Green and Wall

[2018] FamCA 335

FAMILY COURT OF AUSTRALIA

GREEN & WALL [2018] FamCA 335

FAMILY LAW – ENFORCEMENT OF ORDERS – Contravention – where the husband has contravened final orders requiring him to make a payment to the wife – where the final orders provided for the removal of a Lis Pendens (caveat) pending payment to the wife - where the husband has instituted proceedings in E State to remove the Lis Pendens – where it is found the husband instituted proceedings in E State in an attempt to avoid the obligations imposed on him by this Court – contravention found – orders made restraining the husband from doing any act or thing for the purposes of removing the Lis Pendens, pending payment to the wife.

Family Law Act 1975 (Cth)
Family Law Rules 2004 (Cth)

APPLICANT: Ms Green

RESPONDENT: Ms Wall

FILE NUMBER: MLC 9764 of 2014

DATE DELIVERED: 17 May 2018

PLACE DELIVERED: Melbourne

PLACE HEARD: Melbourne

JUDGMENT OF: Macmillan J

HEARING DATE: 8 May 2018

REPRESENTATION

COUNSEL FOR THE APPLICANT: Mr Puckey

SOLICITOR FOR THE APPLICANT: Mills Oakley Lawyers

THE RESPONDENT: No Appearance

Orders

UPON THE COURT being satisfied that the husband MR WALL has failed to comply with the following orders of the final orders made by the Family Court of Australia on 27 April 2016:

(a)paragraph 1(b) requiring the husband to pay the wife MS GREEN the sum of $300,000 on or before 1 February 2017;

(b)paragraph 3 requiring the husband to forthwith do all acts and things and sign all necessary documents as may be required to pay or cause to be paid to the wife the outstanding sum of $300,000 with interest thereon at the rate prescribed in the Family Law Rules 2004 (Cth) from the husband’s Company H Savings Plan including but not limited to by loan from the said Plan;

IT IS ORDERED THAT

1. On or before 31 May 2018 the husband pay or cause to be paid to the wife the sum of $300,000 (“the Payment”) together with interest of $28,972.60 calculated pursuant to the rate prescribed in the Family Law Rules 2004 (Cth) from 1 February 2017 to the date of this order, that rate currently being a rate of 7.5 per cent per annum plus additional interest accrued thereon from the date of this order up to and including the date of receipt of the Payment, as prescribed in the Family Law Rules 2004 (Cth) (“the Total Payment”) with the Total Payment to be paid into the wife’s lawyer’s (Mills Oakley’s) Trust Account on behalf of the wife.

2. In order to effect the Total Payment to the wife the husband forthwith do all acts necessary and sign all such documents as are required for him to personally withdraw in his sole name and/or raise a loan in his sole name and for his sole benefit from his Company H Savings Plan (with a balance of US$765,426 as at 22 April 2016), such sum as is required to give effect to the Total Payment pursuant to paragraph 1 herein with the husband to be solely liable for any and all liabilities inclusive of but not limited to all taxation arising from the withdrawal and/or loan to give effect to the Total Payment.

3. In the event the husband fails to make the Total Payment in full pursuant to paragraph 1 herein, that the husband also pay or cause to be paid up to and including the date of receipt of the Total Payment by Mills Oakley pursuant to paragraph 1 herein interest thereon prescribed in the Family Law Rules 2004 (Cth) with such further sum in his sole name and for his sole benefit as is required to pay the said interest from his Company H Savings Plan (with a balance of US$765,426 as at 22 April 2016), including but not limited to by loan from the said Plan with such sum of interest being calculated on the outstanding Total Payment from 31 May 2017 to the date the Total Payment is deposited into the Trust Account of Mills Oakley Lawyers pursuant to paragraph 1 herein (“the Total Payment plus interest”).

4. Contemporaneously with receipt of the Total Payment into the Mills Oakley Trust Account (or the total repayment including interest as may be required for the husband to fully comply with these orders) on behalf of the wife, the wife remove the Lis Pendens lodged by her in respect of the property known as and situate at C Street, D Town, E State, United States of America being the property more particularly described as C Street, D Town E State, according to the map or plat thereof recorded in Cabinet “K”, Sheets … of the Map/Plat Records of, E State (“the E State property”).

