Ebner & Pappas - [2014] FamCAFC 230

FAMILY COURT OF AUSTRALIA

EBNER & PAPPAS AND ANOR

[2014] FamCAFC 230

FAMILY LAW – APPEAL – JURISDICTION – Where the appellant appeals from orders made in the Supreme Court of NSW – Where the appellant appeals orders setting aside a contract for the sale of land to the second respondent – Where the appellant appeals orders for costs made against him pursuant to Civil Procedure Act 2005 (NSW) – Whether the consent orders contained an implicit obligation to act reasonably – Where the appellant did not act reasonably to facilitate the transfer of the property – Where the primary judge found the second respondent was not a bona fide purchaser – Whether the first respondent was a creditor – whether the first instance proceedings were ‘proceedings under the Act’ for the purposes of s 117 of the Family Law Act 1975 (Cth) – Where it was found that the primary judge did not err in setting aside the contract for the sale of land – Where it is found that the primary judge did not err by making a costs order pursuant to the Civil Procedure Act 2005 (NSW) – Where, had leave to file a notice of appeal been granted, the appeal would have been dismissed.

FAMILY LAW – APPLICATION IN AN APPEAL – Application for an extension of time to appeal orders – Where the delay is not adequately explained for the entire period – Where there is no merit in the proposed grounds of appeal – Application dismissed.

Civil Procedure Act 2005 (NSW)
Conveyancing Act 1919 (NSW)
Family Law Act 1975 (Cth)
Family Law Rules 2004 (Cth)
Jurisdiction of Courts (Cross Vesting) Act 1987 (Cth)

Alghussein Establishment v Eton College [1991] 1 All ER 267
Barton v Deputy Commissioner of Taxation [1974] HCA 43; (1974) 131 CLR 370
Butt v M’Donald (1896) 7 QLJ 68
Concrete Constructions Pty Ltd v Barnes (1938) 61 CLR 209
Davis v Insolvency and Trustee Service Australia and Others (No 2) (2011) 190 FCR 437
Electrical Enterprises Retail Pty Ltd v Rodgers (1988) 15 NSWLR 473
Ebner v Pappas [2014] NSWCA …
Felton v Mulligan (1971) 124 CLR 367
Gallo v Dawson (1990) 93 ALR 479
In Marriage of Cawthorne (1998) 144 FLR 255
In the Marriage of Langford (1992) 110 FLR 396
In the Marriage of Robinson and Willis (1982) 8 Fam LR 131
Insurance Commissioner v Joyce (1948) 77 CLR 39
Jones v Daniel (2004) 141 FCR 148
Lloyds Bank Ltd v Marcan [1973] 1 WLR 1387
Mackay v Dick (1881) 6 App Cas 251
Mackay v Douglas (1872) LR 14 Eq 106
Marcolongo v Chen (2011) 242 CLR 546
Official Trustee in Bankruptcy v Mateo (2003) FLC 93-128
Pappas v Ebner [2013] NSWSC …
Re Struthers, Liquidator of Project Management, Architecture and Construction, Interior (PACI) Pty Ltd (No 3) (2005) 64 NSWLR 392
Ruthol Pty Ltd v Tricon (Australia) Pty Ltd (2005) 12 BPR 23,923
Secured Income Real Estate (Australia) Ltd v St Martins Investments Pty Ltd [1979] HCA 51; (1979) 144 CLR 596
SS Pharmaceutical Co Ltd v Qantas Airways Ltd [1991] 1 Lloyd’s Rep 288
Sydney Attractions Group Pty Ltd v Schulman [2013] NSWSC 858
TCN Channel 9 Pty Ltd v Hayden Enterprises Pty Ltd (1989) 16 NSWLR 130

APPELLANT:

Mr Ebner

FIRST RESPONDENT:

Ms Pappas

SECOND RESPONDENT:

Mr Saran

FILE NUMBER:

Supreme Court of New South Wales: 2013/…

Family Court of Australia: SYC 4655 of 2008

APPEAL NUMBER:

102

2014

DATE DELIVERED:

27 November 2014

PLACE DELIVERED:

Sydney

PLACE HEARD:

Sydney

JUDGMENT OF:

May, Ainslie-Wallace & Aldridge JJ

HEARING DATE:

21 August 2014

LOWER COURT JURISDICTION:

Supreme Court of New South Wales

LOWER COURT JUDGMENT DATE:

12 December 2013

And 17 March 2014

LOWER COURT MNC:

[2013] NSWSC …
[2014] NSWSC …

REPRESENTATION

COUNSEL FOR THE APPELLANT:

Mr Ogborne

SOLICITOR FOR THE APPELLANT:

Bruce and Stewart Lawyers

COUNSEL FOR THE FIRST RESPONDENT:

Mr Einfeld QC with Ms Christie

SOLICITOR FOR THE FIRST REPSONDENT:

ACA Lawyers

SOLICITOR FOR THE SECOND RESPONDENT:

P Law Firm (No appearance)

Orders

The application filed on 7 August 2014 seeking an extension of time in which to file an appeal from the orders of 12 December 2013 and 17 March 2014 be dismissed.
The parties are to file and serve on the other, written submissions as to costs with the respondent’s submission to be filed and served within 28 days of today and the appellant’s submissions to be filed and served within 56 days of today.

IT IS NOTED that publication of this judgment by this Court under the pseudonym Ebner & Pappas and Anor 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 102 of 2014
File Number: Supreme Court of NSW 2013/…

Mr Ebner

Appellant

And

Ms Pappas

First Respondent

And

Mr Saran

Second Respondent

REASONS FOR JUDGMENT

By way of application filed on 7 August 2014 Mr Ebner (“the husband”) seeks an extension of time to appeal from orders made by Pembroke J of the Supreme Court of New South Wales on 12 December 2013. His Honour set aside a contract for the sale of land of known as the B property entered into between the husband and Mr Saran (“the second respondent”) pursuant to the provisions of s 37A of the Conveyancing Act 1919 (NSW) (“Conveyancing Act”). The husband also seeks an extension of time to appeal from a cost order made against him by Pembroke J on 17 March 2014.
In respect of each proposed appeal, that is the appeal against the principal orders of Pembroke J made on 12 December 2013 and the costs orders made on 17 March 2014, the husband seeks an order that time for filing his Notice of Appeal be extended, the Notice of Appeal having not yet been filed. The application seeking an extension of the time in which to lodge an appeal and a draft Notice of Appeal were filed on 7 August 2014.

