Filipovic & Filipovic (No 3)
[2024] FedCFamC2F 249
•27 February 2024
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 2)
Filipovic & Filipovic (No 3) [2024] FedCFamC2F 249
File number(s): MLC 13771 of 2021 Judgment of: JUDGE O'SHANNESSY Date of judgment: 27 February 2024 Catchwords: FAMILY LAW – respondents late filed material – whether respondents should be permitted to rely upon late filed material – whether respondents should be heard at all – whether the application should proceed as undefended – what is an undefended hearing – whether interim property settlement orders should be made – whether orders should be made for the provision of documents and information – ability of directors of a company to obtain documents and information of the company for the purpose of Family Law act 1975 proceedings. Legislation: Corporations Act 2001 (Cth) s 198F, s 290 and s 1303
Evidence Act 1995 (Cth) s 140(2)
Family Law Act 1975 (Cth) s 79 and s 80
Federal Circuit and Family Court of Australia Act 2021 (Cth) s 189, s 190, s 191, s 192
Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) r 1.04, r 1.31, r 1.33, r 1.34 r 2.4, r 10.27
Cases cited: Keskin & Keskin and Anor (2019) FLC 93-932
Medical Training and Development Pty Ltd [2021] NSWSC 981
Morgan & Valverde (2020) FLC 94-100
Saso & Saso [2023] FedCFamC1A 65
Sharpe v Grobbel [2017] NSWSC 1065
Singam & Moffrey (2015) FLC 93-641
Strahan & Strahan(interim Property Orders) (2011) FLC 93-466
Zane & Allan (2008) FLC 93-378
Division: Division 2 Family Law Number of paragraphs: 104 Date of last submission/s: 19 February 2024 Date of hearing: 19 February 2024 Place: Melbourne Counsel for the Applicant: Mr North SC Solicitor for the Applicant: Mills Oakley Lawyers Counsel for the First Respondent: Ms Matson Solicitor for the First Respondent: Kenna Teasdale Lawyers Counsel for the Second, Third and Fourth Respondents: Mr Gates Solicitor for the Second, Third and Fourth Respondents: KHQ Lawyers ORDERS
MLC 13771 of 2021 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 2)
BETWEEN: MS FILIPOVIC
Applicant
AND: MR FILIPOVIC
First Respondent
MR B FILIPOVIC
Second Respondent
C PTY LTD (and another named in the Schedule)
Third Respondent
ORDER MADE BY:
JUDGE O'SHANNESSY
DATE OF ORDER:
20 FEBRUARY 2024
THE COURT ORDERS THAT:
1.For the purpose of, and in, these orders the Applicant, Ms Filipovic, is referred to as ‘the Wife’, the First Respondent, Mr Filipovic, is referred to as ‘the Husband’, the Second Respondent, Mr B Filipovic, is referred to as the ‘Brother’ and the Third Respondent, C Pty Ltd and the Fourth Respondent, D Pty Ltd are collectively referred to as ‘the Companies’.
2.Unless the documents and information described thereafter (‘the required documents and/or information’) has already been;
(i)disclosed by the Husband or any of the Brother and the Companies; or
(ii)provided to the Court on subpoena and released to the parties for inspection and copying; or
(iii)an item or aspect of the required documents and/or information does not exist; then on or before 30 March 2024 (30 days) (‘the new disclosure date’);
the Brother and the Companies provide the following by way of financial disclosure:
(a)Documentary evidence showing the account into which the net proceeds of sale of $1,218,348 received by BB Lawyers on the settlement of E Street, Suburb F was deposited, and documentary evidence showing how these funds were subsequently applied.
(b)Bank account statements in relation to any mortgage/s secured against the property at K Street, Town L, including mortgage number … registered in 2009 for the period 1 January 2010 to date.
(c)Copies of all existing leases or recently lapsed leases associated with commercial properties to be valued as particularised at paragraph 4 of the Orders made by a Judicial Registrar on 16 August 2023.
(d)Copy statements for ANZ account ending #...13 in the name of G Pty Ltd for the period 3 October 2017 to 21 January 2021.
(e)Copy statements for account number …93 and account number …88 for the period 1 January 2018 to date, as identified in the ANZ account ending #...13 in the name of G Pty Ltd.
(f)Copy documents associated with the loan facility number …92 including bank statements associated with that facility for the period 1 January 2021 to date as identified in ANZ account ending #...13 in the name of G Pty Ltd.
(g)Documents and evidence of deposits into ANZ account ending …77 in the name of J Pty Ltd on 1 July 2022 and 15 July 2022 confirming the source from which those deposits were made.
(h)Copy statements for all share trading accounts in the name of the Second Respondent or held by him on behalf of another for the period 1 January 2018 to date including but not limited to any CC Investments accounts in his name.
(i)Copy documents providing a breakdown of beneficiary loans payable to “Filipovic Family” as identified in financial accounts for the B Filipovic Investment Trust for the financial years 30 June 2016 to 30 June 2022 inclusive.
(j)Copy tax returns and financial accounts for the B Filipovic Investment Trust for the financial years ended 30 June 2013 to 30 June 2015 inclusive.
(k)Copy tax returns from financial accounts for C Trust for the financial years ended 30 June 2015 to 30 June 2018 inclusive.
(l)Financial accounts and tax returns for G Trust for the financial year ended 30 June 2018.
(m)Copy bank account statements for accounts ending …50 and …42 for the period 1 January 2021 to date as identified in Westpac account ending …47 in the name of H Pty Ltd.
(n)Copy credit Card statements for account ending …84 in the name of Mr B Filipovic for the period 1 January 2017 to date.
3.That in the event that it is asserted that any of the required documents and/or information have already been disclosed, or already produced on subpoena and released or does not exist, then the party or parties so asserting, by the new disclosure date, file and serve and set out on short affidavit, in concise terms or table;
(a)when and how the required document or information as disclosed; and/or
(b)where in the documents released on subpoena the required document or information is; and/or
(c)which document or what aspect of the required documents and information does not exist and the circumstances of why that is.
4.That should the Husband decide to sell the block of land at O Street, Suburb F (O Street) then he:
(a)Inform the Applicant as to all developments including in respect to any proposed offers for sale before he accepts any offer to sell the property and provide the Applicant with an authority to liaise with the selling agent to enable her to be kept informed as to the proposed sale;
(b)That after payment of the outstanding Line of Credit debt secured by mortgage on that property, the net sale proceeds of O Street be applied as follows:
(i)The sum of $65,000 be paid to the Husband as part property settlement; and
(ii)the sum of $268,000 be paid to the Wife as part property settlement; and
(iii)the balance be paid to an interest bearing account in the names of the Husband and Wife and held on trust for them by a solicitor agreed between the Husband and Wife, and failing agreement the Husband’s solicitors, pending agreement in writing between the Husband and Wife or further order of the Court.
5.Unless the documents and information described thereafter (‘the Husband’s required documents and/or information’) has already been;
(i)disclosed by the Husband or any of the Brother and the Companies; or
(ii)provided to the court on subpoena and released to the parties for inspection and copying; or
(iii)an item or aspect of the required documents and/or information does not exist; then on or before 30 March 2024 (30 days) (‘the new disclosure date’);
the Husband provide the following by way of financial disclosure:
(a)Details and documentary evidence of the total sales of $127,204 referred to in the business activity statement for AA Pty Ltd for the period 1 January 2023 to 31 March 2023.
(b)Details and documentary evidence of the source from which $96,800 was deposited into the bank account ending #...93 on 3 February 2023 and the purpose for which the deposit was made.
(c)In respect to any trust of which the First Respondent is an eligible beneficiary as to capital or income in accordance with Rule 6.06 (3) (f) of the Federal Circuit and Family Court of Australia (Family Law) Rules 2021, copies of:
(i)copy of the trust deed or any amending deed thereof;
(ii)A copy of taxation returns since 1 July 2018 to date;
(iii)A copy of financial statements since 1 July 2018 to date;
(iv)A copy of bank account statements associated with any such trust for the period 1 July 2018 to date.
(d)Income Tax Returns and Notices of Assessment for the financial years ending 30 June 2010 to 30 June 2017 inclusive.
6.That in the event that it is asserted that any of the Husband’s required documents and/or information, has or have, already been disclosed, or already produced on subpoena or does not exist then the party or parties so asserting, by the new disclosure date, file and serve and set out on short affidavit, in concise terms or table;
(a)when and how the required document or information as disclosed; and/or
(b)where in the documents released on subpoena the required document or information is; and/or
(c)which document or what aspect of the required documents and information does not exist and the circumstances of why that is.
7.That the parties organise and participate in a private mediation in the month of June 2024.
8.The parties are at liberty to file and serve a further short written submission, not exceeding 5 pages, as to costs of the Wife’s application in a proceeding served 13 November 2023, and in the event of there having been a relevant offer in writing, a copy of that offer, in accordance with the following timetable:
(a)The Wife to file and serve no later than 7 days after these orders; and
(b)The Husband, the Brother and the Companies file and serve no later than 14 days after these orders.
9.The Wife’s application in a proceeding served 13 November 2023 be otherwise dismissed.
10.The matter be adjourned to a date to be fixed before a Judicial Registrar in July 2024 for Mention.
Note: The form of the order is subject to the entry in the Court’s records.
Note: This copy of the Court’s Reasons for judgment may be subject to review to remedy minor typographical or grammatical errors (r 10.14(b) Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 10.13 Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth).
Section 121 of the Family Law Act 1975 (Cth) makes it an offence, except in very limited circumstances, to publish proceedings that identify persons, associated persons, or witnesses involved in family law proceedings.