5. Pending the husband’s full compliance with these orders, the husband be and is hereby restrained by injunction by this Honourable Court from withdrawing or howsoever otherwise dealing with his Company H Savings Plan and his Company H Pension Plan or abiding any such withdrawal from or dealing with the said Plans save and except for the purpose of complying with these orders and the wife be and is hereby authorised to serve a copy of these Orders upon Company H.

6. Pending the husband’s full compliance with these orders the husband be and is hereby restrained from doing any act or thing for the purposes of removing the Lis Pendens in respect of the real property situate at C Street, D Town, E State, United States of America.  

7. By 4.00 pm on 1 June 2018 the wife file and serve upon the husband bullet point written submissions in support of any application for costs arising out of or incidental to her Application for Contravention filed 22 December 2017.

8. By 4.00 pm on 15 June 2018 the husband file and serve any bullet point written submissions in reply to any application for costs.

9. As soon as practicable the wife cause a copy of the Reasons for Judgment delivered this day and a sealed copy of these orders to be served upon the husband:

   (a)       by email addressed to the husband at:

   (i)…;

   (ii)…; and

   (b)by prepaid post addressed to the husband, care of L Lawyers, E State, United States of America ...

10. The wife’s Application for Contravention filed 22 December 2017 be otherwise dismissed and removed from the list of cases awaiting hearing.

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 Green & Wall 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 9764  of 2014

Ms Green

Applicant

And

Ms Wall

Respondent

REASONS FOR JUDGMENT

1. On 27 April 2016 I made final orders by consent pursuant to s 79 of the Family Law Act 1975 (Cth) (“the Act”) (“the final orders”).

2. Paragraph 1 of the final orders provided as follows:

   The Husband pay or cause to be paid to the Wife the sum of $400,000 payable as follows:

   a)the sum of $100,000 (“the First Payment”) to be electronically transferred  from the Husband’s [M Bank] account number …44 to the Wife’s [M Bank] account number …91 within 7 days and pending the First Payment the Husband be and is hereby restrained from withdrawing funds from and howsoever otherwise dealing with the said account, save for the purpose of making the First Payment; and

   b)the sum of $300,000 (“the Second Payment”) on or before 1 February 2017 (“the date”),

   (collectively referred to as “the Payments”).

3. Although the husband has paid the sum of $100,000 pursuant to paragraph 1(a) of the final orders, it is the wife’s case that not only has he not paid the balance of $300,000 he is required to pay, he has actively set upon a course intended to avoid meeting his obligation to do so pursuant to those orders.  

4. It is on that basis that on 22 December 2017 the wife filed an Application for Contravention. It is that application that is listed before me in the Judicial Duty List this day.

5. In support of that application, the wife relies upon her affidavit filed 22 December 2017. The wife also gave brief oral evidence. The wife’s evidence is unchallenged and I accept her evidence.  

Procedural History

1. The matter was first listed for hearing in the Judicial Duty List on 25 January 2018. I am satisfied that the husband was personally served with the Application for Contravention filed 22 December 2017 and the wife’s affidavit in support of that application on 17 January 2018. I also note that the wife’s solicitor also attempted to contact the husband by email on a number of occasions confirming details of the forthcoming hearing.

2. The husband did not appear and was not represented at the hearing on 25 January 2018 and did not file any material by way of reply in response to the wife’s Application for Contravention. On that date Johns J made orders in the following terms:

   UPON THE COURT being satisfied that the husband [MR WALL] has failed to comply with Order 1(B) of the orders of the Family Court of Australia dated 27 April 2016 that require him to pay to the wife [MS GREEN] the sum of $300,000 on or before 1 February 2017

   IT IS ORDERED

   1.That the wife’s contravention application filed 22 December 2017 be adjourned for hearing at 10.00 am on 16 February 2018 ( “the adjourned hearing”)

   2.That the husband personally attend at the adjourned hearing.

   3.That within 14 days the wife do all acts and things as may be required to personally serve the husband with:-

   a.A sealed copy of this order; and

   b.A Minute of the orders sought by her at the adjourned hearing.

   4.That in the event of the husband’s non-attendance at the adjourned hearing the wife may seek leave to have the application dealt with on an undefended basis.

   5.That the wife’s costs of this day be reserved. 

3. I am satisfied that the order made that day and a minute of the orders sought by the wife were personally served upon the husband on 31 January 2018.

