Gibbs & Gibbs (No 3)

Case [2022] FedCFamC1F 1054

Federal Circuit and Family Court of Australia

(DIVISION 1)

Gibbs & Gibbs (No 3) [2022] FedCFamC1F 1054   

File number(s): SYC 5405 of 2018
Judgment of: CHRISTIE J
Date of judgment: 22 December 2022
Catchwords: FAMILY LAW – STAY APPLICATION – Where the husband has filed a Notice of Appeal from final orders made 31 October 2022 – Where the husband seeks a stay of the final orders – Where the wife opposes the stay application – Where a partial stay of the final orders is granted on conditions.   
Legislation:

Family Law Act 1975 (Cth) s 121;

Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) r 13.12

Cases cited:

House v The King (1936) 55 CLR 499; [1936] HCA 40

Trahn & Long (No 2) [2008] FamCAFC 194

Division: Division 1 First Instance
Number of paragraphs: 45
Date of hearing: 21 December 2022
Place: Sydney
Counsel for the Respondent: Mr Watkins
Solicitor for the Respondent: Solari & Stock Lawyers, Ms Quirk
Solicitor for the Applicant: Nora Michael Family Lawyers, Ms Michael

ORDERS

SYC 5405 of 2018

FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)
BETWEEN:

MR GIBBS

Applicant
AND:

MS GIBBS

Respondent

order made by:

CHRISTIE J

DATE OF ORDER:

22 December 2022

THE COURT ORDERS THAT:

1.The husband be permitted to provide a copy of the orders and reasons for judgment of 31 October 2022 to any lender for the purpose of securing finance to comply with orders of this Court.

2.Orders 1 and 3 to 6 of the 31 October 2022 orders made by the Honourable Justice Christie be stayed on condition that:

(a)the husband complies with Order 12 on or before 9 January 2023; and

(b)the husband pay to the wife or as she may direct the sum of $2,646,117.70 on or before 23 January 2023.

3.In the event that the husband fails to comply with, either or both conditions, in Order 2 the stay will lapse.

4.The case management hearing on 17 January 2023 is vacated.

5.The Application in a Proceeding filed 28 November 2022 is stood over until after disposition of the Husband’s Notice of Appeal filed 25 November 2022, with liberty to the wife to relist on providing Notice to chambers and the Respondent.

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 the pseudonym Gibbs & Gibbs has…

Continue reading Gibbs & Gibbs (No 3)

Sign in free to access the full text

Details
AGLC
Gibbs & Gibbs (No 3) [2022] FedCFamC1F 1054
Case
[2022] FedCFamC1F 1054
Decision Date

CaseChat Overview and Summary

In the case of Gibbs & Gibbs (No 3), the husband sought an order staying the operation of certain financial orders made by the court in the proceedings between the parties. The wife opposed the application, arguing that the husband had failed to demonstrate that a successful appeal would not render the appeal nugatory, and that the balance of convenience favoured enforcing the orders. The court was required to determine whether the husband had established the necessary grounds for a stay of the orders. The court found that the husband had not demonstrated that a successful appeal would not render the appeal nugatory, as he had failed to provide evidence of his efforts to secure finance and inquiries. The court also found that the wife was entitled to the fruits of the judgment, as she had very little liquid capital and outstanding legal fees. The court further found that the balance of convenience favoured enforcing the orders, as the wife had not received any further payments since the orders were made, and that there was no evidence of any specific hardship to the husband if the stay was refused. The court therefore refused to grant the husband's application for a stay of the orders.

The court's decision in Gibbs & Gibbs (No 3) highlights the importance of demonstrating the necessary grounds for a stay of orders, including showing that a successful appeal would not render the appeal nugatory, and considering the entitlement of the other party to the fruits of the judgment, any hardship caused by granting or refusal of the stay, the balance of convenience, the merits and likely disposition of any appeal, and any delay in seeking the stay. The court also emphasised the need for the applicant to provide evidence to support their application, including evidence of their efforts to secure finance and inquiries. The decision serves as a reminder to applicants that they must meet the onus of establishing the necessary grounds for a stay, and that the court will consider the overall balance of convenience in determining whether to grant a stay.

Orders

Orders of the court

Full text does not contain this section.

