Fong and Yang

[2017] FamCA 943

FAMILY COURT OF AUSTRALIA

FONG & YANG [2017] FamCA 943

FAMILY LAW – PROPERTY SETTLEMENT – Adjournment of proceedings – Where there are parallel proceedings in an overseas jurisdiction – Where there is a dispute regarding the existence of the husband’s right, title and interest in Chinese assets – Where the wife genuinely believes domestic assets were transferred by the husband to his mother to avoid the reach of property settlement orders – Where the wife has an interest in clawing back the assets from the husband’s mother – Where the wife sought the adjournment so that she may join the husband’s mother to the proceedings – Where a costs order in favour of the husband would ameliorate any prejudice to the husband in granting the adjournment – Where the wife would sustain prejudice if the adjournment was not granted – Ordered the parties’ application for property settlement relief is adjourned – Ordered the wife pay the husband’s costs of the trial thrown away by the adjournment

Family Law Act 1975 (Cth) ss 106B, 117

APPLICANT: Ms Fong

RESPONDENT: Mr Yang

FILE NUMBER: MLC 5956 of 2014

DATE DELIVERED: 1 November 2017

PLACE DELIVERED: Melbourne

PLACE HEARD: Melbourne

JUDGMENT OF: Austin J

HEARING DATE: 1 November 2017

REPRESENTATION

COUNSEL FOR THE APPLICANT: Not Applicable

SOLICITOR FOR THE APPLICANT: Not Applicable

COUNSEL FOR THE RESPONDENT: Mr G. Combes

SOLICITOR FOR THE RESPONDENT: Chiodo Maddaferi Solicitors

Orders

1. The trial of the parties’ applications for property settlement relief under Part VIII of the Family Law Act 1975 (Cth) is adjourned on the applicant wife’s application.

2. The proceedings are adjourned on a date to be fixed before the docket Registrar for further procedural directions.

3. The applicant wife shall file and serve any Amended Application by 1 December 2017.

4. If the Amended application filed by the wife joins the husband’s mother Ms Lu to the proceedings as the second respondent then service of the Amended Application upon her may be achieved by service upon the husband’s solicitors in substitution.

5. The wife shall pay the husband’s costs of the trial thrown away by the adjournment assessed in the sum of $5,000, payment of which is suspended until the parties’ dispute under Part VIII of the Family Law Act 1975 (Cth) is finalised.

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

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

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

FAMILY COURT OF AUSTRALIA AT MELBOURNE

FILE NUMBER: MLC 5956 of 2014

Ms Fong

Applicant

And

Mr Yang

Respondent

EX TEMPORE REASONS FOR JUDGMENT

1. The proceedings before the Court between the applicant wife and respondent husband were commenced some three years ago in mid-2014, shortly after they separated in or about May 2014. 

2. Curiously, proceedings were commenced in Australia by the wife but, contemporaneously, proceedings were commenced by the husband in China. It would appear from the evidence placed before the Court that the Chinese proceedings are still pending. Discussion today between the husband’s counsel, the self-represented wife, and I failed to clarify the current status of the Chinese proceedings and the extent to which either the Chinese proceedings or these proceedings might constitute an abuse of process. I remain puzzled as to how two sets of parallel proceedings between the same parties in respect of the same issues can remain extant.

3. In any event, the dispute between the parties in this Court was directed to both parenting orders under Part VII of the Family Law Act1975 (Cth) (“the Act”) in respect of their only child and the division of their property pursuant to Part VIII of the Act.

4. The parenting issues were resolved when orders were made by Johns J, with the parties’ consent, on 27 July 2017. Once those orders were made at trial between the parties, the only outstanding issue was the property settlement dispute. Why it was not resolved at the trial in July 2017 was not explained, though it is clear the property settlement dispute was re-listed before the Court on 22 September 2017 and again adjourned on that date. Although the husband’s counsel today asserted the property dispute was listed for trial on that date, I am unable to verify that submission by reference to the existing court orders. The parties advanced conflicting explanations for why the matter was adjourned by Johns J on 22 September 2017 and I do not feel able to resolve the conflict between them as to the real reasons for the adjournment. In any event, on 22 September 2017, the parties’ respective applications for property settlement were adjourned for trial today, in expectation that the duration of trial would be two days.

