Holden & Holden
[2015] FCCA 788
•2 April 2015
FEDERAL CIRCUIT COURT OF AUSTRALIA
| HOLDEN & HOLDEN | [2015] FCCA 788 |
| Catchwords: FAMILY LAW – Application for leave pursuant to section 44(3) – capacity of the applicant to provide instructions and participate in proceedings – where applicant’s evidence is internally inconsistent and deficient – where applicant fails to provide disclosure or any evidence on significant issues – where applicant calls evidence that he is unable to be cross-examined – significant debt incurred of which the respondent was previously unaware and which is not explained or inadequately explained by the applicant – where the parties have been separated for a period of time approaching the length of their relationship – where the applicant is a sophisticated litigant, being a (occupation omitted) experienced in Family Law and fails to offer any adequate explanation for failing to make application within the limitation period – where any hardship to the applicant would be significantly outweighed by hardship to the respondent and the child of the marriage – where a prima facie case cannot be found in light of the inadequacies and deficiencies of the applicant’s evidence – meaning of “informality” in proceedings before the Federal Circuit Court – refusal to adjourn proceedings as sought by applicant when sole basis for adjournment is deficiency of the applicant’s evidence after both trial directions and prior adjournment and where adjournment would now, in light of diminished Court resources, create delay of over 12 months – admissibility of evidence regarding FDR intake – conditional admission of material then demonstrated as relevant and unconditionally admitted – rejection of tender of aide memoir where its contents are not in accordance with the evidence as led – rejection of evidence of settlement negotiations – inappropriate communication with chambers following closure of case. |
| Legislation: Family Law Act 1975, ss.10J, 44(3), 79 Family Law (Family Dispute resolution Practitioner) Regulations 2008, reg.25 |
| Neocleous & Neocleous (1993) FLC 92-377 Tate & Tate (1997) FLC 92-724 AMS & AIF (1999) CLR 160 Hall & Hall (1979) FLC 90-679 Thompson & Berg [2014] FamCAFC 73 Haset Sali v SPC Ltd [1993] HCA 47 |
| Applicant: | MR HOLDEN |
| Respondent: | MS HOLDEN |
| File Number: | BRC 5040 of 2011 |
| Judgment of: | Judge Harman |
| Hearing date: | 24 March 2015 |
| Date of Last Submission: | 24 March 2015 |
| Delivered at: | Parramatta |
| Delivered on: | 2 April 2015 |
REPRESENTATION
| Counsel for the Applicant: | Mr Bennett |
| Solicitors for the Applicant: | MacDonnells Lawyers |
| Counsel for the Respondent: | Ms Gillies |
| Solicitors for the Respondent: | Matthews Folbigg Pty Ltd |
ORDERS
The Application pursuant to section 44(3) of the Family Law Act 1975 for leave to commence property adjustment proceedings out of time is dismissed.
Remove the above issue from the list of cases awaiting hearing.
Adjourn the balance of the proceedings (parenting proceedings) for further mention and directions and, if all issues are not resolved to finality, call over to 10 July 2015 at 9:30am.
Grant leave to the parties to vacate the further listing of the proceedings upon Terms of Settlement being filed to deal with and dispose of all extant issues.
IT IS NOTED that publication of this judgment under the pseudonym Holden & Holden is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT PARRAMATTA |
BRC 5040 of 2011
| MR HOLDEN |
Applicant
And
| MS HOLDEN |
Respondent
REASONS FOR JUDGMENT
These proceedings involve an Application pursuant to section 44 (3) of the Family Law Act 1975 to commence Part VIII property adjustment proceedings out of time.
The proceedings also involve a plea for parenting relief although those issues are not pressed before the Court today. The Court is advised that those issues are, subject to some further negotiation, effectively resolved.
Relief is sought in the following terms:
The applicant has leave to file applications for orders relating to parenting and for property with respect to the child and property of the former marriage of the Applicant and Respondent.[1]
[1] Initiating Application filed 2 April 2014.
It must be observed from the outset that leave is not required to commence parenting proceedings under Part VII. Those proceedings are properly before the Court with the requirements of section 60I of the Family Law Act 1975 being met.
Parties
The parties to the proceedings are Mr Holden, the Applicant and former husband, and Ms Holden, the Respondent and former wife.
The parties were married on (omitted) 1993.
The parties separated under one roof on either 13 May 2006 (as alleged by the husband) or “late 2006” (as alleged by the wife).
The parties physically separated in mid 2010 (the husband asserts a date of 10 June 2010).
The parties were divorced by an Order pronounced by a Sessional Registrar 24 August 2011. The Divorce Order became final one month later namely, 25 September 2011.
The period in which property adjustment proceedings might have been commenced without leave (being 12 months from the date upon which the Divorce Order became final) concluded on 26 September 2012.
These proceedings were commenced by an Application Initiating Proceedings filed 2 April 2014, being some 19 months out of time.
The Application that was filed by Mr Holden on 2 April 2014 did not identify the relief sought by him in the event that he was successful in obtaining the Courts leave to commence proceedings out of time. An Amended Application Initiating Proceedings filed 18 July 2014 remedies that deficiency and purports to seek both interlocutory relief pursuant to section 44 (3) of the Act and, subject to such leave being granted, then seeks Orders for property adjustment in the following terms:
The nett matrimonial property pool be divided in shares of 50% to the respondent and 50% to the applicant.
The wife by a Response filed 16 May 2014 sought Orders in the following terms:
That the Application of the father filed 2 April 2014 be dismissed.
That the Respondent file a further response once the Applicant has properly pleaded his application.
The proceedings be transferred to the Federal Circuit Court of Australia at Parramatta.
By an Amended Response filed 4 August 2014 the Respondent, again, sought dismissal of the husband’s applications both interlocutory and final.
Material considered
In dealing with these proceedings I have regard to the material enumerated below.
In the case of the Applicant I have read and considered each of:
a)The Initiating Application filed 2 April 2014;
b)The Amended Initiating Application filed 18 July 2014;
c)The Affidavit of Mr Holden sworn or affirmed 16 October 2014 and filed 16 October 2014;
d)The Financial Statement filed 18 July 2014;
e)The Financial statement filed 16 October 2004;
f)The Affidavit of Dr A sworn or affirmed 17 October 2014 and filed 20 October 2014;
g)The Affidavit of Dr A sworn or affirmed 19 December 2014 and filed the same day;
h)An Outline of Case document filed by the husband’s Counsel;
i)A document titled “Summary of argument on behalf of the Applicant Husband”;
j)A document headed “Applicants Outline of Submissions”;
k)Exhibit A1 being a letter from Ms Holden to Mr Holden dated 15 May 2013;
l)Exhibit A2 being two Medico Legal Reports obtained by Mr Holden for use in and in connection with a criminal charge with which he was then dealing and comprising a report of Dr S dated 31 August 2010 and a report of Ms J, psychologist dated 28 May 2009;
m)Exhibit A3 comprising numerous loan applications and other documents from the (omitted) Bank and relating to advances by that organisation between June 1999 and September 2003.
In the case of the wife I have had regard to the following:
a)The wife’s Response filed 16 May 2014;
b)An Amended Response filed 4 August 2014;
c)The wife’s Statement of Financial Circumstances filed 4 August 2014;
d)An Affidavit of Ms Holden sworn or affirmed 14 October 2014 and filed the same day;
e)An Outline of Case document filed by the wife’s Counsel:
f)Exhibit R1 comprising a file note apparently prepared by the husband and relating to borrowings from the (omitted) Bank;
g)Exhibit R2 a settlement statement with respect to the sale of a property at Property L, WA being registered in the sole name of Ms Holden and the sale occurring in December 1998;
h)Exhibit R3 being certain documents relating to the purchase of a property at Property G, New South Wales of which the wife is the sole registered proprietor together with the mortgage relating to that purchase and dealings with respect to the property since its purchase;
i)Exhibit R4 being certain documents relating to the purchase and subsequent sale of a property at Property K of which the wife was the sole registered proprietor;
j)Exhibit R5 comprising a Bank Statement and other documents relating to a mortgage encumbering a property previously owned in the name of Mr Holden and the discharge of that mortgage during the 2001/2002 financial year;
k)Exhibit R6 comprising correspondence from the wife’s attorneys to the husband’s attorneys seeking disclosure of specified documents;
l)Exhibit R7 comprising various Internet printouts with respect to the husband’s suggested present employment;
m)Exhibit R8 comprising a printout from an Internet site relating to the present employment of the husband’s partner Ms M;
n)Exhibit R9 comprising a statutory trust account statement for an account held by the husband’s then (employer omitted) in the name of “(omitted)” and dated August 2008;
o)Exhibit R10 being a statement with respect to the (omitted) Bank account in the name of the husband covering the period from 12 April 2007 -11 May 2007;
p)Exhibit R11 being correspondence from the (omitted) addressed to the husband dated 13 July 2010;
q)Exhibit R12 correspondence from Centrelink to the husband dated 21 April 2009.
History of proceedings
These proceedings first came before a Judge of the Federal Circuit Court on 19 May 2014. On that date Judgment as regards determination of an application for transfer of the proceedings was reserved.
By Orders made 26 May 2014 the proceedings were transferred to the Parramatta Registry of the Court and brief reasons for Judgment delivered.
The proceedings first came before the Parramatta Registry of the Court on 9 July 2014. On that date it was noted that both parties were desirous of an adjournment so as to continue negotiation and hopefully resolution of some if not all issues in dispute. The adjournment was granted and Orders were made requiring the husband to file an Amended Application setting out and particularising all Orders sought by him in the proceedings and “… if any financial issue is sought to be agitated an affidavit and financial statement in accordance with the Federal Circuit Court rules all documents to be filed and served by close of business 18 July 2014.”
The proceedings next came before the Court 6 August 2014. On that date the matter was listed for trial and a hearing date of 24 October 2014 was allocated. Trial directions were made requiring both parties to file and serve all evidence relied upon by them.
The proceedings came before the Court for hearing on 24 October 2014. The hearing commenced. The wife, even though the Respondent in the proceedings, was invited to give evidence first. Leave was granted to the wife to adduce further evidence. That course of action was taken with the consent of the parties and as it has become apparent, from the material then filed, that:
a)The husband has previously been declared bankrupt. The husband was discharged from bankruptcy prior to commencing these proceedings;
b)At the time of physical separation of the parties in 2010 a debt in excess of $695,000 was secured against title of the property at Property G (in which property both parties had lived until that time whether separated under the one roof or otherwise). The wife denied knowledge of the debt as at the date of physical separation and decried any knowledge of the debt, how and when the debt had been incurred or the distribution or application of the funds obtained. Clearly the Property G property had been offered as security;
c)Shortly after the physical separation of the parties and as a consequence of entreaties and submissions made by the wife to the (omitted) Bank the above debt was, as regards the wife, “waived” and with the effect that the Property G property was then rendered subject to a mortgage of $25,000 only being that which had been obtained at the time of the purchase of that property.