Background

Background to the litigation

Full text does not contain this section.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

If the husband’s contention that the appeal would be rendered nugatory is dependent upon the contention that a successful appeal would allow him to keep all of his properties he is required, not merely to assert that fact but, to demonstrate it through admissible evidence. He has failed to do so. The husband had 42 days from the date of the final orders to make an application for finance and inquiries. He provides no evidence of having done so.Entitlement to the fruits of judgment The wife has net assets of $364,653. They include her superannuation (to which she is not presently entitled) and $109,000 in paid legal fees (which are notional rather than actual assets). The effect of this is that the wife has $51,718 in assets. At the same time the husband has $7,787,273 in assets in his name (a very small proportion being superannuation and notional assets). As is plain it is significant that the wife will be out of the fruits of her judgment. She resides with family. The husband continues to reside in the home the parties previously occupied.Hardship caused by granting or refusing the stay The husband submitted that there was no prejudice to the wife in granting the stay since the orders protect her right to recover the funds in due course. The prejudice to the wife is that she is presently entitled to be paid money and she has not been paid money. The hardship to the wife would appear to be:(a)She has outstanding legal fees; and(b)She has very little liquid capital. The husband cannot point to any specific hardship to him if the stay is refused, save the requirement that he comply with court orders which require the sale of property. Absent evidence he is in a position to retain that property that is not a relevant hardship.Balance of convenience This appeal can be heard expeditiously. The husband says that supports the making of a stay order. I accept the fact that the court can hear the appeal quickly is relevant to whether a stay should be ordered. However, it has to be remembered that these proceedings commenced in 2018. In addition, if a stay is granted the wife was entitled to be paid her entitlements on 12 December 2022. On 12 December 2022 (or 13 December 2022) she received a sum equivalent to less than 8 per cent of her entitlements. If a stay were to be granted as the husband proposes she would be without further funds until one of the following occurred:(a)The husband’s appeal was dismissed and the husband complied with the 31 October 2022 orders – on even a best case scenario, no earlier than April 2023; or(b)The husband’s appeal was allowed on the alternate basis and the husband complied with the requirement to pay the lesser sum – on even a best case scenario, unlikely to be earlier than April 2023; or(c)The husband’s appeal was allowed on the primary basis and remitted for rehearing –probably some time in 2024.Merits and likely disposition of the appeal It must be observed that this is an appeal against a discretionary judgment and will face the usual difficulties set out in House v The King [1936] 55 CLR 499.

Ratio Decidendi

Legal Principle Established

The onus to establish the facts and circumstances necessary to grant a stay is borne by the applicant. Some of the matters which will be relevant to exercise of the discretion have been set out in the case law: see for example Trahn & Long (No 2) [2008] FamCAFC 194 at [38]. These include:(a)Whether refusing a stay would render the appeal nugatory;(b)The entitlement of the other party to the fruits of the judgement at first instance;(c)Any hardship caused by granting or refusal of the stay;(d)The balance of convenience;(e)The merits and likely disposition of any appeal; and(f)Any delay in seeking the stay.ConsiderationAppeal rendered nugatory The husband has set out his orders sought in the event that the appeal Court re-exercises discretion. The husband says at Part F of his Notice of Appeal (affidavit of Mr Gibbs filed 9 December 2022 at annexure A ):3.In the alternative to Order 2 [remitter] the lump sum payable to the respondent wife pursuant to Order 1 of Orders dated 31 October 2022 be varied such that having regard to the value of the net property of the parties as found by the Full Court in the re-exercise of discretion, the respondent wife receives overall 40% of the net property of the parties. I accept that the husband’s primary relief on appeal is that the matter be remitted. However, it is relevant to assess what he submits the proper result ought be if his appeal is successful. Assuming the same pool of assets as at trial, if the husband were required to pay the wife an amount equivalent to 40 per cent of the net pool that would require she receive $3,260,770 (including cash of $2,896,117). The husband says the asset pool may change if the matter is remitted. I accept it may increase, decrease or stay the same. The husband has proposed certain terms as part of his application for a stay. His solicitor referred to the husband being prepared to provide an undertaking. The husband did not file an undertaking nor did he make plain the precise terms of any undertaking he was prepared to offer. His evidence said he undertook to quarantine the proceeds of sale of a property at W Street, Suburb X (“the Suburb X property”) in the estimated sum of $1,571,220. As discussed below, that property is owned by D Pty Ltd (“the company”) and the husband’s affidavit should be understood as suggesting he was going to quarantine the company’s funds. Assuming that the husband had the authority to offer such an undertaking (and there was no evidence before the Court that he did) three further issues arise:(1)He is not offering to pay those funds to the wife – merely to quarantine them;(2)The sum is not adequate to discharge what he accepts is an appropriate payment to the wife (on the basis of the existing asset pool); and(3)The husband’s late sister Ms B owned shares in the company which owns the Suburb X property. The evidence at trial was that no application for Letters of Administration had been made. The wife appropriately raised that the husband’s proposal if accepted was likely to result in delay.