IT IS NOTED that publication of this judgment by this Court under a pseudonym has been approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
REASONS FOR JUDGMENT
INTRODUCTION
The matter of Ms Filipovic (‘the Wife’), Mr Filipovic (‘the Husband’), Mr B Filipovic (‘the Brother’), C Pty Ltd and D Pty Ltd (‘the Companies’) comes before me for the determination of interim issues contained in the Wife’s application in a case filed on 13 November 2023.
The Wife is also the applicant in the substantive proceedings where she seeks property alteration orders pursuant to section 79 of the Family Law Act 1975 (Cth) (‘the Act’). This is the second decision in the matter. The first was delivered on 7 July 2023 and hereinafter referred to as the July 2023 reasons[1]. At [12] of the July 2023 reasons I observed:
12.The Husband and the Wife cohabited as man and wife over eight years and have made, I assume, different contributions recognised by section 79(4) of the Act over about 10 years as at the time of this joinder application. They have two children aged five and four and the parties also seek that the court determine … their children’s living arrangements. The Wife is aged 42 and works part time, and the Husband is aged 40 and, he says, works as a [professional]. The Husband and his brother have had a business association since 2006, before the cohabitation of the Husband and Wife.
[1] Anonymised as Filipovic & Filipovic (No 2) [2023] FedCFamC2F 825
A detailed background of the matter is set out in the July 2023 reasons, including the controversial circumstances and events that led to the joinder of the Brother and the Companies to the property adjustment proceedings between the Husband and Wife. It is unnecessary to further recite those circumstances and the controversies around those circumstances when the July 2023 reasons provide background and context to the parties’ dispute.
Interim hearing on 19 February 2024
I heard the matter over most of the day of Monday 19 February 2024 although the hearing was interrupted for short periods by my attending to a call over and consent orders in other matters during the day. Following the conclusion of submissions at about 4:00 PM, I indicated to the parties that I intended to deliver oral reasons and orders, res tempore, the following morning at 10:00 AM, but with the qualification that I may put off the delivery to a later time if I had not adequately considered the matter and formulated orders by 10:00 the following morning. At about 9:30 on the following morning my associate indicated to the parties that the matter would be fixed for the delivery of reasons and orders on the following Friday and then later still to the following Tuesday 27 February 2024.
Ruling on late filed material with reasons reserved
A significant controversy in this hearing was the intended reliance by some parties on very late filed material. Upon the application of the Wife’s senior counsel I did not permit the Husband, the Brother or the Companies to rely on the late filed responses, applications or affidavits. I reserved my reasons and these are my reasons.
In response to the ruling not permitting reliance on the late filed material, counsel for the Brother and Companies asserted that the Wife should not be permitted to rely upon assertions of fact in her outline of case of events subsequent to the filing of her only affidavit before the court, being 13 November 2023. I was concerned there maybe substance in that position and it took a significantly longer time than I had anticipated on the evening of the hearing to identify whether there was material in the outline of case (itself filed 14 minutes late) that asserted or alleged events after Thursday November 2023 and thus the equivalent of evidence from the bar table or mere assertion.
Limitation on interim hearing: proceedings issued two years ago
This is an interim hearing and the limitations on fact finding on an interim hearing conducted on the papers are acknowledged and followed. Nonetheless in this case certain circumstances are either clear or not disputed. It is significant however that the wife commenced proceedings on 10 December 2021 and I am hearing this still quite preliminary interim application in February 2024, that is just a bit over two years later. The parties have not yet completed disclosure, valuation or mediation.
The July 2023 orders
The orders, that were made on 7 July 2023 following a hearing where reasons were reserved after a hearing over 12 December 2022, 21 March 2023 and with last written submissions on 16 June 2023, were as follows:
THE COURT ORDERS THAT:
Upon the undertaking of the Applicant Wife, [Ms Filipovic] as to damages, by her senior counsel to submit to such order (if any) as the court may consider to be just for the payment of compensation (to be assessed by the court or as the court may direct) to any person (whether or not that person is a party) affected by the operation of order 2 herein or any continuation (with or without variation) of order 2 and to pay that compensation to the person/s affected by order 2 herein:
1. The following be and are parties to these proceedings:
(a) [Mr B Filipovic] as the Second Respondent; and
(b)[C Pty Ltd] (ACN […]) as trustee for [C Trust] as the Third Respondent; and
(c)[D Pty Ltd] (ACN […]) as trustee for the [B Filipovic Investment Trust] as the Fourth Respondent.
2.Save in the ordinary course of business, the Second Respondent, [Mr B Filipovic] and the Third Respondent, [C Pty Ltd] and the Fourth Respondent [D Pty Ltd], be and are restrained by themselves, their servants or agents from:
(a)Dealing with, transferring, encumbering or dissipating the assets of [C Pty Ltd] (ACN […]) and [D Pty Ltd] (ACN […]);
(b)Altering the directorship and/or shareholding of [C Pty Ltd] (ACN […]) and/or [D Pty Ltd] (ACN […]); and
(c)Liquidating or deregistering [C Pty Ltd] (ACN […]) and/or [D Pty Ltd] (ACN […]),
without first obtaining the Applicant Wife’s written consent or obtaining an Order of the Court.
3.Within 21 days of these Orders, the Second and Third Respondents provide to the Applicant the following documents:
(documents listed)
…
4.Within 21 days of these Orders, the Second and Fourth Respondents provide to the Applicant the following documents:
(a) For [D Pty Ltd] (ACN […]):
(documents listed)
(b) For [G Pty Ltd]:
(documents listed)
…
(c) For [H Pty Ltd]:
(documents listed)
(d) For [J Pty Ltd]:
(documents listed)
(e)All documents in respect to the acquisition of the property at [K Street]
(documents listed)
…
5.Within 28 days of these Orders, the parties jointly appoint a property valuer to undertake a Single Expert Valuation in accordance with the Rules (and in default of agreement within 14 days of these Orders, the Applicant Wife nominate three and the First Respondent together with the other Respondents choose one) of the properties located at:
(eight real properties listed)
…
6. Any application for costs be in accordance with the Rules.
7.The Wife’s application in a proceeding filed 28 July 2022 and the responses to that application filed 25 August 2022 and 8 September 2022 are otherwise dismissed.
8.These proceedings be listed for directions hearing before [a] Registrar […] on 16 August 2023 at 2:00pm.
…
Once the Brother and the Companies were joined to the proceedings it was essential to the proper conduct of the litigation that the properties described at order 5 of the 7 July 2023 orders (‘the third party properties’) be valued. It is significant that as at February 2024 that still has not occurred. The controversy between the parties cannot be resolved or even progress further until those valuations have occurred. To value the third party properties all of the leases of the properties concerned are required.
It is essential for the controversy to progress to a resolution that the relevant financial circumstances and history of all of the parties, including taking into account the value of the third party properties, be known to each of the parties and to the Court.
In the orders and reasons of 7 July 2023 (at order 8) the proceedings were adjourned to a Judicial Registrar on 16 August 2023.
The 16 August 2023 Orders
I refer to and recite the orders of the Judicial Registrar of 16 August 2023, noting those orders adjourned the proceedings to 11 October 23.
THE COURT ORDERS BY CONSENT UNTIL FURTHER ORDER THAT:
1.That the parties participate in a private mediation on 6 October 2023.
…
3.That each party shall provide to each other party a list of documents (or class of documents) it requires to be produced within 14 days and those documents shall be produced within a further 14 days subject to any objection to their production.
4.That the parties shall appoint [DD Real Estate] to prepare a Desktop Appraisal of the properties listed below:
(eight real properties listed)
with the costs of [DD Real Estate]…
THE COURT ORDERS THAT:
Next Court Event (Further Case Management)
5.All outstanding applications are adjourned to the Judicial Registrar’s List (by Microsoft Teams) on 11 October 2023 at 2.00 pm for a procedural hearing.
Private Mediation
6.Not later than 7 days prior to the mediation, each party must send to each other party (if not already exchanged) and to the mediator:
(a)a copy of any Initiating Application, Response, Affidavit and Financial Statement upon which that party relies;
(usual documents listed)
…
7. The parties shall:
(a) comply with all reasonable requests made by the mediator.; and
(b)attend the mediation in person or as otherwise requested by the Mediator and make a genuine attempt to resolve maters in dispute.
…
AND THE COURT NOTES THAT:
A.The parties will consider whether this matter ought be transferred to Division 1 at or prior to the next return date.
B.In the event that the mediation ordered at paragraph 1 herein is vacated, the parties are to jointly notify Chambers (by email to …@...) forthwith confirming the reason for the delay and the updated mediation date.
C.The Court is informed that all issues as to valuation have been attended to in these Orders. The parties assured the Court that any outstanding disclosure will be attended prior to the mediation and the parties have been advised that costs orders may be made in the event the matter is not able to proceed on the date allocated for the mediation in these Orders.
D.To ensure the mediation proceeds as planned, any party may seek a mention hearing on short notice in relation to the issue of discovery/disclosure in the event any issue arises in respect to those matters.
E.In the event the mediation does not resolve the property dispute between the parties the parties shall appoint a valuer to prepare valuations of the properties identified at order 4 above in accordance with the manner set out at order 5 of the orders dated 7 July 2023.
F.Consistent with paragraph 125 of the Reasons for Judgment of His Honour Judge O'Shannessy dated 7 July 2023, any valuation, and the costs expended on the same, are all subject to the ultimate orders of the judge at final hearing. The costs expended on the mediation shall also be subject to the ultimate orders of the judge at final hearing.
G.In the event that any party fails to comply with these Orders, the Court may order that they pay the legal costs of the other party resulting from their non‑compliance or the matter may be listed for an undefended hearing.
