Duarte and Morse

[2018] FamCA 449

FAMILY COURT OF AUSTRALIA

DUARTE AND MORSE [2018] FamCA 449

FAMILY LAW – PRACTICE AND PROCEDURE – STAY – Application for Stay – Where there is an Appeal made – Where the completion of the orders will render the Appeal nugatory – Whether the Appeal has a reasonable chance of success – Prejudice to the Respondent.

Aldridge & Keaton 2009 FamCAFC 106

Family Law Act 1975 (Cth)

APPLICANT: Ms Duarte

RESPONDENT: Mr Morse

FILE NUMBER: SYC 737 of 2014

DATE DELIVERED: 14 February 2018

PLACE DELIVERED: Sydney

PLACE HEARD: Sydney

JUDGMENT OF: Le Poer Trench J

HEARING DATE: 8 February 2018

REPRESENTATION

COUNSEL FOR THE APPLICANT: Self

COUNSEL FOR THE RESPONDENT: Mr Othen

SOLICITOR FOR THE RESPONDENT: Slater Gordon Lawyers

Orders

1. Order 31 made by the court on 1 December 2017 is stayed pending the determination of the Appeal filed by the applicant wife on 28 December 2017 or until further order of the court subject to the following conditions:-

   (a)The stay order will lapse/cease forthwith upon subject appeal being taken to have been abandoned as a result of the failure of the applicant to comply with any provisions of Chapter 22 of the Family Law Rules or any direction of the Appeals Registrar or a Judge/Judges of the Appeal Division of the court.

   (b)The applicant is to do all that is necessary on her part to ensure the appeal filed by her is and remains in readiness for a hearing as soon as that can be scheduled by the Appeal Division of the court.

   (c)The stay order will lapse/cease forthwith upon a dismissal of the appeal filed by the applicant.

2. The respondent has leave to apply to the court to discharge this stay order at any time prior to the determination of the appeal filed by the applicant should he contend that circumstances warrant such action by the court.

3. The applicant is to pay the costs of the respondent incurred in relation to the stay application. Such costs fixed at $5,750. Payment is to be made from the applicant’s entitlement to any funds payable to her from the sale proceeds of the property described as the Suburb C property in the orders made 1 December 2017, or from such other source as the court may order in the event that the orders of 1 December 2017 are disturbed, varied, or set aside by the appeal division of the court at the determination of the appeal filed by the applicant.

Note: The form of the order is subject to the entry of the order in the Court’s records.

IT IS NOTED that publication of this judgment by this Court under the pseudonym Duarte & Morse has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).

Note: This copy of the Court’s Reasons for Judgment may be subject to review to remedy minor typographical or grammatical errors (r 17.02A(b) of the Family Law Rules 2004 (Cth)), or to record a variation to the order pursuant to r 17.02 Family Law Rules 2004 (Cth).

FAMILY COURT OF AUSTRALIA AT  SYDNEY

FILE NUMBER: SYC737/2014

Ms Duarte

Applicant

And

Mr Morse

Respondent

REASONS FOR JUDGMENT

Introduction

1. Before the Court is an application filed by Ms Duarte (the applicant) on 9 January 2018. The application seeks a stay of orders made by me on 1 December 2017. The application is totally opposed by Mr Morse (the respondent). The respondent also seeks a cost order in relation to the application.

BACKGROUND

1. The orders made on 1 December 2017 brought to an end, at first instance, the parenting, property, and cross-vested proceedings between the applicant and respondent, and also the applicant’s partner Mr Tolman. The final hearing in the matter had been conducted over 12 hearing days between 26 June 2017 and 3 August that year. The issues determined by the orders made 1 December 2017 were legally and factually complex.

2. The applicant appeared for herself in the trial and she continues to do so now.

3. The parenting orders made 1 December 2017 placed the children of the applicant and respondent under the sole parental responsibility of the respondent, with the applicant being restricted to strictly supervised and restricted time with the children. The orders were the antithesis of the parenting orders the applicant had sought in the trial. She sought the court make no parenting orders.

4. The focus of this application for a stay is upon orders 28 and 31 of the 1 December 2017 orders. Those two orders are property orders and provide for the applicant to make a payment of $523,455 to the respondent by 26 February 2018 and should she fail to do so then order 31 requires the Suburb C property (described in the orders) to be sold. The proceeds of sale of the property are required to be distributed as to 49.8 per dent to the respondent.

5. The applicant, if successful on her appeal, seeks either a discharge of all orders made on 1 December 2017 (thus leaving the situation where there would be no operative parenting or property orders) or alternatively that the orders be set aside and a re-hearing ordered. Consequently, and understandably, the applicant desires the sale order (31) be stayed until the appeal is determined.

6. The applicant filed with her application in a case, an affidavit sworn by her. In that she states she does not have cash available to make a payment of any significant amount to the respondent.

7. The affidavit filed by the applicant in support of the stay annexes a copy of the Notice of Appeal filed by her on 28 December 2017. The grounds detail submitted error by me as trial judge and are 59 in total. Portions of the affidavit filed by the applicant provide further information/submission to support the grounds specified in the Notice of Appeal.

