Debono and Debono (No. 2)

[2013] FamCA 797

FAMILY COURT OF AUSTRALIA

DEBONO & DEBONO (NO. 2) [2013] FamCA 797

FAMILY LAW – ORDERS - Interim application – wife apparently incorrectly removed from ASIC records as a director which precluded her from exercising her role under orders of the Court to sell a property – Section 106B order made to rectify position.

Family Law Act 1975 (Cth)

APPLICANT: Ms Debono

RESPONDENT: Mr Debono

FILE NUMBER: MLC 7072 of 2011

DATE DELIVERED: 3 October 2013

PLACE DELIVERED: Melbourne

PLACE HEARD: Melbourne

JUDGMENT OF: Cronin J

HEARING DATE: 3 October 2013

REPRESENTATION

COUNSEL FOR THE APPLICANT: Mr Baker

SOLICITOR FOR THE APPLICANT: Westminster Lawyers

COUNSEL FOR THE RESPONDENT: Mr Davis

SOLICITOR FOR THE RESPONDENT: George Liberogiannis

Orders

1. That all outstanding applications are adjourned to 9.00am on 30 October 2013.

2. That the costs of both parties of this day are reserved.

3. That pursuant to s 106B of the Family Law Act 1975 (Cth), the instrument by which the husband advised the Australian Securities and Investments Commission that the wife had resigned as a director of D Pty Ltd is set aside and the wife is at liberty to advise the ASIC that she remains a director of D Pty Ltd.

4. That the reasons for judgment this day be transcribed.

IT IS NOTED that publication of this judgment by this Court under the pseudonym Debono & Debono (No. 2) 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 MELBOURNE

FILE NUMBER: MLC 7072 of 2011

Ms Debono

Applicant

And

Mr Debono

Respondent

REASONS FOR JUDGMENT

1. This application came into the duty list – it was filed on 20 September.  There is a rather odd argument between the legal practitioners as to whether or not the lawyer was acting or not acting but this morning, I have had the benefit of counsel for both parties.  I do not intend to deal with who was right and who was wrong. 

2. What is abundantly clear from this application is that Young J, on 21 December 2012, made a variety of orders and, although it was said before that D Pty Ltd, a company, was not a party to the proceedings, I indeed note that it was and therefore specific orders probably could have been made against the company.  That is not the path that his Honour followed. 

3. The evidence, which is at this stage untested and without a response from the husband, suggests that something happened within days of His Honour’s order being made which had the effect of removing the wife from D Pty Ltd in the sense of her directorship.  There is another argument by the wife that her shareholding was transferred but it seems to me, for the purposes of this exercise, that it does not matter.  What is critical is whether or not she is a director and, therefore, can now and in the future speak on behalf of the company. 

4. Whether she can speak for the company as a sole director is a dispute that can be had on another day and I am very conscious that directors of companies do not have the right unilaterally to speak for the corporation.  In any event, what is clear is that His Honour made an order that forthwith the property at Suburb Q be sold.  Ten months later, that has not occurred.  The wife’s complaint today is that by virtue of her removal as a director which she does not accept was possible, the property is not being sold. 

5. If, indeed, the husband did sign a document to ASIC on 3 January 2013 indicating that the wife had resigned as a director whilst the wife says she has not, then the document lodged with ASIC was quite wrong.  That is a matter that needs to be fleshed out when the husband has had an opportunity to have his say. 

6. The application today seeks a variety of orders but one of them is an order under s 106B of the Family Law Act 1975 (Cth) (“the Act”) that the husband do all such acts and things and sign all such documents as may be required to “withdraw” the document lodged removing the wife as a director. I am not entirely sure that ASIC would be happy about the withdrawal of the form but would most likely rather have a new one, indicating that the wife is a director of the company, D Pty Ltd. Section 106B of the Act sets out that the Court can set aside or restrain the making of an instrument or disposition by or on behalf of, or by direction or interest, of a party, which is made or proposed to be made to defeat an existing or anticipated order in those proceedings or which, irrespective of intention, is likely to defeat any such order.

7. Even on the evidence that I have read and the submissions that I have heard, it seems that whatever the husband did in January had the effect of precluding the wife from fulfilling her obligations to sell Suburb Q through D Pty Ltd in its capacity. On that basis, I propose to make an order under s 106B to set aside the transaction between the husband and D Pty Ltd and also ASIC, and direct that the husband sign an appropriate form indicating that the wife until further order is a director of the company. I will have these reasons transcribed.

I certify that the preceding seven (7) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Cronin delivered on 3 October 2013.

Associate: 

Date:  16 October 2013