The above reasons are long of necessity as the issues in these applications were involved. Based on the foregoing the following is a distillation of the essential conclusions I have reached –
d)the husband’s application to set aside the notice of discontinuance he filed in November 2017 is granted;
e)the husband must file a statement of claim in accordance with the Rules of the Supreme Court of Victoria setting out with full and proper particulars all allegations of facts on which he relies to support his claims, especially equitable clams, in real and personal property including choses in action;
f)the trial date of 12 June 2019 is vacated;
g)within seven days of today the parties must bring in a minute that gives effect to these orders;
h)from the controlled monies account, payment is to be made to the wife’s solicitors of the sum of $317 946.52, such sum to be released within seven days and such sum to be characterised as a partial property settlement order;
i)this proceeding is to remain in my docket;
j)a directions hearing is to be conducted on 19 June 2019;
k)if the husband fails to provide a statement of claim in accordance with these orders (as to content and by the date stipulated) this proceeding will go forward to trial on an undefended basis; and
l)I will hear the parties on the question of orders to be made that the husband pay the costs of and incidental to this application to be agreed or taxed in default of agreement.

I certify that the preceding ninety-two (92) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Wilson delivered on 27 May 2019.

Associate:

Date: 27 May 2019