4. The husband did not appear and was not represented at the hearing in the Judicial Duty List on 16 February 2018. On that date Johns J made orders adjourning the wife’s Application for Contravention for hearing in the Judicial Duty List this day, requiring the husband to personally attend at the adjourned hearing, the wife to personally serve the husband with a sealed copy of the orders made that day and reserving the wife’s costs of that day.  Although counsel for the wife submitted there was some dispute as to the purpose of the adjournment, there were notations to that order which read as follows:

   AND THE COURT NOTES

   A.That the wife has sought an adjournment of these proceedings in order to obtain evidence as to the status of the proceedings commenced by the husband in [E State], United Stated of America in which it is understood he seeks the removal of the lis pendens lodged by the wife in respect of the property at [C Street, D Town, E State] notwithstanding the husband’s failure to comply with order 1(b) of the Final Orders of the Family Court dated 27 April 2016.

   B.In the event of the husband’s failure to appear at the adjourned hearing the wife has indicated to the Court that she will seek that a warrant issue for the husband’s arrest.

5. I am satisfied that the order made on 16 February 2018 was personally served upon the husband.

6. The husband was called but did not appear and was not represented at the hearing before me.  As these are contravention proceedings the husband is not required to file answering material. However, not only has the husband failed to personally appear on any of the three occasions when this matter has been listed for hearing, and despite two orders specifically requiring him to do so,  he has not participated in these proceedings on any level. If the husband were opposing the application and even if he had not filed an answering affidavit, he would normally be expected at the very least to have filed a Notice of Address for Service and conveyed to the Court in some fashion the fact that he is opposing the application. He has not, despite ample opportunity, done so.

7. Even though the notation to the orders made 16 February 2018 suggests that the wife would be seeking a warrant for the husband’s arrest, leaving aside the facility of her doing so, I see no purpose in adopting that course.

8. In all of the circumstances, I am satisfied that the wife is entitled to have her Application for Contravention heard and determined and that the matter should proceed on an undefended basis.

Alleged Contraventions

1. The wife alleges that the husband has contravened the final orders made by the Court on 27 April 2016 as follows:

   a)That the respondent without reasonable excuse has failed to make the payment of $300,000 on or before 1 February 2017 pursuant to paragraph 1(b) of the final orders;

   b)That the respondent without reasonable excuse has failed to comply with paragraph 3 of the final orders to do all acts and things he was required to do to pay or cause to be paid to the wife so much of the payment then outstanding together with interest thereon at the rate prescribed by the Family Law Rules 2004 (Cth) out of his Company H Savings Plan including, but not limited to by loan from the said Plan.

2. The wife further sought to have the husband dealt with for having contravened paragraph 2 of the final orders, based upon his attempts to have the Lis Pendens removed from the property at C Street, D Town, E State in the United States of America (“C Street”). In my view, paragraph 2 of the final orders places an obligation upon the wife to remove the Lis Pendens upon receipt of payment from the husband, rather than an obligation upon the husband, albeit his attempts to remove the Lis Pendens are relevant for the purposes of my determination of whether he has contravened the final orders requiring him to make the payment and if I am so satisfied what orders I should make.

Background

1. The wife deposes that the husband has failed to make the payment despite numerous requests made by her solicitors that he do so. On 12 January 2017 in accordance with her instructions, her solicitor wrote to P Lawyers, the husband’s solicitors at the time the final orders were made, requesting confirmation as to when the husband proposed making the payment of $300,000 so that the wife could make the necessary arrangements for the removal of the Lis Pendens in accordance with those orders.

2. On 6 February 2017 the wife’s solicitors, again on the wife’s instructions, forwarded a letter to P Lawyers requesting confirmation that the payment that was required to be made by 1 February 2017 had been made, so that the wife could remove the Lis Pendens as the final orders required her to do.

3. On 8 February 2017 the wife’s solicitors again wrote to P Lawyers, inter alia, as follows:

   We refer to your telephone conversation with the writer this afternoon wherein you confirmed that you have not received any response to our letters from your client.

   We again confirm that our client has all things prepared for the Lis Pendens to be lifted as soon as her final payment of $300,000 is received.

   In the event we do not have a positive response from your office as to your client’s compliance and/or otherwise, we will assume you do not have instructions to act and will directly contact [Mr Wall].

