DGC & SLC

[2005] FamCA 765

[2005] FamCA 765  JFDGCSLC

FAMILY LAW ACT 1975

IN THE FULL COURT OF

THE FAMILY COURT OF AUSTRALIA

AT SYDNEY

Appeal No. EA 129 of 2004
File No. SYF 4127 of 2004

IN THE MATTER OF:

DGC

Applicant/Husband

- and -

SLC

Respondent/Wife

REASONS FOR JUDGMENT

BEFORE:  Bryant CJ, Coleman & Boland JJ
DATE OF HEARING:        6^th day of May 2005
DATE OF JUDGMENT:     17^th day of August 2005

APPEARANCES:               Mr Kearney of Counsel, (instructed by Watts McCray, Solicitors, 4^th Floor, Lachlan Tower, 17-21 Macquarie Street, Parramatta NSW 2150) appeared on behalf of the applicant husband.

Mr Harding of Senior Counsel, (instructed by L C Muriniti & Associates, Solicitors, Suites 14 & 15, 8-12 Pacific Parade, Dee Why NSW 2099) appeared on behalf of the respondent wife.

Name of Appeal  DGC & SLC
Appeal Number  EA 129/2004
Date of Appeal hearing                   6^th day of May 2005
Date of Judgment  17^th day of August 2005
Coram  Bryant CJ, Coleman & Boland JJ

Catchwords:   Application for Leave to Appeal against orders dismissing applicant’s application for a stay of the proceedings in circumstances where proceedings had been commenced in Hong Kong.

Contrary to contention of applicant, trial Judge correctly applied decision of Henry v Henry (1996) 185 CLR 571 – Although refusing the stay would mean the continuation of proceedings in both jurisdictions, the proceedings in the Australian Court were not “vexatious and oppressive” – Trial Judge’s reasoning in this respect was adequate, especially in light of Voth v Manildra Flour Mills Pty Ltd (1990) 171 CLR 538 – Trial Judge did not have regard to irrelevant facts or circumstances and considered all relevant facts and circumstances – In light of these findings, trial Judge’s decision that the Family Court of Australia was not a “clearly inappropriate forum” within the ambit of a reasonable exercise of discretion.

None of the proposed grounds of appeal having substance, Leave to Appeal refused – Adam P Brown Male Fashions Pty Ltd v Philip Morris Inc (1981) 148 CLR 170 followed.

Application for Leave to Appeal dismissed
Applicant contribute to respondent’s costs

1. This is an application by the husband for Leave to Appeal against orders made by Steele J on 17 December 2004 dismissing the husband’s application filed 24 November 2004 for a stay of proceedings instituted in this Court against the husband by the wife and, if leave be granted and the appeal upheld, an order in substitution for the trial Judge’s order, staying the wife’s application to this Court filed 14 October 2004.  The wife has opposed the husband’s application. 

BACKGROUND

1. A number of matters which find expression in the trial Judge’s reasons and which are not controversial provide background to the proceedings.

2. The parties cohabited from the late 1980s, living in Hong Kong from 1989 until the parties separated in early 2002. 

3. The parties married on 14 June 1991. 

4. The major assets of the parties comprised:

   ·     a jointly owned home unit in Sydney said to have a value of about AU$500,000.00 which had been purchased in about 1987;

   ·     a home unit in Noosa Heads in the State of Queensland registered in the names of the parties as joint tenants, said to have a value of AU$1.5 - AU$2 million; and

   ·     an apartment in Hong Kong in the husband’s sole name, said to have a value of about HK$6.5 million.

The husband has a superannuation entitlement which the wife contends the husband told her to be worth between AU$1.5 - AU$2million.

1. The husband is 51 years of age, and is employed as an airline pilot with Cathay Pacific Airlines in Hong Kong.  The wife is 48 years of age, has lived in Australia since separation in early 2002 and is presently unemployed.  Both parties are Australian citizens.

2. On 15 June 2004 the husband applied to the District Court in Hong Kong for dissolution of the marriage and ancillary relief, which includes relief by way of property settlement.  Such application was served on the wife on 5 July 2004. 

