KACHMARIK & GEBEL
[2019] FamCAFC 224
•27 November 2019
FAMILY COURT OF AUSTRALIA
| KACHMARIK & GEBEL | [2019] FamCAFC 224 |
| FAMILY LAW – APPEAL – PROPERTY– Where the wife filed an Application in an Appeal seeking that the appeal be summarily dismissed due to the husband’s failure to comply with previous orders – Where a number of orders were made to enforce the orders of the primary judge – Where the husband sold, received and dissipated the proceeds of the property – Where the principles in Watson & Watson (2013) FLC 93-530 applied – Where the wife has established that the husband is in clear disobedience of previous orders – Where the Court exercises its discretion to not hear the husband in relation to his appeal – Appeal dismissed – Cost submissions ordered. |
| Family Law Act 1975 (Cth) s 75(2) |
| Moorcroft & Moorcroft; (2018) FLC 93-881; [2018] FamCAFC 253 Watson & Watson (2013) FLC 93-530; [2013] FamCAFC 25 |
| APPELLANT: | Mr Kachmarik |
| RESPONDENT: | Ms Gebel |
| FILE NUMBER: | BRC | 8160 | of | 2016 |
| APPEAL NUMBER: | NOA | 107 | of | 2018 |
| DATE DELIVERED: | 27 November 2019 |
| PLACE DELIVERED: | Cairns |
| PLACE HEARD: | Brisbane |
| JUDGMENT OF: | Ainslie-Wallace, Tree & Forrest JJ |
| HEARING DATE: | 27 August 2019 |
| LOWER COURT JURISDICTION: | Federal Circuit Court of Australia |
| LOWER COURT JUDGMENT DATE: | 20 September 2018 |
| LOWER COURT MNC: | [2018] FCCA 2633 |
REPRESENTATION
| THE APPELLANT: | In person |
| COUNSEL FOR THE RESPONDENT: | Mr Kirk QC |
| SOLICITOR FOR THE RESPONDENT: | HopgoodGanim Lawyers |
Orders
On the Application in an Appeal filed by the Respondent on 9 May 2019, Appeal NOA 107 of 2018 against the orders of 26 October 2018 be dismissed.
The Appellant’s Application in an Appeal filed 5 June 2019 seeking an extension of time to file his Summary of Argument be dismissed.
The Respondent file and serve any written submissions as to the issue of costs within fourteen (14) days of the date of this order.
The Appellant file any response to the Respondent’s submissions as to costs within fourteen (14) days of their receipt by him.
Note: The form of the order is subject to the entry of the order in the Court’s records.
IT IS NOTED that publication of this judgment by this Court under the pseudonym Kachmarik & Gebel has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
Note: This copy of the Court’s Reasons for Judgment may be subject to review to remedy minor typographical or grammatical errors (r 17.02A(b) of the Family Law Rules 2004 (Cth)), or to record a variation to the order pursuant to r 17.02 Family Law Rules 2004 (Cth).
| THE FULL COURT OF THE FAMILY COURT OF AUSTRALIA AT BRISBANE |
Appeal Number: NOA 107 of 2018
File Number: BRC 8160 of 2016
| Mr Kachmarik |
Appellant
And
| Ms Gebel |
Respondent
REASONS FOR JUDGMENT
INTRODUCTION
On 26 October 2018, the primary judge pronounced orders which divided the parties’ property, such that Ms Gebel (“the wife”) obtained 75 per cent of the net pool, and Mr Kachmarik (“the husband”) received the balance.
On 23 November 2018, the husband appealed from those orders, however neither prior to then, at that time, nor subsequently, has he made any application to stay their operation.
Thereafter the wife sought to enforce the orders, and orders in that respect have now been made on three subsequent occasions. Although no appeal has been brought from those enforcement orders, and no application made to stay or discharge them, nonetheless it is uncontentious that the husband has, in many respects, not complied with them.
In light of what she contends is the husband’s disobedience of the primary judge’s orders and subsequent enforcement orders, on 9 May 2019 the wife filed an Application in an Appeal seeking orders that the husband not be heard on his appeal, and in that event, it either be dismissed, or stayed pending his compliance with the orders.
Also listed before us was an Application in an Appeal filed by the husband on 5 June 2019, seeking an extension of time in which to file his Summary of Argument in the appeal.
These are our reasons for decision arising from both Applications in an Appeal.
