Connie and Connie

[2008] FamCA 776

FAMILY COURT OF AUSTRALIA

CONNIE & CONNIE [2008] FamCA 776

FAMILY LAW – INJUNCTION – caveat and lapsing notice – the effect of consent orders for property settlement – other considerations
FAMILY LAW – COSTS – the exercise of discretion to make an order for party/party costs

Family Law Act 1975 (Cth)

Penfold v Penfold (1980) 144 CLR 311

APPLICANT: Ms Connie

RESPONDENT: Mr Connie

FILE NUMBER: SYF 8281 of 2000

DATE DELIVERED: 5 September 2008

PLACE DELIVERED: Sydney

PLACE HEARD: Sydney

JUDGMENT OF: The Hon. Justice Rose

HEARING DATE: 5 September 2008

REPRESENTATION

COUNSEL FOR THE APPLICANT: Ms McIntosh

SOLICITOR FOR THE RESPONDENT: Ms Ross-Maranik

Orders

1. That on or before 4.00pm 8 September 2008 the husband shall complete execute and cause to be delivered to the Proper Officer of the New South Wales Department of Lands an instruction and/or request for the withdrawal of his lapsing notice served on the wife on or about 21 August 2008.

2. That upon the husband complying with Order 1 he forthwith cause his solicitor to furnish to the legal representative for the wife by facsimile transmission a true copy of the letter or document evidencing his compliance with Order 1.

3. That in the event of the husband not having complied with Orders 1 and 2 the Registrar of the Court is permitted to sign complete and furnish to the legal representative for the wife the appropriate documentation referred to in Order 1 upon it being furnished to the Registrar by the solicitor for the wife with such completion and execution to be carried out by the Registrar on behalf of the husband.

4. That the husband pay the wife’s costs of and incidental to her Application in a Case filed 1 September 2008 in the sum of $2,000.00 on or before 5.00pm 3 October 2008.

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

FAMILY COURT OF AUSTRALIA AT SYDNEY

FILE NUMBER:  SYF8281 of 2000

MS CONNIE

Applicant

And

MR CONNIE

Respondent

REASONS FOR JUDGMENT

Application in a Case filed 1 September 2008

1. Application is made by the wife in these proceedings for injunctive relief pursuant to her Application in the Case filed 1 September 2008.

2. The substance of the orders sought by the wife is to require the husband to provide a document to the New South Wales Department of Lands withdrawing his lapsing notice in relation to a caveat lodged by the wife on the title to the property previously identified by the parties in the substantive proceedings as “the [E] property”.

3. On 9 July 2008, property settlement orders were made by consent (“the consent orders”) and a copy of those Orders is annexure “A” to the Affidavit of the wife sworn 29 August 2008 filed 1 September 2008.

4. In relation to the consent orders, are the following brief relevant matters.

5. The wife was required to transfer her interest in the E property to the husband on or before 11 August 2008 subject to the existing mortgage to the National Australia Bank and to vacate the E property at the time when she complied with Order 1 leaving it in good order and repair and removing four birds which were on the property.

6. Order 4 of the consent orders required the husband to pay to the wife $200,000.00 on or before 16 January 2009 and simultaneously discharge the mortgage.

7. Order 13 of the consent orders permitted the wife to lodge, a caveat over the E property pending compliance with Order 4, and that caveat to be removed by the wife at her cost upon the husband complying with Order 4.

8. Order 14 of the consent orders was an order for the sale of the E property by public auction, in the event that the husband had not complied with Order 4.

9. The wife executed a transfer and furnished it through her legal representative to the solicitor for the husband and vacated the E property in accordance with Order 1 of the consent orders.

10. The wife had completed a caveat for lodgement on the title to the property prior to her compliance with Order 1 but had also completed and furnished a letter, ostensibly in the correct form, to the New South Wales Department of Lands which gave her consent to the husband’s lodgement of the transfer to which I have referred.

11. There followed correspondence between the legal representatives for the parties.

12. By letter dated 25 July 2008, the husband’s solicitor contended that the caveat did not comply with the consent orders and requested that it be removed forthwith.  Further legal proceedings were threatened unless the caveat was removed by 4.00pm Monday 28 July 2008.

13. There followed further correspondence between the legal representatives for the parties.

14. By letter dated 25 July 2008, the wife’s legal representative gave a short history of the consent orders and their interpretation, as she saw them, and raised for response an issue as to what it was that the husband contended amounted to a non-compliance with the consent orders.

15. By letter dated 25 July 2008, the husband’s solicitor replied.  The only issue raised by him was that following an inspection by the husband of the E property, he contended that it was not in a state of good order and repair.  The husband enclosed the draft transfer to enable full compliance with Order 1.

16. At that particular point, the issue about the caveat not being as contemplated by the consent orders, appeared to be related to an unrelated issue, namely whether or not the property had been left in good order and repair.

17. There then followed correspondence between the legal representatives for the parties regarding the date and time at which the husband’s inspection of the E property took place, and the authority which he purported to exercise to be present on that property.  The correspondence also dealt with whether or not the wife had left the property in good order and repair as contemplated by the consent orders.

