Carter and Southwell and Anor

[2015] FamCA 844

FAMILY COURT OF AUSTRALIA

CARTER & SOUTHWELL AND ANOR [2015] FamCA 844

FAMILY LAW – PRACTICE AND PROCEDURE – Where the third respondent seeks to be removed as a party to the proceedings – Where the de facto wife seeks a declaration that a property owned by the third respondent is being held beneficially for the de facto husband – Application dismissed – Costs reserved to the final hearing.

Family Law Act 1975 (Cth)
Family Law Rules 2004 (Cth) rr 6.04, 10.12

Bigg & Suzi (1998) FLC 92-799
Ferrall and McTaggart (trustees for Sapphire Trust) and Ors & Blyton and Ors (2000) FLC 93-054
LindonvThe Commonwealth(No. 2) (1996) 70 ALJR 514
Webster & Lampard (1993) 177 CLR 598

APPLICANT: Ms Carter

FIRST RESPONDENT: Ms Southwell

SECOND RESPONDENT: Mr Fraser

FILE NUMBER: SYC 2196 of 2014

DATE DELIVERED: 9 September 2015

PLACE DELIVERED: Sydney

PLACE HEARD: Sydney

JUDGMENT OF: McClelland J

HEARING DATE: 9 September 2015

REPRESENTATION

FOR THE APPLICANT: Ms Carter appeared in person

COUNSEL FOR THE RESPONDENT: Mr Richardson SC

SOLICITOR FOR THE RESPONDENT: Mr Hudson of Hudson Law

Orders

1. The third respondent’s application to be removed as a party to the proceedings be dismissed.

2. Leave is granted to the parties’ legal representatives to have photocopy access to the documents produced under subpoena issued to the Commonwealth Bank of Australia.

3. The applicant de facto wife’s costs be reserved.

By Consent

1. Orders and notations are made in terms of paragraphs 1 to 2 of a document titled “Minute of Order” dated 9 September 2015.

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

FAMILY COURT OF AUSTRALIA AT SYDNEY

FILE NUMBER: SYC 2194 of 2014

Ms Carter

Applicant

And

Ms Southwell

First Respondent

And

Mr Fraser

Second Respondent

EX TEMPORE REASONS FOR JUDGMENT

1. In this matter, the third respondent in the substantive proceedings, Ms Carter, has sought orders pursuant to Rule 6.04 of the Family Law Rules 2004 (Cth) (“the Rules”) to be removed as a party to these proceedings. Rule 6.04 provides that an application for such orders needs to be in accordance with rule 5.01. That Rule deals with applications in a case. However, the substance of the application by the third respondent is an application for summary orders, pursuant to rule 10.12(d) of the Rules, that the case of the de facto wife against the third respondent should be dismissed on the basis that there is no reasonable likelihood of success.

2. The orders which are sought by the de facto wife in respect to the third respondent are set out in an Amended Response filed on 5 December 2014. In that Amended Response, the de facto wife has sought declarations that the third respondent holds a property located at B Street, Suburb C (“the property”), beneficially for the applicant in the substantive proceedings.  The applicant in the substantive proceedings was the partner of the de facto wife. The de facto wife also seeks orders for the sale of the property and payment to her of an amount of $260  000 from the proceeds of that sale on the basis that she says that the applicant wrongly applied funds for the benefit of the third respondent which were used in the purchase of the property.

3. The property was purchased in late 2001 for the sum of approximately $735 000, plus stamp duty.  The third respondent has given evidence that the approximately 90 per cent of the purchase price was provided by her. Her evidence is that those funds were raised from the sale of a Suburb D property and that funds were also raised by way of the sale of a unit at E Town. She acknowledges that some additional funds, in the amount of $80 000, were contributed by the applicant. 

4. In addition to Rule 10.12 to which I have referred, the Court has inherent power to summarily dismiss or strike out proceedings.[1]  However, it is important to note that the bar for striking out proceedings is set very high.

   [1] Minister for Immigration & Indigenous Affairs v B (2004) 219 CLR 365at [68] – [69].

5. The power is confined to proceedings which disclose no reasonable cause of action.  That is, where the Court is satisfied that the application is doomed to fail, as distinct from merely being weak or unlikely to succeed.  The Full Court of the Family Court dealt with this issue in Beck.[2] That case confirms that the bar for taking that course of action is, as I have said, very high.

   [2] Beck & Beck (2004) FLC 93-181.

6. Essentially it is reserved for cases in which, I quote:

   ...it can be demonstrated that the substantive application cannot possibly succeed.[3]

   [3] Ferrall and McTaggart (trustees for Sapphire Trust) and Ors & Blyton and Ors (2000) FLC 93-054.

7. Further, in Webster & Lampard,[4] the High Court  said that:

   The power ... must be exercised with “exceptional caution” and “should never be exercised unless it is clear that there is no real question to be tried”.

   [4] (1993) 177 CLR 598.

8. In making that assessment, Mr Richardson SC who appeared on behalf of the de facto wife, has referred to the authority of Bigg & Suzi[5] and, in turn, the reference in that case to the decision of Kirby J in LindonvThe Commonwealth(No. 2).[6]  In particular, Mr Richardson has referred to the passage which states that, in order to obtain such relief – that is, that the proceedings be stuck out or discontinued:

   ...the party seeking it must show that it is clear, on the face of the opponent’s documents, that the opponent lacks a reasonable cause of action.

   [5] (1998) FLC 92-799.

   [6] (1996) 70 ALJR 514 at 544-5.

9. In this case, the reference to the opponent, for the purposes of that passage, is the de facto wife.  So in other words, in making the application for summary dismissal of the de facto wife’s application, insofar as it applies to the third respondent, the third respondent must take the de facto wife’s case at its highest.  Further, she must do so on the basis of the documents that have been filed.

10. In these proceedings, there are unquestionably complex issues of fact and law for the Court to ultimately determine at final hearing. Resolution of those issues, however, must await the final hearing because the Court is not able to deal with issues of factual controversy in these summary proceedings. 

11. The third respondent has not, in these proceedings, been able to show that the de facto wife’s application, insofar as it seeks the orders that I have referred to, against the third respondent is “doomed to fail”.  On that basis, the third respondent’s application is dismissed. 

12. In this matter, Mr Richardson for the de facto wife has sought an order for costs pursuant to section 117(2A) of the Family Law Act1975 (Cth). The costs order is sought on the basis that, firstly, the application by the third respondent has been wholly unsuccessful and, secondly, that an offer to resolve this matter – that is, the third respondent’s application – was made by letter from Swaab Attorneys dated 4 September 2015. That letter included an offer that the third respondent’s application be dismissed and that the costs of all parties be reserved until final hearing.

13. The application for costs is of substance. The only reservation that the Court has in awarding costs against the third respondent, at this stage of the proceedings, is that the Court is without evidence as to the financial circumstances of the third respondent. This is relevant to the Court’s consideration, pursuant to section 117(2A)(a). On that basis, the question of costs of today will be reserved for final hearing. Insofar as the solicitors for the de facto wife made an unsuccessful attempt to resolve this matter and, also given the nature of the relief and the potential significance for the de facto wife, I will certify that it was appropriate that they engaged senior counsel.

I certify that the preceding thirteen (13) paragraphs are a true copy of the reasons for judgment of the Honourable Justice McClelland delivered on 9 September 2015.

Associate: 

Date:  9.10.2015