3. On 8 September 2004 the wife applied in Hong Kong for a stay of the Hong Kong proceedings.  On 9 September 2004 a temporary stay order was made in Hong Kong pending the hearing of the wife’s application for a stay which was fixed for hearing on 22 December 2004. 

4. On 14 October 2004 the wife filed an application in the Family Court of Australia in Sydney for orders for settlement of property, such application being amended on 22 November 2004. 

10.  On 24 November 2004 the husband filed an application in the Family Court of Australia seeking to restrain the wife from continuing proceedings in this Court pending resolution of the proceedings in the District Court in Hong Kong. 

11.  On 16 December 2004 the wife applied unsuccessfully to adjourn the hearing of her stay application in the District Court in Hong Kong from 22 December 2004 to a later date.  The same day the wife filed an application for dissolution of marriage in the Federal Magistrates Court of Australia. 

12.  On the hearing of the husband’s application we were, by consent, provided with an “AGREED CHRONOLOGY OF HONG KONG PROCEEDINGS SINCE 17 DECEMBER 2004” from which it is apparent that on 5 January 2005 a judge of the District Court in Hong Kong dismissed the wife’s application for a stay of the Hong Kong proceedings. 

13.  On 18 January 2005 the Judge granted the wife Leave to Appeal to the Court of Appeal in relation to his order of 5 January 2005 on condition that the wife took no further steps in relation to the divorce and/or property settlement proceedings in Australia pending the outcome of the appeal.  On 27 January 2005 the Judge made a further order staying the proceedings in the District Court in Hong Kong pending the determination of the appeal from his order of 5 January 2005 to which we have referred. 

14.  On 4 February 2005 the wife’s application for dissolution of marriage which came before the Federal Magistrates Court at Sydney was adjourned to 5 May 2005. 

15.  The wife’s appeal from the orders of the Judge of the District Court in Hong Kong of 5 January 2005 refusing a stay of the Hong Kong proceedings was fixed for hearing by the Court of Appeal in Hong Kong on 27 July 2005.

THE REASONS FOR JUDGMENT OF THE TRIAL JUDGE

16.  Having recorded the matters to which we have referred the trial Judge said:

“The test to be applied in determining whether a stay of the proceedings in this Court should be made in circumstances where there are proceedings in a foreign jurisdiction relating to the same issue is that it is only in circumstances where the Local Court is a clearly inappropriate forum that a stay should be granted.” (Judgment paragraph 7)

17.  His Honour referred to the judgment of the majority (Dawson, Gaudron, McHugh and Gummow JJ) of the High Court in Henry v Henry (1996) 185 CLR 571 at 591 in relation to the question of whether the proceedings in the Australian Court are “vexatious and oppressive” and, as such, should be stayed.

18.  The trial Judge recorded, accurately it is agreed, that a judgment of the District Court in Hong Kong can be enforced in Australia and vice versa (Judgment paragraph 8). 

19.  Reference was made by his Honour to the decision of the High Court in Regie Nationale Renault v Zhang (2002) 210 CLR 491 in which the High Court at 504 quoted from its earlier conclusion in Henry v Henry (1996) 185 CLR 571:

“... the local court is a clearly inappropriate forum, which will be the case if continuation of the proceedings in that court would be oppressive, in the sense of `seriously and unfairly burdensome, prejudicial or damaging', or, vexatious, in the sense of `productive of serious and unjustified trouble and harassment'.”    

20.  Applying those statements of principal to the facts of the case before him, the trial Judge concluded that “Other than to pursue the Stay [of the Hong Kong proceedings] the Wife has taken no other active part in the proceedings in Hong Kong” (Judgment paragraph 9).  He further referred to the fact that “Of the four principal items of property, two items of real estate are in Australia and one item of real estate and the Husband’s superannuation entitlements are in Hong Kong” but then qualified the statement about the husband’s superannuation entitlements that these “may lie elsewhere, perhaps Singapore, but in any event not in Australia” (Judgment paragraph 9). 