18. As previously mentioned, the signed transfer pursuant to Order 1 of the consent orders had been furnished to the solicitor for the husband, and that is made clear by the legal representative for the wife's letter dated 8 August 2008.

19. On the same day, correspondence was sent by the wife’s legal representative to the New South Wales Department of Lands confirming the wife’s consent to the registration of the subject transfer.

20. Subsequent correspondence also dealt with the obligation of the parties to meet mortgage instalments in relation to the E property.

21. Additional material annexed to the wife’s affidavit relates to lodgement of documents by a registration service and further correspondence in relation to the husband’s attendance at the E property.

22. By letter dated 21 August 2008, the husband’s solicitor provided service to the wife as the caveator, of the lapsing notice which had been issued by the Registrar-General which is in the usual terms.

23. There then followed further correspondence between the legal representatives for the parties which raised the contentions that each had as to the circumstances which validly or otherwise gave rise to the lapsing notice and otherwise reiterated, in a different form, issues that the parties had already canvassed in earlier correspondence.

24. An affidavit was sworn by the husband on 4 September 2008 providing a chronology of matters as contended by him.

25. Submissions were made by the solicitor agent for the husband today, in which it was contended that the form of caveat signed by the wife was defective for the various reasons outlined by her, and that the caveat ultimately registered, a copy of which is Exhibit 2, has various previously blank boxes completed, but was otherwise “fundamentally defective” because it did not state the nature of the estate or interest in the land as set forth in Schedule 1 and it prohibited amongst other things, registration of the transfer to the husband and of a plan of subdivision.

26. There was subsequently proffered for completion by the wife, a new form of caveat being Exhibit 3, which amongst other things, states that the nature of her estate or interest in the land was:

    “Payment of lump sum $200,000 to caveator and discharge of mortgage Y[…] on or before 16 January 2009 pursuant to Order 4 Family Court 9 July 2008.”

27. In addition, it reiterated the interest claimed by the wife in her earlier caveat document which was subsequently registered and is Exhibit 2, namely the consent orders.

28. I raised with the solicitor agent for the husband the legal basis for the particulars given in the first part of Schedule 1 relating to payment of the lump sum of $200,000.00 and discharge of the mortgage as to the estate or interest in land that those particulars created.

29. I was assured on some unsubstantiated basis that the description in the last-mentioned paragraph of this judgment created a caveatable interest.  No authority for that proposition was put to me.

30. My understanding of the law as applied for some decades is that the indebtedness for a lump sum, or any other amounts of money, does not create an equitable interest in land.  The orders, as opposed to the amount of money, however, can support a caveat due to a register that existed in the Registrar General’s Department as it was then known of Causes Writs and Orders.  Unfortunately, I have not been enlightened any further on that issue and to some extent, it is academic.  The objective facts are that a caveat has been registered as set out in Exhibit 2.  There is a lapsing notice and the only issue that arises is whether or not I should accede to the application of the wife for an order compelling the husband to withdraw the lapsing notice.

31. It was further submitted on behalf of the husband that this matter could be resolved by permitting the registration of a plan of subdivision and to that extent Exhibit 3 deals with that particular issue.

32. My perusal of the consent orders makes it clear that there was no qualification expressed at all in relation to the lodgement of a caveat to permit the registration of a plan of subdivision, notwithstanding whether that was an issue raised in the affidavit material of the husband in the substantive proceedings.  The evidence is that the husband has been a successful practitioner for many years.  He was also legally represented.  I am entitled to assume that if the registration of a plan of subdivision was indeed foreshadowed, in which event it, would have been obvious that consent of the wife was necessary to lodge it, given Order 13 of the consent orders which consented to her lodging a caveat.  That condition would then have been expressed in the short minutes of orders which led to the consent orders being made.  However, no such reference was made.  Indeed, the correspondence to which I have referred in some length, annexed to the affidavits before me, being correspondence from the husband’s solicitor, does not raise one word of protest or objection to the caveat in terms of it preventing a plan of subdivision being registered.

33. I provided an opportunity for further instructions to be obtained by the legal representatives for the parties to see whether this matter can be resolved in a practical, pragmatic and commonsense way.  Unfortunately, that opportunity to resolve the matter did not lead to resolution.

34. I am satisfied that the wife has complied with such of the consent orders that are relevant to the lodgement of a caveat and to enable the registration of the wife’s transfer to the husband of her interest in the E property pursuant to Order 1 of the consent orders.

35. There clearly are issues which are separate from those matters.  Those issues are whether or not the wife left the property in good order and repair as required by Order 2, and now, at the eleventh hour, a written request for the wife’s consent to lodgement of the plan of subdivision.

36. I have no evidence before me of the detail of that plan of subdivision, the steps that would be taken by the husband to have it lodged, the timing of such a proposal and perhaps also whether by taking such an action, it would either impede or enhance the possible sale of the E property in the event that Order 14 of the consent orders needs to be relied upon by the wife.  Clearly, the husband can make an application supported by an affidavit in which he seeks appropriate orders as he may be advised.  No such application is before me, let alone any evidence to support it.

