Hillier and Hillier (No 3)

[2009] FamCA 854

FAMILY COURT OF AUSTRALIA

HILLIER & HILLIER (NO. 3) [2009] FamCA 854

FAMILY LAW – PROPERTY – Interim

Bankruptcy Act 1966 (Cth)
Family Law Act 1975 (Cth)

APPLICANT: Mr Hillier

RESPONDENT: Ms Hillier

FILE NUMBER: MLC 4502 of 2009

DATE DELIVERED: 17 August 2009

PLACE DELIVERED: Melbourne

PLACE HEARD: Melbourne

JUDGMENT OF: Cronin J

HEARING DATE: 17 August 2009

REPRESENTATION

COUNSEL FOR THE APPLICANT: Mr Mazzotta

SOLICITOR FOR THE APPLICANT: Mills Oakley Lawyers

COUNSEL FOR THE RESPONDENT: Dr Ingleby

SOLICITOR FOR THE RESPONDENT: Kennedy Wisewoulds

Orders

1. That all outstanding applications be adjourned to Thursday 20 August 2009 at 10.00am in the Judicial Duty List before me.

2. That the letter written by Mr AH be marked Exhibit W1 and be placed on the court file.

3. That until further order, the husband be restrained from resigning from his Agent contract with Y Franchise.

4. That until further order, the husband be restrained from presenting a debtor’s petition in relation to bankruptcy or from entering into a personal insolvency agreement under Part X of the Bankruptcy Act 1996 (Cth).

5. That the husband do all things and acts necessary and give all necessary directions to cause the electronic transfer of the sum of $355,000 received by him with respect to the share sale agreement into Kennedy Wisewoulds trust account to be held in trust on behalf of the parties pending resolution and/or further order of the Court.

6. That the husband be restrained from pursuing any other share sale agreement in relation to his interest in Y Franchise until further order.

7. That the husband forthwith provide to the wife’s solicitors copies of all communications between he and:

   (a)    Y Franchise;

   (b)    NN Acountants;

   (c)    Mr AH;

   (d)    W Accountants; and

   (e)    Meier Denison Guymer.

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

IT IS NOTED that publication of this judgment under the pseudonym Hillier & Hillier is approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth)

FAMILY COURT OF AUSTRALIA AT MELBOURNE

FILE NUMBER: MLC 4502 of 2009

MR HILLIER

Applicant

And

MS HILLIER

Respondent

REASONS FOR JUDGMENT

1. This is an application that was brought on urgently by arrangement between my associate and the wife.  Dr Ingleby appears on behalf of the applicant wife and Mr Mazzotta on behalf of the husband.  I want to firstly record my gratitude to Mr Mazzotta for attending, he having indicated that he has been given very short notice, but equally importantly, he is not in funds to appear.  That is, perhaps, not surprising at the moment, having regard to the fact that, on what I recall from the last hearing, the parties are in a net deficit position.  Dr Ingleby puts that at between $2 and $3 million. 

2. What has provoked this application is that, pursuant to the orders I made on the last occasion, the husband has travelled to the United States and there are currently arrangements, as were foreshadowed, to complete the sale of a contract for the Y Franchise in Australia. 

3. What has caused the difficulty is that a payment has been made by the purchaser, and the husband holds $355,000 in an account in his name in the United States. 

4. I made it clear in my reasons for judgment that I was comfortable in saying that I thought the husband was coming back to Australia because there were contractual obligations that he had to fulfil.  In addition to that, there were ongoing children’s issues.  Mr Mazzotta has recorded on the transcript this morning his client’s concern about not having been able to speak to the children. 

5. I have been handed a confusing letter written by, according to the wife, the husband but signed by the purchaser of the Y Franchise contract indicating that the funds were under the control of the purchaser, albeit that they should technically, it seems to me, be in the control of the vendor.   There is a statement at the end of the letter which says that he, the purchaser, would not transfer these funds back to Australia.  The last sentence reads:  “These funds are in my controll (sic) to the contact (sic)”.

6. Which I presume the sentence was meant to say “contract”.  However, it is said by Mr Mazzotta that the funds are in the husband’s name in an account.  The husband has not had the opportunity to put his position by affidavit and, on that basis, he needs to do so, particularly having regard to the precarious nature of the financial position of the husband and the wife. 

7. It was made clear to me on the last occasion that the husband’s position with the Y organisation was tenuous in the sense that if he went bankrupt or entered into a personal insolvency agreement under Part X of the Bankruptcy Act 1966 (Cth), he would automatically lose his rights with the Y group.  The husband is adamant, through what he has said to Mr Mazzotta, that he does not want to either go bankrupt or enter into a personal insolvency agreement.  To put in context, there are already insolvency practitioners involved in this case.  

8. To compound the problem, the wife was served with a bankruptcy petition which is returnable on 8 September.  The amount of $355,000 is therefore critical to the proper determination of not only the family law issues, but potentially the insolvency issues as well. 

9. I am asked to make an order on the basis of the powers under s 114 of the Family Law Act 1975 (Cth). The two main bases which give rise to such an order, is that it is an injunction and, as such, the balance of convenience is one of the issues that needs to be considered.

10. Secondly, the court should only make an order under s 114 when it is satisfied that it is proper to do so. Having regard to the short period of time under which I propose to make the injunction, I am satisfied that the balance of convenience does require that the injunction be granted and secondly, that is proper to do so. In those circumstances, I will make orders in terms of paragraphs 1, 2, 3 and 4 of the wife’s proposed minutes.

11. One of the complaints of the wife is that she gets mixed messages from the husband and the solicitors have been unable to get access to some documents, including various communications between the husband, the purchaser, the insolvency practitioners and others. 

12. It seems to me, that for the proper understanding of what is going on, the wife is entitled to have access to that information. Under those circumstances, the husband having the obligation, under the Family Law Rules 2004, to be proactive in providing information, I propose to make an order in terms of paragraph 5.

I certify that the preceding twelve (12) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Cronin

Associate: 

Date:  24 August 2009