21.  His Honour recorded, uncontroversially, that the Family Court of Australia “would have no power to make splitting Orders in relation to off shore superannuation entitlements, although of course a money order may be made” and, again it is not suggested erroneously, that “ultimately when all the values of the respective items of property are known and collated … an approach may be taken which enables the Court to do justice between the parties without making splitting Orders” (Judgment paragraph 9).

22.  Reference was made to the fact that the parties “lived together for a substantial period of time in Hong Kong” but had otherwise “each … lived the majority” of their respective lives in Australia.  Since at least April 2002 the wife has resumed living in Australia.  The husband lives in Hong Kong where he has stated an intention to continue living.  The trial Judge referred to the possible use of “a video link” for the purpose of taking evidence at trial from Hong Kong.

23.  His Honour concluded that:

“The course taken by the Wife in seeking a stay of the Hong Kong proceedings could not in my view be seen as an abuse of process where she may be seen as having embraced the jurisdiction of both Courts.  In the words of the High Court in Regie Nationale Renault v Zhang it could not be said that to allow the proceedings to continue in Australia would result in them being oppressive in the sense of seriously or unfairly burdensome, prejudicial or damaging or vexatious in the sense of being productive of serious and unjustifiable trouble and harassments to the Husband.” (Judgment paragraph 11)

24.  He thus concluded:

“I am not satisfied that this Court is a clearly inappropriate forum for the determination of the property proceedings although in so saying I am not unconscious of the undesirability of having proceedings continuing concurrently in both countries.” (Judgment paragraph 12)

25.  For the reasons he had given, the trial Judge dismissed the husband’s application for a stay of the Australian proceedings.

RELEVANT LAW

26.  The law governing this application is neither in doubt nor dispute, and was well summarised in the concession by learned counsel for the husband that:

“The Appellant accepts that whilst not determinative of the application for leave to appeal if with substance, if the Appeal sought to be pursued by the Appellant is found to have no merit then this will be determinative of the application for leave.” (Appellant’s Summary of Argument at 2)

27.  For the purpose of this application, we accept that if any of the four proposed grounds of appeal sought to be relied upon by the husband was found to have substance, the Court would grant the husband Leave to Appeal in reliance upon the decision of the High Court in Adam P Brown Male Fashions Pty Ltd v Philip Morris Inc (1981) 148 CLR 170 (to which this Court referred in Rutherford and Rutherford (1991) FLC 92-255).

PROPOSED GROUNDS OF APPEAL

28.  By his proposed Amended Notice of Appeal the husband articulated four grounds upon which his appeal would be based if leave were granted.

GROUND 1

29.  Ground 1 of the proposed Amended Notice of Appeal provided:

“That His Honour erred in failing to find that the continuation of proceedings in both Hong Kong and Australia was prima facie vexatious and oppressive.”

30.  The thrust of this challenge was that the trial Judge failed to correctly apply the decision of the High Court in Henry v Henry (1996) 185 CLR 571 at 591.  Counsel for the husband complained that the trial Judge failed to make a “prima facie finding” that refusing the husband’s application would “have the effect of permitting the continuation in both Australia and Hong Kong of proceedings in relation to the same controversy – the division of the matrimonial property of the parties consequent upon the breakdown of their marriage” (Appellant’s Summary of Argument at 3). 

31.  It was further asserted that the trial Judge failed to have regard to that likely effect notwithstanding that, in Henry v Henry at 591 the High Court had identified such consideration as “highly relevant to the question of whether the local proceedings are oppressive” (Appellant’s Summary of Argument at 3).  It was thus submitted that the trial Judge had erred in that “the consequences of the continuation of both proceedings forms no part of the Court’s determination”. 

32.  In response, learned Senior Counsel for the wife disputed that the use of the term “prima facie” by the majority in Henry v Henry was intended “to suggest that once it is established by an applicant for a stay that the applicant was the first to institute proceedings in another place concerning the same controversy, the onus shifts from the applicant to the respondent in some fashion”. Had that been the “evident intention” of the majority in the High Court that could have been stated “in explicit language” (Respondent’s Summary of Argument at 5).

33.  The trial Judge was clearly aware that the husband was the first to commence proceedings and detailed, accurately, a number of dates relevant in that context.  It is also apparent that his Honour appreciated that the likely effect of refusing a stay was the continuation of both sets of proceedings. 

