Henton & Henton - [2022] FedCFamC1F 574

Federal Circuit and Family Court of Australia
(DIVISION 1)
Henton & Henton [2022] FedCFamC1F 574

File number(s): PAC 1371 of 2018

Judgment of: RIETHMULLER J

Date of judgment: 17 March 2022

Catchwords: FAMILY LAW – PROPERTY – Mortgages – Allegation of fraud perpetrated by husband – Indefeasible title – Summary judgment for bank.

Legislation: Family Law Act 1975 (Cth) ss 75, 79, 106B

Cases cited:
Hurst v Vestcorp Limited (1988) 12 NSWLR 394

Van den Heuvel v Perpetual Trustees Victoria Limited [2010] NSWCA 171

Yazgi v Permanent Custodians Limited [2007] NSWCA 240

Division: Division 1 First Instance

Number of paragraphs: 34

Date of hearing: 17 March 2022

Place: Parramatta

Solicitor for the Applicant: Brander Smith McKnight Lawyers

Counsel for the Applicant: Mr Fantin

Solicitor for the First Respondent: Anderson Boemi Lawyers

Solicitor for the Second Respondent: Thomson Geer

Counsel for the Second Respondent: Mr Hynes
ORDERS

PAC 1371 of 2018

FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)

BETWEEN:
MS HENTON

Applicant

AND:
MR HENTON

First Respondent

B BANK (ACN …)

Second Respondent

order made by:

RIETHMULLER J

DATE OF ORDER:

17 MARCH 2022

THE COURT ORDERS THAT:
1.That there be summary judgment for the second respondent.
2.That the parties draw specific orders to reflect the terms of this judgment.

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 Henton & Henton has been approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
EX TEMPORE
REASONS FOR JUDGMENT
RIETHMULLER J:
INTRODUCTION

The second respondent, B Bank (“B Bank”), seeks summary judgment against the husband and wife with respect to two loans secured by a mortgage over the matrimonial home.
There is no dispute as to the quantum of B Bank’s claim, which is around $360,000 for the primary debt (although there is ongoing interest and legal fees that are also claimed), secured by a mortgage over the matrimonial home located in Suburb C NSW (“the Suburb C property”). The Suburb C property is estimated to be worth $1.8 million by the husband. The Suburb C property is, on anybody’s view, worth well over $1 million.
The issue that arises in this case is that the wife says that she did not sign any agreements or mortgage documents with B Bank. The wife says that the mortgage was registered, and the documents produced, as a…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Henton & Henton

Details

AGLC: Henton & Henton [2022] FedCFamC1F 574
Case: [2022] FedCFamC1F 574
Decision Date

CaseChat Overview and Summary

In the matter of Henton & Henton, the Federal Circuit and Family Court was presented with a dispute between B Bank and the wife regarding the enforceability of a mortgage and loan agreements signed by both the husband and wife. The wife has defaulted in producing handwriting samples for comparison with the signatures on the mortgage documents, leading to B Bank seeking summary judgment. The central issue before the court was whether B Bank could succeed in their claim against the wife, even if her signatures on the documents were fraudulent and had been knowingly placed there by the husband. This question is significant given the wife's contention that she was unaware of the mortgage agreements and had no intention to enter into them.

The court considered whether the wife's default in producing handwriting samples justified B Bank's claim for summary judgment. Additionally, the court explored whether B Bank could still prevail if the wife's signatures were indeed forgeries. The court noted that the wife's default in providing the samples created a real issue about the authenticity of her signatures, and if they were forgeries, it indicated the husband's involvement in the fraud. Despite these concerns, B Bank argued that they were entitled to judgment based on the wife's default or the fraudulent application of her signatures. The court determined it was more efficient to first address whether B Bank could succeed against the wife, even under the assumption that her signatures were forgeries.