4. The wife deposes and I accept that her solicitors did not receive a response to this letter or their earlier letters.

5. In accordance with the wife’s instructions on 23 February 2017 the wife’s solicitors wrote directly to the husband, inter alia, as follows:

   In the event the payment is not immediately paid to our client, she will have no option but to issue enforcement proceedings in the Family Court of Australia in Melbourne and will seek that you pay her costs of and incidental to such proceedings on an indemnity basis.

   As set out in our letter of 12 January 2017 our client will lift the Lis Pendens over the [C Street] property contemporaneously with the second payment being deposited into her account. She instructs she has all process in place for that to occur immediately upon the payment being received by her. 

6. The wife then sought the assistance of Company H with respect to the payment of the monies she is owed by the husband from the husband’s pension fund. After she was advised by the Pension Plan Services Supervisor of Company H that the company was unable to assist, the wife again instructed her solicitors to write to the husband in relation to his failure to comply with the final orders.

7. On 16 November 2017 Mr N, the wife’s attorney in E State, received a letter from O Lawyers, the husband’s attorneys in E State advising, inter alia, as follows:

   I am writing you again with respect to the above referenced Ernest Money Contract and your client’s Lis Pendens.

   Mr Wall will be forced to let the contract expire and the sale will not close if we cannot reach some agreement on a release of the Lis Pendens as to the [C Street] property.

   As I indicated in previous correspondence, [Mr Wall] is not in a position to pay the almost $300,000 settlement awarded by the Australian Court. He will be forced to let the property go back to the mortgage company if this sale does not close.

   Surely a portion of $52,000 is better than letting the contract expire and receiving nothing as a result of losing this asset.

   There is no secret deal or “kickback” in this transaction. Mr Wall is acting in good faith trying to settle a portion of the debt to your client. 

8. This letter was sent in the context of the husband, without the wife’s knowledge, having pledged to sell C Street. It is the wife’s evidence that the husband has agreed to sell the property for US$680,000 in circumstances where the property was purchased for US$905,000 in 2013 and the property is valued on the Q District website for $996,780. The wife deposes as to the values on this website being used to assess the tax payable on the sale of property in E State.

9. On 17 November 2017 the wife instructed her lawyer Mr N to write to the husband’s attorneys as follows:

   Thank you for your November 16, 2017, letter, with assurances regarding the sale of the property at [C Street]. I can hope you can understand our concerns based on a comparing the purchase price and appraisal price for the property to [Mr Wall’s] sales price.

   Having said that, the key issue is not the sale of the property. The key issue is [Mr Wall’s] ongoing failure to comply with the Agreed Divorce Decree issues by the court in Australia.

   ..

   I should note, in closing, two other provisions of the Divorce Decree. First, [Ms Green] is under no obligation to release the lis pendens until such time as [Mr Wall] pays as agreed. Second the Divorce Decree also states that if [Mr Wall] does not, or cannot pay as promised, he agreed to the following provision… 

10. The letter thereafter set out paragraph 3 of the final orders.

11. On 19 December 2017 Mr N received a letter from Mr L of O Lawyers enclosing an Action for the Removal of Lis Pendens filed on the husband’s behalf in the Q District Court, E State (“the District Court”).  That same day Mr N advised the wife by email that the husband has caused proceedings to be issued and that the husband had pledged to sell the property to a third party for a value equivalent to approximately two thirds of its value in a bid to extinguish his equity in the property, that being the wife’s security for the payment of the $300,000 pursuant to the final orders. He further advised that the husband had not disclosed to the District Court the terms of the final orders of this Court.

12. Although when the wife filed her affidavit she was awaiting the hearing of the proceedings in the Q District Court, it was her oral evidence that the husband’s application had been dismissed, but that he has now issued further proceedings in another county. It was her evidence that the purpose of these further proceedings is the domestication of the orders of this Court, which would appear to be akin to the registration of those orders and that on that basis, the husband would be arguing that, the underlying legal proceedings, having been concluded, the Lis Pendens would no longer have any effect.

Legal Principles

1. Section 105 of the Act provides that all decrees made pursuant to the Act, as is the case in this case, may be enforced by any court having jurisdiction under the Act.

2. Section 112AB provides that a person will be taken to have contravened an order if and only if:

   a)Where the person is bound by the order –he or she has:

   i)Intentionally failed to comply with the order; or

   ii)Made no reasonable attempt to comply with the order

   … 

3. Section 112AC of the Act provides that a reasonable excuse for contravening an order includes, but is not limited to, that person having contravened that order because or substantially because he or she did not at the time of the contravention understand the obligations imposed by the order or the court and the court is satisfied that the respondent ought be excused in respect of the contravention.

