CHILD SUPPORT REGISTRAR & RANERI
[2014] FamCAFC 159
FAMILY COURT OF AUSTRALIA
| CHILD SUPPORT REGISTRAR & RANERI | [2014] FamCAFC 159 |
| FAMILY LAW – APPEAL – APPLICATION IN AN APPEAL – Where the applicant seeks an order that the appeal be dismissed for non-compliance with orders for the filing of a summary of argument – Family Law Rules 2004 (Cth) r 22.45 – Where the respondent failed to comply with the orders – Where there was no application by the respondent seeking an extension of time – Where in any event there is no utility in the appeal proceeding – Appeal dismissed. FAMILY LAW – APPEAL – APPLICATION IN AN APPEAL – COSTS – Where the respondent should pay the costs of the applicant of and incidental to the application. |
| Child Support (Registration and Collection) Act 1988 (Cth) Family Law Act 1975 (Cth) |
Family Law Rules 2004 (Cth) – r 1.08(1)(c) & (e), r 21.02, r 22.45 (1) & (2)
| Ebner v Official Trustee in Bankruptcy (2000) 205 CLR 337 Jackamarra v Krakouer (1998) 195 CLR 516 |
| APPLICANT: | Child Support Registrar |
| RESPONDENT: | Mr Raneri |
| FILE NUMBER: | SYC | 279 | of | 2011 |
| APPEAL NUMBER: | EA | 70 | of | 2013 |
| DATE DELIVERED: | 1 September 2014 |
| PLACE DELIVERED: | Sydney |
| PLACE HEARD: | Sydney |
| JUDGMENT OF: | Strickland, Ainslie-Wallace & Ryan JJ |
| HEARING DATE: | 1 May 2014 |
| LOWER COURT JURISDICTION: | Family Court of Australia |
| LOWER COURT JUDGMENT DATE: | 10 May 2013 |
| LOWER COURT MNC: | [2013] FamCA 332 |
REPRESENTATION
| SOLICITOR FOR THE APPLICANT: | Mr Markus Australian Government Solicitor |
| COUNSEL FOR THE RESPONDENT: | In person |
| SOLICITOR FOR THE RESPONDENT: | Firm R |
Orders
The appeal against the orders of Watts J made on 10 May 2013 be dismissed.
The respondent pay the applicant’s costs of and incidental to the application in an appeal filed on 28 March 2014.
IT IS NOTED that publication of this judgment by this Court under the pseudonym CSR & Raneri has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
| THE FULL COURT OF THE FAMILY COURT OF AUSTRALIA AT SYDNEY |
Appeal Number: EA 70 of 2013
File Number: SYC 279 of 2011
| Child Support Registrar |
Applicant
And
| Mr Raneri |
Respondent
REASONS FOR JUDGMENT
Introduction
The Child Support Registrar (“the Registrar”) by application in an appeal filed 28 March 2014 seeks an order that the appeal brought by Mr Raneri (“the solicitor”) against orders of Watts J made on 10 May 2013, be dismissed. The Registrar contends that the solicitor has failed to comply with a procedural order made on 11 September 2013 requiring him to file and serve his summary of argument in the appeal on or before 28 February 2014. It is further contended that in any event there is no utility in the appeal.
It is necessary to give some background to the dispute to understand the appeal.
Background
The solicitor acted for Mr Keane (“the husband”) in proceedings before the primary judge. The husband sought to set aside a child support agreement entered into in March 2004 in respect of his children with Ms Keane (“the wife”) on the basis of changes in his circumstances which had occurred since he entered into the agreement. The wife opposed the application.
The husband’s present wife, Mrs Keane, was also a party to the proceedings, asserted a constructive trust arising in her favour in relation to a property (known as the G Property) at which she and the husband resided.
In the proceedings the Registrar sought a declaration as to the amount of the arrears of child support together with penalties owed to it by the husband, and sought other consequential orders.
On 10 May 2013 his Honour dismissed the husband’s application and that of Mrs Keane, and made the declarations and orders sought by the Registrar.