After the wife had given brief evidence with respect to the above issue, the husband was called for cross examination. It very quickly became apparent that Mr Holden had, until the day prior to hearing, been resident within a psychiatric ward of a hospital, albeit on a voluntary basis.
Mr Holden indicated that he had attended Court on “escorted day leave” (his “escort” being his partner Ms M). Mr Holden gave evidence that he had been receiving treatment within the hospital and was prescribed and taking a number of medications relating to and as part of this treatment.
At paragraph 69 of his trial Affidavit Mr Holden stated:
I was readmitted as a voluntary inpatient at the (omitted) Hospital on (omitted) [2014] and I am still an inpatient at the date of this affidavit. I don’t know yet when I am likely to be discharged because my psychiatrist is changing drugs and their dosages to see what is the appropriate mix to treat my condition.
The proceedings were stood in the list to afford Counsel the opportunity to take further instructions, discuss between themselves and with their respective clients the course of action to be taken with respect to the proceedings and, importantly, for Mr Holden's Counsel to satisfy themselves that Mr Holden was competent to give instructions and to participate in the proceedings.
When the proceedings returned before the Court later that day and with the consent of both parties the proceedings were adjourned and listed for mention on a future date so that enquiries could be made by Mr Holden’s attorneys such as to satisfy themselves that:
a)Mr Holden was capable and competent of providing instruction;
b)Mr Holden did not require a case Guardian; and
c)There were no remaining issues which required address, such as matters which might be suggested to impact upon the capacity of Mr Holden to both provide instructions and undergo cross examination.
When the proceedings next came before the Court on 3 November 2014 a further hearing date was fixed, namely the date upon which the matter proceeded, 24 March 2015. A direction was also made that the husband, no later than close of business 19 December 2014, file and serve an Affidavit by his treating psychiatrist:
certifying as to his capacity to both provide instruction and participate in these proceedings including, cross examination and absent such affidavit being filed the parties shall then have liberty to restore the matter to the list on 7 days’ notice in accordance with Federal Circuit Court protocols and, for the purpose of considering whether a custodian (sic) is required for the husband [the reference intended to be to a Case Guardian].
As would be apparent from the listing of material considered above a further Affidavit by the husband’s treating psychiatrist was, in fact, filed. That Affidavit, filed 19 December 2014, concluded with the following:
With regard to Mr Holden’s participation in proceedings, in particular his ability to go into the witness box, answer questions and be cross-examined by the other lawyer, it is my opinion that at the present time he is not in a position to do so. However, it is envisaged that with further management, Mr Holden will likely be able to attend to this. In this regard, I would recommend that Mr Holden’s condition be reviewed approximately a month before the Court appearance.
At the commencement of the hearing 24 March 2015 inquiry was raised of Counsel for Mr Holden as to whether the matter was to proceed and whether any issue was raised as to Mr Holden’s competence and capacity to provide instruction and participate in proceedings and, specifically, whether Mr Holden was in a position to be cross examined.
Mr Holden's Counsel advised the Court, on instructions from Mr Holden, that Mr Holden had spoken to his psychiatrist some few days earlier and had been specifically told by his psychiatrist Dr A that he was perfectly capable of being cross-examined and thus wished to proceed on that basis.
I pause to note, as will be discussed in more detail in a consideration of relevant case law that the Application for leave, as an interlocutory proceeding, need not necessarily involve cross examination of the Applicant (or either party for that matter). Certainly as regards demonstration by the Applicant of a prima facie case cross examination is not necessary and would not ordinarily occur. However, as noted by Lindenmayer J in Neocleous & Neocleous[2], cross examination on issues of delay and hardship is permitted and to refuse to allow it would amount to a denial of due process.
[2] (1993) FLC 92-377.
Counsel for the Respondent appropriately took objection to evidence regarding the husband’s capacity to be cross examined coming from Mr Holden rather than from his treating psychiatrist.
Proceedings were stood to allow some inquiry to be made as to the availability of Mr Holden’s psychiatrist for cross examination, albeit attending by telephone from Brisbane where the psychiatrist is resident.
After a delay of over an hour, Dr A was able to be cross examined (there being no criticism whatsoever of Dr A as regards this delay he having previously advised his availability for cross-examination, (if required) and in light of his busy clinical practice).
Dr A gave brief evidence and was eruditely cross examined by Counsel for Ms Holden. Dr A was clear in his evidence that:
a)He had not spoken to Mr Holden regarding Mr Holden’s capacity to be cross examined;
b)He had not indicated to Mr Holden or those instructed by him anything to suggest that Mr Holden was capable of undertaking and withstanding cross examination; and
c)In his opinion Mr Holden was not able to be cross examined and that if undertaken this would be detrimental to Mr Holden’s well-being.
Following the evidence of Dr A the proceedings were again stood in the list to enable instructions to be taken by Counsel for each party and to allow forensic decisions made by Counsel for each of the parties.
Upon the matter resuming Mr Holden's Counsel sought adjournment of the proceedings. It was made clear in submissions in support of such adjournment application that no issue was raised as to Mr Holden’s competence to provide instructions.
Counsel for Ms Holden conceded that the matter could proceed without cross examination of Mr Holden on any issue and that if such a course were taken, with the wife’s informed consent that any prejudice would fall upon the wife; she being the one denied the opportunity of testing Mr Holden’s evidence.
Counsel for Mr Holden pressed adjournment on the basis that Mr Holden would seek to adduce further evidence not yet before the Court. The tenor of this submission would suggest that Mr Holden has not, as directed, filed all evidence upon which he proposes to rely and was thus “not ready”.
The adjournment application was refused and reasons with respect to that refusal will be incorporated within this Judgment.
The matter then proceeded on the basis of the evidence as filed by the parties augmented by the tender of documents as identified above and written submissions in the case of Mr Holden and oral submissions by Counsel for both parties.
The husband’s competence to participate in the proceedings
As would be apparent from the above discussion and principally focused upon:
a)The evidence of Dr A; and,
b)The submissions of Counsel for Mr Holden;
I am satisfied as to the husband’s competence to provide instructions and participate in the proceedings. No evidence has been led nor any submission put that would contraindicate that finding.
The husband has not filed nor sought to file any evidence that would suggest an absence of competence on his part.
The evidence of Dr A goes to:
a)The husband’s capacity to endure or withstand cross examination;
b)Advancing a diagnosis of bipolar affective disorder; and
c)Briefly outlining treatment for that condition.
Dr A is clear in his evidence:
It is my opinion that Mr Holden is able to provide instructions to his lawyer as to how his case is conducted including any negotiations as to settlement of the claim.
The only potential concern that arises from the evidence of Dr A is a potential issue of credit as regards that put to the Court by Mr Holden by his Counsel. That submission was based upon Mr Holden’s instructions (and I make clear that no criticism whatsoever is raised of Mr Holden's Counsel, they acting on Mr Holden’s instructions at all times). I am not satisfied, however, that such credit findings need be made.
Discussion of evidence
A helpful chronology of events is provided by the wife’s Counsel and I incorporate that chronology herein. A chronology was not provided in the husband’s case.
(omitted) 1959
Husband is born.
(omitted) 1964
Wife is born.
(omitted) 1984
Husband is (omitted) as a (occupation omitted).
1993
Husband is divorced from his first wife.
1993
Parties commence cohabitation.
At that time husband was employed by (omitted) in Sydney.
(omitted) 1993
Parties marry.
(omitted) 1997
Parties purchase the property at Property K for $465,000.00. The property was the subject of a mortgage in the sum of $573,500.00. Upon sale of the property in WA the net proceeds of sale were applied from those sale proceeds to the home at Property K.
(omitted) 1998
Husband obtains a further loan from (omitted) Bank in the amount of $573,500.00.
(omitted) 1999
Husband obtains a further loan from (omitted) Bank in the amount of $75,000.00.
(omitted) 2000
Husband obtains a further loan from (omitted) Bank in the amount of $150,000.00.
(omitted) 2002
Husband obtains a further loan from (omitted) Bank in the amount of $70,000.00.
(omitted) 2002
Husband obtains a further loan from (omitted) Bank in the amount of $30,000.00.
(omitted) 2002
Husband obtains a further loan from (omitted) Bank in the amount of $225,000.00.
(omitted) 2002
X is born (currently 12 years of age).
22.12.2002
Husband appoints a trust called “(omitted)”/(omitted) Family Trust.
2002-2005
Husband conducts his own (business omitted).
25.7.2003
(omitted) receives endorsement as a deductible gift recipient from the ATO.
(omitted) 2003
Husband obtains a further loan from (omitted) Bank in the amount of $51,000.00.
2005
The Property G property is purchased by the wife.
2006
Parties separate.
Husband ceases to provide any financial support to the wife.
2006-2010
Wife and child live in the upstairs portion of the home. The husband lives in the downstairs portion of the home.
Mid 2007
Parties are said to owe $695,000.00 to (omitted) Bank.
Wife becomes aware that the parties owe that amount on the home when she receives a copy of a letter from (omitted) Bank. Until that time she was unaware of the level of indebtedness.
June 2007
Wife speaks to the bank about the correspondence that was received and is advised that the bank intend to “take the house” in about 7 days.
2010
Husband moves to Brisbane.
11.8.2011
Wife files a Response to the Application for a Divorce filed by the husband.
14.6.2011
Application for a Divorce is filed by the husband.
In that Application the husband notes he is seeking parenting orders.
25.9.2011
As a consequence of an Application for Dissolution filed by the husband a Divorce Order has been made and became absolute on this date.
The document contains two pages including a notice as to the provisions of Section 44 of the Act.
2.4.2014
Husband files an Application with the Court (Brisbane Registry) where he appears to seek leave to commence property proceedings. The husband files that Application on his own account.
(omitted) 2014
Husband remarries.
To the extent that the chronology provided by the wife’s Counsel might be suggested to prefer the wife’s evidence I make clear, for reasons that I will discuss shortly, that the wife’s evidence is preferred. The wife’s evidence is plausible and internally consistent and, to that extent that the material tendered and marked as Exhibits corroborates any evidence, it tends to corroborate the evidence of the wife.
I am conscious that neither party has been cross examined on their evidence. Accordingly, I do not propose to make significant findings of credit. It would, as regards many aspects of the evidence, be unsafe. In any event I am satisfied that it would be largely unnecessary.
