Joubert & Bottari (No 2)
[2024] FedCFamC1F 322
•6 May 2024
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 1)
Joubert & Bottari (No 2) [2024] FedCFamC1F 322
File number(s): SYC 4450 of 2022 Judgment of: HARPER J Date of judgment: 6 May 2024 Catchwords: FAMILY LAW – PROPERTY – EX TEMPORE – Where matter is in the MCFP List – Where wife seeks adjournment of final hearing on first day of allocated hearing dates – Where essential expert evidence is not presently available – Where no balance sheet is before the Court – Where it is agreed that expert evidence is necessary – Where husband concedes that final hearing would not conclude in the five days allocated and would need to go part heard to receive expert evidence – Where senior counsel for the wife contends that late produced material from the husband would require putting to the husband that he is a liar – Court takes the view that the risk of part-heard cross-examination is undesirable in such circumstances – Adjournment granted – Orders made for wife to pay the husband $1 million as a condition of the adjournment – Cost thrown away by the adjournment reserved. Legislation: Family Law Act 1975 (Cth) Pt VII
Federal Circuit and Family Court of Australia Act 2021 (Cth) s 67 and s 68
Cases cited: Bing and Bing (2007) FLC 93-318; [2007] FamCA 418 Division: Division 1 First Instance Number of paragraphs: 29 Date of hearing: 6 May 2024 Place: Sydney Counsel for the Applicant: Mr Dickson KC with Mr Richardson Solicitor for the Applicant: Michael Conley Lawyers Counsel for the Respondent: Mr Williams KC with Mr Roberts Solicitor for the Respondent: Barkus Doolan Winning ORDERS
SYC 4450 of 2022 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)
BETWEEN: MR JOUBERT
Applicant
AND: MS BOTTARI
Respondent
ORDER MADE BY:
HARPER J
DATE OF ORDER:
6 MAY 2024
THE COURT NOTES IN CHAMBERS THAT:
A.These proceedings were commenced by the Applicant Husband (“husband”) on 28 June 2022. Final hearing dates were allocated commencing on 6 May 2024, however the parties failed to make the proceedings ready to proceed to final hearing on the allocated dates.
THE COURT ORDERS THAT:
1.The final hearing dates of 6, 7, 8, 9 and 10 May 2024 are vacated.
2.As a condition of the adjournment, the Respondent Wife (“wife”) pay to the husband $1 million by way of partial property settlement within 60 days of these orders.
3.In default of the wife complying with Order 2 above, the husband has liberty to apply to my Chambers to have the matter relisted on 3 days’ notice for the wife to show cause why her response should not be struck out and the matter proceed on an undefended basis.
4.The costs thrown away by the adjournment pursuant to these orders are reserved.
5.The proceedings are stood over to a date to be advised.
6.The wife have first access to any documents produced under subpoena by N Limited with such right to lapse 14 days after the date of these orders and thereafter, all parties have access to such documents.
7.The time for compliance with the subpoenas issued to the wife and J Pty Ltd by 28 days.
8.The parties are to file and serve any affidavits in reply within 30 days after receipt of the single expert valuation evidence.
THE COURT FURTHER NOTES THAT:
B.The wife has liberty to place any documents produced under subpoena by N Limited which she claims to be privileged into a sealed envelope.
Note: The form of the order is subject to the entry in the Court’s records.
Note: This copy of the Court’s Reasons for judgment may be subject to review to remedy minor typographical or grammatical errors (r 10.14(b) Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 10.13 Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth).
Part XIVB of the Family Law Act 1975 (Cth) makes it an offence, except in very limited circumstances, to publish an account of proceedings that identify persons, associated persons, or witnesses involved in family law proceedings.
IT IS NOTED that publication of this judgment by this Court under the pseudonym Joubert & Bottari has been approved pursuant to subsection 114Q(2) of the Family Law Act 1975 (Cth).
EX TEMPORE REASONS FOR JUDGMENT
HARPER J:
These are property adjustment proceedings under Pt VIII of the Family Law Act 1975 (Cth) (“the Act”). The applicant is the husband, and the wife is the respondent.