The present appeal, between the solicitor and the Registrar, concerns the injunction made by his Honour on 10 May 2013 against the solicitor, and his Honour’s dismissal on that day of the solicitor’s applications that the Registrar’s application for the injunction be summarily dismissed and that
his Honour recuse himself from hearing the matter.
The proceedings between the Solicitor and the Registrar
In 2009, the solicitor and the husband entered into a Costs Agreement which contains a clause charging the husband’s property as security for the solicitor’s legal fees incurred from time to time. Relevantly, Clause 16A to that agreement is as follows:
16A Charging Clause
By entering into this agreement, the client acknowledges that in respect of any unpaid costs that the firm shall be entitled to lodge a caveat against any property, interest or title of the client which is in the client’s name and shall be entitled to maintain such a caveat on the title until such time as all of the fees and disbursements owing to the firm have been discharged. The client expressly charges the property held by the client with the payment of outstanding legal fees and expressly consents to the lodgement of a caveat by the firm at any time to secure such payment of such fees.
On 9 November 2011 the Registrar instituted enforcement proceedings in the Federal Magistrates Court (as it was then known) against the husband.
On 17 February 2012, the solicitor lodged a caveat (supported by the Costs Agreement) against the title of the G property. That caveat was then withdrawn by the solicitor on 29 June 2012 to enable a loan to be drawn down by the husband and his present wife to meet their legal costs.
On 10 July 2012 the enforcement proceedings were transferred to the Family Court of Australia and pending disposition of the same an order was made by Federal Magistrate Scarlett (as his Honour then was) restraining the husband from further encumbering the G property. The order stated:
UNTIL FURTHER ORDER, THE COURT ORDERS THAT:
…
2.The [husband] is restrained from selling, assigning, transferring, encumbering or dealing in any way with his interest in the [G Property]…. (“the real property”), without the prior written consent of the [Registrar].
3.The [husband’s] interest in the real property be charged in favour of the [Registrar] for the total debt (and the Applicant be at liberty to lodge the caveat over real estate to secure the interest created by this charge).
On 17 July 2012 the solicitor again lodged a caveat (supported by the Costs Agreement) against the title of the G property.
By an application in a case filed by the Registrar on 20 September 2012, the Registrar sought an order against the solicitor that:
1.The [solicitor] (including through his law firm, his employees and his agents) be restrained from relying on the encumbrance and charge:
1.1created by the Costs Agreement dated 21 October 2009 between the [solicitor] and [husband];
1.2against the [husband’s] interest in the [G Property]
except to the extent that the encumbrance and charge relate to legal fees arising under the above-mentioned agreement that were outstanding as at 10 July 2012 and which have not since been paid.
The solicitor opposed that application.
To repeat, on 10 May 2013 his Honour made the injunction restraining the solicitor as sought by the Registrar.
During the hearing, the solicitor made two applications. In the first, he asked that the primary judge recuse himself. This was refused. The second application sought summary dismissal of the Registrar’s application for the injunction. This too was refused.
Application that the primary judge recuse himself from further hearing the matter
The application was said to rest on remarks made by his Honour on
12 September 2012 and which his Honour described as:
124.1… I indicated a “preliminary view” that if a Federal Magistrate made an order that the father not further encumber the [G Property], then it was inappropriate for the father’s solicitor to rely upon an existing charge to do work which would have the effect of further encumbering the property and I expressed a “preliminary view” and a “concern” that the solicitor should have taken the position that he could no longer rely upon the charge to incur further fees and that some other arrangement in relation to costs should have been made between the father and the 4th respondent. I expressed a “concern” that he had not done this.
124.2… I inquired of counsel representing the father (who was calling the 4th respondent as a witness) as to whether or not he needed
[the solicitor] to be warned. Counsel for the father indicated that he did and I provided a warning to the 4th respondent. This was on the basis that there was, at least on a prima facie level, the potential for the 4th respondent to be charged with aiding and abetting the father in breaching the order made on 10 July 2012 by acting in a way that would further encumber the [G Property] after the date the order was made.After referring to the well-known authority, Ebner v Official Trustee in Bankruptcy (2000) 205 CLR 337, his Honour concluded:
126.I find that none of the matters referred to by counsel for the
4th respondent would lead a fair minded lay observer to reasonably apprehend that the Court might not bring an impartial mind to the resolution of the Registrar’s application for injunctive relief. What had been established was in the nature of a prima facie case on the facts which did not seem in dispute. The 4th respondent was to be given every opportunity to answer that case.