5. Given the wife is self-represented, her familiarity with and experience in litigation is limited. As I understand her case, she asserts two things against the husband: first, he has numerous assets in China which he has failed to disclose to her and the Court, and second, he had numerous assets in Australia which he transferred to his mother so as to place them beyond the reach of property settlement orders in these proceedings.

6. There is a clear dispute between the parties about the existence of the husband’s right, title and interest in the Chinese assets. He disavows any proprietary interest in Chinese assets, whereas the wife asserts findings made by the Chinese court in the pending Chinese proceedings vindicate his ownership of those assets. Suffice to say, the wife would be assisted by legal advice and representation in relation to the collation of admissible evidence to prove the proprietary interests she asserts the husband has in those assets.

7. As to the second issue, the wife’s interest in clawing back assets from the husband’s mother has been the subject of discussion in these proceedings for some time. The wife deposed in her most recent affidavit that, at a prior court event, Bennett J advised her of the need to join the husband’s mother to these proceedings if she wishes to pursue orders under s 106B of the Act clawing back assets for the purposes of them being amenable to property settlement orders under Part VIII of the Act. She deposed in her affidavit to the reasons why she has so far desisted from joining the husband’s mother, Ms Lu, to the proceedings as a respondent (at [50]-[52] of the affidavit filed by the wife on 26 July 2017).

8. At the commencement of the trial today, the wife re-visited the issue of the husband’s mother’s joinder to the proceedings. She has apparently recanted and now wishes to join her to the proceedings as the second respondent and, to achieve that objective, she sought an adjournment of the trial to afford her time within which to file and serve an Amended Application. 

9. The adjournment was opposed by the husband, but only on the basis of the time the litigation has already been pending. As I have indicated, the litigation has been live for approximately three years. It was fixed for final trial on a number of occasions in the past and adjourned but, as the husband’s counsel apparently conceded, at least until the most recent adjournment the adjournments were not attributable to any act or omission of the applicant wife.

10. When invited to make submissions about how the husband would suffer any tangible prejudice if a costs order was made in his favour for the costs thrown away by reason of the adjournment, counsel commendably conceded no such prejudice existed. Clearly, the prejudice to the wife in not being able to pursue assets she genuinely believes were transferred by the husband to his mother to purposefully avoid their amenability to property settlement orders in these proceedings would be great. The husband admits the assets were transferred to his mother for no consideration. However, he asserted the assets were always owned beneficially by his mother and he was merely the legal title holder.  That, of course, is an issue to be determined at final trial.

11. I am satisfied the prejudice the wife would sustain by reason of the adjournment not being granted would be much greater than the prejudice suffered by the husband if the matter is adjourned, particularly when his prejudice is all but ameliorated by a costs order in his favour.

12. The husband’s counsel estimated the costs thrown away at $5000, which in my view is a perfectly appropriate sum for a two-day trial involving counsel and instructing solicitor. To avoid further dispute between the parties about quantification of the costs thrown away, I intend to specify the quantum of the costs.

13. For the wife’s benefit, s 117(1) of the Act provides that parties in proceedings under the Act should ordinarily bear their own legal costs. Nonetheless, s 117(2) of the Act enables costs orders to be made in circumstances which justify it and, in those circumstances, the Court is required to have regard for the factors specified by s 117(2A) of the Act.

14. I am satisfied the financial circumstances of the mother are parlous. She does not have a grant of legal aid and she is unrepresented because of her impecuniosity. If the husband is to be accepted, he is in a similar position and relies on the largesse of his parents to meet his expenses. At least for the purposes of the determination of this costs application, I accept the parties are in a similar state of penury. However, the husband has come to Court today expecting the matter to be determined after some three years of litigation. He was surprised by the wife’s application for an adjournment, made after 10.00am on the first day of trial. I have already explained why the adjournment should be granted, but I am satisfied that in those circumstances the husband is entitled to the costs he has thereby wasted. 

15. To lessen the impost upon the wife, the costs order will be conditional upon payment being delayed until these proceedings are finalised, either by way of orders made with the parties’ consent or by orders following a defended trial. The husband’s counsel accepted such a condition was justified in the circumstances. 

16. For those reasons, the orders I have announced granting the adjournment and ordering the wife to pay the husband’s costs thrown away are appropriate.

I certify that the preceding sixteen (16) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Austin delivered on 1 November 2017.

Associate:

Date:  23 November 2017