Background

After some years of litigation in the Family Court of Australia, the husband and Ms Pappas (“the wife”) settled their property proceedings by the making of consent orders on 25 October 2012. Although we will consider those orders in considerably more detail later in these reasons, at this point it is sufficient to note that the agreement principally related to the B property which had been the parties’ marital home. Essentially, the agreement between the parties was that, on payment by the wife to the husband by bank cheque of a sum sufficient to discharge the mortgage on that property, the husband would transfer all of his interest in that property to the wife.
The husband did not transfer his interest to the wife rather, on 12 August 2013 at 10 pm, he exchanged contracts for sale of the property to the second respondent. No deposit was paid by the second respondent.
On 13 August 2013 the wife commenced proceedings in the NSW Supreme Court. On that day an ex parte injunction was granted restraining the husband from selling encumbering or otherwise dealing with the B property. As it turned out, the husband had, before being served with the injunction, exchanged contracts to sell the property to the second respondent.
After hearing from both the husband and the wife, Robb J concluded that the wife had demonstrated a sufficiently arguable case that she had not lost her equitable estate in the property for the purposes of the application then before the court. Thus his Honour continued the ex parte orders made on 13 August 2013.
The wife then brought an action pursuant to s 37A of the Conveyancing Act seeking orders that the purported sale to the second respondent be set aside. On 12 December 2013, Pembroke J set aside the contract for sale of land between the husband and the second respondent and further ordered the husband to deliver to the wife’s solicitor an executed transfer of the B property by 10 am 13 December 2013.
On 17 March 2014, Pembroke J ordered the husband and the second respondent to pay the wife’s costs of and incidental to the applications.
It is in relation to these orders that the husband now seeks leave to appeal and if leave is granted to appeal against those orders. The second respondent did not appear before us. In the substantive proceedings before Pembroke J in the Supreme Court of NSW, the second respondent was represented by a solicitor who “made no submission, tendered no document and asked no question” (at [40]). No appearance for the second respondent was recorded in the costs proceedings or the appeal in the NSW Supreme Court (discussed below). The second respondent did not appear nor sought to be heard before us.

THE APPEALS

On 8 January 2014 the husband filed a Notice of Intention to Appeal in the Supreme Court of New South Wales. A Notice of Appeal was filed on 12 March 2014 and an Amended Notice of Appeal was filed on 14 April 2014.
On 26 June 2014 the Court of Appeal of the New South Wales Supreme Court found that the appeal to that court was incompetent as it had no jurisdiction to hear it. The Court of Appeal found that Pembroke J, in hearing and determining the wife’s application, was hearing a matter arising under the Family Law Act 1975 (Cth) (“Family Law Act”) and thus, pursuant to s 7(5) of the Jurisdiction of Courts (Cross Vesting) Act 1987 (Cth), any appeal from his orders lay to the Full Court of the Family Court of Australia.
As previously noted, the order setting aside the contract of sale for the B property was made on 12 December 2013 and the costs order was made on 17 March 2014. Rule 22.03 of the Family Law Rules 2004 (Cth) (“the Family Law Rules”) requires the Notice of Appeal to be filed within 28 days of each respective date.
Clearly, the time for filing an appeal in the Family Court has expired and the husband is required to make application for an extension of time to file a Notice of Appeal pursuant to r 1.14.
The principles governing such a grant of leave are well known (see Gallo v Dawson (1990) 93 ALR 479) and may be summarised thus:
·    The grant of an extension of time is discretionary and the object is to ensure that Rules which fix times do not become instruments of injustice.
·    The discretion can only be exercised upon proof that strict compliance with the Rules will work an injustice upon the applicant.
·    When determining whether the Rules will work an injustice, it is necessary to have regard to the history of the proceedings, the conduct of the parties, the nature of the litigation, and the consequences for the parties of the grant or refusal of the application for extension of time.
·    When considering an application for extension of time in which to file an appeal or an application, it is necessary also to consider the prospects of success of that appeal or application.

Explanation for the delay

It was submitted by the wife that the husband’s appeal to the New South Wales Court of Appeal was a deliberate, albeit wrong, decision and therefore the need to seek an extension of time to appeal to this Court was the result of a considered decision.
The husband submitted that he was led into appealing to the Court of Appeal by the findings of the primary judge. In his primary judgment the judge did not avert to the nature of the jurisdiction being exercised by him. He however gave some consideration to that issue in his costs judgment given on 17 March 2014. The context of that consideration was that his Honour had been asked to apply s 117 of the Family Law Act to the determination of the costs issue. He said at [4]:
I am prepared to accept that these proceedings may arguably, and coincidentally, satisfy the definition of ‘matrimonial cause’ within the meaning of s 4(1)(ca)(i) or (ii) of the Family Law Act 1975 (Cth). That definition refers to ‘proceedings between the parties to a marriage with respect to the property of the parties to the marriage … arising out of the marital relationship, or in relation to concurrent, pending or completed divorce proceedings between those parties’.
His Honour proceeded to note that, whatever the nature of the jurisdiction being exercised, he clearly had jurisdiction to hear and determine both the primary proceedings and the costs issues.
By the time of that judgment, of course, the husband had already filed his Notice of Intention to Appeal and Notice of Appeal in the NSW Court of Appeal. Just short of a month after these observations of Pembroke J were made, the husband filed his Amended Notice of Appeal in the NSW Court of Appeal.
As there was no discussion by the judge in his primary judgment of the nature of jurisdiction he was exercising, the submission by the husband that he was following the jurisdiction identified by the primary judge cannot be accepted. In any event, it is s 7 of Jurisdiction of Courts (Cross Vesting) Act 1987 (Cth) that determines the jurisdiction and not any observations of the primary judge.
The husband had been aware of the controversy as to the jurisdiction of the Court of Appeal to hear this appeal for some time. On 13 May 2014 he filed a Notice of Motion in the Court of Appeal seeking an order that the appeal be transferred to the Family Court of Australia pursuant to s 5 of the Jurisdiction of Courts (Cross Vesting) Act 1987 (Cth). That Notice of Motion was listed before the Court of Appeal for hearing on 26 June 2014. As we have said, on that date, the NSW Court of Appeal held that the husband’s appeal to that court was incompetent.
As to the delay between the determination of the Supreme Court appeal and the filing of this application, the husband deposed:
10. Since 26 June 2014 I have been concerned as to whether I should re-lodge the appeal with the Family Court of Australia, due to the complexity of the jurisdiction issues and arguments which had been raised and also in connection with the costs judgment implications.
(Affidavit of husband sworn 4 August 2014)
His application seeking an extension of time in which to appeal was filed some six weeks after 26 June 2014.
No other explanation was given as to why the application for an extension of time was not made earlier. The delay is not adequately explained after 26 June 2014, which makes the case for an extension of time far from compelling.
There is also force in the wife’s submission that the she has now been faced with responding to two appeals. There will be a direct prejudice to her in that, although she has received the benefit of a costs order in the Court of Appeal proceedings, it will not wholly compensate her for the costs of the additional appeal.
In considering extensions of time a relevant factor is the merits, or otherwise, of the proposed appeal. It is appropriate to discuss those merits and then to return to the issue of leave.