BACKGROUND
The parties and their relationship
The husband is presently 51 years of age; the wife, 50. They commenced their relationship in 1994, married in February 1999 and finally separated on 28 April 2016. There were two children of the marriage, being twin girls, presently 15 years of age. It seems that the children presently live with the wife, and spend little, if any, time with the husband.
The primary judgment
The primary judge was satisfied that the net value of the parties’ property (including superannuation) was in the order of about $3 million, to which the wife should be treated as having made contributions, both financial and non-financial, that justified a division in her favour of 70 per cent. His Honour then determined that the factors in s 75(2) of the Family Law Act 1975 (Cth) favoured the wife to the extent of a further 5 per cent.
Order 6 of the orders made on 26 October 2018 required the husband to assume sole responsibility for a loan secured over the wife’s home (which the evidence established was in the order of $110,000.00). Further, the husband was obliged to re-finance the debt within 30 days of 26 October 2018, so as to effect the wife’s release from it.
Subsequent events
It is not in dispute that the husband has not re-financed the $110,000 debt, which remains secured over the wife’s home. Partly, that might be because the husband had limited readily realisable assets from which to effect that repayment. However under the orders, the husband retained a 50 per cent interest in a property at B Street, Suburb C (“B Street”) via a related trust. It seems that the B Street property was listed for sale at the time of the 26 October orders.
On 14 December 2018 the wife filed an enforcement application, which was personally served on the husband on 21 December 2018, although it was not returnable until 26 March 2019. That application sought to, pending the outcome of the husband’s appeal, preserve the husband’s share of any sale proceeds of the B Street property. On 14 March 2019, prior to her enforcement application being heard, the wife noticed a “sold” sign placed outside the B Street property, and sought an urgent hearing of her enforcement application, which was then brought forward to 10.00 am on Friday 15 March 2019 before Judge Jarrett. The husband was notified of that urgent hearing by email at 2.54 pm on 14 March 2019, and was further advised of the listing on 15 March 2019 at 4.02 pm on 14 March 2019. A solicitor from the wife’s solicitor’s firm telephoned the husband at 10.05 am on Friday 15 March 2019, during which conversation the husband denied knowing he was obliged to appear at court that day, and claimed he was unable to do. An email advising the husband of the hearing was also sent by the solicitor at 10.11 am.
Orders were made by Judge Jarrett in the husband’s absence at 10.25 am on 15 March 2019, as follows:
1.Pending the hearing of the application of the wife filed on 14 December, 2018 on 26 March, 2019:
(a)the husband shall pay the net proceeds of the sale of the 50% interest held by him as trustee of the [D Trust] in the property located at [B Street, Suburb C] in the State of Queensland (after payment of the secured mortgage thereon and any costs of sale) to the trust account of HopgoodGanim Lawyers; and
(b)the husband shall provide to the wife by way of disclosure all documents relating to the said sale, including the contract of sale, the settlement statement, the bank statement into which the net proceeds referred to in paragraph 1(a) above were paid, and if any sums have been paid therefrom, details of the person(s)/entity(s) receiving such sums.
2.In the event that the father fails to comply with order 1(a) herein within twenty-four (24) hours of service of this order, then the Court declares pursuant to s.45(1) of the Federal Circuit Court of Australia Act 1999 (Cth) that it is appropriate, in the interests of the administration of justice, to allow discovery in this proceeding, and for that purpose:
(a)the wife may deliver specific questions of the husband in relation to the said sale and the application of the net proceeds as she shall be advised by 4:00pm on 20 March, 2019 and the husband shall provide an answer thereto by 4:00pm on Friday 22 March, 2019; and
(b)the wife have leave pursuant to r.15A.02(1) of the Federal Circuit Court Rules 2001 to issue such subpoenas as she may be advised in relation to the sale of the said property and/or application of the said proceeds of sale.
3.The costs of the wife are reserved.
(As per the original)
Details of those orders were emailed to the husband by the wife’s solicitors at 10.56 am on 15 March 2019. Relevantly, the email provided:
Dear Mr [Kachmarik]
We inform you that orders have been made by Judge Jarrett this morning in relation to our client’s urgent application which will be served upon you shortly.
Specifically, the order you are required to comply with forthwith is as follows:
“The Husband shall pay the net proceeds of the sale of the 50% interest by him as trustee of the sale of the [D trust] in the property located at [B Street, Suburb C] in the State of Queensland (after payment of the secured mortgage thereon and any costs of sale) to the trust account of HopgoodGanim Lawyers”
…
We inform you that in the event that you fail to comply with the above order, you will be in contempt.
