Chang & Liao & Ors (No 3)

[2009] FamCA 1116

FAMILY COURT OF AUSTRALIA

CHANG & LIAO AND ORS (NO. 3) [2009] FamCA 1116

FAMILY LAW – PROPERTY SETTLEMENT - Leave to file application out of time

APPLICANT: Ms Chang

RESPONDENT: Mr H Liao

RESPONDENT: Mr K Liao

RESPONDENT: C Pty Ltd

FILE NUMBER: SYC 1271 of 2008

DATE DELIVERED: 12 November 2009

PLACE DELIVERED: Sydney

PLACE HEARD: Sydney

JUDGMENT OF: Cohen J

HEARING DATE: 12 November 2009

REPRESENTATION

COUNSEL FOR THE APPLICANT: Mr Hodgson

SOLICITOR FOR THE APPLICANT: Yau & Wang Lawyers

COUNSEL FOR THE RESPONDENT: Ms Doust

SOLICITOR FOR THE RESPONDENT: Accentro Legal

Orders

The order I make about the wife’s appeal as to costs is:

1. Leave is granted to the Wife to file out of time an Application for Review of Orders made by Judicial Registrar Loughnan on 17 July 2009 within 14 days of the date of this order.

2. The costs of today are reserved and are adjourned until the completion of the property proceedings.

IT IS NOTED that publication of this judgment under the pseudonym Chang & Liao and Ors is approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth)

FAMILY COURT OF AUSTRALIA AT SYDNEY

FILE NUMBER: SYC 1271 of 2008

MS CHANG

Applicant

And

H LIAO

Respondent

And

K LIAO

Respondent

And

C PTY LTD

Respondent

REASONS FOR JUDGMENT  

1. In this matter I have before me two applications by the wife.  The first is an application to extend time for appeal against a final property decision by a judicial registrar.  The second is – and it is within time – an appeal against that judicial registrar’s order for costs in favour of a second and third respondent.  The costs order was a substantial one.  It was that the wife pay the respondents’ costs of the property proceedings assessed at $30,000.  The matter of the costs order really ought to be considered only after I consider whether or not to extend the time to appeal against the property order.

2. The wife’s case is really quite simple.  This is a case where there is not a great deal of money involved but the wife alleged the husband, in concert with his brother and a company that the brother controlled, had attempted to – and had in fact – disposed of or hidden part of the husband’s assets.  She sued the brother and the company as well as the husband in the property proceedings.  The judicial registrar held that both the husband and his brother could not be believed, but ultimately held that no orders ought to be made against the brother or the company, and that is why he made an order for costs in their favour.

3. In the property proceedings the wife’s case for delay is simple.  It is that by the time judicial registrar made his decision she had been liable for, and had paid, $92,500 in costs and was reeling from that obligation in view of the net assets that were disclosed of less than a million dollars.  Those net assets of less than a million dollars included a $427,000 addback that the judicial registrar imposed on the husband’s share of the assets because the husband had not explained the disappearance of that money to his satisfaction.

4. So in monetary terms there was, in fact only, about $575,000 in cash or assets of a real nature available for division.  $92,500 is a very large amount for one party to pay in costs when confronted with assets available for division in such a small amount.  The wife took other advice and ultimately felt that she could not afford to appeal because of the problems of further costs.  However, by coincidence she met counsel who appeared for in the hearing and after discussing with him and discovering that he was prepared to act for her pro bono, she decided that she could afford to appeal.  And one must remember that she had an appeal as of right.  That she had an appeal as of right rather than an appeal based upon on any error that the judicial registrar may have made in my mind makes the issue of excuse for delay slightly less of an issue.

5. But in any event in my view she had, I think, a good excuse for her delay when one thinks that her delay was not great.  Judgment was delivered on 17 July.  By 30 September she had filed her application to extend time.  There is not any evidence of any description that the husband has been harmed by her failure to appeal within time.  The husband’s counsel, who in my view diligently and skilfully argued every point that might have been available to him, submitted that the wife’s prospects of success are a relevant matter in determining whether or not the leave to appeal should be granted.