Merit

In considering the merits of the proposed appeal and to give context to the discussion of them, it is helpful to set out some factual background to the findings of the primary judge.
The husband and the wife have been engaged in proceedings in the Family Court of Australia for some years. On 25 October 2012 the court made the following consent orders as to the division of their property:

1.That the parties acknowledge that the property known as [B] (the Property) is presently encumbered by way of four mortgage accounts (the Mortgage) to National Australia Bank (the Bank) securing a facility limit of $920,000 (the Facility Limit). As at 16 October 2012 the mortgage accounts with a total drawn amount of $680,000 are as follows:
i.Account 1236 drawn $196,987.68 current repayment $1,359.94 per month.
ii.Account 2603 drawn $240,913.53 current repayment $1,667.08 per month.
iii.Account 2943 drawn $92,545.74 current repayment $1,297.86 per month.
iv.Account 8185 drawn 149,553.05 with no monthly repayment and a facility limit of $200,000.
2.That on 16 October 2012, the Husband shall ensure that the amount drawn under the Mortgage is $680,000 with a Facility Limit of $730,446.95 whereafter the Wife shall immediately be responsible for the Mortgage and indemnity and hold the Husband harmless from any claim or action by the Bank.
3.That immediately upon the Wife providing a bank cheque issued by an Australian bank sufficient to discharge the Mortgage in full, the Husband shall contemporaneously with the discharge of the Mortgage in full, do all things and sign all documents necessary to transfer to the Wife his interest in the Property subject to the Mortgage to the Wife including giving a direction to the Bank to release the title to the Property directly to the Wife. As from the discharge of the Mortgage, the following paragraphs 4, 5, 6, 7, 8 and 11 will cease to have effect except to the extent of any rights or liabilities arising prior to the date of discharge of the Mortgage.
4.The until such time that the Wife discharges the Mortgage under paragraph 3 and subject to paragraph 5 below, the Wife shall make minimum monthly payments of $3,000 per month into the Mortgage for the first annual period after the date of these Orders and thereafter minimum monthly payments of $4,000 per month with such monies to be first applied towards interest and thereafter to a reduction of principal outstanding.
5.The Wife is at liberty to pay lump sum amounts into the Mortgage as a reduction of principal outstanding which for the purposes of the Orders will be applied as an equivalent amount of payments required by paragraph 4 above.
6.The Wife shall be at liberty to draw upon the Mortgage any funds to meet minimum monthly payments arising under paragraph 5 up to the Facility Limit but for no other purpose.
7.The Husband shall be at liberty to draw upon the Mortgage any funds to meet principal and interest obligations to the Bank arising under the Mortgage but for no other purpose.
8.Neither party shall further encumber the Property without firstly discharging the Mortgage in full except that the parties may mutually agree to obtain an increase of the Facility Limit from the Bank at any time.
9.That in the event of any sale or disposition of the Property after the date of these Orders and the net sale proceeds are $3,250,000 or more after repayment of any renovation costs to the Wife and payment of all real estate agent’s commission and selling costs, then the Wife shall pay to the Husband an amount of $80,000 and the parties are to provide all necessary instructions and authorities to cause $80,000 to be paid to the Husband from the net proceeds of sale upon settlement of the Property.
10.That the Wife is responsible for all costs of or relating to the Property or its transfer, including but not limited to real estate agency commissions, council and water rates and applicable land taxes whensoever arising, any capital gains tax or income tax payable by the Husband as a result of these Orders or transfer and the Wife shall within 5 days indemnify the Husband in the event any such cost, taxes or amount is paid by the Husband. The Husband shall do such lawful things reasonably requested by the Wife which lawfully minimise or avoid the imposition of such costs, taxes or amounts. Any expenses arising from such requests are to be paid by the Wife.
11.That if the Mortgage is in default and not remedied within 30 days of the default, both parties agree do all things and sign all documents necessary to sell the Property and provide all necessary instructions and authorities to cause the net proceeds of sale to be applied in the following order and priority:
a)Repayment of the sum required to discharge the Mortgage secured on the Property.
b)Payment of all legal costs associated with the sale of the Property;
c)Payment of all Real Estate Agent’s commission and selling costs;
d)Payment to the Husband of $80,000 if payment is required by paragraph 9 above.
e)In payment of the balance to the Wife.
15.That as against the Husband the Wife be solely entitled to all other property, both real and personal in his ownership, possession or control including but not limited to:
a)Her interests in the [F] Trust;
b)Her interests in [E] Pty Limited;
c)Her interests in [Pappas] Pty Limited;
d)Her interest in the [F] Superannuation Fund;
e)Her interest in any shares;
f)All funds held in financial institutions in her name.
All household contents and personal effects including jewellery currently in her possession save and except those items referred to in the list of chattels attached to these Orders.