…
The Respondent’s disclosure
The effect of the 16 August 2023 orders was that disclosure was required by 28 July 2023. The disclosure was on 11 August 2023 and in unusual form as recited in the Wife’s affidavit:
30.Contrary to the orders of Judge O'Shannessy. [Mr B Filipovic] did not provide disclosure by 28 July 2023
31.On 11 August 2023 an email from his lawyer was received al 3 31 pm, attaching a link to documents. It stated the link would be deactivated “within 10 minutes of receipt" The link was indeed deactivated exactly 10 minutes after it was received. My lawyer, who was not in his office building at the time the link was sent was only able to download the documents by alerting his legal assistant to the email, and requesting that the documents be immediately downloaded
DIRECTIONS HEARING 16 AUGUST 2023
32.On 16 August 2023 [the] JR […] made Orders that further disclosure requests be made by 30 August 2023, and documents be produced within 14 days thereafter. A private mediation was to occur on 6 October 2023 with a further Directions Hearing on 11 October 2023. The court noted
a.The Court has been informed that all issues as to valuations have been attended to in these orders
bParties assured the court any outstanding disclosure will be attended to prior to mediation
33.On 18 August 2023 I requested [Mr B Filipovic] provide by 1 September 2023, further documents, including In relation to the acquisition of [Town L]. and answers to questions.
34.Not having received any response, my lawyer sent a follow up letter on 5 September 2023
35.[Mr B Filipovic] eventually replied on 7 September 2023 belatedly seeking documents regarding the [Town L] property, contrary to the Orders made on 16 August 2023.
36Contrary to the Orders made 16 August 2023, [Mr B Filipovic] thereafter took the position that:
ahe would “not respond to any requests for documents in relation to [Town L] until your client has responded to the above request".
b.if he did not receive my documents [regarding [Town L]] there would be no mediation
37 My lawyer attempted to negotiate a mutual exchange of documents.
38[Mr B Filipovic] agreed for a mutual exchange on 25 September, which was then postponed to 26 September, then he resiled from the exchange altogether.
39 I agreed to provide my financial disclosure first.
40[Mr B Filipovic's] lawyer sent a link to documents, but stated I would only get the password to access the link after I had provided the documents sought by [Mr B Filipovic].
41.I complied with this demand, but after my lawyer sent my documents, the password provided to access the documents failed to open the link. A file was ultimately provided without encryption on 26 September 2023
42.The documents provided suggested there were other accounts associated with various entities in which [Mr B Filipovic] had an interest which had not been disclosed
aI requested copy statements for other accounts in the name of [J Pty Ltd] ("[J Pty Ltd]") given the narrations in bank statements provided for account […77] in the name of [J Pty Ltd] refer to deposits being received into that account (#...77) from [J Pty Ltd]" This included deposits on 1 July 2022 and 15 July 2022 into account [#...77] totalling over $245,000 where the narration makes reference to those payments being received from "[J Pty Ltd]" No response or documents have been received following a request for this by my lawyers to [Mr B Filipovic's] lawyers
bI requested an explanation for how over $1,200,000 of net proceeds from the sale of a property at [E Street] had been applied
cI requested copies of [Mr B Filipovic’s] share trading accounts given he had spent over $120.000 to purchase [CC Shares] on 22 and 29 April 2022, funded from the $760,000 deposited into his personal account on 19 October 2021 from an account in the name of [D Pty Ltd], one week after our separation. The origin of these funds is the sale of a property at [S Street]
d I am able to produce this correspondence at the hearing
43.[Mr B Filipovic] replied on 4 October 2023 stating “... we do not consider our client is necessarily obliged to comply with the numerous requests you have provided ... until your client makes their case against our client clear". He sought I prepare "pleadings" and reiterated ·”To be clear, we do not propose to seek instructions in relation to your letter sent today until we have a response to our letter"
Ultimately, in circumstances where I did not permit late filed responding material to be relied upon, the Wife’s evidence as to the respondent’s disclosure is uncontradicted, and for the purpose of this interim hearing, I accept it.
Neither the July 2023 order or the orders of the Judicial Registrar provided for “mutual exchange” or any other restriction or qualification.
The October 2023 Orders
I infer from the nature of the orders that on the 11th of October 2023 it was clear that the parties disagreed about a number of matters in the interim. Unsurprisingly, and in an attempt to assist the parties progress their dispute, the Judicial Registrar made orders to ensure the parties formalise their disputes in a manner that would assist just resolution. Those orders included:
…
Documents to be Filed
4. Not later than 4.00 pm on 8 November 2023, the Applicant file and serve:
(a)Application in a Proceeding setting out with precision the interlocutory orders sought; and
(b)An affidavit in support of the interlocutory orders sought which is no longer than 10 pages in length and has no more than 5 annexures (noting the provisions of Rules 5.04 and 5.08 of the Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) and the Central Practice Direction – Family Law Case Management).
5.Not later than 4.00 pm on 6 December 2023, the First, Second, Third and Fourth Respondents file and serve:
(a)a Response to an Application in a Proceeding setting out with precision the interlocutory orders sought; and
(b)an affidavit in support of the interlocutory orders sought which is no longer than 10 pages in length and has no more than 5 annexures (noting the provisions of Rules 5.04 and 5.08 of the Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) and the Central Practice Direction – Family Law Case Management).
…
AND THE COURT NOTES THAT:
H.In the event of non-compliance with these filing directions, the Court will at its discretion either vacate the Interim Defended Hearing, conduct the matter as a procedural hearing, proceed on an undefended basis, list other matters with priority and/or make a costs order against the defaulting party.
(emphasis added)
Wife files 2 working days late but the listing is months away in Feb 2024
Said to be pursuant to those orders the Wife filed and served an application in a case and an affidavit in support on Monday 13 November 2023[2]. It needs to be acknowledged that application should have been filed five days, or two working days, earlier being Wednesday 8th of November. It was not in dispute before me that the 13 November 2024 application and affidavit in support was the application contemplated by the Judicial Registrar's orders of 11 October 2023. It was implicit in the Wife’s application that I would at the hearing extend the time for the Wife to file that application or vary the Orders to permit the application and affidavit to relied on. This was not an issue but I do so extend the time for filing of the application and affidavit to the day6 those documents were served: 13 November 2023.
[2] For reasons unclear the portal index shows the application filed on 13 November 2023 but the application document records it filed on 13 December 2023. There was no issue raised about this.
The application was made returnable on 19 February 2024 and listed as an interim defended hearing on the face of the documents. It was common ground before me, or at least not disputed, that the Wife’s late filed application was in substance the application contemplated by the orders of 11 October 2023.
Wife’s subpoena returnable on 13 November 2023
The Wife issued 5 subpoena in late October 2023 returnable on 13 November 2023 and I infer the documents produced were released to the parties soon thereafter.
The Respondents don’t file or explain
The orders of the Judicial Registrar of 11 October 2023 had provided that the Husband, Brother and the Companies file and serve any responding material by 6 December 2023. That day came and went and they didn't file or explain their delay.
The first reminder to the Respondents
On 13 December 2023 (W3), 1 week after the court ordered due date, the Wife’s solicitors wrote to the solicitors for the husband and the solicitors for the brother and companies. acknowledged that the application and affidavit had been filed and served five days late and purported to extend the time for filing to all of the respondents.
It is not disputed that there was no reply to the 13 December 2023 letter.
The second reminder to the Respondents
On 20 December 2023 the Wife’s solicitors wrote to the solicitors for the husband.
That letter (W4) stated as follows.
Dear Colleagues
[Filipovic & Filipovic] & Ors – MLC13771/2021
We refer to our letter dated 13 December 2023 and note that your clients have still to file and serve any Response or Affidavit in support in answer to our client's Application in a Proceeding.
Even accepting the extension provided to your clients, your clients remain in breach of the orders made on 11 October 2023 in circumstances in which they are over a week late in filing their material.
Please ensure that any responses that your clients seek to rely upon are filed and served with this office by this Friday, 22 December 2023.
We put you on notice that in the event that your clients fails to comply with the orders by the close of business on 8 January 2024 at the latest, our client will object to your clients' reliance on any material filed after that date and will seek for our client's application to proceed on an undefended basis.
Yours sincerely,
…
The effect of that letter was that the wife solicitors were reminding the other parties of the obligation to file responding material, reminding them that they had not done so in accordance with the existing orders, requesting a prompt filing of the material body and in affect putting it out there that if the respondents filed by 8 January 2024 no objection would be taken but after that date objection would be taken.
It is not disputed that there was no reply to the 20 December 2023 letter.
The festive season and no reply
I take into account that the period between 20 December 2023 and 8 January 2024 is the festive season when most lawyers are away from their desks. But the orders for filing do not state nor can it be implied, that any time limits would be extended merely on account of the festive season unless expressively stated. Time limits are not extended for the Spring Racing Carnival, the AFL finals, the Wycheproof King of the Mountain, the Melbourne Formula One or any other like, and enjoyable to some, activity.
There was no reply to the second reminder letter of 20 December 2023. The day of 8 January 2024 came and went without response from the husband, the Brother or the Companies.
The second reminder letter was as follows.
Dear Colleagues,
[Filipovic & Filipovic] & Ors – MLC1371/2021
We refer to our letter dated 13 December 2023 and note that your clients have still to file and serve any Response or Affidavit in support in answer to our client's Application in a Proceeding.
Even accepting the extension provided to your clients, your clients remain in breach of the orders made on 11 October 2023 in circumstances in which they are over a week late in filing their material.
Please ensure that any responses that your clients seek to rely upon are filed and served with this office by this Friday, 22 December 2023.