The parties were married in 2006, and the marriage lasted some 15 years until 2021, when the parties separated in November.
There is one child of the relationship, who is now 11 years old. For the purposes of this judgment, there is no dispute that the husband has seen the child once only in the past two years. Consequently, the wife has carried the burden of parenting in that period.
The proceedings are in the Major Complex Financial Proceedings List. They were commenced by the husband on 28 June 2022, and transferred to that list in August 2022. The proceedings were listed for final hearing to commence on 6 May 2024, with an estimate of five days.
On 30 April 2024, as had been foreshadowed earlier at a compliance hearing, the wife filed an Application in a Proceeding, seeking orders that the trial dates be vacated, pending the release of a single expert report, being evidence to value a number of entities conducting businesses which are relevant to the composition of the balance sheet.
There is, at present, no balance sheet available to the Court, even in draft form, as a result of the expert evidence being unavailable. However, there was no dispute that the balance sheet includes several very valuable parcels of real estate located in Sydney, New South Wales.
In very broad terms, on a final basis, the husband claims 45 per cent of the net matrimonial pool. The wife, for her part, accepts that the husband should receive a payment of at least $3 million, although the further details of the final relief are highly contingent upon the expert valuation evidence. I note that the husband has already received some $360,000 by way of partial property settlement.
The wife seeks an adjournment on two bases. The first is the absence of the single expert evidence. She herself gave evidence in support of the adjournment to the effect that, despite her control of the relevant business entities, the firm N Limited, who have been engaged since August 2020, have not produced a number of the necessary tax returns and financial records of the relevant entities. The wife claims this is not something for which she can be held responsible.
The second basis is that, by his trial affidavit filed on 15 April 2024, some three weeks prior to the commencement of the trial, the husband, according to the wife, introduced extensive evidence which put in issue, in considerable detail, his contributions to aspects of the businesses, and the controlling entities, which are presently in the control of the wife. She argues that numerous documents, previously not relevant, have become relevant, because of the husband’s affidavit, and certain documentary disclosures recently made by him.
Her senior counsel adverted to the likelihood that the wife will seek to impugn the husband’s credit in relation to this part of his case, possibly by contending that he is being mendacious. She argues that she is confronted with a new case, which she should have an opportunity to consider and meet, especially since she will claim that the assertions of fact made by the husband constitute a tissue of lies.
During the hearing of the application for adjournment, the wife made an open offer of a further payment of $200,000 within 60 days, as partial property settlement, as a condition of any adjournment.
I note, also, that she contends that the costs thrown away by any adjournment should be reserved.
The husband, for his part, accepts that the trial cannot finish in the time allocated, in any event. His senior counsel estimated another three days would be required, but agreed this was contingent upon the content of the evidence to be given by the single expert.
Nonetheless, the husband resists any adjournment and pressed for the trial to commence. He argued that the wife had failed to provide any persuasive explanation for the delay in the provision of material to the single expert, or otherwise explain why the trial is not ready to proceed on the allocated days.
He further denied that his trial affidavit material raised any new case. He argued that his claims for contributions to the businesses were obvious from at least the time when he filed an affidavit, on 25 August 2023, and pointed out that the wife has had his trial affidavit for some three weeks which should have been sufficient time for her to take the necessary steps to deal with anything raised in it. He argued the trial should commence and go part-heard to permit receipt and completion of the single expert evidence.
As a fallback, as I understood it, he argued that if the Court was minded to grant the adjournment, it should be on condition that the wife pay the $3 million, which she concedes should be paid to him, as well as paying the costs thrown away by any adjournment. I note here that the wife resisted any payment of $3 million, arguing that the Court could not be satisfied on the present evidence that there existed an identifiable source from which any such payment could be made.
The husband gave evidence in his trial affidavit that he presently rents a room in the family home of a friend, paying some $500 a week. However, he submitted that he wants and should be entitled to accommodate himself in his own premises and submitted that a partial property settlement now was appropriate for that reason.
