Jacobs and Jacobs

[2015] FamCA 831

FAMILY COURT OF AUSTRALIA

JACOBS  & JACOBS [2015] FamCA 831

FAMILY LAW – PROPERTY – Interim – Urgent hearing on an ex parte basis – Where the wife has attempted to bring this application to the notice of the husband and interested parties – Wife’s application for an injunction restraining the husband and his adult children from dealing with the proceeds of sale of various entities, which are due to settle today– Where it is the wife’s evidence that the husband has embarked upon a course designed to remove assets of the parties – Where sale of the entities was not disclosed to the wife by the husband despite his obligation of full and true disclosure – Where the matter is listed for a duty hearing in three days time and can be revisited at that time – Orders made inter alia placing the proceeds of sale into the trust account of the wife’s solicitors – Orders made that the husband’s adult children be joined to the proceedings.

Family Law Act 1975 (Cth)

Family Law Rules 2004 (Cth)

Ansah v Ansah [1977] 2 All ER 638
In the Marriage of Kennedy (1993) FLC 92-409
In the Marriage of Sieling (1979) FLC 90-627

In the Marriage of Stowe (1981) FLC 91-027

APPLICANT: Ms Jacobs

RESPONDENT: Mr Jacobs

FILE NUMBER: BRC 798 of 2013

DATE DELIVERED: 18 September 2015

PLACE DELIVERED: Brisbane

PLACE HEARD: Brisbane

JUDGMENT OF: Kent J

HEARING DATE: 18 September 2015

REPRESENTATION

SOLICITOR FOR THE APPLICANT: Barry.Nilsson. Lawyers

Orders

IT IS ORDERED UNTIL FURTHER ORDER:

1. This application proceed urgently ex parte pursuant to Rule 5.05(4), 5.12 and 5.13 of the Family Law Rules 2004.

2. That upon the Respondent, Mr Jacobs , receiving any consideration as a result of the sale, transfer, disposal or alienation in any other form of any interest he has in any of the following entities or of any asset or any form of property, including but not limited to intellectual property, owned by any of the following entities:

   (a)Mr Jacobs Family Trust;

   (b)Jacobs C Pty Ltd;

   (c)Jacobs D Pty Ltd;

   (d)Jacobs E Pty Ltd;

   (e)Jacobs F Pty Ltd;

   (f)G Pty Ltd;

   (g)H Pty Ltd;

   (h)Jacobs SA Pty Ltd;

   (i)          I Pty Ltd;

   (j)          J Pty Ltd;

   (k)L Pty Ltd;

   (l)          M Pty Ltd;

   (m)N Pty Ltd;

   (n)O Pty Ltd;

   (o)P Pty Ltd;

   (p)Q Pty Ltd;

   (q)R Family Trust;

   (r)S Family Trust;

   (s)T Pty Ltd;

   (t)          W Pty Ltd;

   (u)X Pty Ltd;

   (v)Y Pty Ltd;

   (w)Z Pty Ltd;

   (x)AA Pty. Ltd; and

   any other entity in which the First Respondent, Second Respondent and Third Respondent have an interest the Respondent shall do all acts and things and sign and/or execute all such documents as are required to ensure that such monies be placed into the trust account of Barry.Nilsson. Lawyers pending the further hearing of this application on Monday, 21 September 2015, and not to be released except pursuant to an Order of this Court.

3. That Mr A Jacobs , born … 1989, be joined as the second respondent to these proceedings.

4. That Ms B Jacobs , born … 1995, be joined as the third respondent to these proceedings.

5. That Mr A Jacobs  and Ms B Jacobs , in their capacity as directors of each of the following companies:

   (a)       N Pty Ltd;

   (b)       Jacobs SA Pty Ltd;

   (c)       O Pty Ltd;

   (d)       P Pty Ltd;

   (e)       Jacobs F Pty Ltd; and

   (f)       Jacobs E Pty Ltd.

   and in their respective capacities as trustee and/or appointor of each of the following trusts:

   (g)       S Family Trust;

   (h)       Mr Jacobs Family Trust; and

   (i)        R Family Trust;

   are hereby restrained from causing or directing any other person to cause any of the abovementioned entities to distribute, transfer or in any way deal with any proceeds of sale or monies otherwise received by any of the abovementioned entities other than in accordance with these Orders and shall do all acts and things and sign and/or execute all documents required to cause such monies to be transferred into the trust account of Barry.Nilsson. Lawyers immediately upon their receipt by any of the above entities or by any solicitor acting on behalf of any of those entities pending the further hearing of this application on Monday, 21 September 2015, with such monies not to be released except pursuant to a further Order of this Court.