We put you on notice that in the event that your clients fails to comply with the orders by the close of business on 8 January 2024 at the latest, our client will object to your clients' reliance on any material filed after that date and will seek for our client's application to proceed on an undefended basis.
Yours sincerely,
…
An outline of case required
The 11 October 2023 orders, by [3], also required the parties to file an outline of case on or before 4:00 PM on or before Friday 16 February 2024, the afternoon of the last working day before the hearing on the following Monday. The purpose of the Outline of Case is to alert the Court and the other parties to how the application or response will be argued.
The material of the respondent’s
Below is a timeline of when the respondents filed their material and served it upon the applicant.
Date and Time: Material Filed 15 February 2024 at 8.18am: Husband’s response to an Application in a Proceeding 15 February 2024 at 8.18am: Affidavit of the First Respondent 16 February 2024 at 12.29pm: The Brother and the Companies Application in a Proceeding. 16 February 2024 at 12.29pm Affidavit of the Brother on behalf of himself and the Companies. 16 February 2024 at 4.24PM: Cost Notice on behalf of the Brother and the Companies. 16 February 2024 at 5.01pm: Response to an Application in a Proceeding of the Brother and the Companies. 16 February 2024 at 5.01pm: Affidavit of the Brother on behalf of himself and the Companies. (Duplicate of the previous affidavit filed 16 February 2024) 19 February 2024 at 9.27am Cost Notice of behalf of the Brother. Three preliminary applications
Senior counsel for the Wife made oral application for three preliminary applications arising, he said, from the manner of the Husband, the Brother and the Companies had conducted the litigation since the 11 October 2023 Orders and had failed to comply with directions despite reminders. He said:
SENIOR COUNSEL: Your Honour, could I start by indicating that my client’s position is that none of the material that the first or other respondents seek to rely upon today should be received today, that neither of my friends should be heard today, and my client’s application ought proceed as if undefended today...
Many years ago, in the Supreme Court of Queensland…when two (particular) practitioners appeared…(the Justice) said, “…We don’t be needing these,” and picked up the Rules of Court and threw them into the well of the court. And your Honour might well, in this case, think that the first to fourth respondents have come before you today expecting that we won’t be needing the Rules of Court, nor will we be needing or adhering to any prior order or direction of the court. We will just do as we please.
Senior counsel took the court through the procedural orders and events since the July orders referred to above. Senior counsel referred to the rules, including Rule 2.41 of the Federal Circuit and Family Court of Australia (Family Law) 2021 Rules.
2.41.When service is effected
A document served electronically or by post is taken to have been served:
(a)if the document was sent electronically, on the next business day after the document was sent;
(b)if the document was posted to an address in Australia, 40 on the day on which the document would be delivered in the ordinary course of post.
The point being that some of the material relied upon was deemed to have been electronically served last Friday and some or the day of the hearing (the following Monday)
No reason provided in filed material
I heard submissions from the parties as to the three preliminary oral applications. It was common ground that the respondent’s material filed did not include any explanation for the late filing.
Legislation and Rules
The Federal Circuit and Family Court of Australia Act 2021 (Cth) provides:
189 Formal defects not to invalidate
(1)Proceedings in the Federal Circuit and Family Court of Australia (Division 2) are not invalidated by a formal defect or an irregularity, unless the Court is of the opinion that:
(a)substantial injustice has been caused by the defect or irregularity; and
(b) the injustice cannot be remedied by an order of the Court.
(2)The Federal Circuit and Family Court of Australia (Division 2) or a Judge may, on such conditions (if any) as the Court or Judge thinks fit, make an order declaring that the proceeding is not invalid:
(a)by reason of a defect that it or the Judge considers to be formal; or
(b) by reason of an irregularity.
190 Overarching purpose of civil practice and procedure provisions
(1)The overarching purpose of the civil practice and procedure provisions is to facilitate the just resolution of disputes:
(a) according to law; and
(b) as quickly, inexpensively and efficiently as possible.
(2)Without limiting subsection (1), the overarching purpose includes the following objectives:
(a)the just determination of all proceedings before the Federal Circuit and Family Court of Australia (Division 2);
(b)the efficient use of the judicial and administrative resources available for the purposes of the Court;
(c) the efficient disposal of the Court's overall caseload;
(d) the disposal of all proceedings in a timely manner;
(e) the resolution of disputes at a cost that is proportionate to the importance and complexity of the matters in dispute.
(3)The civil practice and procedure provisions must be interpreted and applied, and any power conferred or duty imposed by them (including the power to make Rules of Court) must be exercised or carried out, in the way that best promotes the overarching purpose
(Notes omitted)
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191 Parties to act consistently with the overarching purpose
(1)The parties to a civil proceeding before the Federal Circuit and Family Court of Australia (Division 2) must conduct the proceeding (including negotiations for settlement of the dispute to which the proceeding relates) in a way that is consistent with the overarching purpose.
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192Power of the Federal Circuit and Family Court of Australia (Division 2) to give directions about practice and procedure in a civil proceeding
(1)The Federal Circuit and Family Court of Australia (Division 2) or a Judge may give directions about the practice and procedure to be followed in relation to a civil proceeding, or any part of such a proceeding, before the Court.
(2) Without limiting subsection (1), a direction may:
(a) require things to be done; or
(b)set time limits for the doing of anything, or the completion of any part of the proceeding; or
(c)limit the number of witnesses who may be called to give evidence, or the number of documents that may be tendered in evidence; or
(d) provide for submissions to be made in writing; or
(e) limit the length of submissions (whether written or oral); or
(f)waive or vary any provision of the Rules of Court in their application to the proceeding; or
(g) revoke or vary an earlier direction.
(3)If a party fails to comply with a direction given by the Federal Circuit and Family Court of Australia (Division 2) or a Judge under subsection (1), the Court or Judge may make such order or direction as the Court or Judge thinks appropriate.
(4)In particular, the Federal Circuit and Family Court of Australia (Division 2) or Judge may do any of the following:
(a) dismiss the proceeding in whole or in part;
(b)strike out, amend or limit any part of a party's claim or defence;
(c) disallow or reject any evidence;
(d) award costs against a party;
(e)order that costs awarded against a party are to be assessed on an indemnity basis or otherwise.
The Federal Circuit and Family Court of Australia (Div 1) and (Div 2) Rules (‘the 2021 Rules’) exist[3] to expedite just resolution of disputes and those rules include:
[3] Federal Circuit and Family Court of Australia (Family Law) Rules 2021.
Federal Circuit and Family Court of Australia (Family Law) Rules 2021
1.04 Overarching purpose
(1)The overarching purpose of these Rules, as provided by section 67 of the Federal Circuit and Family Court Act, is to facilitate the just resolution of disputes according to law and as quickly, inexpensively and efficiently as possible.
(2)Parties to family law proceedings must conduct the proceeding (including negotiations for settlement of the dispute to which the proceeding relates) in a way that is consistent with the overarching purpose.
(3)A party's lawyer must, in the conduct of a proceeding before the court (including negotiations for settlement) on the party's behalf:
(a)take account of the duty imposed on the party referred to in subrule (2); and
(b) assist the party to comply with the duty.[4]
[4] Section 67 applies to Division 1, and the identical section 190 applies to Division 2.
…
1.31 Court may make orders or dispense with these Rules
(1)The court may, in the interests of justice, dispense with compliance, or full compliance, with any of these Rules at any time.
(2)If, in a proceeding, the court gives a direction or makes an order that is inconsistent with any of these Rules, the direction or order of the court prevails in that proceeding.
…
1.33 Failure to comply with a legislative provision or order
(1)If a step is taken after the time specified for taking the step by these Rules, the Family Law Regulations or a procedural order, the step is of no effect.
(2)If a party to a proceeding does not comply with these Rules, the Family Law Regulations or a procedural order, the court may do any of the following:
(a) dismiss all or part of the proceeding;
(b) set aside a step taken or an order made;
(c) determine the proceeding as if it were undefended;
(d) order costs;
(e)prohibit the party from taking a further step in the proceeding until the occurrence of a specified event;
(f)make any other order the court considers necessary, having regard to the overarching purpose of these Rules (see rule 1.04).
1.34 Relief from orders
(1) A party may apply for relief from:
(a) the effect of subrule 1.33(1); or
(b) an order under subrule 1.33(2).
(2)In determining an application under subrule (1), the court may consider the following:
(a) whether there is a good reason for the non-compliance;
(b)the extent to which the party has complied with orders, legislative provisions and pre-action procedures;
(c)whether the non-compliance was caused by the party or the party's lawyer;
(d)the impact of the non-compliance on the management of the proceeding;
(e) the effect of the non-compliance on each other party;
(f) costs;
(g)whether the party should be stayed from taking any further steps in the proceeding until the costs are paid;
(h)if the application is for relief from the effect of subrule 1.33(1)--whether all parties consent to the step being taken after the specified time.
…
10.27 Orders on default
(1) If an applicant is in default, the court may order that:
(a)the proceeding be stayed or dismissed as to the whole or any part of the relief claimed by the applicant; or
(b)a step in the proceeding be taken within the time limited in the order; or
(c)if the applicant does not take a step in the time referred to in paragraph (b)--the proceeding be stayed or dismissed, as to the whole or any part of the relief claimed by the applicant.
(2) If a respondent is in default, the court may:
(a)order that a step in the proceeding be taken within the time limited in the order; or
(b)give judgment or make any other order against the respondent; or
(c)make an order referred to in paragraph (b) to take effect if the respondent does not take a step ordered by the court in the proceeding in the time limited in the order.