The wife and the children of the marriage lived at the B property following the parties’ separation and after the making of the consent orders on 25 October 2012. The husband was and remained the sole registered proprietor.
Not long after the making of the consent orders, the wife set about giving effect to the consent orders. In the months that followed, numerous emails passed between the husband and wife. They were annexed to the wife’s affidavits before his Honour and it was not suggested by the husband that they did not present an accurate picture of the communications between them on the issue of transfer of the property to the wife.
On 13 November 2012 the wife wrote to the husband and asked “How will we go about doing a transfer?” Ignoring that request, a few weeks later the husband provided her with a draft of his application pursuant to s 79A of the Family Law Act to have the consent orders set aside. That application was filed on 24 January 2013 and summarily dismissed by Stevenson J on 24 May 2013. The appeal from that decision was heard at the same time as this application.
Meanwhile, on 20 December 2012, the wife asked the husband, “Can you please send me a copy of the Transfer for the house please” (Exhibit E, email of first respondent, 20 December 2012). His reply was to the effect that the buyer prepared the transfer, that there were substantial arrears of council rates going back to 2008 which he suggested the wife pay and further that there was an unresolved capital gains tax issue in respect of which the husband needed security from the wife. The wife replied that she would not pay the rates for the period when the husband owned the house.
On 22 January 2013 the husband wrote to the wife complaining that she should have been preparing documents rather than going on a holiday and that “your answer to the transfer is another breach of the Orders”. This was accepted to be a reference to the wife’s refusal to pay the arrears of rates on the property.
On 24 January 2013 the wife’s lawyer sent a transfer form to the husband and asked him to sign and return it. The husband replied advising that the amount outstanding to the National Australia Bank (“NAB”) was $691,130 and that the arrears of council rates were $8,614. Later that day he sent another email to the lawyer saying that he would “review the transfer and revert shortly”. He then asked for the provision of a bank cheque notwithstanding that no settlement appointment had been arranged. The husband referred again to his s 79A application and the request in that application for a stay of the order requiring him to transfer the B property to the wife.
On 29 January 2013 the wife’s lawyer replied :
In relation to your request for a bank cheque now, the Family Court Orders require you to do all things necessary to transfer your interest in the property to our client at the same time as our client provides you with a bank cheque to discharge the NAB mortgage. As you are aware, our client is financing this settlement and the Property is being used as security for that finance.
It would appear that you are not prepared to loan us the signed Transfer for stamping purposes. Accordingly, we propose a settlement be arranged whereby in exchange for the duly executed Transfer from you and a duly executed discharge of the Mortgage and the Certificate of Title from NAB a bank cheque to payout the NAB debt be handed to you (or your agent) to hand to the NAB.
Again, we request you please pass on my details to your banker at the NAB and ask him/her to contact me to discuss settlement arrangements.
The husband replied that he was able to lodge the transfer for stamping himself.
On the following day the wife’s lawyer informed the husband that the wife’s incoming mortgagee was now ready to settle the transfer and the discharge of the National Australia Bank mortgage.
On 31 January 2013 the husband informed his banker at the National Australia Bank that he should prepare for the discharge of the mortgage in anticipation of settlement. He, however, informed his banker that order 3 had not yet been satisfied by the wife and that, “there may be some delay from other proceedings”. We infer that this was a reference to his s 79A application.
On 1 February 2013 the wife’s incoming mortgagee was ready to settle. The husband went overseas for most of that month. Before he went, the husband informed the bank that he was holding off signing the discharge of the mortgage.
In late April 2013 the NAB loan went into arrears in the amount of $1,260. The husband was not making the payments pursuant to the facility and the wife had not made the monthly payments pursuant to order 4.
On 29 April 2013 the wife wrote to the husband saying:
We have sent you the transfer forms for the house – this would remove this issue immediately. I hardly think you can expect me to start paying for something that has not been transferred.
(Exhibit E, email of first respondent, dated 29 April 2013)
By way of reply the husband said:
What I think is irrelevant. You have been notified.
(Exhibit E, email of appellant, dated 29 April 2013)
On 30 April 2013 the wife approached the NAB directly. On 6 May 2013 she was advised that the bank would not communicate with her and that it would “need to continue to deal with [Mr Ebner] until the position has been resolved.” (See Exhibit E, email of first respondent, dated 29 April 2013).
On 16 May 2013 the NAB advised the husband that the mortgage had been in arrears ($2,823) for 31 days.
When the husband raised this with the wife she replied :
I have spoken to [the NAB] and need the house to be transferred so that I can start making payments – WHY are you holding this up.
(Exhibit E, email of first respondent, dated 16 May 2013)
(Emphasis in original)
On 23 May 2013 the husband informed the wife that she could not speak directly to his banker. Nonetheless, on 25 May 2013 the wife sent an email directly to the NAB saying that she would like to proceed in transferring the property into her name.
On 28 May 2013 the wife’s lawyer wrote to the NAB asking if the bank was willing to arrange a settlement of the mortgage discharge and tried to arrange a settlement appointment. On the same day the wife’s lawyer asked for an indicative payout figure. The wife also wrote to the NAB saying:
Did [Mr Ebner] give you any indication of why he is holding up the transfer of the property? I just need to understand so we can all move forward.
I am happy to comply with the Orders and pay mortgage, but need to pay out so that I can manage the payments.
(Exhibit E, email of first respondent, dated 28 May 2013)
On the same day the wife’s lawyer asked the NAB for a payout figure. By telephone, an employee of the NAB informed him that the husband had informed the bank he would not provide the authority to proceed with the discharge. The NAB also wrote to the wife’s lawyer saying that the husband’s “unwillingness to execute transfer/sign settlement & discharge instructions is not a matter for the bank”. (Exhibit E, email of NAB, dated 28 May 2013).
The wife replied the same day saying:
Thanks for this update – as I have mentioned to you I do NOT want this to go into default this is not my intention. If the bank cannot order the transfer to me then I will pay the mortgage down to prevent from going to default.
(Exhibit E, email of first respondent, dated 28 May 2013)
On 7 June 2013 the wife wrote to the NAB saying:
[A solicitor] has notified me that the bank can not move forward with transfer without [Mr Ebner’s] consent. Therefore to stop this matter progressing to a situation that is not great for anyone, I will start paying the mortgage. As I do not want to deal with [Mr Ebner], can you let me know what need to be paid and where I pay it.
(Exhibit E, email of first respondent, dated 7 June 2013)
The NAB replied that day saying that it was “unable to provide any detail regarding [Mr Ebner’s] personal financial matters”. (Exhibit E, email of NAB, 7 June 2013) A few hours later the husband wrote to the wife saying “you have no right to deal directly with my banker”. (Exhibit E, email of appellant, dated 7 June 2013).
Meanwhile, on 28 May 2013 the husband informed the wife that the swimming pool at the property did not comply with council requirements and that those requirements must be met by the wife, at her expense, before any transfer could be made to her. When the husband was informed by the wife’s lawyers that a certificate of compliance was not necessary prior to a transfer taking place, the husband replied, “Please don’t provide me any advice as you do not represent me”. (Exhibit E, email of appellant, dated 28 May 2013).
On 24 June 2013 the bank issued default notices to the husband.
On 8 July 2013 the husband informed the wife that he had opened his mail backlog and noticed “default notices attached arising from your failure to make any payments”. Three days later the wife contacted the bank and the husband again saying:
[Mr Ebner] has notified me that he has received notices to default. I have told you that i am willing to pay the loan, but need assurances to move forward.
(Exhibit E, email of first respondent, dated 11 July 2013)
The husband responded saying that it was the wife who had “blatantly breached the orders again and again”. He also told her that there was no point talking to his banker as “it is out of his hands and can’t talk to you anyway”.
On 19 July 2013 the wife wrote to the husband saying “can you please provide me with a contract so I can find out how to move forward on paying the loan. I have made this request three times and have been blocked by your bank”. (Exhibit E, email of first respondent, dated 19 July 2013).
The wife repeated her plea on 22 July 2013. The husband replied that his bank was no longer involved and he asked “What payments are you proposing and I will pass info on”. (Exhibit E, email of appellant, dated 23 July 2013).
When the wife replied “I need the account details and what is owing exactly”, the husband merely replied “I sent all the default notices to you the other day. Everything is on them”. (Exhibit E, emails of first respondent and appellant, dated 23 July 2013).
On 28 July 2013 the wife sent a letter of demand to the husband requiring compliance with the original orders and stating that she was ready to comply with the orders and repay the amounts in full.
On 5 August 2013 the husband replied “please provide evidence that you are able to settle as required by the orders. Your word is worthless and irrelevant”.
On 6 August 2013 the husband wrote to the bank telling them that he was “working on a solution”. He also wrote to the wife saying “I am extremely busy today so will respond tomorrow afternoon”. (Exhibit E, emails of appellant, dated 6 August 2013).
On 7 August 2013 the wife received a Notice to Occupier from the bank advising her of its intention to take possession of the property. On 8 August 2013 the husband received from the bank a letter of demand requiring full repayment of the mortgage within seven days.
On 9 August 2013 the husband entered into a real estate agency agreement with a real estate agent for the sale of the property. He said that, over the weekend, he made enquiries with a potential purchaser for the property who considered the price too high. He then deposed:
21. On Monday 12 August 2013 when I did not obtain a response from the agent’s potential buyer ([Mr E]), I made an approach to a business associate ([Mr G]) who then introduced the buyer, [Mr Saran] and a contract was exchanged late on Monday evening 12 August 2013.
(Affidavit of the husband, sworn 15 August 2013)
The sale price pursuant to the contract was $2,350,000. The contract contained the following special condition:
An amount of $1,000,000 is payable on completion to discharge the mortgage. In the event that the lender and mortgagee agree to extend the mortgage for a maximum period of two years then the amount payable on completion shall be reduced by an amount equal to the amount secured by the continuing mortgage. The balance of the purchase price (less any amount paid on completion) is payable in full on the earlier of the expiry of the period of two years from the contract date or the resale of the Land.
(Annexure J, Affidavit of the husband, sworn 15 August 2013)
This clause was considered by Robb J and his analysis was adopted by Pembroke J in his reasons. Robb J said at [15] – [17]:
15It is self evident that the terms of the contract of sale were unusual. They were to have the effect that the only cash required to be paid by the purchaser on completion would be an amount necessary to pay any mortgage. No further cash would be paid for a period up to two years, which is relevant to the position of the plaintiff when regard is had shortly to the terms of an order made by the Family Court of Australia. In short, there would be no money paid to the plaintiff for the period contemplated by special condition 50.
16Additionally, there is evidence which would cause the court to infer that by reason of information made available by the defendant and the terms of special condition 50 itself, it was contemplated that a redevelopment of the Property would occur in order to maximise its value.
17It follows that the contract was subject to development risk on the part of the purchaser, so the purchaser’s capacity to repay the balance of the contract price may be affected if a development proposal led to an unsatisfactory commercial outcome. It is also to be noted that while clause 2.2 of the contract, in standard terms, provided, “Normally the purchaser must pay the deposit on the making of this contract and this time is essential,” it was apparently agreed between the purchaser and the defendant that the deposit would be paid the next business day.
The husband had not met or spoken to the purchaser at any time. His evidence was that the purchase was arranged by telephone with the purchaser’s son.
A document entitled “Balance Sheet” was exhibited before Robb J that demonstrated that the husband had earlier attributed a value of $3,172,500 to the B property in the Family Court of Australia proceedings.
On 12 August 2013 the husband purported to exchange contracts for the sale of the B property to the second respondent. The husband said he was entitled to do so under the orders. The wife asserted that it was a transaction designed to hinder or delay her rights as a creditor and that the transaction was void pursuant to s 37A of the Conveyancing Act. That section provides:
(1) Save as provided in this section, every alienation of property, made whether before or after the commencement of the Conveyancing (Amendment) Act 1930, with intent to defraud creditors, shall be voidable at the instance of any person thereby prejudiced.
(2) This section does not affect the law of bankruptcy for the time being in force.
(3) This section does not extend to any estate or interest in property alienated to a purchaser in good faith not having, at the time of the alienation, notice of the intent to defraud creditors.
The primary judge agreed with the wife and set aside the transaction.