…
(As per the original)
(Tender document “FRW-7” to Respondent wife’s affidavit filed on 9 May 2019, p.36)
The sealed orders were provided to the parties on the morning of Monday 18 March 2019, and were served on the husband by email at 10.20 am, and personally at 1.05 pm on that day.
By then, at 8.57 am on 18 March 2019, the husband had emailed the wife asserting, in substance, that he had already received the proceeds of sale of the B Street property in cleared funds on Thursday 14 March 2019, and by paying specified asserted liabilities, had wholly dissipated those monies.
From documents later obtained by the wife under subpoena, it appears that the monies received by the husband from the proceeds of sale of the B Street property were paid into his bank account, and disbursed as follows:
Date Time Amount Action 15 March 2019 1:06am $20,000 INTERNET TFR - '[fashion] gift' 15 March 2019 9:23am $2,000 NAB ATM CSH 15 March 2019 10:33am $80,000 WITHDRAWAL - bank cheque payable to [Mr Kachmarik] 15 March 2019 10:37am $50,000 WITHDRAWAL - cash in branch 15 March 2019 11:11am $50,000 WITHDRAWAL - cash in branch 15 March 2019 11:19pm $9,000 INTERNET TFR - to [E Group] 15 March 2019 $12 B/CHQ FEE 15 March 2019 Not known $20 PRCH-FLEXIP - Caltex 18 March 2019 Not known $499.80 EFTPOS DEBITS - '[F Company]' 18 March 2019 Not known $322.92 EFTPOS DEBITS - Queensland Department of Transport 18 March 2019 Not known $270.07 PRCH-FLEXIP - Dan Murphy's 19 March 2019 11:40am $8,413.89 INTERNET TFR – [G Company] 20 March 2019 Not known $4.17 EFTPOS DEBITS - eBay 20 March 2019 Not known $41.72 EFTPOS DEBITS - PayPal 21 March 2019 Not known $21.95 EFTPOS DEBITS - Dominos 21 March 2019 Not known $183 PRCH-FLEXIP – [Wine Bar] 22 March 2019 11:57pm $500 ANZ ATM 24 March 2019 2:10am $302.90 BBL ATM + withdrawal fee (As per the original)
(Respondent wife’s affidavit filed 9 May 2019, p. 9)
Particularly, the subpoenaed records show that, contrary to what the husband claimed in his email to the wife at 8:57 am on 18 March 2019 (Tender document “FRW-9” to Respondent wife’s affidavit filed on 9 May 2019, p.46), in fact there was at that time still $10,740.32 in his bank account, derived from the proceeds of sale of the B Street property (Tender document “FRW-11” to Respondent wife’s affidavit filed on 9 May 2019, p.76).
The wife’s enforcement application returned before Judge Jarrett on 26 March 2019, on which occasion further orders were made, relevantly as follows:
1.Pursuant to the orders made by [the trial judge] on 26 October, 2018 ("final orders'') the husband forthwith:
(a)pay to the wife the cash sum of $2,845.48 pursuant to paragraph 1 of the final orders together with default interest ... in the sum of $70.16 as at 26 March 2019;
(b)refinance or payout in full the computer market loan in the amount of $106,257 as at 25 March, 2019 owing to the Commonwealth Bank of Australia (account no. …08) pursuant to paragraph 6(b) of the final orders; and
(c)pay to the wife the cash sum of $416.35 being one half share of the joint Commonwealth Bank account (…14) pursuant to paragraph 13 of the final orders.
2.Until the full payment of the computer market loan, and pursuant to paragraph 6(b) of the final orders, the husband be solely responsible for the repayments for the computer market loan (namely any principal and/or interest repayments as well as any arrears owing). Further, the husband shall reimburse to the wife the sum of $3,498.90 being the repayments for the said loan paid by the wife since the final orders. That in default of the husband paying the said loan repayments, the wife shall be reimbursed such sums paid by her or on her behalf since 26 October, 2018 towards the computer market loans from the sale proceeds pursuant to order 7(j) herein.
…
4.Until further order the husband shall pay the net proceeds of the sale of the 50% interest held by him as trustee of the [D Trust] in the property located at [B Street, Suburb C] in the State of Queensland (after payment of the secured mortgage thereon and any costs of sale) to the trust account of HopgoodGanim Lawyers.