(Notes omitted)
Leave to rely on late filed material
That the respondent’s filed material was late, and very late, is self evident from the reasons above. It was common ground there was no explanation for the late filing in the material filed and no explanation provided before the material was filed. The Wife asserted prejudice to her as follows:
SENIOR COUNSEL: And, your Honour, it caused prejudice to my client. It continues to cause prejudice to my client. My client has not had the opportunity to properly instruct my 35 instructor. Frankly, haven’t had an opportunity to properly consider the contents of the documents. And should my instructor and I put my client to the expense of perusing, considering and preparing arguments against documents filed at the last minute, in circumstances where one struggles to find a reason for the late filing, other than that it was deliberate and intended to cause mischief and disruption to the 40 applicant and contemptuous of this court’s processes. In those circumstances – and I’m reminded there’s still no case outline from .....
…
SENIOR COUNSEL: In the absence of any evidence or explanation, [the late filing was deliberate and intended to cause mischief] it’s an inference that’s open, because someone who had a credible or innocent explanation for such delay in utter disregard of the direction of the court would hasten to go into evidence about it, so -
The Husband’s submissions as to why oral applications should be dismissed included that:
·The Wife had herself filed her application 5 days late and there was no agreement to suffer late filing;
·The proposal to not complain about the respondents late filing (as contained in the 13 December 2023 letter) if filed by 22 December or 8 January 2024 could not properly be made;
·The interim part property order sought by the Wife was “a very significant order” and she was seeking that on an undefended basis and without hearing form the Husband;
·That the Husband would be prejudiced if he was not permitted to rely on his filed material by the inherent prejudice of if I were to read his material there would be evidence to support his opposition to the discovery orders and the part property orders the Wife seeks;
·The effect of what the Wife sought, where she occupied the Suburb N property and sought, on the sale of the O Street property to retain the proceeds, was 100% of the non third party or uncontroversial pool and hence, although the Wife had her father funding her substantial legal fees, and yet she still sought funds for legal fees. If she was unsuccessful in her claim at trial as to trust property being included in the pool there was the very real prospect of there being nothing left. And hence, I infer, a real risk that the part or interim property orders would not be able to be undone or clawed back;
·There was no prejudice to the Wife identified;
·In any event the prejudice of what was proposed should consider the prejudice to both parties;
·The Husband had needed to go to a lot of trouble to subpoena the Trust records of the Wife’s father;
·The mere late filing and absence of explanation was an insufficient basis to find or infer that the late filing parties conduct was deliberate and intended to cause mischief;
·The serious consequences for the Husband if the part property orders sought by the Wife were made;
·It was not open to me to, and if it was open I should not, take into account the late filed material sought precise orders for the Wife to make disclosure by precise dates when the Husband had not complied with orders as to filing;
It was conceded that a discovery order in the form of “unless already disclosed or produced on subpoena the documents don’t exist” would cure the potential prejudice to the Husband of my proceeding without my reading the late filed material.
The Brother and the Companies submission as to why the oral application should be discussed included that:
·The Wife having filed late herself (13 November 2023 not 8 November 2023) did not come to the court with clean hands and her 13 December 2023 letter was attempt to set a new deadline for filing and the parties nor either of them just can’t do that.
·The Wife’s 5 subpoena’s returnable 13 November 2023 had produced “thousands; of pages” of discoverable material and the Wife’s case was as if nothing had taken place by way of information exchange (when stuff had happened)[5].
[5] This submission was objected to as evidence from the bar table and I heard it on the basis that it was an assertion not on affidavit in reply to an affidavit filed 13 November 2023 for a hearing on 19 February 2024.
·The Wife’s case outline had also been filed late (it was filed at 4.13 PM instead of before 4.00 PM.
·The Wife’s outline of case or another affidavit should have included, but didn’t, a concession that would have taken account of the thousands of pages produced on subpoena and set out, “We have these. We’re not pressing it. Here’s (a list) of the ones we still need” and this led to the incorrect inference being drawn that “nothing had been provided”.
·That the Brother and the Companies should be able to put from the bar table during the hearing an explanation for the late filing despite being able to together an affidavit late last week (that did not provide an explanation foe delay) because of:
·The 10 page limit on length of interim affidavits.
·The subpoenaed material (released on 13 Nov 2023) had to be inspected and work out what remained undisclosed and that was “not a quick task”.
·The fact that legal firms shut down during the festive season.
·The inference of deliberate late filing to cause mischief was not open without further cogent evidence.
·The alleged prejudice to the Wife of the late filing was not very high.
·The late filed application for transfer did not take anyone by surprise because that had been flagged in notation F to the 11 October 2023 orders.
·The Brother faced the difficulty that some documents sought related to non related third parties.
·It was conceded that some documents sought in the application (some of 1 (a) & 1 (c)) had not yet been provided.
·The need for transfer to Division 1, though included in the late filed documents, was overwhelming, obvious and had been previously raised.
In reply the Wife, by her senior counsel submitted, that to the extent it was suggested the Husband would be denied the opportunity to fairly present his case, the Husband had been given the opportunity but had squandered it and, if that causes the Husband prejudice, he should look to himself. But the prejudice to the Wife was inflicted upon her by the respondents delay in filing.
As to the issue of transfer to Division 1, the Wife said there were many considerations, some complex, and it was not appropriate to decide such issues when, with valuation, disclosure and mediation not yet completed or undertaken, it was not yet clear how many witnesses there would be or how long the case would take and that the Wife’s choice of forum as applicant could not simply be disregarded.
I indicated or ruled as follows but reserved my reasons:
·I was not satisfied that the late filing was deliberate and/or intended to cause mischief. But I would not permit the Husband or the Bother and the Companies to rely upon the late filed material, including affidavits, responses to the Wife’s application and recently filed further applications.
·I would permit counsel for the Husband, the Brother and the Companies to address me and make submissions about the substantive applications of the Wife.
·I would deal with the Wife’s application based only on the evidence of her affidavit and the cost notices after hearing submissions from all parties whether that was the same as “undefended” or not.
I am satisfied that the Husband, the Brother and the Companies are in default of compliance with the filing orders of 11 October 2023. It was not contended that they weren’t. This is not a case where an adjournment with costs, to remedy the prejudice to the not defaulting, or at least not significantly defaulting, party was pressed by those in default.
I am satisfied that Rule 10.27(2)(b),”…or make any other order against the (defaulting) respondent…”, and common sense, gives ample power to proceed without permitting the respondents to rely on the late filed material.
No good reason provided
I was guided by the analogous matters recited in Rule 1.34 (recited above) as to the, in substance, implied application to vary the 11 October 2023 orders for filing by the Husband and the Companies. I was not satisfied any of the submissions provided a good reason for non compliance with the filing directions or a good reason for filing so late, that is on the eve of the long awaited interim hearing. I was not satisfied any of the submissions provided even a reasonable, as composed to a good, explanation for not complying with the court orders as to filing explanation.
Not deliberate or intended to cause mischief
I also was not satisfied that the very late filing was deliberate or intended to cause mischief. That would be a very serious finding and the provisions of section 140(2) of the Evidence Act 1995 (C’lth) would need to be satisfied. I am not satisfied it was. I raised, in argument, the lesson of life, that an error or failure is usually due to a muck up rather than a conspiracy or intention to harm and I take that lesson into account in assessing the section 140(2) provision.
But the material was filed very late and there was no attempt to respond to the courteous reminders. I am not satisfied the Husband or the Brother or the Companies took the Wife’s application seriously or took the court ordered times for filing sufficiently seriously. I take into account that the Wife’s application was filed 2 business days late but it was for an application that had been listed three months away. Hence there can be no suggestion that 2 business days prejudiced the other parties. I take into account the Wife’s outline of case was filed and served 13 minutes late. It should not have been but the lateness is, although unexplained, very minor and I am not satisfied that caused any prejudice to the other parties.
I am satisfied that the very late filing did prejudice the Wife, at least to some degree. Disputes as to disclosure are tedious and time consuming. Time is required to properly deal with them. Electronic filing on the Thursday or Friday before a hearing on the Monday, fixed some three months previously, does not permit not only the lawyers but the lay party to come to grips with the substance and the detail of responding material.
The Judicial Registrar had good reason to set out the filing regime he did. The late filing set that scheme at naught.
The late filing seriously inconvenienced the court and the applicant party. The lay party has to provide instructions in a rush. That prejudices her.
Balancing all of the evidence, including the lack of deposed reasons for late filing, the very late filing (as opposed to late but still a month or couple of weeks before the hearing), the overarching purpose of the legislation and the Rules and the fact that these were court orders (not advisory suggestions), I was and am, not satisfied I should vary the interim hearing orders to permit reliance on the very late filed and served material.
Application that the respondents not be heard on the substantive applications
It does not follow from the late filed material not being relied upon that the defaulting parties should not be heard. The court retains a discretion as to the conduct of the substantive hearing. That does not mean what happens is at large. It is a serious thing to deprive a litigant of the opportunity to be heard at all. Because late filed material cannot be relied upon, and even if that means a party has no contradictory or other evidence at all, it does not follow that by the late filing the right to be heard is forfeited. In the circumstance where I am not satisfied that the late filing was deliberate or intended to cause mischief, I am not satisfied that the very drastic step of not permitting a party to be heard at all is appropriate or warranted.
Application for undefended hearing
The expression “undefended” is not defined, or otherwise explained in the Rules. The explanatory guide to the Family Court of Australia 2004 Rules, that is the old rules that no longer apply (and the guide was expressly stated not to be part of the rules) explained the term “undefended basis” in the following way:
“…… The court may order that a hearing or trial may proceed, because of the respondent’s failure to comply with the rule or order, as if a response had not been filed the court may make orders set out in the application on being satisfied by evidence that the orders should be made.”