Application for summary dismissal of the Registrar’s application for injunction
His Honour noted at [128] that the basis for the application was, according to counsel for the solicitor, that the application was attended by procedural unfairness and irregularity. Counsel for the solicitor likened the Registrar’s application to an application for contempt or contravention and which thus required the application of r 21.02 of the Family Law Rules 2004 (Cth) (“the Rules”) such that the application must contain in considerable particularity the detail of the matters asserted.
His Honour rejected that submission, finding that the Registrar’s application was for an injunction to support its application then before the court for enforcement of a debt owed to it by the father. Further, the primary judge said, in any event, he would otherwise dispense with the Rules relating to the form of the application being pursued by the Registrar against the solicitor.
His Honour further rejected the argument that, given the seriousness of the matters alleged against the solicitor, he was entitled to “full particulars” of that which was being asserted, finding that on 12 September 2012 the Registrar had identified the particulars on which it relied to support its application for injunction.
He concluded:
133. The Registrar’s evidence, when taken at its highest, provided an arguable basis for the granting of the injunction sought. Accordingly summary dismissal is not appropriate and I find that the matter should proceed to be heard.
The primary judge’s orders
The specific orders made by his Honour on 10 May 2013 which are the subject of the appeal are as follows:
13. The 4th respondent’s oral application that I disqualify myself be dismissed.
…
15. The 4th respondent’s oral application for summary dismissal of the [The Registrar]’s Application in a Case filed 20 September 2012 be dismissed.
16. The 4th Respondent (including through his law firm, his employees and his agents) be restrained from relying on the encumbrance and charge:
16.1 created by the Costs Agreement dated 21 October 2009 between the father and the 4th respondent; and
16.2 against the father’s interests in the [G Property]
except to the extent the encumbrance and charge relate to legal fees arising under the above-mentioned agreement that were outstanding as at 10 July 2012 and which have not since been paid.
The appeal
The amended Notice of Appeal filed on 14 October 2013 raises 6 grounds of challenge to those orders. It is useful to set them out in full:
1. His Honour failed to give proper reasons for his determination to dismiss the application to disqualify himself from hearing the Child Support Registrar’s application dated 12 (sic) September 2012
(“the application”).2. His Honour erred in law in failing to disqualify himself from hearing the application.
3. His Honour erred in failing to give proper reasons as to his determination to dismiss the summary dismissal application made on 1 March 2013.
4. His Honour erred in law in the application of Section 114(3) of the Family Law Act and/or in the alternative Section 34 of the Family Law Act to grant the relief sought by the Child Support Registrar.
5. His Honour erred contrary to the evidence that [the solicitor] was aware of the order of Federal Magistrate Scarlett made on the 10th July 2012 on or before the 17th July 2012.
6. His Honour erred contrary to the evidence in finding that some of the monies received by the Applicant and the 3rd Respondent on or about the 12th July 2012 were paid to [the solicitor].
The orders sought by the solicitor in the amended Notice of Appeal are:
1. That the order made by Watt J. (sic) to dismiss the disqualification application be set aside.
2. That Watt J. (sic) be disqualified from hearing the application by the Child Support Registrar dated 20th September 2012 (“the application”)
3. That the application be remitted for hearing before a Judge other than Watt J. (sic)
4. Alternatively that the application by the Child Support Registrar made on 20th September 2012 be dismissed
5. A declaration that the Appellant’s charge (created pursuant to the Appellant’s costs agreement dated 21 October 2009) over the husband’s interest in the [G Property], extends to all of the costs rendered by the Appellant to the Husband in the proceedings in priority to any claim on the property by any party to the proceedings.
The Registrar’s application in an appeal
The Registrar’s application in an appeal relies on r 22.45 of the Rules in seeking an order that the solicitor’s appeal be dismissed.