34.  In Henry v Henry the majority (Dawson, Gaudron, McHugh and Gummow JJ) said at 589 “There may be cases in which the notion of prima facie right has some role in determining whether or not a stay should be granted”, particularly in a case which is “otherwise a finely balanced contest”.  Their Honours further said at 589 that there were:

“… also cases in which that notion can do little more than indicate that the onus lies on the party seeking a stay to establish that the chosen forum is clearly inappropriate. Indeed, there may be cases where the forum is so clearly inappropriate that the notion of prima facie right can have no real bearing on the matter”.      

35.  Later, at 591, their Honours said:

“It is prima facie vexatious and oppressive, in the strict sense of those terms, to commence a second or subsequent action in the courts of this country if an action is already pending with respect to the matter in issue.  And although there are cases in which it has been held that it is not prima facie vexatious, in the strict sense of that word, to bring proceedings in different countries, the problems which arise if the identical issue or the same controversy is to be litigated in different countries which have jurisdiction with respect to the matter are such, in our view, that, prima facie, the continuation of one or the other should be seen as vexatious or oppressive within the Voth sense of those words.”

36.  In a passage relied upon by learned Senior Counsel for the wife, their Honours however added at 591 that:

“It does not follow that, because one or other of the proceedings is prima facie vexatious or oppressive within the Voth sense of those words, the local proceedings should be stayed. However, it does follow that the fact that there are or, even, that there may be simultaneous proceedings in different countries with respect to the same controversy is highly relevant to the question whether the local proceedings are oppressive in the sense of ‘seriously and unfairly burdensome, prejudicial or damaging’, or, vexatious, in the sense of ‘productive of serious and unjustified trouble and harassment’. And it also follows that courts should strive, to the extent that Voth permits, to avoid that situation.”

37.  Nothing to which we have been referred establishes that the trial Judge erred in any of the respects asserted in the draft ground of appeal.  We are not persuaded that the trial Judge failed to regard as “highly relevant to the question of whether the local proceedings” were oppressive, any of the matters relied upon by counsel for the husband, including the fact that the wife had commenced proceedings in this country after, and with knowledge of the application which the husband had earlier commenced in Hong Kong.  We thus find this proposed ground lacks substance. 

GROUND 2

38.  Proposed Ground 2 provided:

“His Honour failed to give sufficient reasons for concluding that the continuation of proceedings in both Hong Kong and Australia was not productive of serious and unjustifiable trouble and harassments to the Appellant.”

39.  The focus of this challenge was that the trial Judge’s finding that:

“The course taken by the Wife in seeking a stay of the Hong Kong proceedings could not in my view be seen as an abuse of process where she may be seen as having embraced the jurisdiction of both Courts.  In the words of the High Court in Regie Nationale Renault v Zhang it could not be said that to allow the proceedings to continue in Australia would result in them being oppressive in the sense of seriously or unfairly burdensome, prejudicial or damaging or vexatious in the sense of being productive of serious and unjustifiable trouble and harassments to the Husband.”

was “unsupported by any reasons evident from the judgment”.  Reliance for that contention was placed upon decisions such as Pettitt v Dunkley (1971) 1 NSWLR 376.

40.  It was submitted that the trial Judge was obliged to find that “the continuation of the two sets of proceedings as prima facie vexatious and oppressive;” (a complaint with which we have dealt in the context of our examination of proposed ground 1) and that the Court was obliged to “determine whether the continuation of the Australian proceedings would be ‘oppressive’ or ‘vexatious’” and to have regard “to ‘the general circumstances of the case, taking into account the true nature and extent of the issues involved’ ” (Henry v Henry at 591).It was submitted that the trial Judge’s reasons failed to reveal the process by which he reached his conclusion in that regard.