6. She said that there were few prospects of success and that any benefit that the wife might gain from the appeal would at best be marginal and would be more than eaten up by additional costs to her.  I conclude that her submission that prospects of success on an appeal are relevant to whether or not leave should be granted to extend time for appeal is correct, despite Mr Hodgson’s argument that it is not.  He said that because it was an appeal from a judicial registrar she had an absolute right to appeal and therefore the issue of prospects was irrelevant.

7. In fact I think that is incorrect because she had lost her absolute right to appeal by the effluxion of time and needed leave to appeal to extend time to appeal, and therefore prospects of success become a relevant consideration.  Unfortunately for Ms Doust’s argument, I am of the view that prospects of success favour the wife.  Having regard to the judgment of the judicial registrar I am left with quite considerable concern about his approach.  Without needing to canvass errors of law, because if there is a right – if time is extended such errors are irrelevant, I think it is appropriate to say that the judicial registrar’s approaches, in at least two aspects of the matter, leave the court with some disquiet, with the view that if such errors had not been made the result might have been considerably different in favour of the wife.

8. There is one matter in particular that I should point to.  It relates to a taxi plate.  The wife said that the husband had pretended to dispose of a taxi plate which he had not disposed of.  Originally he claimed to have disposed of it to somebody other than his brother but subsequently said it was his brother that he sold it to, despite continuing to drive the taxi.  He then said that he had received the money for the taxi plate.  The evidence is that a taxi plate was worth approximately $285,000, yet there is not material before the court indicating what happened to that $285,000.  It is not to be included in the $425,000-odd addback because that relates to an entirely different aspect of the husband’s dishonesty as found by the judicial registrar.

9. The judicial registrar seems to have ignored the disappearance of the plate or the funds received from its sale, except that he said this, at paragraph 155 of his judgment, “But for his failure to account for the proceeds of sale of the taxi plate,” and I will not bother with the number:

   “I would have found that contributions were made in the proportion of 60 per cent by the husband and 40 per cent by the wife.  Failure to make proper disclosure permits the court latitude in relation to findings of contribution.”

10. Ultimately the judicial registrar found that the husband had contributed to the extent of 50 per cent because of that latitude he granted.  He found that the contributions were equal, so in effect made an adjustment of 10 per cent for the disappearance of $270,000, which he held to be the amount involved in the failure to account for the contributions for the sale of the taxi, whereas an adjustment of 10 per cent really altered reflects an addition of extra $100,000 to the assets. 

11. In those circumstances I think the wife has a real prospect of increasing her share of the property of the parties which ought to be distributed to an extent greater than the cost that she will incur in an appeal.  There is also another aspect of the matter which concerns me, and it is that relating to that an appeal also involves the outcome of a costs application that she has made, that is the application to set aside the order for costs.  One - when faced with some of the inconsistencies in relation to the order for costs made in favour of the second and third respondent, and the findings that both the husband and the second respondent could not be believed, raises some concern.

12. If there is no right to appeal there is no justifiable method by which a fair review of the order for costs can be made.  It seems to me on the one hand to be validly arguable that because no orders were made against the second and third respondent, despite the wife’s claims that orders should be made against them, it was appropriate to order costs in their favour but in view of the second respondent’s conduct of the proceedings – conduct which was held to involve dishonesty and perjury, in effect – one wonders how such an order can be justified.

13. It seems to me that it would only be fair to allow a new mind after having come to findings on the facts, that new mind being a judge as litigants in this court are really entitled to have make findings.  Only then can justice be done between all of the parties.  It is my view that there is an ample case here in view of the lack of harm by the delay to the husband, the wife’s prospect of improving her position, her excuse for the delay which I find is reasonable, and the need to review the costs in a fairer light for all parties that the time for appeal should be extended to14 days from today, and I shall make an order accordingly.  The costs order must be reserved to the judge who ultimately hears the property proceedings.

I certify that the preceding thirteen (13) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Cohen

Associate: 

Date:  25 November 2009