Rule 22.45(1) and (2) relevantly provides as follows:
(1) This rule applies if:
(a) the appeal is not taken to have been abandoned; and
(b) a party (the defaulting party ) has not:
(i)met a requirement under these Rules or the Regulations;
(ii)complied with an order in relation to the appeal (including an application for leave to appeal or application in relation to an appeal); or
(iii)shown reasonable diligence in proceeding with an appeal or application.
(2) A court having jurisdiction in the appeal or application may:
(a) if the defaulting party is the appellant or the applicant:
(i) dismiss the appeal or application;
…..
In the alternative, the application of the Registrar sought that further procedural orders be made providing for the solicitor to file his written summary of argument and list of authorities, and if he fails to comply, then the appeal be dismissed. However, it was explained to us by the solicitor for the Registrar that this order is sought only in the event that the primary application is unsuccessful.
In support of the application, the solicitor for the Registrar relied on a number of affidavits. It is unnecessary to traverse them at length, however it is apposite to observe that on 28 February 2014, by which time the solicitor’s summary of argument was to have been filed pursuant to the order made on 11 September 2013, the solicitor for the Registrar sent an email to the solicitor enquiring when it would be filed. No response was received. A second letter was sent to the solicitor on 13 March 2014 again observing that the summary had not been filed and noting that if it was not received by 18 March 2014, the matter would be brought back to court. Still no response was received from the solicitor.
On 31 March 2014 (after the application to dismiss had been filed and served), the solicitor for the Registrar received the first communication from the solicitor. It was both insulting and preposterous. It read:
It appears your overzealous approach to the Appeal is causing unnecessary costs.
We are currently awaiting the decision of His Honour Justice Watt (sic). The terms of that decision may substantially alter the nature of the Appeal.
In those circumstances as indicated to you at the Family Court, it is premature at this particular point in time to attend to the expensive task of preparing submissions in circumstances where His Honour’s decision may in fact make the entire Appeal otiose…
It is important that we observe here that the solicitor filed no application seeking an extension of time in which to file his summary of argument, nor did he file an affidavit setting out what was the nature of the decision on which he was waiting and why he said it “may substantially alter the nature of the Appeal”. Indeed, the solicitor did not file any material in response to the Registrar’s application.
Further, we note that by email dated 3 April 2014 the solicitor for the Registrar responded to the letter of 31 March 2014 pointing out first that the solicitor had “failed to articulate the basis upon which the matter reserved before Watts J ‘may in fact make the entire appeal otiose’”, and secondly indicating that the Registrar would not seek an order for costs if the solicitor then consented to an order for an extension of time to file his summary of argument. There was no response to this email by the solicitor.
It must of course be remembered that the solicitor is a legal practitioner and an officer of the court. Despite that, in summary, he failed to respond at all to email correspondence from the Registrar, he made what we have described as “insulting and preposterous” claims in his eventual email of 31 March 2013, he failed to make an application for an extension of time supported by an affidavit setting out his reasons for failing to comply with orders of the court, and his explanation for not doing so was because he considered the onus was on the applicant to bring the matter back to court, rather than he, the party in breach of the order. In short, and expressing it as generously as we can, the solicitor’s conduct leaves a lot to be desired.
Before us the solicitor argued that, in proceedings that followed those determined by his Honour on 10 May 2013, he made another application to the primary judge that he disqualify himself from continuing to hear the matter. He said that if his Honour acceded to that request and “declared himself to be biased” then that declaration would undermine the integrity of his Honour’s earlier, May 2013 decision.
For greater clarification, and from a perusal of the first instance file, it seems that on 13 June 2013, consequent upon his Honour’s final orders of 10 May 2013, the wife filed an application seeking an order that the husband pay her costs on an indemnity basis. The husband responded to that application on
11 October 2013 seeking that her application be dismissed or, in the alternative, that the solicitor be ordered to pay the wife’s costs.
On 28 November 2013 the solicitor filed an application in a case seeking the following orders:
1. That His Honour Watt J (sic) disqualify himself from further hearing any application in which the 4th respondent is a party.