The wife’s evidence is concise, clear, plausible and internally consistent. I have no reason to doubt it.
The husband’s evidence, to the extent that it has withstood objection (and thus redaction from the husband’s Affidavit), is silent on a number of significant issues as to which I am satisfied that the husband has both:
a)Had full notice of the wife’s evidence going to those issues; and
b)Been afforded a more than abundant opportunity, including prior to the initial hearing date 24 October 2014 and during the adjournment period being some 5 months prior to the hearing date 24 March 2015, to put before the Court all evidence suggested to be relevant (either in his case or tending to discredit or dispute the wife’s evidence.
It is on this basis, the absence or omission from the husband’s evidence of material of fundamental importance to the issues in dispute between these parties and the failure to address the wife’s evidence regarding those issues, that I am satisfied that the wife’s evidence should be preferred. I am satisfied that the wife’s evidence is more reliable and given frankly and with candour.
The husband, with full notice of the case which the wife presents, has simply failed to place before the Court evidence which, from his own professional qualifications and experience and that of his attorneys, he would or should have realised was fundamentally relevant and important. Further, I am satisfied that the husband has failed to comply in any meaningful or substantial fashion with his obligation for full, frank and candid disclosure.
The wife’s position has been clear from the date that she first filed Affidavit material, namely, 15 May 2014 (albeit that was an Affidavit intended only to identify issues in dispute between the parties).
In submissions Counsel for Mr Holden has sought to address this “yawning gap” in the evidence. Submissions must be based upon evidence before the Court. Mr Holden has, through the evidential deficiencies that he has created, both as to the preparation and filing of Affidavit material and the lack of full and proper disclosure, placed his Counsel in an invidious position. Counsel is not criticised in those circumstances. Mr Holden's Counsel has valiantly sought to address and protect Mr Holden’s interests in these proceedings notwithstanding the difficulties that Mr Holden has, himself, created.
A schedule prepared by Mr Holden or those instructed by him was sought to be tendered to provide “explanation” for various transactions which occurred during the relationship of the parties or during that period of living separately and apart under the one roof.
It is to be remembered that during that period June 1999 to September 2003 a debt of approximately $695,000.00 came into existence. Ms Holden denies knowledge of those transactions at any time prior to 2010. Indeed Ms Holden’s evidence is that until 30 June 2007, some 12 months after the separation of the parties under the one roof and shortly after Mr Holden’s bankruptcy, she was unaware of this debt and, on her evidence, she remains unaware of the purpose or application of those funds being drawn by Mr Holden.
The parties are agreed that when the Property G property was purchased by the wife in her sole name ((omitted) 2005) that:
a)A property at Property K which had previously been owned (again in the sole name of Ms Holden) was sold for approximately $890,000;
b)At the time that the Property K property was purchased a mortgage for the entirety of its purchase price was obtained. The parties subsequently sold a property which had been owned by them in Western Australia (where they had lived for a time in furtherance of Mr Holden’s (omitted) career) and the proceeds of sale of that Western Australian property were applied in reduction of the mortgage encumbering the Property K property;
c)The parties continued to make significant payments in reduction of the mortgage encumbering the Property K property and such that by August 2001 the mortgage or mortgages encumbering the Property K property had been discharged in full;
d)The Property K property was, at the time of its sale, unencumbered;
e)The proceeds of sale of the Property K property were applied towards the purchase of the Property G property and such that a modest mortgage of $25,000.00 was all that the wife was required to obtain to complete the purchase of the Property G property and meet the costs and expenses associated therewith;
f)Mr Holden was not obliged to give discharge of the debts of approximately $695,000.00 which existed as at June 2007 as a consequence of his bankruptcy;
g)Ms Holden was not obliged to contribute to or meet the debt of $695,000.00 extant as at June 2007 and as a consequence of her negotiation with the (omitted) Bank. Such negotiations were between the wife and the Bank and did not involve the husband. With respect thereto the bank ultimately agreed to absolve Ms Holden from liability (for reasons which are not entirely before the Court or clear).
The evidence of Ms Holden regarding the various loans obtained by the husband from the (omitted) Bank, is clear. At paragraphs 28 – 43 (inclusive) of her Affidavit Mr Holden alleges that:
a)The husband undertook all of the financial managements (sic) for the family;
b)During the marriage the Applicant obtained various funding from the (omitted) Bank. The wife deposes “whilst I am aware of some of these borrowings, some are not known to me. I am unaware as to the precise manner in which the applicant applied those funds”;
c)Further the wife deposes “The husband did not involve me in the decision to borrow and I trusted him because he was my husband and because he was a (occupation omitted). He said to me “go away this has nothing to do with you”;
d)The various loans exceeding the amount of $695,000.00 (which amount the parties agree was outstanding to the (omitted) Bank as at June 2007) are listed at paragraph 32 of Affidavit.
The majority of the loans enumerated by Ms Holden are verified by the documents tendered by Mr Holden and comprising Exhibit A3.
The only reference made by Mr Holden to these loans (including addressing that the loans obtained, the purpose for borrowing and the application of funds advanced) is contained in paragraph 26 of Mr Holden's Affidavit as follows:
I understand that Ms Holden believes that I may have retained funds from the dealings with the (omitted) Bank in relation to our Property K and Property G properties and somehow have access to these funds now. I can categorically refute any suggestion I had any additional funds from the (omitted) Bank or any other source dating back to the period of the dealings with the (omitted) Bank prior to my bankruptcy.
Ms Holden had sworn her Affidavit on 14 October 2014. Mr Holden swore his Affidavit on 16 October 2014. It is unclear whether Mr Holden had access to the Affidavit of Ms Holden at the time that his Affidavit was sworn. However, the earlier Affidavit sworn by Ms Holden on 15 May 2014 had, at paragraph 18 thereof, made the following allegation:
After the time of separation I learnt that the applicant had forged my signature on a bank guarantee. After the applicant vacated my home, I was then contacted by the bank seeking to recover their security. It was something that I had no knowledge of. I was then involved in protracted negotiations in relation to this forged document. Additionally there were other creditors of the applicant whom I have had to deal with since separation. The witnesses in relation to the banking guarantee issue if contested by the father, are located in New South Wales.
I make clear that the earlier Affidavit of Ms Holden, which is not read by her in the determination of these proceedings, is not relied upon as evidence in this determination. I have identified the above paragraph purely to give context to, perhaps make sense of, the denial by Mr Holden of any impropriety or wrongdoing by him as set out in paragraph 26 of his Affidavit. The wife’s earlier Affidavit does makes clear that the husband was, some 10 months prior to hearing, given clear notice by Ms Holden that she proposed and intended to raise issues regarding advances obtained by Mr Holden as relevant and important issues.
Ms Holden has not sought to pursue an allegation of fraud or forgery nor called any other witness with respect to that allegation regarding the $695,000.00 debt. I am not satisfied that the absence of this evidence at hearing would or should give rise to an adverse inference. I have referred to the evidence that is available to highlight the deficiencies in that which is led by Mr Holden regarding the debts as at 2010. Mr Holden neither refers to the advances nor attempts to address or explain the advances he received.
It is trite to observe that “he who alleges must prove”. It is concerning that Mr Holden, in the full knowledge of the allegations raised by Ms Holden, has sought to deal with the vexed issue of significant debt created between June 1999 and September 2003 by simply suggesting that the wife’s allegation of forgery of her signature, if it is raised, is denied. He neither denies the advances nor attempts to explain them.
Mr Holden is, as observed above, a sophisticated litigant. Mr Holden is a (occupation omitted) with experience in dealing with (omitted). In those circumstances, for Mr Holden to assert that he was unaware of:
a)The limitation period that applied to the commencement of proceedings;
b)The obligation of full and frank disclosure applying in all proceedings under the Family Law Act 1975 (or financial proceedings generally);
c)The case that he was required to answer being the clear assertion by Ms Holden that Mr Holden had received and had the benefit of funds in excess of $695,000.00;
is, at best, problematic and, at worst, disingenuous.
The parties agree that the substantial asset which presently exists and is available to the parties (leaving aside any issue as to whether other assets might exist or might be inferred from the failure of Mr Holden to provide complete disclosure) comprises the real property at Property G of which Ms Holden remains the sole registered proprietor. The property has an agreed value of $1.1 million. The value of the Property G property as at the agreed date of separation of the parties (mid-2006), to the extent that it might be suggested to be relevant, is not known.
Ms Holden asserts that since separation she has continued to maintain the property, meet its liabilities and has affected a number of renovations and improvements to property. Ms Holden is clear in her evidence “I have undertaken improvements to the property comfortable in the knowledge that the time for the applicant to file a property application had passed.” [4]
[4] Affidavit of Ms Holden filed 14 October 2014, paragraph 46.
Evidence regarding attempted mediation
As regards the husband’s delay with respect to action to address property adjustment issues between these parties there is, again, relatively little if any dispute.
The husband has, at all relevant times, been a (occupation omitted). The husband has advertised at various times (including the present) that he possesses “particular (occupation omitted)”. The husband could not be described as an “unsophisticated litigant”.
The husband approached Relationships Australia to initiate Family Dispute Resolution in or about January 2012. The husband suggests that his approach to Relationships Australia was to initiate mediation with respect to both property adjustment and parenting issues.
The husband suggests that he attended an intake appointment with Relationships Australia 15 March 2012. On the following day 16 March 2012 Relationships Australia wrote to the husband confirming that he had attended an appointment and that Ms Holden would be contacted by them or at least attempts thereat prosecuted.
The next approach by Mr Holden to that agency occurred November 2012 being approximately 2 months after the limitation period for commencement of property adjustment proceedings without leave had passed.
Whilst it is not an issue that was specifically raised by Counsel for either party it must be observed that the administrative and intake records of Relationships Australia, records which would have otherwise corroborated or disproved the husband’s evidence regarding both the nature and purpose of the mediation which he had sought to initiate and the chronology of events relating to attempts to attend mediation, are obtainable on subpoena and admissible. This arises as regulation 25 of the Family Law (Family Dispute resolution Practitioner) Regulations 2008 in the following terms:
Family dispute resolution practitioners -- assessment of family dispute resolution suitability
(1) Before providing family dispute resolution under the Act, the family dispute resolution practitioner to whom a dispute is referred must be satisfied that:
(a) an assessment has been conducted of the parties to the dispute; and
(b) family dispute resolution is appropriate.