8. The applicant has helpfully provided a written submission to support her application.

9. The respondent filed no affidavit evidence however he did file in court, with my leave, a Response to the Application in a Case filed by the applicant. He opposes each order the applicant seeks and he asks for his costs of the application to be paid by the applicant.

The submissions

1. Both the applicant and the respondent relied upon the same body of law to address their submissions. That body of law can be conveniently seen in the Full Court decision in Aldridge & Keaton 2009 FamCAFC 106 at paragraph 2 per Bryant CJ, Boland & Crisford JJ, where the following is stated:

   The principles to be applied in determining an application for a stay of orders both in the general law and in respect of parenting proceedings are also well known (see The Commissioner of Taxation of the Commonwealth of Australia v Myer Emporium Limited [No.1] (1986) 160 CLR 220 at 222; Alexander v Cambridge Credit Corporation (1985) 2 NSW LR 685; Jennings Construction Limited v Burgundy Royale Investments Pty Limited (1986) 161 CLR 681; Clemett & Clemett (1981) FLC 91-013; JRN & KEN v IEG & BLG (1998) 72 ALJR 1329 at 1332). The authorities stress the discretionary nature of the application which should be determined on its merits. Principles relevant to this matter include the following:

   ·    the onus to establish a proper basis for the stay is on the applicant for the stay.  However it is not necessary for the applicant to demonstrate any “special” or “exceptional” circumstances;

   ·    a person who has obtained a judgment is entitled to the benefit of that judgment;

   ·    a person who has obtained a judgment is entitled to presume the judgment is correct;

   ·    the mere filing of an appeal is insufficient to grant a stay;

   ·    the bona fides of the applicant;

   ·    a stay may be granted on terms that are fair to all parties - this may involve a court weighing the balance of convenience and the competing rights of the parties;

   ·    a weighing of the risk that an appeal may be rendered nugatory if a stay is  not granted – this will be a substantial factor in determining whether it will be appropriate to grant a stay;

   ·    some preliminary assessment of the strength of the proposed appeal – whether the appellant has an arguable case;

   ·    the desirability of limiting the frequency of any change in a child’s living arrangements;

   ·    the period of time in which the appeal can be heard and whether existing satisfactory arrangements may support the granting of the stay for a short period of time; and

   ·    the best interests of the child the subject of the proceedings are a significant consideration.

2. The applicant addressed the matters specified to be considered in the decision of Aldridge and in particular emphasised the importance in this case of the court “weighing the risk that an appeal may be rendered nugatory if a stay is not granted”. She says a reasonable and considered review of the grounds of appeal identified by her and supported with the further information contained in her affidavit must give rise to the conclusion she has satisfied the court she has “an arguable case” to put before the Full Court.

3. If a stay of order 31 is not granted by the court then it appears inevitable that the Suburb C property will be sold and the proceeds applied as the orders of 1 December 2017 require. The applicant says that will render her property appeal nugatory as she is seeking an outcome, if successful, which would see her retain that property with her partner Mr Tolman as a co-owner.

Some preliminary assessment of the strength of the proposed appeal

Does the applicant have an arguable case?

1. The respondent addressed the grounds of appeal in oral submissions. The submission on each ground was predominantly “the ground has no merit”. However, no detailed submission explaining why that was so was provided. I consider it would not have been appropriate for the respondent to give detailed submissions on each ground, however, it may have been of assistance if the respondent was able to identify some grounds which could be properly described as “legal nonsense” and point out why that description would be apt.

2. The applicant is a highly intelligent litigant who not only has attained high academic qualification, she is also now undertaking a professional degree. In the hearing before me and in the formulation of the grounds of appeal, the applicant has framed challenges to traditionally held approaches to the application of the Family Law Act to the subject matter of her litigation. Such challenges are often novel and testing in that same require consideration of aspects of law which are not otherwise experienced by the court in the ordinary course of conducting its business.

3. A number of the grounds of appeal challenge the Court’s jurisdiction and/or power to have determined some of the issues of fact and/or grant some aspect of outcome to the parties which was seen in the judgment dated 1 December 2017.  As such, it must be recognised that if any such complaint found a receptor in the Full Court then the result would see the setting aside of the orders made or some part thereof.

4. Once the Court determines lack of jurisdiction or power vested in the Court to consider some aspect of dispute between parties, there is really only one outcome available. The appellant would necessarily be seen to have a case requiring attention and other order of the court.

5. I have looked at and considered each of the grounds of appeal upon which the applicant relies. It is my view that many of the grounds have no reasonable basis nor prospect of success. However, without at all meaning to be disrespectful, I do accept that the majority of the Full Court may well consider otherwise.

6. Neither party had made enquiry of the Appeal Registrar as to the delay which might occasion the Full Court hearing the applicant’s appeal. I caused such enquiry to be made, and the court has been informed that a hearing should be expected in about August or September of this year.  

Prejudice to the Respondent

1. The respondent argues that he suffers prejudice in the following manner should a stay of order 31 be granted.

2. It is submitted that he has the benefit of the Court’s judgment. He has an entitlement to the “fruits of his litigation”. He further says that he has been denied an opportunity to acquire a property for both he and the children to reside in since the separation in 2013.