the primary judge’s reasons

His Honour, after referring to the consent orders, said at [8] - [9]:
8It also follows, in my view, that the orders should be construed having regard to conventional principles of implication and construction. Orders of the court that embody the agreement of the parties do not stand in isolation, immune from the ordinary processes by which the court ascertains the extent of the parties’ obligations.
9In this case, two well-known principles of law are brought into play. First, each party must do all things reasonably necessary on his part to ensure that the other receives the benefit of their agreement: Secured Income Real Estate (Australia) v St Martins Investments Pty Ltd [1979] HCA 51; (1979) CLR 596: TFML Ltd v Macarthur Cook Fund ManagementLtd [2013] NSWCA 29 at [50]. Second, a party cannot take advantage of his own wrong. A party’s contractual entitlement that arises upon a particular event will not be enlivened if the event came about through that party’s own wrongful conduct: TCN Channel 9 Pty Ltd v Hayden Enterprises (1989) 16 NSWLR 130; Sydney Attractions Group Pty Ltd v Schulman [2013] NSWSC 858 at [188] – [191].
His Honour adverted to the email correspondence between the parties and to which we have referred and concluded that the process of transferring the property to the wife was not complicated, but called for no more than a little understanding and cooperation. He found that the husband was resiling, inexorably, from his legal obligations.
His Honour concluded at [40] - [42]:
40I am quite satisfied that the requirements of Section 37A of the Conveyancing Act, 1919 have been met, even assuming that valuable consideration was given and it is necessary to prove that the second defendant knew of the intention to defraud. As Rich J said in Insurance Commission v Joyce (1948) 77 CLR 39 at 49, where an inference is open and the defendant elects not to give evidence ‘the court is entitled to be bold’. See also SS Pharmaceutical v Qantas Airways [1991] 1 Lloyd’s Rep 288 at 292 (Gleeson CJ and Handley CJ). In this curious case, the very existence of the second defendant, let alone his bona fides, was never established. For all I know, he could be an illusion. His separate representation appears to have been an attempt to demonstrate that he was independent. The hapless young solicitor who purported to represent the second defendant knew nothing and did nothing. He made no submission, tendered no document and asked no question. He merely sought to rely on an affidavit, not from the second defendant, but from someone who was said to be the second defendant’s son and an associate of the husband. However, the affidavit said nothing relevant and admissible and I would not allow it.
41As I have explained, the husband’s intention was to ‘hinder, delay or defeat’ his wife: Marcolongo v Chen [2011] HCA 3; (2011) 242 CLR 546. His wife was a creditor by reason of Order 3, which gave her an equitable interest in the property. A conveyance to defeat a spouse’s claim in matrimonial proceedings is within the section: Cadogan v Cadogan [1977] 1 WLR 1041; [1977] 3 All ER 831 at 842. The husband wanted to prevent his wife having the benefit of that order. Although he had originally agreed to her having that right, he showed no willingness to implement Order 3 except by reference to a construction of it that denied any obligation by him to act reasonably in order to ensure that she have the benefit of the order. His intransigence was a pretext for denying this wife’s rights. His belief in his own legal rights was not the dominant factor. His overriding intention was to hinder, delay or defeat. His intention towards his wife was not merely unreasonable, it was dishonest by the standards of ordinary, decent people.
Order 11
42I have said enough to explain why the husband was not entitled, in the particular circumstances of this case, to seek to trigger a sale in accordance with Order 11. The language of Order 3 must be read subject to the implicit obligation of the husband to act reasonably and co-operatively in order to facilitate his wife’s enjoyment of the right granted to her by that order. It is not necessary to contradict the terms of Order 3 to give effect to that implicit obligation. Amplification and qualification is not contradiction. It is only necessary to read and implement the requirements of Order 3 with the degree of reasonableness and common sense that would be expected of any reasonable person acting in good faith. The husband did not demonstrate those qualities. He breached his implied obligation. Despite the wife’s failure to pay the monthly instalments pursuant to Order 4, the husband’s actions were the dominant reason for the remedied default on which he relied to trigger Order 11. In those circumstances, he cannot take advantage of his own conduct so as to claim an entitlement to the benefit of Order 11.

grounds of appeal

The husband relied in his draft Notice of Appeal (assuming an extension of time is allowed) on eight grounds of appeal of which Ground 3 was not pressed. A number of those grounds contained a number of sub-grounds which often overlapped or repeated other sub-grounds, albeit in slightly different language. However, in his submissions, counsel for the husband dealt with the grounds under three broad headings. Counsel for the wife addressed the appeal in this way and it is convenient for us to follow the same course.

Did the Consent Orders contain implicit obligations and were they breached? (Grounds 1(a), 1(b) and 2).