37. Consequently, as I am satisfied that the wife has complied with her obligations pursuant to the consent orders for the completion, execution and submission of a transfer of her interest to the husband pursuant to Order 1 of the consent orders, and has vacated the E property and lodged the caveat as set out in Exhibit 2.  Therefore, I propose to make orders in substance as sought by her.

38. On the evidence before me, there is no valid basis for the husband having taken action to ensure the lapsing notice was issued in relation to the wife’s caveat referred to in Exhibit 2.

Oral application for costs made on behalf of the wife

1. An oral application is made on behalf of the wife for an order that the husband pay her costs on an indemnity basis of and incidental to her Application in a Case filed 1 September 2008.

2. The general principle in relation to costs in this jurisdiction is that each party bears his or her own costs in accordance with s.117(1) of the Act.  However, there is a wide discretion to make an order for costs provided in s.117(2) if it seems just or proper to do so.  That requires the finding of the circumstance that may lead to an order for costs.  The High Court held many years ago in Penfold and Penfold[1] that there is no requirement that there be a special circumstance

   [1] Penfold v Penfold (1980) 144 CLR 311

3. Consequently, the first matter that I must consider is whether or not a circumstance has been established which may justify a costs order.

4. In my view there is such a circumstance, represented by the wife’s compliance with the consent orders and the subsequent frustration of the caveat lodged by her pursuant to the consent orders by the lapsing notice ultimately issued upon the implicit request of the husband.

5. As I have already found, the basis of a subsequent dispute between the parties was related to a separate and independent issue, namely whether or not the E property had been left in good order and repair as required by the consent orders.

6. That issue had no relevance as to whether or not the wife had exercised her rights pursuant to the consent orders for lodgement of the caveat.

7. It was only yesterday that a fresh issue was raised, namely the terms of the caveat prohibiting lodgement of a plan of subdivision, there having previously been given in a timely way the written consent of the wife to registration of the transfer referred to in Order 1 of the consent orders.

8. However, the matter does not end there.  I must consider such matters that are relevant pursuant to s.117(2A).

9. There is no evidence before me of the parties being legally aided. Each of the parties in the substantive proceedings have given evidence of their respective financial circumstances.  Whilst the level of debt was substantial indeed, nonetheless there is no aspect of it that I have been requested to take into account as part and parcel of whether or not the discretion to make an order for costs should be exercised.

10. There has been considerable correspondence passing between the parties’ legal representatives in relation to the matter of the caveat and the lapsing notice, which until yesterday, in my view, had no relevance to those particular matters.  Yesterday, however, the letter which became Exhibit 4 was provided by the husband’s solicitor, setting out the basis of resolution of all remaining issues between the parties, and that is a matter that I did take into account.  There were no other matters raised by the solicitor agent for the husband.

11. I have concluded that there will be an order for costs.

12. In my view, having regard to the findings that I made, there is no merit in the husband agitating the matter of the caveat given its registration and the basis for a lapsing notice being sought as outlined in his solicitor’s correspondence, annexed to the affidavits that I have read in the proceedings.

13. As I previously emphasised on a number of occasions, the matters raised by the husband had no relevance to the question of the lodgement of the relevant caveat, but rather was relevant to an argument as to whether or not the wife had left the property in good order and repair.  The matter of lodgement of registration of plan of subdivision was never raised in the correspondence by the solicitors for the husband until yesterday, nor was it clearly a matter within contemplation, having regard to the detailed orders made by consent, the short minutes of orders of which had been signed by the parties.  In that regard, I take into account that the husband is a successful professional and legally represented by a competent solicitor and counsel.  I am entitled to infer from that background that if it had been anticipated that it was possible that a plan of subdivision might be sought to be registered, then an appropriate provision would have been inserted in the consent orders.   Unfortunately, there was no such provision.

14. Whilst I have given serious consideration to making an order for indemnity costs, I do not do so as the apparently genuine attempt to resolve this matter as a result of the letter sent yesterday, being Exhibit 4, is a matter to which I attach weight.  Because of that action, albeit belated, I consider that it is not appropriate to make an order for indemnity costs, but rather party/party costs.

15. It was submitted by counsel for the wife that on a party/party basis, the quantum would be approximately 60 percent of indemnity costs which would result in an amount of approximately $3,400.00.  That assessment was not accepted by the husband through his solicitor.  The husband’s solicitor submitted that the amount was more in the order of $1,500.00 based on her experience.  No other material has been put before me.

16. The $1,500.00 referred to by the solicitor for the husband reflected the appearance before me and the essential preparation for that appearance.  However, I consider it appropriate to take into account the work that was involved with some of the correspondence that passed between the parties and to that extent, it is just that an amount of costs on a party/party basis reflect such additional work.  Again, unfortunately, I am not aided by any reference to particular scales or what is appropriate having regard to practical experience.

17. Consequently, I am left in the position of having to make an arbitrary assessment.

18. Taking into account all of those relevant matters so far as the quantum of costs are concerned, I have concluded that the amount will be $2,000.00 and orders will be made accordingly.

I certify that the preceding fifty-six (56) paragraphs are a true copy of the reasons for judgment of the Hon. Justice Rose

Associate: 

Date:  15 September 2008