6. That each of Mr Jacobs , Mr A Jacobs  and Ms B Jacobs  provide to Ms Jacobs within fourteen (14) days of the date of these Orders a copy of any and all documents relating to the transfer, sale or proposed sale of the interests of either or all of them in any of the following entities or of the assets or any form of property, including but not limited to intellectual property, owned by any of the following entities:

   (a)       Mr Jacobs Family Trust;

   (b)       Jacobs C Pty Ltd;

   (c)       Jacobs D Pty Ltd;

   (d)       Jacobs E Pty Ltd;

   (e)       Jacobs F Pty Ltd;

   (f)       G Pty Ltd;

   (g)       H Pty Ltd;

   (h)       Jacobs SA Pty Ltd;

   (i)        I Pty Ltd;

   (j)        J Pty Ltd;

   (k)       L Pty Ltd;

   (l)        M Pty Ltd;

   (m)      N Pty Ltd;

   (n)       O Pty Ltd;

   (o)       P Pty Ltd;

   (p)       Q Pty Ltd;

   (q)       R Family Trust;

   (r)       S Family Trust;

   (s)       T Pty Ltd;

   (t)        W Pty Ltd;

   (u)       X Pty Ltd;

   (v)       Y Pty Ltd;

   (w)      Z Pty Ltd;

   (x)       AA Pty. Ltd; and

   any other entity in which the Frist Respondent, Second Respondent and Third Respondent have an interest for the period 28 December 2012 to the date of these Orders.

7. The Applicant Wife be granted leave to serve a copy of any Orders made on 18 September 2015 to any solicitors acting with respect to the sale of any of the assets of the following entities:

   (a)       N Pty Ltd;

   (b)       Jacobs SA Pty Ltd;

   (c)       O Pty Ltd;

   (d)       P Pty Ltd;

   (e)       Jacobs F Pty Ltd; and

   (f)       Jacobs E Pty Ltd.

   and to any solicitor handling the sale, transfer, disposal or alienation of the Respondent’s interest in any entity referred to in paragraph 1 of these Orders and any purchaser or recipient of such interest or their legal representatives.

8. The wife cause these orders to be served forthwith upon the Husband’s trustee in bankruptcy.

9. That in the event that either party refuses or neglects to do any act or sign any document required to be signed or executed in compliance with the provisions of these Orders, then pursuant to section 106A of the Family Law Act 1975 (Cth), the Registrar or Deputy Registrar of the Family Court of Australia at Brisbane is hereby appointed to execute all deeds and documents in the name of the defaulting party and do all acts and things necessary to give validity and operation to the said Order and the affidavit of the solicitor for the non-defaulting party shall be sufficient evidence of such non-compliance. The party in default is ordered to pay all reasonable solicitor/own costs incurred by the non-defaulting party.

10. The Applicant be granted leave to file two affidavits of service of Ms BB and an affidavit of service of Ms CC.

11. That the Applicant’s costs of and incidental to this application be reserved.

IT IS NOTED that publication of this judgment by this Court under the pseudonym Jacobs & Jacobs has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).

FAMILY COURT OF AUSTRALIA AT BRISBANE

FILE NUMBER: BRC798/2013

Ms Jacobs

Applicant

And

Mr Jacobs

Respondent

EX TEMPORE REASONS FOR JUDGMENT

1. Substantive property proceedings have been on foot in this matter since the wife filed her Initiating Application on 5 February 2013 against a background of the parties having commenced cohabitation in 2000, marrying on 14 December 2002, and finally separating on 28 December 2012.  There are two children of the marriage: a son aged ten and a son aged eight.  Both of those children live with the wife and spend time with the husband.

2. The proceedings have progressed through various stages in terms of case management, including orders being made, for example, on 14 October 2013 for a single expert to value the parties’ business interests.  The wife filed an Application in a Case on 2 July 2015 seeking the appointment of a single expert with respect to valuing the husband’s business interests.  That application was listed to 28 August 2015 with directions for the husband to file his response and other material.

3. On 28 August 2015, the hearing of the Application in a Case filed 2 July 2015 was adjourned to be heard with another Application in a Case filed on 28 August 2015 on Monday next, 21 September 2015. 

4. The current application listed urgently today arises in circumstances where the wife has been provided with information from a liquidator of one of the business entities to the effect that assets of the husband’s entities, or entities with which he is associated, are to be sold with settlement of that sale to occur today.

5. It ought be noted that information provided to the wife about recent events concerning the husband, including his bankruptcy and in respect of this prospective sale comes not from the husband himself, notwithstanding his ongoing duty of disclosure in property proceedings, but via other sources. 

6. On the evidence provided by the wife, it would seem that without the wife’s knowledge or consent or any information, the husband may have embarked upon a course designed to remove assets of the parties, or either of them, via the entities from the proper purview of the Court in determining final property settlement proceedings.  It would seem, again on the evidence provided by the wife, that the husband may have enlisted the aid of his adult children in that design.  It appears that those children, Ms B Jacobs and Mr A Jacobs , have been appointed to various roles within the corporate structure, and by corporate structure, I mean the six entities now set out: 

   a)N Pty Ltd, Jacobs SA Pty Ltd;

   b)O Pty Ltd;

   c)P Pty Ltd;

   d)Jacobs F Pty Ltd; and

   e)Jacobs E Pty Ltd.

