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Chan v Acres

Chan v Acres

Case [2013] NSWSC 1597 1 November 2013

Fraud on Creditors

Miscarriage of Justice

Disclosure Obligations

Family Law

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Supreme Court

New South Wales

Amendment notes

Medium Neutral Citation: Rebecca Chan and Anor v Robert Acres and Anor [2013] NSWSC 1597
Hearing dates: 16 & 17 October 2013
Decision date: 01 November 2013
Jurisdiction: Equity Division
Before: Kunc J
Decision:
Amended statement of claim dismissed

Catchwords: FAMILY LAW - Whether transfer of property pursuant to Family Court consent orders liable to be set aside as fraud on creditors - Conveyancing Act 1919 (NSW), s37A
FAMILY LAW - Defendants did not disclose to Family Court existence of plaintiffs' claim against first defendant - Whether there was a miscarriage of justice - Family Law Act 1975 (Cth), ss79(10), 79A(1)
Legislation Cited: Conveyancing Act 1919 (NSW)
Evidence Act 1995 (NSW)
Family Law Act 1975 (Cth)
Family Law Rules 2004
Home Building Act 1989 (NSW)
Cases Cited: Attard v James Legal Pty Ltd [2010] NSWCA 311; (2011) 80 ACSR 585
Barker v Barker [2007] FamCA 13
Cannane v J Cannane Pty Ltd (in liq) [1998] HCA 26; (1998) 192 CLR 557
Cardile v LED Builders Pty Limited [1999] HCA 18; (1999) 198 CLR 380
Green v Schneller [2002] NSWSC 671; (2002) 29 FamLR 346; (2002) 11 BPR 20,935
In the marriage of MJ Bailey and the Estate of HR Bailey (1989) 13 FamLR 652
Kang v Kwan [2002] NSWSC 1187; (2002) 11 BPR 20,623
Marcolongo v Chen [2011] HCA 3; (2011) 242 CLR 546
Molier v Van Wyk (1980) 7 FamLR 18
Category: Principal judgment
Parties: Rebecca Chan (Plaintiff)
Warren Cox (Second Plaintiff)
Robert Acres (First Defendant)
Janet Elaine Acres (Second Defendant)
Representation: Counsel: Mr D.P.M. Ash (Plaintiffs)
Mr B. Ilkovski (1st Defendant)
Mr. M.A. Ashhurst SC and Ms. A.B. Petrie (2nd Defendant)
Solicitors: Snelgroves (Plaintiffs)
Atkinson Vinden Lawyers (First Defendant)
Blackman Legal Pty Ltd (Second Defendant)

File Number(s): 2013/00168213
Publication restriction: No

Judgment

Summary

The issue in these proceedings is whether a family law property settlement made between the defendants ("Mr and Mrs Acres") should be set aside as a fraud on creditors under s 37A of the Conveyancing Act 1919 (NSW) (the "CA") or set aside or varied under s 79A of the Family Law Act 1975 (Cth) (the "FLA").

Mr and Mrs Acres commenced living together in a de facto relationship in 1987. In 1988 Mr Acres was retrenched from his employment and has not worked full time since then. Mr and Mrs Acres married in 1989. Mrs Acres, a successful businesswoman, was the principal breadwinner throughout their marriage.

In November 2007 Mr and Mrs Acres bought a house in Wahroonga (the "Wahroonga Property") with the intention of renovating it. Mr Acres became the owner-builder for the purposes of the Home Building Act 1989 (NSW) (the "HBA"). Having completed the renovations, the Wahroonga Property was sold to the plaintiffs in May 2010. Within a month the plaintiffs began complaining to Mr Acres about alleged defects in the Wahroonga Property. Those complaints culminated on 14 February 2012…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Chan v Acres

Details

AGLC: Chan v Acres [2013] NSWSC 1597
Case: [2013] NSWSC 1597
Decision Date: 01 November 2013

CaseChat Overview and Summary

The case of Chan v Acres involved the plaintiffs, Chan and his wife, suing the defendants, Acres and his wife, over the transfer of a property. The plaintiffs sought to set aside the transfer of the property on the grounds that it constituted fraud on their creditors. This application was predicated on the provisions of the Conveyancing Act 1919 (NSW), specifically section 37A, which allows for the setting aside of transactions if they were entered into with the intention to defraud creditors. Additionally, the plaintiffs argued that the defendants had not disclosed the existence of the plaintiffs' claim against the first defendant to the Family Court, which led to a perceived miscarriage of justice. The Family Court was tasked with determining whether the transfer of the property could be set aside and if the failure to disclose the claim amounted to a miscarriage of justice under the Family Law Act 1975 (Cth), sections 79(10) and 79A(1).

The court had to assess whether the transfer of the property could be considered fraudulent under section 37A of the Conveyancing Act 1919 (NSW). It was necessary to examine the intention behind the transfer and whether it was intended to defraud the plaintiffs' creditors. Furthermore, the court needed to determine if the defendants' failure to disclose the plaintiffs' claim against the first defendant to the Family Court constituted a miscarriage of justice. This involved interpreting the relevant provisions of the Family Law Act 1975 (Cth) and evaluating the impact of this non-disclosure on the fairness of the proceedings. The court was also required to consider the implications of any potential miscarriage of justice on the outcome of the case.

The court concluded that the transfer of the property could not be set aside as fraud on creditors, as there was insufficient evidence to establish that the transfer was made with the requisite fraudulent intent. Regarding the failure to disclose the plaintiffs' claim against the first defendant, the court found that this did not amount to a miscarriage of justice. The court determined that the absence of disclosure did not affect the fairness of the proceedings or the outcome of the case. Consequently, the plaintiffs' application to set aside the property transfer and to seek a declaration of a miscarriage of justice was dismissed. The court's decision was grounded in the lack of evidence supporting the allegations of fraud and the limited impact of the non-disclosure on the proceedings.

Orders