In Zane & Allan (2008) FLC 93-378 (‘Zane & Allen’), the husband had failed to comply with orders and directions of the court and to cooperate with orders and directions relating to valuation of assets by single expert. The matter was listed for final hearing and on the day of the final hearing the husband appeared by counsel and sought an adjournment and, as I understand it, the purpose of the adjournment was to enable compliance by the husband with the Court orders and directions. The primary judge refused the adjournment application and proceeded to hear the matter in what was described as an “undefended” hearing over two days. A reserved judgement was delivered later. The husband appealed and the majority regarded the primary judge’s discretion as to whether to proceed undefended as miscarrying. The appeal was allowed and the matter remitted for rehearing on the basis that the discretion to determine whether the matter should proceed undefended miscarried.
At [10] the majority repeated the primary judge’s observations of just what an undefended hearing is (or at least was then) and did not criticise or approve those observations. Zane & Allen has been referred to since but without the list of matters set out at [10] being approved or adopted. I regard the list as at least useful to consider. The majority recited the primary judge’s observations as follows:
10.We note that his Honour subsequently considered the meaning of an “undefended hearing” in the reasons he delivered for the substantive property settlement orders made on 11 April 2006. In those reasons his Honour said:
28The following guidelines appear from the abovementioned cases and materials:-
(a)In an undefended case the Response becomes a nullity (Rules of Court)
(b)Where an Application has been struck out due to the default of a party to make a full frank and prompt disclosure of his/her financial affairs that party ought have no further right to be heard without order of the Court (Tate and Tate)
(c)In an undefended hearing the applicant has a duty to the Court to make full disclosure and deal with the Court in good faith (Krebs)
(d)In an undefended hearing the applicant must establish the case with admissible evidence (Tate)
(e)In an undefended hearing the trial Judge has the discretion to have regard only to the evidence of the party before the Court and not the affidavit evidence of the excluded party (Tate) [The converse of this being there must be a discretion to have regard to part or all of the affidavit evidence filed by the excluded party]
(f)The trial Judge in an undefended hearing may exercise a discretion to have regard to agreements reached between the parties prior to the hearing as to such matters as value of property where such agreements have been noted on the Court record or where there is admissible evidence establishing such agreement (Tate)
(g)Where a court does proceed to conduct a hearing as an undefended matter it is still bound by the same general requirements as to proof as in a defended matter. This does not mean that a court necessarily has to insist on detailed evidence, make elaborate findings and give reasoned decisions in undefended matters… Nevertheless it must be satisfied that the evidence supports its findings and orders.
(h)Subject to matters of procedural fairness the trial judge may allow the remaining party in an undefended hearing to rely on affidavit material filed and served on the excluded party together with oral evidence and the tendering of documents to establish a case.
(i)There is a wide discretion to be exercised by the trial Judge as to the extent of the involvement of the defaulting party in the undefended hearing. This discretion must be tempered with regard to procedural fairness, natural justice and the requirement to do justice to all of the parties. Each case will demand an individual assessment by the trial Judge as to the appropriate procedure to be adopted. In many cases the reasons giving rise to the determination that the case should proceed undefended will no doubt impact upon the decision of the trial Judge as to the method of hearing to be adopted. In many cases the trial Judge will have regard to the evidence of the remaining party only.
…
29… I am of the opinion that the husband has forfeited his right to have me read his affidavit evidence. In any event where his evidence was not corroborated I would be unable to accept it as there is no ability on the wife’s part to cross-examine him or his witnesses as they are not present.
30I will have regard to the Court record in order to consider any agreements recorded for the purpose of the final hearing. I have also referred to some of the husbands’ evidence in the course of my reasons…
…
32I have read all of those affidavits and my findings are based on the evidence set out therein, on the documents tendered in the hearing, reference to some of the husbands affidavit evidence or the matters of Court record referred to together with the wife’s oral evidence, unless I state otherwise.
At [11] the majority said it was unnecessary to express a view as to whether the primary judge’s understanding of an undefended hearing was correct or not.
At [6] of the his reasons the primary judge observed as follows:
6…As best I can determine an order made for a hearing to proceed undefended does not automatically exclude participation by the other party in some manner. It seems to me that the trial Judge would have the discretion to allow participation in any way which might be helpful to the Court or which may be seen as warranted in the particular circumstances of the case. In some cases it may be appropriate to exclude the other party from any participation at all.
There was no criticism or approval of the primary judge’s description of the breadth of the matters to be considered within an undefended hearing. In that case the majority point out that even in the event of default of a party with complying with court directions and rules there is a discretion to be exercised as to whether or not a final hearing should proceed as undefended. Of significance in finding that the discretion had miscarried the majority observed that the recalcitrant and noncomplying husband had filed some material and sought to participate in the hearing and that there were significant factual and legal issues that required hearing. An error was that the observations about the breadth of the discretion was made after the “undefended” ruling had been made and the trial had concluded.
As May J, in dissent as to the result of appeal in Zane & Allan, observed correctly and concisely:
[190]First it would be wrong in this case to lose sight of the fact that there are two parties to this dispute. The wife is entitled to have her application filed 1 September 2000 heard.
In Singam & Moffrey (2015) FLC 93-641 (Singam) the primary judge proceeded to hear a matter undefended after a party had failed to file documents in accordance with the rules of the court and had not attended a court ordered conciliation conference. That litigant in person had attended to directions hearings by telephone but was required to attend a further hearing in person but on the day of the hearing requested to appear by telephone. The request was denied.
In that case the Full Court regarded the primary judge as proceeding under the then applicable old (new Rules are now in force) default provisions of the then applicable rules. Those rules differ from the current rules but the themes are sufficiently similar for the observations to be apposite. At [43-44] the Full Court observed:
43.The exercise of the relevant discretions occurs within an important statutory and regulatory framework. The Federal Circuit Court “… must proceed without undue formality and must endeavour to ensure that the proceedings are not protracted” (s 42 Federal Circuit Court of Australia Act 1999 (Cth)). The Court may “… dispense with compliance, or full compliance …” with any of the Rules (r 1.06) consistent with specified objects of the Rules to “… operate as informally as possible” and to “use streamlined processes” (r 1.03(2)). The Court “will apply the Rules in [80183] accordance with their objects” (r 1.03(3)) and “must … avoid undue delay, expense and technicality” (r 1.03(4)).
44. …As is evident, the court has wide powers to frame proceedings and procedural requirements consistent with the interests of justice and the proper interests of both parties. Judgment by default is a remedy that results from a conclusion that the interests of justice require one party to be denied an important right; to have their case heard, even if considered weak or misguided. Frequently, other orders, including procedural orders shaped to fit the particular circumstances of the case, should be preferred.
The appeal was allowed on the basis that the exercise of the discretion to proceed undefended had miscarried.
In Morgan & Valverde (2020) FLC 94-100 (‘Morgan’), Austin J, siting as the Full Court dealt with an appeal arising from where a respondent had not complied with procedural orders and the primary judge had referred to Rule 10.27(2) (recited above) of the current Rules and said she would proceed “on an undefended basis”. The appeal was ultimately successful because, although there is no reference to the respondent asking to cross examine the other sides witnesses, the possibility of him doing so was not explained sufficiently to him. A defaulting party must still be heard as to what course the substantive hearing would take and a litigant in person informed of options.
In the course of allowing the appeal the observations of Austin J shed light on what an undefended hearing is. Austin J observed:
23The primary judge expressly referred to such power in the reasons for judgment, saying:
101.As a consequence, r 10.27(2) of the [the Rules] gives me the discretion to make orders including the giving of judgment or the making of any other order against [the appellant]. I intend to exercise that power.
…
185.[The appellant] has not complied with orders of this Court and is in default pursuant to r 10.26 of [the Rules], so much so that these proceedings have been heard on an undefended basis.
24But the primary judge did not do as portended. Her Honour did not order the appellant to take some other “step in the proceeding” (r 10.27(2)(a)). Nor did her Honour “give judgment” against the appellant (r 10.27(2)(b)). The Response filed by the appellant in February 2020, seeking certain property settlement orders, was not summarily dismissed. In fact, during final submissions, the primary judge elicited from him the precise nature of his proposal, as her Honour was properly intent on determining what just and equitable orders were needed to finalise the cause between the parties under Pt VIIIAB of the Act.
25The appellant was allowed to make final submissions, but not permitted to cross-examine the respondent, though no “other order” of that sort was actually made or explained (r 10.27(2)(b)). The hearing did not proceed on an “undefended basis”, as the primary judge said it did (at [185]), since the appellant participated in the trial and resisted the respondent’s application, though he was deprived of an opportunity to cross-examine her.
Hence in an undefended hearing consistent with Morgan an undefended hearing would mean any application of response of the defaulting party is dismissed before the substantive hearing and the defaulting party is not permitted to be heard on the substantive relief at all and the defaulting party is nor permitted to cross examine the other sides witnesses or tender documents to contradict the other sides evidence. Hence in an undefended hearing consistent with Morgan the defaulting party appears to be entirely excluded from participation in the substantive hearing contrary to the primary judges observations in Zane & Allan.
In Saso & Saso [2023] FedCFamC1A 65 (‘Saso’), Aldridge J sitting as the Full Court heard an appeal where the primary judge had refused an adjournment when the appellant was represented for the purpose of an adjournment application only. After refusing the adjournment the appellant was unrepresented and after referring to Rule 1.33 (recited above) and determining that the hearing would proceed undefended the primary judge did not permit the appellant to speak or address the court at all because the matter was an undefended hearing.