On this basis such administrative and intake appointment’s and communications and correspondence relating thereto do not form part of “family dispute resolution” and are thus not captured by the inadmissibility provisions relating to family dispute resolution in section 10 J of the Family Law Act which provides:
Admissibility of communications in family dispute resolution and in referrals from family dispute resolution
(1) Evidence of anything said, or any admission made, by or in the company of:
(a) a family dispute resolution practitioner conducting family dispute resolution; or
(b) a person (the professional) to whom a family dispute resolution practitioner refers a person for medical or other professional consultation, while the professional is carrying out professional services for the person;
is not admissible:
(c) in any Court (whether or not exercising federal jurisdiction); or
(d) in any proceedings before a person authorised to hear evidence (whether the person is authorised by a law of the Commonwealth, a State or a Territory, or by the consent of the parties).
Nothing of great significance turns upon this issue and, as indicated above, I do not propose to make findings of credit regarding the evidence of either party save where absolutely necessary and I do not consider it necessary in this instance. Similarly, no Jones & Dunkel[5] inference is drawn. However, clearly available evidence which would have gone towards proof or disproof of this element of the husband’s evidence (principally of relevance as regards explanation for the delay) could have been obtained and produced.
Ultimately I am not satisfied that any failure to adduce such evidence would affect the credit of either party nor does it give rise to a Jones & Dunkel (1959) 101 CLR 298 inference. I am satisfied that an alternate, safer and more desirable approach is available and which I will explore in due course in discussing the husband’s delay.
Evidence regarding the husband’s mental health and delay
Whilst the husband has adduced evidence with respect to his mental health at different points in time it must be noted that this evidence is confined to:
a)The present time being the period addressed by the evidence of Dr A. The husband did not engage with Dr A until April 2014; and
b)The reports of Dr S and Ms J dated 31 August 2010 and 28 May 2009 respectively.
None of the evidence relied upon by the husband with respect to his mental health addresses the period from the date of divorce of the parties (24 August 2011) to April 2014 being the period which contained the limitation period. Further, none of the evidence relied upon by Mr Holden with respect to his mental health suggests any lack of awareness on his part of the limitation period applicable to the commencement of property adjustment proceedings following divorce nor any impediment, arising from mental illness or otherwise, to his commencing proceedings within the limitation period. To that end there is no causal nexus between the husband’s suggested mental health at any given point in time and the failure to act and initiate proceedings.
Evidence as to present circumstances and arrangements
There is one child of the relationship between the parties being a daughter X born (omitted) 2002 (presently aged 12 years).
There is no issue that X lives with her mother and spends time with the father, predominantly periods during school holidays.
There is significant controversy between the parties as to financial provision for X made by each party since separation. Ms Holden asserts (paragraph 47) “I have not received any payments by way of child support since 2006 when the applicant father and I separated”.
Mr Holden, for his part, asserts that he is in receipt of a Newstart allowance and this is his sole source of income. Mr Holden attests that his present wife is similarly absent paid employment and is in receipt of a disability support benefit as her only source of income.
As regards child support Mr Holden asserts “I also care for X and provide clothing, arrange private medical insurance for her, pay the cost of dental treatment, the cost of return flights to come to Brisbane which she has done at least every school holidays and times in between them since I’ve been in Brisbane, fees relating to her secondary school and other sundry matters”.[6]
[6] Affidavit of Mr Holden filed 16 October 2014, paragraph 4.
During the course of submissions it would appear that the circumstances described by Ms Holden, being that no direct financial support is provided by Mr Holden, is agreed. In any event there is no evidence to support any other position.
Rejection of and conditional admission of evidence
At the commencement of the hearing a significant number of objections were taken by Counsel for each party. Significant portions of the affidavit of Mr Holden were not read as a consequence of such objections being conceded or upheld. Portions of Ms Holden’s evidence were also disregarded on that basis.
As indicated above one of the documents the tender of which was rejected was a schedule prepared by Mr Holden or those instructed by him and purporting to set out and give explanation for various financial transactions which occurred during the relationship of the parties.
The schedule, whilst suggested to have been prepared by Mr Holden and by reference to various source documents, was not a document on oath. Thus it did not comprise “evidence”. The schedule might have been admissible by reference to section 50 of the Evidence Act (dealing with proof of voluminous or complex documents).
However, such provision did not assist in the admission of the document as:
a)The source documents to which reference was suggested to have been had were not identified;
b)The source documents, by and large, were not tendered into evidence nor available for tender;
c)The schedule contained significant information (both as to the potential importance to issues in the proceedings and the volume of information) which was not the subject of any evidence given by Mr Holden.
On the above basis the schedule was rejected as a tender.
During closing submissions it was again sought to provide the document as “an aide-memoire”. The document was again rejected. As an aide memoire the document could only assist if it referred to evidence properly before the Court and “speaking to” that evidence. The utility of the document as an aide memoire when seeking to introduce significant new evidence or seeking to found submissions not supported by evidence before the Court was illusory.
A number of the documents which the wife had sought to tender (particularly exhibits R7, R8 and R11) were conditionally admitted. Those documents have become part of the evidence that has been considered and relied upon by me in these proceedings and, accordingly, it is necessary for me to explain their admission.
Section 57 of the evidence act deals with conditional or provisional relevance. It is in reliance upon that section that the documents were admitted subject to the respondent establishing that the document and the evidence which would flow therefrom were relevant and would go to issues of relevance.
Section 57 is in the following terms:
Provisional relevance
(1) If the determination of the question whether evidence adduced by a party is relevant depends on the Court making another finding (including a finding that the evidence is what the party claims it to be), the Court may find that the evidence is relevant:
(a) if it is reasonably open to make that finding; or
(b) subject to further evidence being admitted at a later stage of the proceeding that will make it reasonably open to make that finding.
Exhibits R7 and R8 were tendered to raise an issue as to both the veracity of evidence given by the husband (principally his ability and that of his partner to participate in paid employment) and to address the evidence of the husband that he was either unaware of the time limit which applied to the commencement of proceedings or had a reasonable excuse for failing to make application within that time limit. Exhibit R11 was tendered on the same basis.
I am satisfied that each of the above exhibits addresses the position which the wife advances, namely, that the husband is a sophisticated litigant with specialised knowledge from his past qualification and experience in dealing with (occupation omitted)
Further, I am satisfied that to the extent that the husband seeks to assert that he was “under a disability” arising from his mental health such as would have precluded him from making application within the limitation period that the material tendered by the wife and conditionally admitted into evidence (and now unconditionally so) is relevant and goes directly to countering the husband’s assertions.
In light of the above findings with respect to the documents previously conditionally admitted I am satisfied that the evidence sought to be tendered by the wife is relevant and is thus admitted unconditionally.
Section 55 of the Evidence Act 1995 (Cth) provides:
The evidence that is relevant in a proceeding is evidence that, if it were accepted, could rationally affect (directly or indirectly) the assessment of the probability of the existence of a fact in issue in the proceedings.
Section 56 of the Act then makes clear that :
… Evidence that is relevant in a proceeding is admissible in the proceeding (together with the converse proposition that evidence that is not relevant in the proceeding is not admissible.)
Paragraph 32 of the wife’s Affidavit had also been the subject of challenge on a number of bases including form and relevance. That portion of the wife’s affidavit was then also conditionally admitted.
On the basis of the husband’s tender Exhibit A3 and the husband’s concession through his Counsel at the closing of the case (conceding that amounts totalling not less than $695,000.00 had been borrowed from the (omitted) Bank and accessed by the husband) I am similarly satisfied that this evidence is relevant and is thus admissible.
Finally, the husband had sought to rely on certain correspondence passing between he and Ms Holden as evidence of attempts made by him to “negotiate” a resolution of the matter and thus distracting him, as it were, from commencing proceedings within the limitation period. Two such examples of such correspondence were annexed to the husband’s affidavit and objected to and redacted. The husband sought to tender a third piece of correspondence.
The correspondence was rejected. It was, to a large extent, “self-serving” in that the purpose of seeking to introduce the material was to augment the husband’s evidence by adopting that expressed in such letters inter parties as proof of the matters asserted or concessions by Ms Holden. This included and was intended to be introduced as evidence of the husband’s contributions largely based on assertion without particularisation of that alleged to constitute contribution.
The letters were clearly part of a chain of correspondence not included in its totality. More importantly, however, the letters were clearly representative of and contained settlement negotiation and were ultimately rejected by reference to section 131 of the Evidence Act 1995 and on that basis.
After completion of the proceedings a substantial affidavit was filed by the husband which was directed to my chambers with a covering letter from the husband’s attorneys suggesting that the attached, filed affidavit was filed in response to a direction made by the Court for the husband to “explain” the document which comprises Exhibit R1.
The affidavit has not been read or considered.
The affidavit was received after the close of the case whereupon judgment was reserved.
I directed my chamber’s staff to place the affidavit upon the file and correspond with the husband’s attorneys to make clear to them that:
a)No direction to file further evidence had been made;
b)The further material was, unless an application was to be made to reopen the husband’s case, unnecessary and irrelevant;
c)Judgement had already been dictated based on the evidence presented in the case which evidence was closed;
d)Correspondence in such manner was not in accordance with the usual protocol for communication with chambers (it being unclear whether the wife’s attorneys consented to the communication or were even aware of it).
Communication with chambers in such a fashion is unnecessary and unprofessional and should not occur. The potential for due process issues to arise when such communication occurs, the non-consulted party given an apprehension of bias, for example, is real as would be the wife’s legitimate complaint if material submitted after the close of the case has been considered.
If such matters arose an application for recusal might be appropriately made by one party or the other and with significant cost to the parties and the Court as a consequence.
For those reasons that material has not been considered.
In any event the document comprising Exhibit R1, whilst considered, does not significantly impact upon the determination to be made in these proceedings.
Submissions by the parties
The husband’s Counsel submits (both through the Outline of Submissions and Summary of Argument documents referred to above and in oral submissions) that the Court must approach the case through the following steps:
a)To determine whether the husband has a prima facie case being a reasonable claim that requires hearing;
b)Whether the husband would suffer financial hardship were the application to proceed out of time not granted;
c)Whether the husband has adequately explained his delay (though not determinative); and,
d)Whether prejudice will be occasioned to the wife (or the child X) in the event that the application was allowed.
The Court was referred to a number of authorities with respect to the above tests including the excellent and erudite summaries contained in the decisions of Hartnett FM (as Her Honour then was) and Foster J in Riordan & Riordan [2012] FMCAfam 1297 and Morgan and Flanagan [2014] FamCA 248 respectively.
Counsel for Mr Holden referred to a number of authorities in which leave was granted notwithstanding periods of delay significantly greater than those applicable in this case and this included the decisions of Ordway & Ordway [2012] FMCAfam 624, Riordan & Riordan and Morgan & Flanagan.