It was submitted that the primary judge erred in finding at [42] that the orders made on 25 October 2012 contained an implicit obligation that the husband act reasonably and co-operatively in order to facilitate the wife’s enjoyment of the rights conferred upon her by order 3 and that the husband breached that implicit obligation.
As identified by the primary judge, the orders made by the Family Court on 25 October 2012 were the fruits of a contract entered into between the husband and the wife. It is well established a party cannot take advantage of his own breach of contract to avoid his obligations under that contract. Alghussein Establishment v Eton College [1991] 1 All ER 267; TCN Channel 9 Pty Ltd v Hayden Enterprises Pty Ltd (1989) 16 NSWLR 130 at 147; Sydney Attractions Group Pty Ltd v Frederick Schulman [2013] NSWSC 858.
In Ruthol Pty Ltd v Tricon (Australia) Pty Ltd (2005) 12 BPR 23,923 Giles JA said at [22]:
22Thus a party in breach of contract may be precluded from relying on a contractual entitlement arising from the breach, but will not be precluded from a contractual entitlement which does not arise from the breach.
Secondly, it is clearly established that a party to a contract, in the absence of an express term, is obliged to do what is necessary to have the contract carried out. In Mackay v Dick (1881) 6 App Cas 251, at page 263, Lord Blackburn said:
…as a general rule that where in a written contract it appears that both parties have agreed that something shall be done, which cannot effectually be done unless both concur in doing it, the construction of the contract is that each agrees to do all that is necessary to be done on his part for the carrying out of that thing, though there may be no express words to that effect.
In Butt v M’Donald (1896) 7 QLJ 68 Griffith CJ said at pages 70-71:
It is a general rule applicable to every contract that each party agrees, by implication, to do all such things as are necessary on his part to enable the other party to have the benefit of the contract.
These authorities were quoted with approval by the High Court in Secured Income Real Estate (Australia) Ltd v St Martins Investments Pty Ltd [1979] HCA 51; (1979) 144 CLR 596 at page 607-608, Mason J, with whom the other members of the bench agreed, said:
It is easy to imply a duty to co-operate in the doing of acts which are necessary to the performance by the parties or by one of the parties of fundamental obligations under the contract. It is not quite so easy to make the implication when the acts in question are necessary to entitle the other contracting party to a benefit under the contract but are not essential to the performance of that party’s obligations and are not fundamental to the contract. Then the question arises whether the contract imposes a duty to co-operate on the first party or whether it leaves him at liberty to decide for himself whether the act shall be done, even if the consequence of his decision is to disentitle the other party to a benefit. In such a case, the correct interpretation of the contract depends, as it seems to me, not so much on the application of the general rule of construction as on the intention of the parties as manifested by the contract itself.
It was submitted that the primary judge incorrectly found that because consent orders may be set aside on the same grounds as the agreement underlying them, the contractual principles apply to determine the parties’ obligations under the consent orders. It is not clear to us that he did so. His Honour’s view that the orders should be construed “having regard to conventional principles of implication and construction” does not depend upon there being an agreement between the parties.
The husband referred to In the Marriage of Langford (1992) 110 FLR 396 and In the Marriage of Robinson and Willis (1982) 8 Fam LR 131 as authority for the proposition that once an agreement has been embodied in consent orders the legal effect of the orders is derived from the orders and not the agreement, and it is to the orders that regard must be had. This is so, but it misses the point. The wife did not seek to rely on the underlying agreement – she merely sought to apply the orders as properly construed.
There is no reason why the principles identified by the primary judge should not apply to orders made by a court, whether by consent or not. If the terms of a court order, by clear implication require a party to do certain acts to enable the orders to be carried out, in the absence of a contrary order, that party is obliged to carry out those acts so as to give effect to the orders. Such a conclusion flows from the construction of the orders itself and thus the principles enunciated above, which themselves are principles of construction, apply. This was made clear in Secured Income supra where Mason J said, at page 608, the court looks to the intention of the parties “as manifested by the contract itself”. In finding that there is an implied obligation on a party to take a certain step the court is doing no more than giving effect to the court’s intention as manifested by the orders themselves.
This has particular relevance in family cases where parties are obliged to undertake many steps, often in necessary co-operation with the other party, pursuant to orders made for the division of their property.
In In Marriage of Cawthorne (1998) 144 FLR 255 at page 265 the Full Court said:
….However in our view a party cannot successfully seek an order pursuant to s 79A(1) as a result of that party’s own default unless such default was due to circumstances quite beyond that party’s control. This rests first upon the well-established principle of law that no-one should profit by their own wrongdoing.
It follows that the primary judge correctly identified the principles to be applied to determine the husband’s obligations under the orders.
Order 3 provides that upon the wife providing a bank cheque “sufficient to discharge the mortgage in full” the husband shall do all things and sign all documents necessary to transfer to the wife his interest in the property. The wife can only discharge the mortgage if she knows the amount required to discharge the mortgage. The orders thus clearly envisage the wife being informed of the amount required to discharge the mortgage at the time she proposes to do so. It is the husband’s mortgage. The amount required to discharge it at any given time is not within the wife’s knowledge but rather the husband and his bank. It is within his power to inform the wife of the amount required to discharge the mortgage at any time or to permit his bankers to do so. It follows by necessary implication that the husband was obliged to co-operate with the wife by enabling her to be provided with the information necessary for her to discharge the mortgage and other essential conveyancing steps.
Thus the primary judge was entirely correct to find that there was an implicit obligation on the husband to act reasonably and co-operatively to facilitate the rights granted by order 3 by enabling the provision of information to enable the wife to discharge the mortgage.
The above narrative of facts makes it clear that the husband did whatever he could not only to avoid informing the wife of the amount required to discharge the mortgage, but to place whatever obstacles he could in the path of her finding that out. He went to the extent of instructing the NAB not to co-operate. At times he required the wife to provide a bank cheque prior to him effecting a transfer. His counsel conceded that order 3 did not require the wife to do so.
The primary judge therefore correctly found a breach of the obligation on the husband to take the necessary steps to enable the transfer to take place. He was also correct to find that the husband was not entitled to rely on any breach of the orders occasioned by the husband’s own wrongful acts.

Was the wife’s failure to pay the mortgage as required by Order 4 the dominant reason for the default and the trigger of the sale under Order 11 (Grounds 1(c), 1(d), 1(e), 4 and 5)

It was submitted that it was the wife’s “repeated and ongoing” breach of order 4 that was the reason for the default under the mortgage and not the husband’s actions.
The mortgage went into default on 26 April 2013 and on 15 May 2013 and had been in default for more than 30 days. It was submitted that the wife was in default in not making the payment of $3,000 per month as required by order 4.
The primary judge found that on 1 February 2013 the wife’s incoming mortgagee was ready to settle. There is no appeal from that finding. Immediately after being so informed the husband informed his bank that he was holding off signing the discharge of the mortgage. Had the husband acted co-operatively the mortgage would have been discharged shortly thereafter and no arrears would have arisen. It is true that the wife then did not comply with order 4. The wife, however, would never have had to comply with order 4 had the husband complied with his obligation to co-operate in the discharge of the mortgage. What he had to do was simple. He, or his bank as authorised by him, had to provide the wife with a payout figure for the mortgage. The husband had to sign a transfer of the property to the wife and arrange for that to be handed over at settlement on the discharge of the mortgage.
The primary judge found at [37]:
37The wife had been endeavouring to payout the totality of the NAB loans since 1 February. She may not have paid the monthly instalments of $3,000 contemplated by Order 4, but that was not the real cause of the current situation. The real and effective cause was the husband’s wholly unreasonable lack of co-operation, which was motivated by his unwillingness to perform his obligations under Order 3 and his desire to hinder, delay or prevent his wife having the benefit of that order.
He was entirely correct to do so.
It was then submitted that at no time prior to 12 August 2013 had the wife provided to any person a bank cheque, or any other mode of payment (in compliance with order 3). This is true. She could not do so because she did not know the amount required to discharge the mortgage. It was the husband’s fault that she did not.
The obligation upon the husband was neither vague nor uncertain and did not contradict the orders of the court.
It was submitted by the husband that he had said on 30 January 2013 he was happy to sign a transfer and that no further step in arranging a settlement was taken until 27 May 2013. By then, it was submitted, it was too late as order 11 had been enlivened.
The fact remains the husband never signed a transfer. He was never ready to hand over a signed transfer at any settlement. More importantly, a settlement could not occur until the wife became aware of the amount required to discharge the mortgage. Although the husband provided a payout figure on 31 January 2013 and instructed the NAB to prepare a discharge, he immediately reversed his position and became obstructive. Thus the matter was never able to proceed to a settlement.
The husband’s submissions on these grounds fail.