Aldridge J allowed the appeal on the basis that the unrepresented litigant did not get the opportunity to be heard as to how the substantive hearing should proceed once the adjournment was refused and that was a denial of procedural fairness. But in the course of doing so Alridge J touched on what an undefended hearing might or might not be. He observed:
18The question of whether the matter should be adjourned and the course of the hearing thereafter were quite separate matters. The refusal of the adjournment did not compel the matter to proceed on an undefended basis, whatever that ultimately means which was not explored in submissions. Both counsel proceeded on the basis that the effect was that the appellant could not participate in the hearing in any manner. That may not be correct but is not a matter that presently arises for consideration.
19As Austin J explained in Morgan & Valverde, there are a number of options available where the participation of a party is to be limited by reason of a default with procedural orders and normally that would involve allowing the defaulting party to cross-examine (albeit in the limited manner described in Morgan & Valverde), possibly to tender documents and to make submissions. It is apparent that the primary judge did not consider these options.
20That however, is not the point of Grounds 4 and 5. Senior counsel for the appellant at the appeal accepted that it was open to the primary judge to have made an order that the hearing proceed undefended. Rather, the point was that before making the determination as to how the hearing would proceed the primary judge should have sought submissions from the appellant and that this failure was a denial of procedural fairness.
…
24It is well-established that procedural fairness requires a party to be given a reasonable opportunity to present his or her case and it matters not whether that opportunity is taken up (Kioa v West (1985) 159 CLR 550). The respondent submitted that the appellant was afforded the opportunity but did not take it up because she did not file a Case Outline or an affidavit in chief. That however, was the failure to take up the opportunity to prepare for the hearing, and that failure was the basis for the application of r 1.33(2) of the Rule. It was not the opportunity to be heard as to what the consequences of that failure should be.
Hence the opportunity to file an outline of case does not necessarily mean the defaulting party had an opportunity to be heard as to the consequences of default.
Taking into account the guidance of those authorities (there was no time to refer to them and still undertake the substantive hearing), I was, and am, satisfied that that although the respondents were not permitted to rely on late filed material they should be permitted to be heard by submissions as to the substantive application of the Wife. This being an interim hearing the issue of cross examination of the Wife did not arise.
I made that ruling whether or not the end result would be correctly described as “undefended” or not. The respondents, although in default, were heard.
THE SUBSTANTIVE HEARING: DISCLOSURE
It is convenient to first deal with the disclosure orders pressed by the Wife.
I accept the submissions of counsel for the Brother and the Companies that the Wife should not be permitted to rely on assertions of fact, unless agreed, contained in her outline of case filed 13 minutes late on 16 February 2024 that post date her affidavit. To do so would be the equivalent, although not identical to, hearing evidence from the bar table. Just what that would be was not identified by counsel but left up to me to work out. I do not take into account factual assertions in the Wife’s outline of case of events after the date of filing her affidavit in support. Hence I do not take into account assertions of what the subpoena documents have reached or not reached.
Senior counsel referred me to sections 198F, 290 and 1303 of the Corporations Act 2001 (Cth) and a number of authorities[6] to demonstrate the legal rights of the Husband and the Brother to obtain documents relating to the affairs of companies, from the company where either of them is, or has been a director of a company, within the last 7 years including for “private” purposes as opposed to solely for their duties as a director.
[6] Senior Counsel for the Wife referred to Sharpe v Grobbel [2017] NSWSC 1065 at [21], In the matter of Medical Training and Development Pty Ltd [2021] NSWSC 981 at [11] – [15], ASIAK v Australia Secured and Managed MortgagesPty Ltd [2008] FCA 753 at [52], Zunino & Zunino [2019] FamCA 845 at [55]- [56], OSWAL v Burrup Holdings [2011] FCA 609 at [22] & [31] and Re Motasea Pty Ltd [2014] NSWSC 69 at [49] – [51].
In Sharpe v Grobbel [2017] NSWSC 1065 at [21] Brereton J observed that:
21.Moreover, directors are entitled, at common law, to access the books and records of the company as a necessary incident of the office of director, in order that they may properly perform their duties. The statutory right of access under Corporations Act, s 198F, now permits access for the purpose of legal proceedings to which a director or former director is or may become a party, notwithstanding that the director’s purpose may be a private one. For present purposes I am content to accept, without deciding, that consistently with the authorities on s 247A, s 198F may not abrogate legal professional privilege and thus may not override legal professional privilege in respect of advice to the company in connection with a dispute between it and the director. But subject to that exception, a company cannot insist on privilege against its director.
Black J, in Medical Training and Development Pty Ltd [2021] NSWSC 981, at [13] adopted and recited that observation of Brereton J. I am satisfied that the Husband and the Brother by reason of at least section 198F of the Corporations Act have the very wide rights to obtain relevant information from the Companies for the purposes of these proceedings, which would be a “private” purpose as described by Brereton J and adopted by Black J. These submissions were not contended. Rather it was suggested independent third parties can be difficult to obtain information from.
It is self evident that the Husband and the Brother are, for the purposes of section 198F, a party to legal proceedings, that is these proceedings.
Provided the not disputed suggested qualification of “unless already disclosed, or provided on subpoena or does not exist” is applied, I am satisfied there is a proper basis for the Husband, the Brother and the Companies to be ordered to disclose the documents described in the Wife’s application. It was not contended the documents and information sought was not relevant to the large controversy in the proceedings.,
In the circumstances were the request for the documents and information has been outstanding since the Wife filed and served her application on 13 November 2023, I am satisfied that a further 30 days is an appropriate time for the Respondents to deal with the further disclosure of documents and information required.
Continuing obligation of full and frank of all relevant documents and information
Though I will make the orders the Wife seeks (but qualified) as to disclosure no one should think that such orders exhaust the heavy burden of the continuing duty of disclosure that rests on all parties. It is a duty imposed by law and does not need an order.
THE SUBSTANTIVE HEARING: PART OR INTERIM PROPERTY APPLICATION
I was not addressed in detail as to the applicable law, counsel taking it as read that all counsel and the court, understood and sought to apply or would apply the well know principles of such an interim hearing. In this case the Wife seeks that if the Husband decides to sell the O Street block of land then she be kept informed and the entire net proceeds of sale be paid to her “as a part property settlement” and so she seeks orders pursuant to sections 79 and 80 of the Family Law Act 1975 (Cth) (‘the Act’). The Wife asserted the following:
91I am concerned about the continued diminution of our matrimonial assets and [Mr Filipovic’s] intention to now utilise the sale proceeds of [O Street] for his sole benefit.
92I have proposed that the net sale proceeds be equally divided between [Mr Filipovic] and me, and that it be characterised as a partial property settlement to each of us. [Mr Filipovic] has rejected that proposal.
93My lawyer has advised me that he requires funds in trust of $50,000 for the interim hearing in February2024, $30,000 for the mediation to follow; $10,000 for a further Directions hearing and a Readiness and Compliance Hearing and $200,000 for a 5 day trial.
94I am unable to borrow to fund these proceedings from my income or to borrow from other family members. I cannot afford to take a mortgage against my property at [M Street, Suburb N]. Nor can I afford the high interest rates charged by legal lenders. I receive no child support from [Mr Filipovic] and I have no other assets to sell to fund my legal fees.
95My father and I are both concerned about the level of legal fees I have incurred so far and I cannot be certain that my father will continue to lend me further funds given the significant funds he has loaned me so far. In order to guarantee me the ability to continue to pay my lawyers up to and including a Final Hearing, I seek an Order of this Court that I receive the totality of the net sale proceeds of [O Street], with the payment of those funds to be to be characterised as a part property settlement
96There has been a constant mention by [Mr Filipovic] and [Mr B Filipovic] of my legal fees having been paid by my father and his “investment” in my proceedings. My father was used as the apparent justification for limiting the life of the link containing [Mr B Filipovic's] financial disclosure to only 10 minutes.
97Notwithstanding alleging a concern that commercially sensitive information might be provided to my father, [Mr B Filipovic] has directly on two separate occasions sent to my father, letters from his lawyer addressed to my lawyer. My father is not a party to these proceedings and should not be privy to such communications. He has told me he feels harassed by such conduct
98[Mr Filipovic] and [Mr B Filipovic] have attempted to argue that trusts controlled by my father, and other extended family members, represents a financial resource to me
99I have no control over such trust, other than being classified as a primary beneficiary
100I received one solitary trust d1stribut1on of approximately $33,000 from my father In 2009
…
102My father objected to a subpoena to his accountant for the production of trust deeds and financial accounts relating to three trusts of which my father is an appointer. He was ordered to pay [Mr B Filipovic’s] costs
103 I have received no distributions whatsoever for over 14 years.
104I have voluntarily disclosed all my individual tax returns for the financial years since 2009.
The Wife seeks all of the proceeds if the Husband sells O Street because:
·she says she needs to fund her legal fees; and
·she is concerned the Husband will dissipate the proceeds;
·she does not have an interest in her father’s trust.
I refer to and apply the well known observations of the majority Full Court of the Family Court in Strahan & Strahan (interim Property Orders) (2011) FLC 93-466 including the following:
87.If the source of jurisdiction is s 79 of the Act, in Zschokke at 83,216 the Full Court said:
If the order is to be made under s.80(1)(h), it would seem that regard should be had to the requirement in s.79 that the orders be just and equitable and this would require the Court to undertake at least some brief consideration of the matters in s.79(4) including those referred to in s.75(2). If on a brief consideration of those matters, it seems likely to the Court that the party who is the applicant for the interim order for an advance of funds from the other party will be likely to receive by way of property settlement a sum sufficient to cover the advance, that would seem to be sufficient to enable the order sought to be made (cf Wilson and Poletti).