Vacating five hearing days is a serious matter. Final hearing dates in this Court are at a premium and there are many other pieces of litigation which have a claim to judicial time. Any adjournment such as the present application seeks could not be acceded to lightly.
I was initially strongly disinclined to adjourn the final hearing on the wife’s application. No fresh trial dates can be allocated before me until at least the end of 2024. However, on reflection, I am persuaded that the adjournment should be granted for the following reasons.
First, although it may be true that there are deficiencies in the wife’s explanation for the current availability of financial records and tax returns for the relevant entities, the absence of essential expert evidence to settle the value of assets on the balance sheet is a serious gap in the structure of the proceedings as they currently stand on the allocated first day of hearing. There was evidence from the wife that she has been involved in numerous other pieces of litigation which at best, in my view, is an equivocal explanation of delay. But even if it is accepted that is some explanation, it seems to me the absence of the essential expert evidence is a matter which has greater weight in the circumstances of this case.
Second, while I express no firm concluded view, it appears from the material presently available that the husband may have contributed to the need for an adjournment in the sense that he expanded in a material way the case of contributions to the relevant businesses which he now makes through his trial affidavit.
Thirdly, since it is the common position that the trial could not be completed in the allocated time, it seems to me that the question of the desirability of the trial going part-heard needs to be closely examined. Experience suggests that if a trial goes part-heard, this usually adds to the overall costs. Furthermore, in the specific circumstances of this case, the wife has made clear in her submissions that she proposes to assert that the husband is lying about a number of matters which he raises in his affidavit and her submission was to the effect that she needed time to make the relevant inquiries to determine whether such propositions should be properly put to him in cross-examination. In my view, it is extremely undesirable for proceedings to go part-heard and to risk the possibility of cross-examination being potentially incomplete where such serious allegations may well be made.
Furthermore, I also take account of fact that if the proceedings were to go part-heard, which seems to be inevitable if the trial commences this week, this would prevent the proceedings being allocated to another judge on dates earlier than those which would otherwise be available before me. I do not consider that a proper discharge of the Court’s duty to promote the overarching purpose set forward in the Federal Circuit and Family Court of Australia Act2021 (Cth) s 67 and s 68, would be properly discharged.
Fourthly, I take the view that any prejudice to the husband can be cured or at least ameliorated by imposing as a condition of adjournment an order for the payment of a substantial amount of money, in excess of the $200,000 proposed by the wife.
As to that last matter, I am not persuaded by the wife’s contention that no source for the payment can be identified. As already noted, she herself has put forward a payment of $3 million to the husband as final relief. I infer from that fact alone that she concedes she has the resources to pay that amount of money. So taking a cautious approach, a payment of a lesser sum of $1 million should pose even less difficulty and would not exhaust the Court’s power to make a final property division from the remaining assets. I take account of the fact that the wife appears to have had the sole care of the child for the past two years, and even if that is, as the husband contends, a result to some extent of her own actions, it does not change the fact that she has carried that burden.
Nonetheless, I am not persuaded there is any reason why a payment of $1 million dollars should not be made to the husband as a condition of any adjournment. Decisions such as Bing and Bing (2007) FLC 93-318 make clear that where one party controls a vast pool of assets, which appears to be the position in this case, a precise source for payment need not be identified.
That leaves for consideration a peripheral area of debate concerning three subpoenas. The wife had filed objections to those three subpoenas but conceded that in the event an adjournment was granted, the objections fell away if she was able to have first access to a subpoena issued to N Limited.
On the question of costs, at present, I am not able to determine with sufficient clarity where responsibility lies for the present undesirable position in these proceedings. Accordingly, I am persuaded I should reserve costs at this stage, noting that that leaves open the capacity for either party to make application on a later date in respect of costs thrown away by the adjournment.
Accordingly, I make the orders at set out at the commencement of these reasons.
I certify that the preceding twenty-nine (29) numbered paragraphs are a true copy of the Ex Tempore Reasons for Judgment of the Honourable Justice Harper delivered on 6 May 2024. Associate:
Dated: 17 May 2024
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