Was the wife a creditor for the purposes of s 37A of the Conveyancing Act? (Grounds 6, 7 and 8)

The appellant submitted that the primary judge mistakenly proceeded on the basis that the wife was a creditor under order 3 but was, in fact, a creditor under order 11. This was because order 11 had been enlivened by the breach of order 3. It was then submitted that that sale by the husband was in furtherance of the obligation to sell the property under order 11 and that, as the agreed sale price did not exceed $3,250,000, there would be no payment to the wife. Thus she was not a creditor.
This assumes, of course, the sale was a valid sale. The primary judge found that the bona fides of the second defendant, let alone his very existence, were never established. He did so by relying on well-established authorities Insurance Commissioner v Joyce (1948) 77 CLR 39 and SS Pharmaceutical Co Ltd v Qantas Airways Ltd [1991] 1 Lloyd’s Rep 288.
These submissions are also based on the assumption that order 11 was enlivened in circumstances where the wife was in breach. As we have found the husband could not rely upon that breach to trigger the sale.
Lest there be any doubt, however, it is quite clear that the wife needed to be involved in any sale of the property. Upon the making of the orders by the court the wife acquired an equitable interest in the Kulgoa Road property - Official Trustee in Bankruptcy v Mateo (2003) FLC 93-128; Jones v Daniel (2004) 141 FCR 148. She therefore had an interest in its sale.
Further, order 11 provides that if the mortgage was in default and not remedied within thirteen days, “both parties agree [to] do all things and sign all documents necessary to sell the property”.
Even accepting the husband’s submissions that the wife was in breach of the orders and that order 11 was triggered, both the husband and the wife had an interest in the property and its sale. However, he acted unilaterally to sell the property on most disadvantageous terms without regard or reference to the other person who had an interest in the property both by reason of her equitable interest and her entitlement to a surplus on sale pursuant to order 11 or to the terms of the order on which he relied to sell the property. He was not entitled to do so.
The submission also overlooks the express terms of s 37A. The applicant under that section does not need to be a creditor, merely a person prejudiced by the alienation. Whilst there needs to be an intention to defraud creditors it is well established that an intention to defeat future creditors is sufficient - Barton v Deputy Commissioner of Taxation (1974) 131 CLR 370 at 374; Mackay v Douglas (1872) LR 14 Eq 106.
The submission also overlooks that the requisite intention can be established by an intention to defeat, delay or hinder. Marcolongo v Chen (2011) 242 CLR 546; Lloyds Bank Ltd v Marcan [1973] 1 WLR 1387 at page 1392; Electrical Enterprises Retail Pty Ltd v Rodgers (1988) 15 NSWLR 473 at 497. If the wife was a creditor under order 11, as the husband submits, then the wife, as a creditor, was hindered and delayed by the special condition in the sale which delayed settlement for two years.
Thus, even if the primary judge was wrong to find that the husband was obliged to co-operate in the discharge of the mortgage, and we do not consider he was, that would not mean that the appeal should succeed.
There being no merit in any of the grounds of appeal and, if any extension of time in which to file an appeal was granted, it would be dismissed. Therefore, taking into account the merits of the appeal and the matters we have considered earlier, the application for an extension of time in which to appeal will be dismissed.

Is leave to appeal required?

As previously noted, the husband has sought leave to appeal. According to Item 3 of the table contained in s 94AA of the Act, leave to appeal is required for an appeal from a prescribed decree of a Supreme Court of a State constituted by a single judge. Regulation 15A defines a prescribed decree as an ‘interlocutory decree’. The question is then whether the orders of 12 December 2013 are interlocutory or final in nature.
The wife’s Amended Statement of Claim filed on 4 October 2013 seeks a declaration that the husband was not entitled to sell the property, and further or in the alternative, that the transaction is voidable pursuant under the Conveyancing Act, and an order that the husband execute a transfer. The other relief was not relevant once the wife paid NAB and discharged the mortgage. The orders of 12 December 2013 accordingly set aside the transaction and ordered the husband to deliver an executed transfer.
It is noted that order 4 lists the matter for further direction, however it is surmised that this was to set a timetable for the outstanding costs application. Thus, the orders of 12 December 2013 finally resolved the wife’s claim and are not interlocutory. The determination by the Court of Appeal in Ebner v Pappas [2014] NSWCA … that Pembroke J was exercising federal jurisdiction does not change the final nature of the orders. It follows that the costs order of 17 March 2014, discussed in greater detail below, is also not interlocutory in nature. As a consequence of those orders being final in nature, the husband was not required to seek leave to appeal in this instance.