88.In Paris King Investments Brereton J at [33], referring to an interim property order under s 79 and s 80(1)(h) of the Act and also Zschokke, said that “while the requirements of s 79(2) and (4) must be observed in the same manner as for any interim property order, if it appeared that the applicant would likely receive by way of property settlement a sum sufficient to cover the advance, then an interim order may be made”
(citations omitted)
.…
118.We agree with the submissions of senior counsel for the Wife in relation to the approach to be taken to the hearing of an application for an interim property settlement order. There are two stages to the hearing of such an application where the power is to be exercised pursuant to s 80(1)(h) of the Act. This is recognised by the fact that although the power under s 79 should ordinarily be exercised on a once only basis, “circumstances may arise before there can be a final hearing” where the power is exercised. Thus the first step is to resolve whether to exercise the power before a final hearing and if it is resolved to do so then the second step involves the exercise of that power.132. The husband maintains that S is supported by him financially on a voluntary basis and that therefore the application by the wife should be dismissed.
…
126.Senior counsel for the Wife in his oral submissions submitted that in Harris the Full Court was saying that “the touchstone is the need for finality a once–and–for-all hearing and so there must be something that requires a departure from the usual case”. He further submitted however that the expression “compelling” was not used by the Full Court in the sense “of any rote formula” that was intended to “circumscribe the unfettered discretion”. He said that it was used by the Full Court as a description having regard to the “other formulae” of “an appropriate case”, “a proper case” or “as the justice of the case requires”. He further submitted that what the Full Court said about compelling circumstances cannot be considered in isolation from what was previously said. He submitted that to “say that one needs to erect a case of so-called compelling factors and then only exercise in a case where it’s considered to be compelling” would “confine the discretion inappropriately”.
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132.In relation to the first stage, in our view, when considering whether to exercise the power under s 79 and s 80(1)(h) of the Act to make an interim property order the “overarching consideration” is the interests of justice. It is not necessary to establish compelling circumstances. All that is required is that in the circumstances it is appropriate to exercise the power. In exercising the wide and unfettered discretion conferred by the power to make such an order, regard should be had to the fact that the usual order pursuant to s 79 is a once and for all order made after a final hearing.
139.We also emphasise that in order to establish an appropriate case for an interim property settlement order more is required than the mere fact that upon a final hearing the applicant would receive the property being sought (or an amount in excess of the funds being sought) from the other party.
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141.As to the various matters discussed by Brereton J in Paris King Investments which we have discussed above, we do not propose to deal with all of what his Honour said, however we make the following observations about some of the matters. Obviously the applicant should have “at least an arguable case for substantive relief which deserves to be heard”. Further, in determining at the procedural stage whether to exercise the jurisdiction there may need to be evidence of the applicant’s “likely costs of the litigation” given that the need for funds to defray litigation costs and expenses is the circumstance propounded as to why it is appropriate that an order be made. We also accept that “it is not an essential precondition” that the applicant’s legal representatives will not continue to act unless the costs are paid or secured on an ongoing basis.
The cost notices, all late filed, but all helpful and prepared by experienced and competent practitioners show that all parties have already, at this early stage of protracted proceedings, incurred and paid substantial legal fees. The financial relationship between the Wife and her father who has funded her part of these proceedings is controversial. For the purpose of this interim hearing only I accept the assertions in the respective cost notices.
The Husband has paid legal fees of $268,000 and funded that by drawing on the line of credit secured over the O Street property registered in his name alone. That expenditure of funds otherwise available for consideration of distribution between the parties, if just and equitable to do so, would ordinarily be treated as an asset in that party’s hands. The $268,000 has been drawn without reference to the Wife and without any proposal that she receive the same from what may ultimately be regarded as funds amenable to section 79 orders.
The Wife has paid legal fees of $454,000 and these have been funded by, she says a loan, from her father. The Husband submits that given her father has funded so much over such a long period of time, I can infer that he will fund more if asked. I have no such evidence and I do not accept evidence of past generosity can be treated as an inexhaustible source.
The Brother and Companies had paid legal fees of $104,000 and I am tod from the bar table from the Brother’s accounts.
The Wife holds the Suburb N property in her sole name.
Putting aside considerations of the controversial “partnership” or trust assets case of the Wife the very approximate pool of assets of the Husband and the Wife was asserted by the Husband using the Wife’s evidence and assertions to be about:
Suburb N $900,000 O Street $800,000 Line of Credit (300,000) O Street equity $500,000 Total Assets $1,400,000
If the Husband’s paid legal fees drawn on the line of credit is treated as an asset in his hand that less controversial asset pool becomes a further $268,000 or $1,668,000.
The Husband contended a part property settlement order should not be made because:
·the Wife contended for half of the proceeds but by over reach seeks 100%.
·there was a risk of part property settlement not being able to be reversed or clawed back.
·the Wife can call on her father to fund her legal fees.
·the Husband will need to draw on the line of credit to fund his legal fees.
·it is not appropriate to make an interim part property order.
I accept Ms Matson’s submissions that it is not appropriate or proper on this interim hearing, in all the circumstances for the entire proceeds of sale of the O Street property to be paid to the Wife if the Husband sells that property. I accept he will need to fund his legal fees.
In all the circumstances I am satisfied that it is appropriate and just and equitable to make an interim or part property order. It is appropriate because:
·the Wife has a need to fund her legal fees.
·the continued support of her father cannot be assured.
·the parties should, where possible fund their own fees rather than ask for support form their parents.
·the Husband has already, without consulting the Wife (although he has disclosed the source of funds), drawn $268,000 for legal fees from funds likely to be otherwise available for distribution between the Husband and the Wife.
·Although the precise degree of the parties respective section 79(4) contributions to their non controversial assets is not yet known, it is clear that both parents have made substantial contributions in disparate fields over a not insignificant number of years.
·Depending on the size of an interim property order there is substantial ability to claw back all of the interim part property from the Wife, when contribution assessment of section 79(4) matters are considered, even on a worst case for her basis.
·I am satisfied that the Wife has shown more than merely she will receive a property settlement order of some dimension.
I am satisfied the Wife will receive a property settlement order of the dimension she seek on the interim, that is 100% of the proceeds or $500,000 (30% of $1,668,000)
In Keskin & Keskin and Anor (2019) FLC 93-932 ('Keskin') the Full Court, Strickland, Kent & Austin JJ, at [44] approved what was the age old and pre-Stanford "preferred approach" as to the how the nuts and bolts of section 79(4) (and therefore its de facto counterpart at section 90SM(4)) fitted together as set out in Hickey and Hickey and the AG for the Cth of Australia (2003) FLC 93-143 ('Hickey') at [39]. Hickey set out the preferred approach as follows:
[39] The case law reveals that there is a preferred approach to the determination of an application pursuant to the provisions of section 79.?That approach involves four interrelated steps. Firstly, the court should make findings as to the identity and value of the property, liabilities and financial resources of the parties at the date of hearing. Secondly the court should identify and assess the contributions of the parties within the meaning of section 79(4)(a), (b) & (c) and determine the contribution based entitlements of the parties expressed as a percentage of the net value of the property of the parties. Thirdly the court should identify and assess the relevant matters referred to in section 79(4)?(d), (e), (f) & (g) ("the other factors") including, because of section 79(4), the matters referred to in section 75(2)?so far as they are relevant and determine the adjustment study (if any) that should be made to the contribution based entitlements of the parties established at step two. Fourthly, the Court should consider the effect of those findings and determination and resolve what order is just and equitable in all the circumstances of the case.
(Citations omitted and emphasis added)
The preferred approach assists me in making a principled and orderly determination of the parties' interim property dispute.
As to the first step the non controversial asset pool is about $1.4 million or $1.668,000, subject to valuation. As to the second or contribution step both parties have made substantial and not necessarily equal section 79(4) contributions. As to the third section 75(2) step, I do not proceed on the basis of any adjustment as I do not have sufficient information before me at this point.
The Husband’s cost notice asserts costs to the end of mediation of about $35,000 and I am satisfied he should have the ability, on the sale of the property, to properly fund his legal fees to at least the end of the mediation stage. Making an allowance on the more generous side I am satisfied that if the Husband sells the O Street property he should have $65,000 from the proceeds (on top of the $268,000 he has already drawn) to fund his legal fees and if necessary assist with the cost of his living expenses. That $65,000 should be received as interim property settlement.
I am satisfied that the interim property settlement to the Wife should be in the sum of $268,000, the same as the Husband has drawn for legal fees to this point. That sum is about 16% of the likely uncontroversial property pool excluding the third party/partnership and section 106B contentions of the Wife. That sum will be able to be reversed or clawed back if necessary.
If the O Street property is sold the balance of proceeds should be held in trust and if an agreed solicitor to so hold the funds cannot be identified, it should be held by the Husband’s solicitor.
I have determined it is appropriate to add the word “including” in the order regarding the Husband keeping the Wife informed of sale of property developments to keep that obligation as wide as practical.
COSTS
The parties have made costs submissions but I am, properly unaware whether offers in writing that may impact section 117 of the Act considerations. The Wife seeks standard or party/party cost orders. I agreed the parties should have the option to make further short submissions as to costs once these reason are known and the orders will make provision for that.
Those are my reasons.
I certify that the preceding one hundred and four (104) numbered paragraphs are a true copy of the Reasons for Judgment of Judge O'Shannessy. Associate:
Dated: 27 February 2024
SCHEDULE OF PARTIES
MLC 13771 of 2021 Respondents
Fourth Respondent:
D PTY LTD
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