The Court was also taken to various authorities making clear that the Court’s discretion to grant leave should be exercised liberally (Mortimer & Mortimer [2012] FamCA 974 and Morgan & Flanagan [2014] FamCA 248).
The husband asserts that the “yawning gap” in the evidence which might be seen to arise regarding the $695,000.00 worth of outstanding loans as at June 2007 can be explained and, in any event, would have little if any relevance to the proceedings.
The husband sought to assert, during submissions, that the $695,000.00 debt had included funds borrowed for or towards the purchase of the Property K property. That property was ultimately sold in 2005 and the proceeds of sale provided funds towards, if not entirely providing for, the purchase of the Property G property in which the wife and X continue to reside.
That submission cannot be accepted as it is entirely unsupported by and, in fact, contrary to the evidence of the husband. The $695,000.00 debt is accounted for as funds used to acquire the Property K property as the property was, at the time of sale in early 2005, encumbered. There was no debt relating to or attached to that property at the time of its sale in 2005. The funds from the sale of that property were, consistent with the husband’s evidence, used to substantially purchase the Property G property and such that the incredibly modest mortgage of $25,000.00 was all that was obtained.
The complete lack of explanation by the husband, indeed his lack of acknowledgement of the borrowing of funds totalling not less than $695,000.00 independent of the Property K property or the purchase of the Property G property, is highly concerning.
Certainly no finding could be made, nor am I urged to make one, that the husband retains funds. However, no explanation as to the transactions has been provided by the husband nor any explanation provided as to why he has been silent with respect to those transactions.
Certainly those debts and their “payment” have been addressed through both the husband’s bankruptcy and the wife’s negotiation with the (omitted) Bank. However, if the proceedings were to be dealt with under part VIII those transactions might well assume great significance.
The loans and the husband’s failure to acknowledge their past existence or to explain how or why they were incurred would, I am satisfied, have real relevance as regards the assessment of the husband’s prima facie case (both as to the possible composition of the pool of property available to divide between the parties being a fundamental starting point by reference to the High Court’s decision in Stanford & Stanford [2012] HCA 52) as well as the nature and quality of the husband’s possible entitlement.
It is submitted in the husband’s case that the delay, following expiration of the limitation period, is slight and explained by the husband’s active attempts to seek to negotiate arrangements with the wife by instigating a process of Family Dispute Resolution. However, that submission must be viewed by reference to the uncontroverted evidence that:
a)The husband is a “sophisticated litigant” who would or should, at all times, have been aware of the limitation period which applied;
b)The husband could not genuinely be described as having taken “active steps” to pursue a negotiated resolution through mediation or otherwise (in light of his own evidence as to the chronology of those interventions);
c)The husband has failed to produce any evidence which would suggest a mental incapacity at any relevant time during the limitation period or any connection between his mental state at any time and any action or inaction in pursuing his rights (noting that Exhibit R11 suggests that clearly in July 2010, the very period when the report of Dr S is provided, the husband was able to vigorously pursue his rights and entitlements as regards his qualification to (occupation omitted) and contesting any action or suggestion to the contrary); and
d)Significant prejudice would flow to the wife if leave were granted.
The latter proposition is addressed in the husband’s submissions by indicating that the wife has had the benefit of use and occupation of the Property G property since separation and, in particular, since the physical separation parties in 2010. Further, it is put that as Ms Holden has not re-partnered she has thus not intermingled assets with any other person and prejudice would thus not flow to her. For reasons that I will expand upon shortly I do not accept the submission that prejudice would not flow to the wife’s or, indeed, the child of the marriage X.
I propose, shortly, and after a consideration of the submissions by Counsel for Ms Holden, to turn to the relevant authorities to which I have been referred and to follow the path outlined in the submissions of Mr Holden's Counsel and the case law.
Counsel for Ms Holden asserts that as the husband seeks the Courts’ indulgence in granting discretionary relief the Court must exercise its discretion cognisant of:
a)The husband being a (occupation omitted) of more than 30 years standing and with expertise and holding himself out with expertise in dealing with (occupation omitted);
b)The husband bearing the onus of proof of each of the matters which the Court must consider in exercising its discretion (and as to which there would appear to be agreement between the parties). Further, it was submitted that, consistent with authorities such as Stowe, that in an application for discretionary relief, particularly by a sophisticated litigant in the position of Mr Holden, the applicant would bear a more onerous duty of both disclosure and proof;
c)The husband’s failure to provide meaningful disclosure or to respond to requests for information or provision of material;
d)The husband’s failure to adduce evidence which addresses the significant and important issue arising from the past existence of a debt of $695,000.00 as at June 2007 and, further, the husband’s failure to produce such evidence at all and in circumstances whereby he had clear notice of the wife’s allegations.
Ms Holden's Counsel referred to well settled authority regarding disclosure such as Black & Kellner (1992) FLC 92-287 and Weir & Weir (1993) FLC 92-338 in highlighting the husband’s failure to adduce appropriate evidence as to transactions of fundamental importance to the composition of the asset pool, assessment of contributions or adjustments was under section 75 (2).
Further, Counsel for Ms Holden highlighted that recorded above and in light of that evidence that the submission put by Mr Holden that any debt in 2010 arose regarding the purchase of the Property K property, could not be accepted. The suggestion that any debt as existed in 2010 related to the Property K property or was paid out from the sale of that property cannot be accepted as those suggestions are contrary to the evidence including that of Mr Holden. The submission went further, however, in highlighting that the debt which had been incurred to purchase the Property K property (a debt of $573,000.00) had been paid off in a relatively short period of only some years and certainly all such debt was extinguished by August 2001.
The various tender documents were referred to by Ms Holden's Counsel as demonstrating the clear sophistication of Mr Holden as a litigant but perhaps more importantly the existence of entities in which the husband has or has had an interest and with respect to which no disclosure has occurred. This was suggested to cause some concern as regards not only the candour of Mr Holden’s evidence but his assertions as to his present financial situation.
Various internal inconsistencies in the evidence of Mr Holden were also highlighted. One such inconsistency of potentially great significance is the disparity between Mr Holden’s evidence at paragraph 22 of his affidavit and that contained in exhibit A 3.
At paragraph 22 of his affidavit Mr Holden deposes:
So far as I can recall I have never sought, obtained, received or provided a bank guarantee nor, to my knowledge, has Ms Holden at any time prior to a separation.
The documents tendered by Mr Holden as part of his case make clear that bank guarantees were provided both by Mr Holden and are purporting to also be provided by Ms Holden.
I make clear that I am not in a position to make any finding of fraud or forgery with respect to any guarantee which it is suggested has been given by Ms Holden or purportedly so. However, the very documents tendered by Mr Holden are so entirely at odds with his sworn evidence as to be highly concerning and, I am satisfied, make it impossible to accept Mr Holden’s evidence, at least on those points.
Mr Holden’s evidence had been that during the relationship between he and Ms Holden that real estate was always purchased in the sole name of Ms Holden to keep it safe from creditors of Mr Holden in the event of financial difficulty experienced by him. The creation and existence of the significant debts and the home being offered as security is inconsistent with this practice. Clearly the house was exposed to by such significant debt being secured against the home as it would not appear to have been previously.
The inconsistency of the situation which arose in 2010 with the evidence of Mr Holden, indeed the silence of Mr Holden with respect to the debt and how, when and why it was incurred creates a significant internal inconsistency in the evidence of Mr Holden in addition to the “yawning gap” in his evidence as already highlighted.
The inconsistencies and omissions in Mr Holden’s evidence are such that I am not satisfied that I can safely accept his evidence as accurate.
As these proceedings are interlocutory and I must proceed on the basis of treating the applicant’s evidence on its face as “more probably correct” these omissions and inconsistencies become all the more significant. I do not accept that I can take the husband’s evidence on its face as “more probably correct”. The omissions and inconsistencies give some real basis for caution in accepting the evidence of Mr Holden and, ultimately, I do not believe that I can safely accept it.
Ms Holden's Counsel, with some force, submitted that but for the actions of Ms Holden in dealing with and negotiating with the (omitted) Bank to obtain absolution from the debt of $695,000.00 (from which debt Mr Holden were shielded by his bankruptcy) there would now be no asset for these parties to engage in litigation about. Accordingly, Counsel submitted that “the husband washed his hands of the debt and the wife acted to address and remedy the situation the husband had created”. That would appear to be so.
Again, with some force, Ms Holden's Counsel highlighted the absence of contribution made by Mr Holden to any asset identified as relevant in the proceedings since the parties separated in 2006. The delays since separation, some nearly 9 years, would further compound difficulties in assessing contribution.
With respect to hardship, Counsel for Ms Holden submitted that the hardship that would be suffered by Ms Holden, and through her the child of the relationship X who is solely supported by Ms Holden, would be significant and would outweigh the hardship to Mr Holden. Further support of this position following from the evidence highlighted by Ms Holden's Counsel that:
a)If the proceedings had been dealt with and at or shortly after the separation of the parties and certainly prior to the negotiation by Ms Holden with the (omitted) Bank, the asset pool of the parties would have been modest if not negative;
b)The various documents tendered in the wife’s case (and a document annexed to the husband’s material in the form of an application for disability support pension or sickness allowance) corroborate that the husband had declared to those agencies that he had no interest in real estate, whether as a registered proprietor or by reference to any entitlement to make claim against property under the Family Law Act. The husband’s representations to those agencies would not appear to go so far as to invoke the High Court’s rationale in Nelson & Nelson [1995] HCA 25 but would, consistent with the submissions put by Counsel for Ms Holden, lead the Court to infer, as I accept I would be entitled to do, that Mr Holden did not disclose to those agencies including his Trustee in Bankruptcy (at the time of his bankruptcy) that he would have an interest in property if only through a Part VIII claim. If such an interest had been disclosed it is difficult to understand how a Trustee in Bankruptcy, acting with due diligence, would not have commenced proceedings;
c)The “costs” that would now be faced by Ms Holden in dealing with any claim as might be permitted by Mr Holden would extend well beyond mere financial cost. Financial cost would be increased through the complexity of proceedings. That would inevitably follow the exploration of the issues identified by the parties not the least of which is the relevant treatment of the debt of $695,000.00 incurred or created by Mr Holden and completely unexplained by him. The passage of time would further compound those difficulties. Ultimately, however, the costs that would be incurred by Ms Holden would go well beyond mere financial cost and such as to, as is put by Ms Holden, render the sale of the property necessary and causing myriad hardship for Ms Holden and X.