7. By this application, the wife seeks orders until the matter can be heard on Monday next to preserve her interests and preserve the status quo, as it were, in respect of any potential proceeds of the sale of the subject assets.  The application is made and orders are sought essentially on an ex parte basis, given that neither the husband nor anyone else has appeared in response to the application.  Notwithstanding, I am satisfied of the wife’s efforts to bring this application to the notice not only of the husband, but other concerned parties. 

8. It is well settled that an ex parte order should only be made when there is real and urgent need for protection, and that it should only remain in force until both parties or any parties concerned can come before the court to be heard (In the Marriage of Sieling (1979) FLC 90-627, Ansah v Ansah [1977] 2 All ER 638, In the Marriage of Kennedy (1993) FLC 92-409).

9. It is plain that when ex parte orders are made the court is obliged to give a respondent or a person affected by those orders or any party who might be adversely affected by the orders the earliest possibility to be heard (In the Marriage of Sieling supra, and In the Marriage of Stowe (1981) FLC 91-027).

10. In this case, as I have already referred to, the proceedings are to be heard again in only three days time; that is, on Monday 21 September 2015. I am satisfied that with respect to r 5.12 of the Family Law Rules 2004 (Cth) (“the Rules”) that this is a case where it is necessary to shorten the time for service and the fixing of this return date in circumstances where the settlement of the proposed sale is to occur today. For the same reasons I am satisfied within the meaning of the rule that orders should be made without notice to the other parties to the extent that it can be said that relevant other parties do not have notice.

11. I have earlier referred to the feature that the wife has made concerted attempts to bring this application to the notice of other concerned parties.  That is, I am satisfied that each of the husband and his children Ms B Jacobs and Mr A Jacobs have been made aware of this application to the extent that the wife has been able to do so. 

12. The trustee in bankruptcy appointed in respect of the husband’s bankruptcy, which came into effect on 10 September 2015, will have the opportunity to be heard on Monday as well, albeit that it might be that an adjournment needs to be sought by the trustee or indeed by the adult children of the husband, who are now to be joined to these proceedings by order. 

13. I am satisfied that in the events that have occurred on the evidence of the wife, each of the parties sought to be joined to the proceedings are necessary parties within the meaning of the Rules and I make the orders for their joinder accordingly.

14. I am satisfied on the evidence of the wife that she establishes at least a prima facie case that there are sales to occur of entities in which she has a relevant interest, given the property proceedings, with the prospect of that sale occurring today and the prospect of funds that might otherwise be available or property interests within the meaning of s 79 of the Family Law Act 1975 (Cth) (“the Act”) that might otherwise be available being dissipated. It is clear on the evidence that until 28 August 2015 the husband had relevant control of the entities referred to and the assets in the ownership of those entities and that, as matters stood, that property was potentially available for division pursuant to s 79 of the Act.

15. I am satisfied on the wife’s evidence, particularly in circumstances where the husband has failed to make full and true disclosure in terms of what is occurring, that there is a real potential risk, given also the involvement by the husband of his other adult children in what has occurred, in proceeds of any sale today being dissipated or removed from the purview of the wife’s legitimate s 79 application. I am satisfied that the orders now sought and proposed to be made will not adversely affect or prejudice the husband or any other involved party in circumstances where the orders can be revisited in the further hearing on Monday or such later adjourned date as is sought or determined.

16. To the extent that it might be said any party is disadvantaged or prejudiced by these orders, I am satisfied that any such prejudice or disadvantage is brought about by the husband’s conduct rather than the wife in seeking the making of these orders, although that is a matter that can ultimately be determined by the Court when the husband has had an opportunity to be heard. 

17. For these reasons, I make orders essentially in a form similar to those set out in the wife’s Amended Application in a Case filed 17 September 2015, save that with respect to order 2, as discussed during exchanges between the bar table and bench, it would not be appropriate to make orders that might be seen to offend the legitimate interests of the trustee in bankruptcy of the husband.  I am satisfied, though, that orders can be made for any sale proceeds that would otherwise be received by the husband being received by the wife via her solicitors’ trust account until Monday with the further determination of the destination of those funds to be a matter for the Court on Monday, in other words, that paragraph 2 of the draft simply read after the entities are referred to:

    The respondents shall do all acts and things and sign and/or execute all such documents as are required to ensure that such moneys be placed into the trust account of Barry.Nilsson. Lawyers pending the further hearing of these proceedings on Monday, 21 September, and not to be released without further order of this Court. 

18. Otherwise I make orders in terms of those orders set out in the application which are pressed on this application.  I will allow the lawyers for the wife an opportunity to formulate a draft form of orders giving effect to these reasons.

19. Further, I order in addition to those orders, that the wife’s costs of and incidental to this application be reserved.

I certify that the preceding nineteen (19) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Kent delivered on 18 September 2015.

Associate: 

Date:  21 September 2015