3. The respondent submits that he not only has to await the hearing of the appeal, he has the additional expected delay involved in the court being able to publish its reasons. It is submitted that it could reasonably be predicted that might be some months.

Conclusion

1. Having considered the grounds of appeal I consider the applicant’s prospects of success are not good. However, I accept that conclusion may well be seen through the coloured lens of a mistake already made by me in the judgement/order appealed against. I do not conclude the applicant has no prospect of success.

2. The aspect of this case which I consider draws the greatest consideration is the fact that unless the stay is granted the appeal will become nugatory in relation to the property matters. It is my view that the prejudice to the respondent is outweighed by the prejudice to the applicant and as such it is appropriate for the stay to be granted upon conditions.

3. It is a voiced concern of the respondent that, based upon the applicant’s past behaviour, it is highly likely she will delay the hearing of the appeal by her failure to prepare her appeal for hearing in a timely manner and as required by Chapter 22 of the Family Law Rules. The respondent pointed to the failure of the applicant to comply with the courts directions requiring her to file her evidence for the trial. That is a reasonable concern on his part and therefore it is appropriate to set conditions for the continuation of the stay order to the point where orders are made by the Full Court following the hearing of the appeal.

Costs

1. The respondent seeks the court order the applicant to pay his costs of the stay application. The applicant opposes the court hearing that application, as she said she needed time to prepare her argument against the making of such order.

2. I propose to consider the respondent’s costs application as I consider the matter is well able to be argued by the applicant at this time and the parties’ attendances at court limited as much as reasonably possible.

3. The respondent’s case is simply stated.

   ·Section 117 of the Act is to be considered.

   ·The applicant in effect seeks an indulgence when she seeks a stay of the court order pending the hearing of her appeal.

   ·It was reasonable for the respondent to oppose the stay order.

   ·It is a feature of the decisions of the court that when a stay is granted, as in this case, the court frequently makes a costs order in favour of a respondent where financial orders are the subject of appeal and “ability to meet such an order” is not in question. The respondent says that in this case the applicant could meet a costs order from her entitlement to the property orders which now exist.

   ·Any prejudice to the applicant about her ability to pay any cost order made is attended to by ordering such payment be delayed until the proceeds of the sale of the Suburb C property are available to the applicant.

4. The applicant’s case must be that as she has been successful in the application she should not be required to meet a cost order. She says the outcome must arise, in part, from a conclusion that the applicant has an arguable case to put to the Full Court. She says it is premature to make any order for costs when the final outcome of the appeal is not known. She submits that the cost matter should be heard after the appeal result is known if the respondent still seeks to press for the order.

5. In relation to the matters to be considered under s 117(2A), I conclude the following are significant for this case.

   ·The financial circumstances of the parties are set out in the judgment published 1 December 2017. The only significant change which has since occurred is the respondent has received the funds which were held in the controlled monies account of TX Lawyers. That sum was in the order of $665,000.

   ·The applicant has no other ability to meet the cost order as sought by the respondent.

   ·The respondent now has received the funds from TX Lawyers and has used the funds to repay debt as he has set out in his affidavit sworn 21 December 2017. The respondent retains only $200,000 of the funds received from TX Lawyers.

   ·The respondent is entitled to the payments ordered on 1 December 2017. He has been without access to the bulk of his share of the parties property since 2013 when separation occurred. That position contrasts significantly with the position of the applicant who has had the use of significant portions of the parties property during that same period as outlined in the judgment handed down on 1 December 2017.

   ·The applicant has been substantially successful in her application for a stay of order 31 of 1 December 2017.

   ·The grounds of appeal filed by the application are extensive and complicated. The evidence filed in support of the stay application is significant. The consequence is that the respondent has been put to considerable cost in obtaining advice from his lawyers about the merit of the applicant’s application.

   ·Neither party has informed the court they are in receipt of a legal aid grant or assistance.

   ·The proceeding has been brought by the applicant to obtain relief from having to comply with order 31 made 1 December 2017.

   ·In this matter the court ought strive to avoid creating a circumstance which requires further litigation between the parties.

6. Having considers considered all of the above matters I conclude that, on balance, discretion ought be exercised to allow the cost application if the respondent subject to deferred payment.

7. The respondent’s counsel provided an estimate of the respondent’s costs which he described as reasonable given the amount of work which each of the respondent’s solicitors and counsel have had to invest in the matter in order to be able to attend today and represent the respondent. The estimate was $2,750 for counsel and three thousand dollars for his instructing solicitor. Having viewed the material filed by the applicant and relied upon by her in the hearing (written submissions) I consider the fees charged by the solicitor for the respondent and counsel’s fees charged to be reasonable.

8. I propose to make order for the applicant to pay the costs of the respondent in the sum of $5,750. Such payment is to be deferred until the appeal has been determined. Thereafter the payment of the costs of the respondent are to be met from the entitlement of the applicant from the property orders.

I certify that the preceding thirty-three (33) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Le Poer Trench delivered on 14 February 2018.

Associate: 

Date:  14 February 2018