Determination of issues
Refusal to adjourn the proceedings
As indicated above there is no issue in these proceedings as to the husband’s capacity to provide instructions or to give evidence. The only issue which arises is the capacity of the husband to withstand cross examination. Whilst no particularisation is provided in the medical evidence offered as to why the opinion is advanced that the husband cannot be cross examined no issue is taken by the wife’s Counsel with the opinion, in fact, advanced.
The wife would be entitled to have her Counsel cross examine the husband especially as regards the discretionary aspects of the leave application those relating to the husband’s reasons for delay and suggested hardship that would be occasioned to the husband if leave were not granted (or, for that matter, hardship suffered by the wife if leave were granted).
The concern that might otherwise arise that the wife would be denied due process through an inability to cross examine the husband is, I am satisfied, addressed and ameliorated by the concession of Counsel that the matter should proceed without cross examination on any issue. That concession and the procedure then adopted, to proceed with the matter without cross examination of either party, was not cavilled with by the husband.
Those issues having been addressed it would appear clear that the only basis upon which adjournment could be sought by the husband was to enable him to engage in further preparation and presentation of further evidence.
As the husband seeks the Court’s indulgence in entertaining and determining his application for leave to proceed out of time, and as the husband has had a more than abundant opportunity to present evidence and present his case, I was not and am not satisfied that an adjournment of the proceedings was warranted, necessary or appropriate.
The husband’s Counsel submitted that the deficiencies in the husband’s case arose as his affidavit material was intended to identify issues in dispute and to sufficiently articulate the bases for his claim for relief without leading all necessary evidence to enable that claim to be determined, (subject to leave to proceed being granted).
I accept the submission of Counsel for the husband the husband is not, at this time, required to “prove” his claim to relief. The husband is required to demonstrate a prima facie case only (and address the other matters identified above). However, whilst the submission that the husband has “not brought a polished affidavit” to the proceedings is accepted (there are significant evidential deficiencies in the husband’s material) I am not satisfied that this is an adequate explanation or basis for that which the husband now seeks, an adjournment, to put on further evidence and properly prepare his case when it is clearly deficient.
The wife has done all required of her to seek to meet the husband’s case (such as it has been prepared and presented). The deficiencies in the husband’s evidence are solely matters for him and those instructed by him. If there is material which the husband had sought to place before the Court and have taken into account in the determination of his application for discretionary relief then the husband should have caused that material to have been filed with the Court in accordance with the timetable for preparation set when the hearing dates were allocated. Further, as a consequence of the five-month adjournment of the proceedings, the husband might, perhaps, have attended to repair of his case during that adjourned period. That the husband failed to do so is a matter entirely for him.
As was observed by the full Court in Tate & Tate [2000] FamCA 1040:
It is not for litigants, appearing in person or otherwise, to pick and choose which orders they will or will not obey, or when they may condescend to comply with them. Such an attitude, amply evidenced in this matter, if adopted, brings its own nemesis. That is not only because it is contemptuous of the Court’s orders. It is also because it works injustice to the parties who do comply, and unfairness to that myriad of litigants waiting to have their matters despatched as soon as the Court can hear them. The luxury of procrastination – let alone deliberate disobedience – is a luxury of the past if it ever existed.
If the husband has failed to properly prepare his case after the period that has been provided for him to do so (not less than seven months) then I must be conscious of not only potential disadvantage to the husband in conducting his litigation in such a parlous state of preparation but also:
a)The Courts resources and their use (see for example Haset Sali v SPC Ltd [1993] HCA 47 and Aon Risk Services & ANU [2000] HCA 27);
b)The delay which would then follow in hearing the proceedings; and,
c)The prejudice to the wife of further adjournment and whether such prejudice would be remedied by costs. I make clear that the husband’s Counsel, entirely appropriately, conceded that any adjournment granted in the husband’s favour would and must involve an order for costs in favour of the wife.
As regards the Courts resources it is clear that as matters presently stand these proceedings, if adjourned, could not then be heard until sometime in 2016. Indeed a hearing date could not be allocated to the matter at this time as no dates are available in 2015 and the 2016 Judicial calendar is not yet available. The calendar for the remainder of this year is full and listed at between 300 – 600% per day. The best that could be achieved would be to adjourn the matter to call over in July-August and in the hope that the 2016 Judicial calendar would by then have been published and, if so, to then allocate hearing dates to the matter. It would be at the cost of other litigants competing for scarce hearing time.
If the proceedings were adjourned to a further date or dates for hearing that would be the third listing of the matter for trial. I am not satisfied that this would represent an appropriate use of the Courts resources in the circumstances and particularly having regard to the disadvantage that will then be created for other litigants with the hearing of their cases delayed (not only by the allocation of a further date or dates to these proceedings but the reality that the matter would be “part heard” and thus matters listed behind this case would, in turn, be “not reached”).
As regards the cost and disadvantage to the wife I am not satisfied that the wife could be adequately recompensed through an order for costs even if an order for indemnity costs. As Justice Kirby alluded to in AMS and AIF the cost of litigation extends well and truly beyond a mere financial impost.
These parties separated in 2006. If the matter were now adjourned the hearing could not occur before 2016 (and, in all probability, the latter part thereof). The parties and their child X would have their lives put further on hold for at least another 12 months.
Evidential issues would continue to compound with such delay post separation. Distress and pressure of the proceedings remaining on foot and undetermined as well as the distraction from X’s parenting created by the proceedings continuing would represent an onerous and, I am satisfied, inappropriate burden and a burden more substantially borne by Ms Holden and X than by Mr Holden.
In circumstances whereby adjournment is sought to permit Mr Holden to seek to repair or fill the “yawning gap” (as referred to by his Counsel in closing submissions) in his evidence I am not satisfied adjournment is warranted or justified in light of the above.
It is on those bases that the application for adjournment is dismissed.
Interlocutory determination of the application for leave to apply
As these are discretionary proceedings I am conscious of the various matters summarised by Justice O’Ryan in his decision of Tamaniego & Tamaniego [2010] FamCAFC 254 to which I have been referred and particularly those set out in paragraphs 140 - 144 thereof which I incorporate herein:
140. The question whether an order is interlocutory or final has been discussed in many cases including in the High Court: see Re Luck [2003] HCA 70; (2003) 203 ALR 1; Bienstein v Bienstein [2003] HCA 7; (2003) 195 ALR 225 and 230, and Carr v Finance Corporation of Australia Limited (No.1) [1981] HCA 20; (1981) 147 CLR 246 at 248 and 256. The usual test is whether the order finally determines the rights of the parties in the principal cause pending between them.
141. In Thallon and Thallon (1992) FLC 92-322 the Full Court (per Fogarty, Baker and Maxwell JJ) concluded that orders under s 44(3) of the Act whether granting or refusing leave were final, that is, they finally determined that particular proceeding. If leave is granted and property or maintenance proceedings are instituted then that is a separate proceeding: see also Neocleous and Neocleous [1993] FamCA 44; (1993) FLC 92-377 (per Fogarty and Nygh JJ with Lindenmayer J dissenting).
142. In Emamy and Marino (1994) FLC 92-487 the majority of the Full Court (per Ellis and Baker JJ) concluded at 81,075 that an order dismissing an application pursuant to s 44(3) of the Act was final but was interlocutory if leave was granted because property proceedings would then be instituted and the “substantive property rights of the parties under s 79 remain to be determined”. The majority found that Thallon and Thallon was wrongly decided insofar as it was authority for the proposition that an order granting leave was a final order.
143. The issue was briefly considered by the Full Court (per Finn, Warnick and Boland JJ) in Richardson & Richardson [2008] FamCAFC 107 (16 July 2008). In that case the appellant husband filed an application for leave to appeal (and if leave was granted) an appeal against orders dismissing an application for a review of orders made by a Judicial Registrar. The primary judge had, in effect, confirmed the orders of the Judicial Registrar which had granted the wife leave under s 44(3) of the Act to institute proceedings against the husband for property settlement, notwithstanding a delay of 13.5 years. The Full Court said at [6] that it was well established by authorities that an order granting leave pursuant to s 44(3) to institute proceedings is an interlocutory order and that therefore leave is needed to appeal such an order and referred to Emamy and Marino. It was also accepted that in order to obtain leave to appeal, the appellant husband had to establish that there had been an error of principle in the making of the order or that the order worked a substantial injustice towards him.
144. I have some doubt about the correctness of the view of the majority in Emamy and Marino. However, it is not necessary for me to resolve that issue because in the written submissions of the Wife, referring to Emamy and Marino, it was acknowledged that there is Full Court authority indicating that applications pursuant to s 44(3) of the Act are interlocutory proceedings. It was submitted that, in addition, the proceeding was conducted as an interlocutory proceeding and there was no evidence given or cross-examination of witnesses during the hearing before the Federal Magistrate (Transcript, 11 September 2009, p 8). The Wife acknowledged that in those circumstances she required leave to appeal and that such leave can only be granted if her Honour made errors of principle and/or not to grant leave to appeal would cause a substantial injustice to the Wife: see Rutherford and Rutherford (1991) FLC 92-255. Accordingly, it was submitted that the errors made by her Honour in the hearing of the Wife’s application either individually or cumulatively lead to that result such that leave ought be granted.
As the application for leave to apply out of time is clearly an interlocutory application I am satisfied that I can safely proceed to determine the matter without either party having been cross examined and particularly in light of the concessions made by Counsel for each of the parties that the matter can proceed on that basis.
In dealing with the substantive issue of leave I am greatly assisted by the decisions referred to above and which have been highlighted by Counsel in their closing submissions. To that end I incorporate paragraphs 145 – 163 (inclusive) of the decision in Tamaniego [2010] FamCAFC 254 as well as paragraphs 25 – (27) inclusive) of Riordan [2012] FMCAfam 1297 together with paragraphs 6 – 14 of Morgan & Flanagan [2014] FamCA 248 all of which are set out below and all of which, I am satisfied, provide a clear and concise identification of the matters which I must address in determining these proceedings.
Tamaniego & Tamaniego [2010] FamCAFC 254
Institution of proceedings out of time
145. In relation to the approach to be taken to the determination of an application pursuant to s 44 of the Act for leave to institute proceedings for property settlement pursuant to s 79, subject to some additional observations, I will repeat some of what I said in Oxenham & Oxenham [2009] FamCAFC 167 (15 September 2009).
I have emphasised the concluding sentence above as it has some comparison with the facts and circumstances of this case and gives me some comfort that my assessment of the absence of a demonstrated prima facie case is correct.