costs appeal

Grounds 9 & 10

On 17 March 2014 the primary judge ordered the husband and the second respondent to pay the wife’s costs in the sum of $148,278.78.
In the primary judgment the primary judge said that the husband and the second respondent should pay the plaintiff’s costs and be severally liable. He then stood the matter over to give the wife the opportunity to apply for a fixed costs order.
In the judgment of 17 March 2014 his Honour considered the nature of the power to award costs. He relied upon s 98 of the Civil Procedure Act 2005 (NSW) but continued at [8]:
In any event, for what it is worth, Section 117(2) of the Family Law Act, like section 98(4)(c) of the Civil Procedure Act, confers on a court a discretion to make any order as to costs as it considers just. Both provisions authorise the making of grossed fixed sum costs orders. Whether the source of jurisdiction is section 98 of the Civil Procedure Act or section 117 of the Family Law Act, I would, on the unique facts of this case, exercise my powers in the same way to reach the same result.
His Honour then accepted the evidence of a costs consultant and made the above order.
The first ground of appeal in relation to costs is that the primary judge failed to apply s 117 of the Family Law Act or to apply the Family Law Rules.
Section 117(1) provides:
Subject to subsection (2), subsection 70NFB(1) and sections 117AA, 117AC and 118, each party to proceedings under this Act shall bear his or her own costs.
(Emphasis added)
In Re Struthers, Liquidator of Project Management, Architecture and Construction, Interior (PACI) Pty Ltd (No 3) (2005) 64 NSWLR 392 Brereton J collected a number of authorities dealing with this phrase as follows at [8] –[13]:
[8] The section is concerned with “a proceeding … under this Act”, that is to say the Corporations Act. Mr Lee has drawn my attention to the judgment of the High Court of Australia in Construction, Forestry, Mining and Energy Union v Australian Industrial Relations Commission (2000) 203 CLR 645 where, in the context of the Workplace Relations Act 1996 (Cth), s 237(1) — which provided that a party to a proceeding in a matter arising under that Act shall not be required to pay costs incurred by any other party except in limited circumstances — it was said that a “matter” is properly described as one arising under an enactment where the right or duty in issue in the proceeding is one that owes its existence to the enactment. Referring to Re Polites; Ex parte Hoyts Corporation Pty Ltd (1991) 173 CLR 78 at 93, the Court pointed out that an application for a writ of mandamus for compliance with a duty imposed on the Industrial Relations Commission under the Industrial Relations Act 1996 was a matter arising under the Act, because the duty in question owed its existence to the Industrial Relations Act.
[9] From this, at first sight, it might be thought that, because the duty to attend an examination pursuant to an examination order under the Corporations Act, s 596B and s 597, was created by the Corporations Act, therefore a proceeding designed to secure compliance with that duty would be also a matter arising under the Corporations Act. However, such reasoning would incorrectly apply to the concept of a “proceeding under this Act” a statement which related to “a proceeding in a matter arising under this Act”. There is a well-established distinction between a proceeding under an Act on the one hand, and a proceeding in a matter arising under an Act on the other. In Felton v Mulligan (1971) 124 CLR 367 at 382, Menzies J said that it was to be observed:
“… that there is a difference between a matter arising under a law and a matter involving the interpretation of a law. A matter may involve the interpretation of a law without arising under that law. Thus, for instance, if, upon a claim for damages for negligence at common law, it became necessary to interpret some statutory provision imposing some duty upon the defendant, the litigation would involve the interpretation of the statutory provision but would not arise under it. A matter arises under a law when it is necessary in litigation to determine whether that law confers a right or affords a defence which is an issue in the litigation.
A matter arises under the law of the Parliament when in a proceeding it is necessary that there should be a decision upon a claim made by one of the parties to the litigation which is based upon that law. It is to be observed that there a difference between a ‘proceeding’ arising under a law and a ‘matter’ arising under a law. A ‘proceeding’ arises under a law only when it is authorized by that law: see Collins v Charles Marshall Pty Ltd (1955) 92 CLR 529 at 537. A ‘matter’ need not be a ‘proceeding’; it may be part of a proceeding, e.g. a defence that the law authorizing the proceeding is unconstitutional. So it is that a matter may arise under a law made by the Parliament in a proceeding which does not arise under that law.”
[10] This passage was cited with approval in the Federal Court of Australia in Independent Education Union of Australia v Canonical Administrators (1998) 87 FCR 49 at 61, where Ryan J said, “A ‘matter arising under the Act’ is different from a proceeding which may be brought under the same Act”.
[11] In Concrete Constructions Pty Ltd v Barnes (1938) 61 CLR 209, the High Court considered the Contractors' Debts Act 1897, and in particular whether an action at law, in respect of which a certificate of the judgment might, under the Act, be registered in another court, was a proceeding under the Act. Latham CJ said (at 215)
“The ‘proceeding at law is not a proceeding under the Act’. It is a proceeding under a contract which was enforceable by reason of the common law or some statute other than the Act. The Act did not provide for this proceeding at law. It assumes that proceeding, and then provides for a proceeding which depended upon the granting of a certificate which may be used against a third person”.
[12] The same Act was considered by the Full Court of this Court in Webster v Mount Lewis Development Pty Ltd (1940) 40 SR (NSW) 483; 57 WN (NSW) 192. With reference to what Latham CJ had said in Concrete
Constructions Pty Ltd v Barnes, Jordan CJ (at 487; 193) pointed out that the proceeding at law mentioned in s 3 was not a proceeding under the Act: “No doubt, it is the Act which by s 3 enables the making of an application in a proceeding at law for a certificate of the cause of the debt, but it would be straining language to treat an application for such a certificate as the institution of a proceeding under the Act”.
[13] In Australian Forest Managers Ltd (In Liq) v Bramley (1996) 65 FCR 13, Lindgren J was considering s 1335(2) of the Corporations Law, the immediate and identical predecessor of the present section under consideration. In holding that a proceeding was a proceeding “under the Law”, his Honour identified that the statement of claim pleaded breaches of obligations imposed by various divisions of the Law, that the cause of action as pleaded against three of the four respondents was one created by the Corporations Law, and that that cause of action was an essential part of the case intended to be made against the fourth respondent. His Honour concluded: “In those circumstances I have no doubt that the proceeding is one ‘under’ the Law for the purposes of sub- section 1335(2) of the Law”.

In Davis v Insolvency and Trustee Service Australia and Others (No 2) (2011) 190 FCR 437 the Full Court of the Federal Court said at [27] – [28]:
[27] The issue arises because there is a prohibition in s 121(1) of the Family Law Act 1975 on the reporting of any proceeding “under” that Act in a way which identifies, inter alia, parties to such a proceeding. The Family Law Act 1975 is applied by s 105(1)(i) the Collection Act to proceedings under that Act “as if ….the proceedings were proceedings [under the Family Law Act 1975]”. The combined operation of s 121(1) of the Family Law Act 1975 and s 105(1) of the Collection Act is, therefore, to prohibit any reporting of a proceeding “under” the Collection Act which identifies the parties to it.
[28] The two proceedings before this court did not involve any claim by Mr Davis which was authorised to be made either under the provisions of the Family Law Act 1975 or the Collection Act. Consequently the two proceedings before us could not have been said to be “proceedings under” either of those statutes: Felton v Mulligan (1971) 124 CLR 367 at 382–3 ; [1972] ALR 33 per Menzies J; Australian Forest Managers Ltd (in liq) v Bramley (1996) 65 FCR 13 at 18 ; 136 ALR 431 at 436 per Lindgren J; Re Struthers (Liquidator of Project Management, Architecture and Construction Interior (PACI) Pty Ltd) (No 3) (2005) 64 NSWLR 392 ; 56 ACSR 238 ; [2005] NSWSC 1113 at [14] per Brereton J. Accordingly, our reasons do not of themselves engage the prohibition.
Although the Court of Appeal found that the subject matter of the present case is a matter arising under the Family Law Act the proceedings themselves are not “proceedings under the Act”. The proceedings did not invoke any provision of the Family Law Act. The proceedings were not authorised by a provision of that Act. Rather, the proceedings were taken under, and authorised by, s 37A of the Conveyancing Act.
Thus, s 117 had no application to the proceedings.
There is no conflict between that finding and the finding of the Court of Appeal that “the whole of the subject matter of the appeal is a matter arising under the Family Law Act”. In doing so, the Court of Appeal found that the proceedings were an enforcement of a compromise of rights arising under the Family Law Act. It was not suggested that Act authorised the proceedings.
As is made clear in the above authorities, there is a distinction between a proceeding under an act and a matter arising under an act.
In any event, if s 117 was to apply the husband did not identify any of the criteria pursuant to s 117(2)A of the Family Law Act, or any evidence, which, if applied, would lead to a different result.
It was then submitted that the primary judge should have applied or had regard to the rate set out for legal work in schedule 3 of the Family Law Rules. The primary judge was of the view that the costs usually applicable in the Supreme Court of New South Wales should apply. That was an approach that he was entitled to take. He was also entitled to fix the costs himself.
The primary judge had before him the evidence of a costs consultant which was not challenged in this appeal. That evidence included a statement that the amounts charged by counsel for the wife would be sustained in full on an assessment, whether on an ordinary or indemnity basis.
We see no error in the approach of the primary judge and the appeal against the costs orders will be dismissed.

COSTS

Directions will be made for the filing of submissions as to the costs of these proceedings.

I certify that the preceding one hundred and twenty-eight (128) paragraphs are a true copy of the reasons for judgment of the Honourable Full Court (May, Ainslie-Wallace & Aldridge JJ) delivered on 27 November 2014.

Associate:

Date: 27 November 2014