2. Alternatively, that the further hearing of the application by the respondent/father on (sic) filed 11 October 2013 in respect of the
4th Respondent, be adjourned to a date after the determination of the Appeal in proceedings No EA 70/2013.On 17 April 2014, his Honour refused the solicitor’s application of
28 November 2013 that he disqualify himself.
We are not persuaded that the solicitor had any more chance of success in his application of 28 November 2013 than in his oral application heard and dismissed by his Honour on 10 May 2013, and which dismissal was the subject of the appeal. Moreover, his application of 28 November 2013 was in separate proceedings, and we do not accept that there was any prospect that the determination of that application would affect the earlier orders in the other proceedings such that it “would undermine the integrity of the appeal”.
The utility of the appeal
For the Registrar it was argued that the property against which the solicitor’s charge was lodged, having been sold, meant that there was no utility in the appeal proceeding; any priority claimed by the solicitor arising by virtue of his charge over the property had come to an end.
The solicitor for the Registrar informed the court that the Registrar consented to the sale of the G property (the subject of the solicitor’s charge) and from the proceeds, the debt of the husband to the Registrar was discharged. The solicitor received some $25,000 being fees incurred by him prior to the making of the injunction on 10 July 2012 and it seems that the balance of the proceeds of the sale of that property is held in trust pending the determination of the appeal.
The solicitor argued that there was utility in the appeal because the effect of a successful appeal would be that the Registrar would have to pay any funds it received from the sale of the property to him because it had received those funds in priority to the solicitor.
We do not understand this argument. It assumes that the declaration of the debt owed to the Registrar by the husband and the orders requiring it to be paid to the Registrar from the proceeds of the sale of the property created a priority in the Registrar over the solicitor. The issue of whether the declaration would create a preference in the Registrar was considered by his Honour and rejected in the proceedings brought by the husband. No appeal was brought against that finding and his Honour’s orders in this regard. The orders have been complied with and the Registrar’s declared debt satisfied through the sale of the property.
The solicitor further argued that so much of the appeal as related to his application for summary dismissal should proceed because he contends that his Honour was wrong in law in refusing to accept the solicitor’s interpretation of the 10 July 2012 injunction as only affecting new encumbrances on the title of the G property but had no effect on any further debt being incurred on the existing charge. Whether or not his Honour was wrong in law in determining that issue as he did, we repeat that the property has been sold and the proceeds partially distributed.
Accordingly there is considerable force in the argument of the Registrar that there is no practical utility in the appeal proceeding and that to allow it to proceed would be an exercise in futility. However, the issue before us was the failure of the solicitor to comply with the orders of the Appeal Registrar.
The failure to comply with orders
The solicitor did not comply with the orders of the Appeal Registrar and nor did he seek any extension of time to enable him to comply. His stance was entirely at odds with the responsibilities and obligations imposed on parties by r 1.08(1)(c) and (e) of the Rules. He gave no adequate reason why he did not comply.
During the argument on the Registrar’s application, the solicitor in effect sought an extension of time in which to file his summary of argument in compliance with the orders and, if he was granted that extension and a new timetable for preparation of the appeal ordered, he would consent to an order that he pay the Registrar’s costs of the application.
Given his dilatory conduct in the past and his apparent lack of concern to comply with orders of the court as evinced by his response to the measured and timely correspondence from the Registrar, we have no confidence that he would comply with any further orders made.
In the High Court decision of Jackamarra v Krakouer (1998) 195 CLR 516, Gummow and Hayne JJ said at [33]:
... [w]hen an appellant has instituted an appeal within time, if all other things are equal, the bare fact that the appellant has failed to take some interlocutory step within the time fixed by the rules would not be reason enough to shut that appellant out from the pursuit of the appeal unless it were clear that the appeal would fail. Of course, the qualification “if all other things are equal” is very important and it should not be permitted to obscure the fact that very often the fact that an appeal is pending may itself affect the respondent adversely in some way.
…
As we have sought to explain all other things are not equal.
We will thus dismiss the solicitor’s appeal.
Costs
This is a matter in which the solicitor should pay the Registrar’s costs of and incidental to the application.
As to the costs of the appeal, if any, these can be dealt with in accordance with the Rules.
I certify that the preceding fifty two (52) paragraphs are a true copy of the reasons for judgment of the Honourable Full Court (Strickland, Ainslie-Wallace & Ryan JJ) delivered on 1 September 2014.
Associate:
Date: 1 September 2014
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