The court concluded that B Bank was likely to succeed in their claim against the wife, given her default in complying with the court's orders to produce handwriting samples. This default was considered a significant factor in B Bank's favour, even if the wife's signatures were fraudulent. The court found that the wife's failure to provide the samples was a deliberate act that prejudiced B Bank's ability to defend against her claims. Consequently, the court granted B Bank's application for summary judgment against the wife, allowing them to enforce the mortgage and recover the outstanding debt, interest, and legal costs.

Orders

Orders of the court

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Background

Background to the litigation

There have been interlocutory orders for the wife to produce samples of handwriting, which she has not fully complied with, the default of which has in part has led to B Bank seeking summary judgment. More significant however, is the question of whether the wife can ultimately succeed in resisting the claim by B Bank, as opposed to running her case solely against the husband in the matrimonial proceedings under s 79 of the Family Law Act 1975 (Cth) (by seeking an adjustment of the amounts of property each of them might receive on the property settlement orders, given that they have now separated).BACKGROUND The husband and wife purchased the Suburb C property in or around 2002, as joint tenants. The purchase was funded by a mortgage from Westpac Banking Corporation (“Westpac”), which also made further advances. In 2012, the husband approached B Bank to refinance the Westpac mortgage and provide further advances. The husband says that it was both he and the wife that approached B Bank and entered into the transactions; the wife denies this particular fact. B Bank advanced funds which were secured by a mortgage in favour of B Bank, which was registered over the title of the property. The mortgage and loan agreements appear on their face to be in the joint names of the spouses. There is currently owing to B Bank, as a result of the loans, some $360,660.27, together with ongoing interest accruing at $1,250.16 per month. B Bank has also incurred legal fees as a result of this protracted litigation, which has involved many court events over the last year and a half, of in excess of $150,000. Those moneys will be payable by the parties pursuant to the mortgage agreement if there is no costs order in these proceedings. In order to deal with the wife’s allegations that the signatures purporting to be hers on the B Bank documents are forgeries, orders were made for her to provide handwriting samples for an expert to be engaged by B Bank. As I indicated above, these samples have not been forthcoming: she says there is some difficulty obtaining all of the documents, and she seeks to rely upon her report and her passport. It seems to me that there is certainly a real issue as to whether or not the signatures are those of the wife’s or forged signatures, and in the event that the signatures are forgeries, it seems that the fraud must have been knowingly perpetrated by the husband. B Bank, however, argues that they are entitled to judgment on their claim, even if the wife’s signatures were fraudulently applied to the documents, and alternatively on the basis of the wife’s default pursuant to the discovery and signature sample orders that were previously made. It seems to me that it is more convenient to commence by looking at whether or not B Bank will ultimately succeed, even if it were the case that the wife’s signatures were forgeries placed upon the documents by others, because at this point in the proceedings it is not possible to make findings of fact about whether or not they are her signatures on the documents.

Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

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File number(s):	PAC 1371 of 2018
Judgment of:	RIETHMULLER J
Date of judgment:	17 March 2022
Catchwords:	FAMILY LAW – PROPERTY – Mortgages – Allegation of fraud perpetrated by husband – Indefeasible title – Summary judgment for bank.
Legislation:	Family Law Act 1975 (Cth) ss 75, 79, 106B
Cases cited:	Hurst v Vestcorp Limited (1988) 12 NSWLR 394 Van den Heuvel v Perpetual Trustees Victoria Limited [2010] NSWCA 171 Yazgi v Permanent Custodians Limited [2007] NSWCA 240
Division:	Division 1 First Instance
Number of paragraphs:	34
Date of hearing:	17 March 2022
Place:	Parramatta
Solicitor for the Applicant:	Brander Smith McKnight Lawyers
Counsel for the Applicant:	Mr Fantin
Solicitor for the First Respondent:	Anderson Boemi Lawyers
Solicitor for the Second Respondent:	Thomson Geer
Counsel for the Second Respondent:	Mr Hynes

PAC 1371 of 2018
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)
BETWEEN:	MS HENTON Applicant
AND:	MR HENTON First Respondent B BANK (ACN …) Second Respondent

order made by:	RIETHMULLER J
DATE OF ORDER:	17 MARCH 2022