41.  On behalf of the wife it was submitted by learned Senior Counsel that the trial Judge had in fact given reasons which were, in the circumstances of the case, adequate.  Learned Senior Counsel for the wife referred us to the judgment of the High Court in Voth v Manildra Flour Mills Pty Ltd (1990) 171 CLR 538 where the majority (Mason CJ, Brennan, Deane, Dawson & Gaudron JJ) said at 565 that:

“There may well be circumstances in which the primary judge may conclude that it is desirable to give detailed reasons balancing the particular weight to be given to the presence or absence of particular connecting factors and explaining why the local forum is or is not a clearly inappropriate one.” 

42.  Their Honours however added at 565:

“Ordinarily, however, it will be unnecessary for the primary judge to do more than briefly indicate that, having examined the material in evidence and having taken account of the competing written and oral submissions, he or she is of the view that the proceedings should or should not be stayed on forum non conveniens (i.e ‘clearly inappropriate forum’) grounds.”

43.  As was submitted by learned Senior Counsel the wife, save to the extent that the refusal of the stay had the potential to deny the husband such advantage as might have been gained by commencing his proceedings first, albeit without apparent warning and against a background of ongoing negotiations conducted through the parties’ solicitors, there were no additional facts or circumstances to which the trial Judge could have productively referred in the context of his determination of the application before him.

44.  As we have earlier recorded, the trial Judge clearly identified the dates and events relevant to the proceedings in this Court and in Hong Kong.  The issue was clearly finely balanced as his Honour acknowledged.  Nothing to which this Court has been specifically referred demonstrates that the trial Judge failed to adequately reveal the reasoning process which led him to conclude that the refusal of the stay was not potentially “oppressive, in the sense of ‘seriously and unfairly burdensome, prejudicial or damaging’, or, vexatious, in the sense of ‘productive of serious and unjustified trouble and harassment’ ” (Henry v Henry at 587). Given that no fact or circumstance said to be relevant to the issues before him was not identified and considered by the trial Judge, any challenge to the adequacy of his reasons, particularly in light of the judgment of the majority in Voth v Manildra Flour Mills Pty Ltd, fails.  We thus regard this proposed ground of appeal as lacking substance. 

GROUND 3

45.  Proposed ground 3 provided:

3.“That His Honour erred in failing to consider and/or place appropriate weight upon:

3.1 the order in which the respective proceedings were instituted;

3.2 the connection of the parties and the marriage to the jurisdiction of Hong Kong;

3.3 the matters to be taken into account and the issues to be determined in the Hong Kong proceedings;

3.4 the ability of the parties to participate in the proceedings in each jurisdiction, but particularly Hong Kong.”

46.  This proposed ground was essentially related to the “weight” which the trial Judge gave to a number of factors.  The obstacles which beset such a challenge are well known and do not require re-stating in the context of this application (see Gronow v Gronow (1979) 144 CLR 513 per Stephen J at 519-520). The trial Judge was clearly aware of the chronology of events in this Court and in Hong Kong, none of which was entitled in our view to decisive or particular weight in the application before him. His Honour had regard to “the connection of the marriage and the parties to Hong Kong” (Appellant’s Summary of Argument at 5), as he did to their connection with Australia. It could not in our view be successfully asserted that such factors were entitled to decisive or particular weight in favour of either party.

47.  The “issues to be determined in Hong Kong” were referred to, to the extent that the trial Judge had material enabling him to do so.  It has not been established that such factors were entitled to decisive weight in favour of either party’s case before the trial Judge. 

48.  Similar observations apply to “the ability of the parties to participate”. 

49.  The trial Judge was exercising discretion as the various decisions of the High Court to which we have been referred make clear.  It has not been established that his Honour failed to have regard to any fact or circumstance relevant to the exercise of his discretion nor that he had regard to facts or circumstances which were not relevant to such exercise of discretion. 

50.  Neither individually nor cumulatively were the factors referred to by learned counsel for the husband entitled to decisive weight.  Put simply, in our view, the decision could have gone either way without necessarily involving error on his Honour’s part.  We thus regard this proposed ground as lacking merit. 

GROUND 4

51.  The proposed ground 4 provided: -

“That the finding that the Family Court of Australia was not a ‘clearly inappropriate forum’ was a finding outside of a reasonable exercise of discretion by the Court.”