4. Sanctions for contravening an order are set out in s 112AD of the Act and include that the Court may require someone to enter into a bond, can impose a sentence which applies in respect of a person convicted of an offence against the law of a State or Territory, a fine or a term of imprisonment.

5. Subsection 112AD(4) of the Act provides that where the Court is satisfied that a person has without reasonable excuse contravened an order, the Court may make such other order or orders as it considers necessary to ensure compliance with the order that was contravened.

Discussion

1. The wife bears the onus of proving that the husband has contravened paragraph 1(b) and (3) of the final orders made 27 April 2016. As previously referred to, the wife’s evidence is unchallenged and in these circumstances I am satisfied that the husband, having not made the payment the final orders require him to make, has contravened paragraph 1(b) of those orders. I am also satisfied that having not made the payment as ordered, he has not done what is required of him to pay the amount outstanding to the wife out of his Company H Savings Plan and in those circumstances, has contravened paragraph 3 of the final orders. 

2. There is no claim by the husband as to there being a reasonable excuse for him having contravened the final orders. Although there is reference in the correspondence to the husband having asserted that he does not have the money to pay the $300,000, there is no evidence before me to support that assertion nor has the husband applied to set aside the orders. Nor does that answer the question of why, even if he did not have the funds immediately available to make the payment to the wife, he has not complied with the order requiring him to direct that payment out of his Company H Savings Plan.

3. The wife ultimately did not pursue her application with respect to the alleged contravention of paragraph 2 of the final orders, that being the order requiring  her to remove the Lis Pendens contemporaneously with the payment by the husband, which was intended to secure the payment to the wife. In my view the intention of that order is clear. Significantly in my view, these are orders that were made by consent at a time when the husband was represented by both experienced solicitors and counsel. The husband’s unsuccessful application in the Q District Court to remove the Lis Pendens and his outstanding application for the domestication of the orders of this Court in order to establish that the Lis Pendens has lapsed fly in the face of the orders of this Court. I am satisfied that these applications are a deliberate attempt by the husband to avoid the obligations imposed upon him by this Court and that the husband could have been left in no doubt as to the purpose of the final orders when he instructed his attorneys to institute the proceedings in E State. The husband has had every opportunity to put his case before this Court. However, he has chosen instead to pursue proceedings in E State contrary to the intention of the final orders of this Court, to which he consented.

Conclusion

1. Being satisfied that the husband has contravened paragraphs 1(b) and 3 of the final orders made 27 April 2016, the Court may impose one or more of the sanctions available to it that it considers appropriate. Counsel for the wife did not seek the imposition of any particular sanction or sanctions, instead seeking orders which he submitted were intended to ensure the husband’s compliance with the final orders. This included an order directed to the husband restraining him from doing any act or thing for the purposes of removing the Lis Pendens, pending payment of the $300,000 to the wife. This is clearly consistent with the purpose of the final orders. I am satisfied that I should make an order to that effect. 

2. I am also satisfied that I should make the other orders sought by the wife which are in similar, albeit not exactly the same, terms as the final orders, including the provision for interest to be payable at the rate prescribed by the Family Law Rules 2004 (Cth) (“the Rules”) save and except that the amount of that interest has been calculated as at the date of the final orders, albeit further interest will be payable if the husband does not make the payment. I am satisfied that in circumstances where the husband has failed to make the payment the final orders provided him to make, that I should now make orders which require him to withdraw that payment and the interest that is payable from his Company H Savings Plan.

3. The minute of proposed orders provided for the amount to be paid by the husband to include the wife’s costs as well as the interest payable on the amount outstanding. As I propose to make orders for the parties to make submissions with respect to the wife’s application for costs and thereafter determine what, if any, costs are payable, it is not possible to make an order which includes an amount for the wife’s costs.

4. I also propose to order that the wife cause a copy of these Reasons and my order to be served upon the husband. Although the orders made by Johns J required personal service upon the husband, I propose to require the wife to serve these Reasons and my order upon the husband by email and by prepaid post addressed to his attorney in E State, Mr L of O Lawyers.      

I certify that the preceding thirty-nine (39) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Macmillan delivered on 17 May 2018.

Associate: 

Date:  17 May 2018