The “strength” of the husband’s material, incomplete, internally inconsistent, silent on issues of importance and demonstrated to be inaccurate in important regards, is difficult to assess. If I cannot confidently accept the husband’s evidence on its face I am satisfied that the husband must suffer any disadvantage that follows and not the wife.
For the purpose of considering hardship I propose to proceed on the basis that a prima facie case for relief has been or may be established by the husband. It would be disingenuous of me to proceed on any other basis as a finding that no prima facie case is made out would obviate the need to determine the issue of hardship. There could be no hardship if there is no prima facie case worthy of prosecution or any case as there is so unmeritorious as to obviate against leave.
The husband asserts that hardship would automatically follow any refusal of leave as such refusal would leave the wife holding “… approximately close to, if not all, of the matrimonial assets”. It is further submitted that the husband has little if any financial resources now or in the period from separation to the present. Inferentially, if nothing else, the husband’s case would appear to be that he will, in the future, have little if any prospect of acquiring assets or financial resources.
The hardship that the husband might suffer is, in common with an assessment of prima facie case above, made more complex by the difficulties created by the husband in failing to provide proper disclosure or lead evidence regarding the significant issue of the accumulation of debt.
Certainly it could not be denied that the husband, with any order for property adjustment made in his favour, might be better off than he presently is. Accepting the husband’s evidence on its face (which I have difficulty doing for the reasons above) would be so as the husband, on his own evidence, asserts that he cannot work in his chosen professional field as a (occupation omitted) and has not done so for some little time. In various public fora the husband holds himself out as working in that profession, however, and including with specific expertise in (occupation omitted). In those circumstances the husband’s own actions and representations create some difficulty in accepting his evidence on its face as one might otherwise do for the purpose of an interlocutory hearing.
The factual complexity created by the husband’s deficient evidence and actions inconsistent with if not contradictory to his evidence is such that any hearing of a claim for property adjustment relief which would follow upon leave being granted would require significant preparation and would, in light of the evidential difficulties referred to at length, warrant a declaration as to the appropriateness of interrogatories and formal discovery. The hearing of the cause would likely require some days of hearing and would, subject to appropriate evidence as to the husband’s capacity to withstand it, entail significant cross-examination on many if not most areas of evidence.
The above circumstances must be taken into account in assessing hardship. Any cost incurred by the parties, individually or collectively, would, in all probability, be funded from the property pool the subject of the dispute. The husband deposes that he is not in paid employment and supports himself solely from Centrelink benefits (notwithstanding the significant controversy introduced as regards that assertion by the documents produced and published by the husband and tendered in the wife’s case). The wife is in limited part time employment in a (omitted) capacity and deposes in her evidence to having somewhat limited means as well. The wife certainly deposes to the expenditure of her gross weekly income on a week by week basis living, as it were, from pay to pay cheque.
Even leaving aside the complexities created in any future property adjustment determination between these parties as a consequence of the husband’s deficient disclosure and evidence it is clear that:
a)A hearing of some days would be required to determine the dispute;
b)The costs of the parties would be significant;
c)Added complexity arises not only from the issue of debt incurred by the husband as at June 2007 but also the passage of significant time since the separation of the parties (a period of more than 10 years will have passed prior to any hearing); and,
d)The husband’s entitlement, subject to leave being granted, would, at its highest, appear to fall well short of that which he seeks to prosecute particularly when one has regard to not only contribution arguments that the parties have identified (but which need not be determined by me at this time) but also section 75 (2) adjustments.
To the extent that the husband submits that he would be significantly worse off if no section 79 order were made that is not the test as was made clear in Hall & Hall wherein their honours comprising the plurality stated:
As all the authorities point out, the fact that the applicant demonstrates that he or she has a reasonable claim to present the Court is not necessarily the same thing [as suffering hardship].
As their honours also made clear (as quoted above):
If hardship of the required type is established then the court may grant the leave but it has a discretion to refuse to do so and in considering the exercise of that discretion it would take into account any other relevant matters, but basically the question whether there is a reasonable explanation of the delay and the question of prejudice which may have occurred to the respondent as a consequence. Other facts may be relevant in an individual case, such as, for example, any prior order or provision made, and the discretion has to be exercised on the basis of the facts of that particular case.
Further as Nygh J opined in Frost & Nicholson:
To deprive a party of a right to institute proceedings is not per se hardship, but to deprive the wife of a right to action in the present circumstances is to work an injustice and that is a “substantial detriment’…. The stronger the applicant’s prima facie claim the greater the likelihood of hardship if leave were refused. The issue depends on the circumstances of each case.
The husband has been deprived of the right to institute proceedings as a consequence of his failure to commence proceedings within the appropriate limitation period. The issue is thus whether substantial detriment or significant hardship would be occasioned to the husband if leave to apply out of time were now also refused which refusal of leave would have the effect of precluding the husband’s claim for all time.
I have some concern that even if I were incorrect in my assessment that the husband has not established a prima facie case that the case that could be established by him would be a far from substantial claim in all of the circumstances. Again, the quantum of the husband’s likely entitlement, if leave were granted and the claim heard on its merits, need not be determined by me. But on even a cursory examination of the husband’s evidence, subject to its omissions and deficiencies, the husband’s claim would be significantly consumed by legal costs and the value of the claim would likely fail to meet the costs incurred by the parties collectively.
If one leaves aside the costs that would likely be incurred by the parties, individually or collectively, and hardship might be more readily made out by the husband subject to the husband satisfactorily addressing his delay (and the consequence of that delay as the wife has identified in her material, namely, her reliance upon it in having proceeded now since the parties separation in 2006 the most surely since the parties divorced became final, on the basis that no such claim would proceed) and any hardship to the wife and, importantly, X.
Ultimately, and on the basis of my finding that I am not satisfied that the husband has established a prima facie case or even a substantial case, I could not be satisfied that the husband would suffer serious detriment or significant hardship.
If I am wrong as regards the finding as to the absence of a prima facie case then hardship might be established by the husband. To make such a finding I would need to ignore the deficiencies and internal inconsistencies of the husband’s evidence which I am not prepared to do especially given that the husband is an eminently qualified (occupation omitted) with skill, knowledge and experience in (omitted).
I have not had the opportunity of cross examination of either party regarding issues of hardship and delay. Even without that opportunity it is clear, as I would hope would be apparent from the above, that issue arises as to the acceptance of the husband’s evidence on its face. That issue comes about through the husband’s internally inconsistent and deficient evidence which causes me to approach it with some reservation if not scepticism especially when it is in conflict with the evidence of the wife and independent documentation.
Overall and for the reasons above I am not satisfied that the husband would suffer hardship or greater hardship than he suggests he is presently experiencing if leave were not granted. Again and lest I am wrong in that finding I propose to deal with the husband’s delay and the hardship to be suffered by the wife and X if leave were granted.
The husband’s explanations of delay
It is submitted on behalf the husband that his delay in commencing proceedings (or seeking leave to do so) has been minimal and that adequate explanation is provided as:
a)The husband commenced a formal process of mediation some four months after the divorce order in which process the wife is suggested to have participated; and,
b)The husband has suffered from bipolar affective disorder since 2001.
I propose to deal with each of the above submissions separately
The delay in commencing proceedings must be adequately explained by the husband although I accept that delay, by and of itself, would not be dispositive of the application.
The husband has sought leave to commence proceedings relatively shortly after the expiration of the limitation period. The divorce order became final in September 2012 and the husband’s application for relief was filed in April 2014 (being less than two years outside of the limitation period).
In considering delay and from the outset it must be observed that the husband is a qualified (occupation omitted) who, on his own admission, let alone as confirmed by the various documents tendered in the wife’s case, has (occupation omitted) and has held himself out to the community at large as being a specialist in (occupation omitted).
The husband does not at any point in his evidence, suggest that he was unaware of the limitation period which applied to the commencement of proceedings. In light of the husband’s profession in (occupation omitted), I would be loath to accept any such denial if it had, in fact, been advanced.
The husband’s evidence that he attended an appointment with Relationships Australia in March 2012 is corroborated by correspondence sent to the husband by that agency and annexed to the husband’s material (annexure H2). The husband asserts that the purpose of his approach to Relationships Australia was to instigate Family Dispute Resolution with respect to both property adjustment and parenting issues. Other than the husband’s assertion that this was the purpose of his approach to Relationships Australia there is no evidence corroborative or otherwise. The Court is left with the husband’s mere assertion, albeit on oath (and as to which the wife has not had the opportunity to cross-examine).
As indicated above it is open to the husband to subpoena the records of Relationships Australia as regards that which passed between he and that organisation. In light of the specific drafting of the relevant regulation such administrative and intake appointments are not protected by the inadmissibility provisions of Part II of the Act. The husband has not called such evidence.
Also annexed to the husband’s affidavit (annexure H5) is correspondence sent by the husband to an employee of Relationships Australia on 1 April 2014. Within that email the husband asserts that he had first contacted Relationships Australia in January 2012 “… In accordance with the compulsory family dispute resolution requirements in family law proceedings”. Whilst the husband asserts that “the subject matter of the engagement was parenting orders and property orders…” It must be observed that:
a)The “compulsory family dispute resolution requirements in family law proceedings” relate solely to parenting proceedings under Part VII (see section 60I);
b)There is no requirement for parties to attend “compulsory family dispute resolution” with respect to proceedings which do not relate to parenting orders under Part VII. Section 60I is confined to parenting proceedings;
c)The provisions of the Federal Civil Dispute Resolution Act 2011 specifically do not apply to proceedings under the Family Law Act such proceedings being specifically exempted therefrom and thus there is no requirement, as asserted by the husband, for family dispute resolution to occur in property proceedings at all let alone prior to filing;
d)Further the Full Court decision in Thompson & Berg [2014] FamCAFC 73, albeit determined after January 2012, makes clear that the Family Law Rules and the Pre-action Procedures contained therein do not apply to proceedings before the Federal Circuit Court and thus the obligations under those rules do not apply in proceedings before this Court. In any event the Family Law Rules Pre-action Procedures do not compel attendance at Family Dispute Resolution or mediation and, as such, such attendance is not “compulsory”;
e)The husband’s engagement with the process was less than diligent. The husband suggests that after attending his intake appointment 15 March 2012 that he did not then follow up with the agency until November 2012 by which time the limitation period had expired;
f)Whilst the husband asserts that the wife had also engaged in the process through Relationships Australia there is no evidence at all on that issue led by the husband (or the wife). The email of the husband, annexure H5, does not support the husband’s contention either;
g)In his email the husband makes clear that he is aware that he can make application to the Court to be exempted from attendance at Family Dispute Resolution (see section 60 I (7)).