52.  It was submitted that “as a result of the errors complained of” in earlier proposed grounds, the Court’s conclusion fell “outside a reasonable exercise of discretion”.  Having rejected those proposed grounds it is unnecessary to restate our reasons in the context of this proposed ground.  It is however necessary to consider the submission on behalf of the husband that:

“In determining the same, ‘the adjectives “oppressive” and “vexatious” are not to be narrowly or rigidly construed and are to be applied in relation to the effect of the continuation of the proceedings rather than the conduct of the plaintiff in continuing them’. (Oceanic Sun Line Special Shipping Company Inc v Fay (1987 – 1988) 165 CLR 248 per Deane J).”

53.  In support of that complaint the Court was referred to the evidence before the trial Judge establishing that the proceedings in Hong Kong involved the same parties with respect to the same issue or controversy, to the chronology of proceedings in both jurisdictions, and to the fact that the proceedings in Hong Kong enabled both parties to “fully participate in the same on an equal footing”.  It was submitted that these factors combined to make an order for a stay of the Australian proceedings “compelling”.  Reliance was also placed upon the fact that “each country will recognise the other’s orders and decrees” (Appellant’s Summary of Argument at 6), the history of the parties’ involvement with Hong Kong, the costs implications of refusal of a stay and that “the evidentiary burden favours Hong Kong in terms of evidence required regarding the Appellant’s [the husband’s] health and employment” (Appellant’s Summary of Argument at 7). 

54.  The trial Judge was aware of all of the factors thus identified as a reading of his reasons for judgment makes clear.  It has not been established that his Honour misconceived any of those matters.  In what respect he is suggested to have adopted a “narrow” or “rigid” construction of the relevant “objectives” is not clear. 

55.  As we have earlier recorded, other than by concluding that to refuse to stay the Australian proceedings and thereby deprive the husband of the potential benefit of having been the first to commence proceedings, nothing to which we have been referred would render allowing the proceedings to continue in Australia:

“… oppressive in the sense of seriously or unfairly burdensome, prejudicial or damaging or vexatious in the sense of being productive of serious and unjustifiable trouble and harassments to the Husband” (Judgment paragraph 11)

The failure to have regard to that factor as having that significance does not in our view render the trial Judge’s construction of the “objectives” “narrow” or “rigid”. 

56.  In our view, it was within the ambit of a reasonable exercise of discretion for the trial Judge to refuse the stay sought by the husband on the basis that, in an otherwise finely balanced case, the fact that the husband had commenced proceedings first did not render continuation of the application instituted in this Court by the wife “oppressive” or “vexatious” in the “extended sense in which those words were used by Deane J in Oceanic Sun” (Henry v Henry at 588). We thus regard this proposed ground as lacking substance.

57.  On 4 August 2005 we were provided with a copy of the judgment of the High Court of the Hong Kong Special Administrative Region Court of Appeal dismissing the wife’s appeal against the refusal of a stay of the Hong Kong proceedings, which judgment we have read. Nothing emerging from that judgment has caused us to reconsider our conclusion with respect to the present appeal or the basis for it.

CONCLUSION

58.  No proposed ground of appeal being shown to have substance, the application for Leave to Appeal should be refused.

COSTS

59.  It was submitted on behalf of counsel for the husband that if the application were dismissed costs should be reserved.  Learned Senior Counsel for the wife sought an order for costs, quantified in the sum $3,500.00, a sum sensibly not suggested by counsel for the husband to be other than reasonable.

60.  The husband has been wholly unsuccessful with his application which, properly analysed, always involved a challenge to the exercise of a discretionary judgment.  The difficulties which beset such challenges are well known.  There is no suggestion that any aspect of the husband’s financial circumstances should disincline the Court to make an order for costs.  In our view the circumstances justify an order for costs in the wife’s favour and we will so order.

ORDERS

1. That the application for Leave to Appeal filed 15 February 2005 be dismissed.

2. That the husband pay the sum of $3,500.00 by way of contribution to the wife’s costs of and incidental to such application. 

I certify that the preceding
60  paragraphs
are a true copy of the reasons
for judgment delivered by this

Honourable Court.
A.Coleman
Associate
Date: 17/08/05