It would be sufficient to find the absence of explanation for delay in the commencement of proceedings within the limitation period by reference to the husband’s professional (occupation omitted) and experience as a (occupation omitted) in (employer omitted). The absence of any explanation advanced by the husband for his delay, other than the suggestion that he was desirous of resolving the dispute through Family Dispute Resolution which would not appear to have occurred and as to which the husband was less than diligent if not lax in pursuing, does not assist the husband.
To the extent that the husband suggests that the parties were directly engaged with each other in negotiating and attempting to resolve financial issues it would suffice to note that no evidence at all is led by the husband of any such attempt. The husband had sought to tender emails authored by him and addressed to the wife. That portion of the husband’s evidence was objected to and excluded both as to form and on the basis of such material comprising settlement negotiation and did not fall within any of the exceptions to section 131 of the Evidence Act (as above).
Informality in the Federal Circuit Court
To the extent that it might be suggested that the exclusion of material on the basis of form or infringing upon the disclosure of settlement negotiations is contrary to the obligation of the Federal Circuit Court to deal with proceedings “as informally as possible” as directed by section 42:
Federal Circuit Court of Australia to operate informally
In proceedings before it, the Federal Circuit Court of Australia must proceed without undue formality and must endeavour to ensure that the proceedings are not protracted.
I do not accept that to require compliance with the Evidence Act is to act formally. Informality does not allow or dictate a less than rigorous application of the law and including the rules of evidence.
Whilst the Federal Circuit Court is mandated to deal with proceedings with as little formality as possible that does not suggest, imply or require that the Court dispense with ordinary judicial process or application of the law in accordance with one’s oath of office “to do right by all manner of people”.
It is the role of a Court, including the Federal Circuit Court, to apply the laws of the Commonwealth and to conduct proceedings in accordance with time-honoured and well established principles of judicial determination created over a significant time to deliver justice and ensure the integrity of both process and decision making. The rules of evidence are significant in that regard and integral to the attainment of justice. Decisions are not made based on gossip, rumour or innuendo, not unreliable and non-probative evidence.
Informality of process would dictate that the Court endeavour to communicate with litigants, as certain provisions of the Family Law Act require, principally within Part VII, require, in language that will in all probability be understood.
Informality requires the Court ensure the process is, as far as possible, inclusive, non-intimidating and civil. Informality of process would suggest, subject to ensuring that due process is not infringed, that matters such as the order in which witnesses are called might be flexible and responsive to the needs and circumstances of litigants and those involved in litigation.
Informality does not require nor permit laws of the Commonwealth, including the Evidence Act, to be disregarded. In some circumstances, such as those expressly authorised by Division 12A of Part VII of the Act, certain provisions of the Evidence Act do not apply or need not be applied unless the Court considers the circumstances of the case exceptional. However, even when material that would otherwise be excluded by the rules of evidence comes before the Court it is, in accordance with the express terms of the section, to be “given such weight (if any)” as the Court considers appropriate.
These are not proceedings under Part VII. Accordingly, the rules of evidence apply to the proceedings and have been applied.
As regards the husband’s submission that he has suffered from Bipolar Affective Disorder “from 2001” there is, again, no evidence to support that submission. An opinion has been advanced by Dr A in similar terms to the submission put on the husband’s behalf. However, that portion of the evidence of Dr A was rejected as the opinion offered clearly fell outside of the personal knowledge of the good Doctor who did not meet with Mr Holden until April 2014 and thus could not offer the opinion which he had purported to offer in the first of his affidavits (paragraph 5).
Even if one were to accept that Mr Holden presently suffers from a Bipolar Affective Disorder or, for the sake of the argument, suffered from that disorder (as first diagnosed in or after April 2014), as at the date of divorce of these parties, there is still no causal connection suggested on the evidence between that diagnosis and the husband’s failure to act within the limitation period of which he was fully aware and as to which he has never suggested a lack of awareness.
What is clear from the evidence, including that tendered in the wife’s case, is that the husband has, at all times since the separation of the parties, been able to attend to his personal affairs and including his extensive and lengthy dealings with the (omitted) involving, at one stage, an application for injunctive relief to the Supreme Court of New South Wales. Clearly there was no impediment to such action being taken by Mr Holden, his instruction of others retained to assist in those endeavours nor any incapacity on his part in taking appropriate action to protect his rights and interests as he saw them from time to time.
I am not satisfied that Mr Holden has offered any explanation that is plausible or sufficient for his delay in commencing proceedings for property adjustment relief within the limitation period.
I am not satisfied that the absence of adequate explanation would be, by and of itself, dispositive of the application. However, it is a factor of some importance particularly when balanced against the hardship which might be suggested by Mr Holden or the hardship and prejudice which might be experienced by the wife and X.
Hardship and prejudice to the wife and X
The husband submits that any prejudice to the wife arising from leave being granted is “limited” in that:
a)The wife can make all of the arguments that she has raised in these proceedings in substantive property adjustment proceedings;
b)The wife has not re-partnered or intermingled assets with another person; and,
c)The wife has not altered her assets since the time of divorce. That is, of course, subject to the wife’s evidence, which there is no reason to doubt, that she has affected repairs and renovations to the home.
The wife submits that she would experience significant hardship if leave were now granted to Mr Holden to commence property proceedings. This is particularly suggested to arise from:
a)The failure of Mr Holden to provide any financial contribution or support for the wife or X since separation;
b)The wife’s limited income from part-time employment such that she is not in a position to raise significant funds to either make any payment to the husband or to obtain a fresh mortgage in the event that the home was sold or required refinance;
c)The financial pressure that would flow to the wife if leave were granted and she were then required to deal with those proceedings and to comply with any subsequent orders as may be made;
d)The reality that any order for property adjustment would have the effect that the wife would “… Not be able to retain the home for herself and X… X is very settled in the home of his friends, her dog the support of caring community close by”; and
e)The reality that contributions post separation, a period of some 10 years, have included repairs and improvements to the property undertaken by Ms Holden.
It is trite to observe that there is much force to that which Ms Holden places before the Court as to the hardship that she and X would experience if property adjustment proceedings were now commenced. That hardship is real and whilst it is dismissed by Mr Holden, principally on the basis that as Ms Holden is not re-partnered and thus there is no further complication of intermingling of assets (such as has occurred or has the potential to occur as between Mr Holden and his partner), I accept it as so.
As regards X there has a ready been significant hardship to her since the separation of her parents. Without entering into the controversy arising from the evidence of the parties and each of them as to care arrangements for X whilst her parents lived separately and apart under the one roof (physical separation occurring when X was eight years of age), it is clear that X has, for the last five years, lived in her mother’s sole or primary care and with no financial assistance or contribution from her father. The extent of Mr Holden’s contribution to X would appear to be limited to his funding fares for her travel to Queensland, where Mr Holden removed himself following physical separation, and in meeting X’s expenses whilst she is in his care (such as housing, clothing, feeding and entertainment).
X has suffered significant hardship through an absence of financial support and assistance from her father since separation. Under the International Convention on the Rights of the Child, X has “a right” to maintenance (see articles 26 and 27). That right has not been significantly enlivened by Mr Holden who, whilst he would assert that he has been in an impecunious financial position and unable to assist, cannot deny the reality that X’s expenses have been primarily or solely met by her mother.
Ms Holden is clear in her evidence that he was fully aware of the time limit which applied to the commencement of property adjustment proceedings notwithstanding that she is not a (occupation omitted). As a consequence she deposes to having taken some comfort from the expiration of the limitation period and the understanding that any claim was then precluded. In purported reliance upon that circumstance Ms Holden has continued to make plans for herself and X and including the renovations, repairs and improvements to the property at Property G to which I have referred.
I am satisfied that there would be significant hardship to both Ms Holden and X if leave to apply out of time were granted. Leaving aside the financial costs that would be incurred the commencement of property adjustment proceedings this would see their lives “put on hold” as it were for a period of not less than 12 – 18 months and possibly longer until the matter can be heard on a final basis.
As already observed the financial cost of those proceedings, in light of the complexities that potentially arise from the absence of disclosure or evidence or the failure to adduce evidence will give proper disclosure (which failings would appear to have typified Mr Holden’s conduct of this case), would be substantial and would significantly erode not only any entitlement which Mr Holden might ultimately establish but also the entitlement of Ms Holden from which entitlement Ms Holden would continue, in all probability, to primarily or solely support X.
In closing the discussion of this issue I again observe that Mr Holden’s evidence is that the home at Property G, together with previous real estate, was deliberately purchased and registered in the sole name of Ms Holden to ensure that such property would not be available to creditors in the event that Mr Holden, for whatever reason, fell upon hard times in his business dealings. That evidence by Mr Holden by and of itself contradicts the borrowings specifically guaranteed by Mr Holden and/or by Ms Holden (whether the guarantee was knowingly made and advanced by Ms Holden or otherwise) and the security for payment of those debts against title of the Property G home.
To the extent that the parties jointly or Mr Holden singularly had the intent or desire to “quarantine” real estate from creditors this outcome would appear, on one view of the evidence (although it would be prefaced upon an acceptance of the husband’s generally defective evidence on the topic), to have been achieved. Due to the deficiencies in Mr Holden’s evidence I am not in a position to find that it has been so. However, if that is what had occurred (and it would appear inherent from Mr Holden’s case that such a scenario is implied or inferred) then, again, real issues might arise by reference to authorities such as Nelson, as to allowing Mr Holden to give such evidence or obtain what might be described as “advantage” (although I do not intend to suggest that bankruptcy could generally be described as advantageous) by representing one state of affairs to his Trustee in Bankruptcy and the world at large and then representing a different state of affairs to this Court.
I am satisfied that I need not address the above issue further other than to note the possibility that such considerations might arise (creating more complexity and cost) in the event that leave were granted. It is not possible to address the matter further in light of the deficiencies of Mr Holden’s evidence which deficiencies are a significant basis in my assessments, as set out above, that Mr Holden has not:
a)Made out a prima facie case;
b)Demonstrated a compelling explanation for his delay in commencing proceedings within the limitation period;
c)Demonstrated that he would experience substantial detriment or hardship or, to the extent that it may be established, has not demonstrated that such detriment or hardship as might be suffered by him is outweighed by this detriment or hardship that would be suffered by Ms Holden and/or X.
For those reasons I am satisfied that the application for leave pursuant to section 44 (3) made by Mr Holden must fail and accordingly I make orders as follows.
I certify that the preceding two hundred and forty-eight (248) paragraphs are a true copy of the reasons for judgment of Judge Harman.
Associate:
Date: 2 April 2015
[3] Affidavit of Dr A filed 19 December 2014, paragraph 4.
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