…
6.Pending further order of this Honourable Court, pursuant to s.114 of the Family Law Act 1975, the husband be restrained and an injunction granted preventing the husband from disposing of and/or dealing with and/or further encumbering the [Vintage motor vehicle], save for the husband's compliance with these orders.
7.[Mr J], Solicitor, of …, Brisbane in the State of Queensland be appointed receiver to the [Vintage motor vehicle] and the ancillary items set out in 7(a) below in accordance with the following orders:
(a)the husband shall forthwith deliver to the receiver or his duly appointed agent for sale:
(i)the [Vintage motor vehicle];
…
…
9.Subject to all proper objection, the respondent answer the questions delivered to him under cover of the letter from the applicant’s solicitors dated 20 March, 2019 such answers to be provided by the close of business on Monday 2 April, 2019.
…
(As per the original)
It is not in contention that the husband has failed to comply with the orders of 26 March 2019.
On 17 May 2019, the wife’s enforcement application was again listed, and Judge Jarrett again made further orders (in the husband’s absence) as follows:
1. Unless specifically amended or revoked herein the existing orders made by the Court on 16 March 2019, 26 March, 2019 and 3 April, 2019 remain in full force and effect.
2. The husband shall contact the receiver, [Mr J] and by no later than 4:00pm Friday 24 May, 2019 and make the arrangements for the immediate delivery of the [Vintage motor vehicle] in accordance with the specific directions of the Receiver.
3. In addition to the delivery of the [Vintage motor vehicle] referred to in paragraph 2 above, the husband shall also deliver to the receiver the items pursuant to paragraph 7(a) of the orders dated 26 March, 2019.
4.The husband shall file and serve by 4:00pm Friday 31 May, 2019 an affidavit responding to the questions put to him in relation to the property pool and his financial affairs as set out in the following correspondence sent to him by HopgoodGanim:
(a)Email correspondence to the husband dated 20 March, 2019;
(b)Email correspondence to the husband dated 29 March, 2019;
(c)Email correspondence to the husband dated 4 April 2019.
5. The husband shall provide copies to the wife’s solicitors of all documents noted, referred to and as requested in the following correspondence sent to him by HopgoodGanim:
(a)Email correspondence to the husband dated 20 March, 2019;
(b)Email correspondence to the husband dated 29 March, 2019;
(c)Email correspondence to the husband dated 4April, 2019;
6.By 4:00pm Friday 7 June, 2019 the husband shall complete and file a financial statement and thereafter serve a copy upon the wife's solicitors.
7.Further the husband shall include within the financial statement:
(a)a full listing of all bank accounts in which he has a direct and/or indirect interest and whether in his sole name and/or held jointly with another person and/or in the name of a related entity (including but not limited to the [D Trust]);
(b)a full list including detailed descriptions of all cars, car engines, boats and motor vehicles owned, operated and/or in the possession of the husband.
…
…
10.The husband deliver into the custody of the Court, his Australian Passport by delivering it to the Registrar of the Federal Circuit Court of Australia by 4:00pm Monday 20 May, 2019 who shall retain it pending further order of the Court.
...
(As per the original)
It is not in contention that the husband has failed to comply with any of those orders, apart from the delivery up of his passport.
RELEVANT LEGAL PRINCIPLES
In Watson & Watson (2013) FLC 93-530 at [36] the Full Court said this:
36. From the detailed discussion by the Full Court in Fahmi of the various authorities referred to, and the express or implicit acceptance of particular statements of principle or approach, the following propositions emerge as to the discretionary rule that a party in a contempt may not be heard when a court is exercising jurisdiction under the Act:
(a)Procedural justice dictates that the fact that a party has disobeyed an order of the Court is not of itself a bar to the party being heard on a subsequent application brought by that party;
(b)In courts exercising jurisdiction under the Act, the rule, when it operates, gives rise to a discretion not to permit a party being heard. That is, unlike other jurisdictions such as New South Wales and South Australia where the rule is to be applied as a strict rule subject to limited exceptions, in this jurisdiction the discretionary approach applies (as to New South Wales see Young J in Young v Jackman (1986) 7 NSWLR 97; 11 Fam LR 331 at 335 referring to the Court of Appeal decision in Permewan Wright Consolidated Pty Ltd v Attorney General (unreported, Court of Appeal, Hutley JA, 11 December 1978); and as to South Australia see per Bray CJ (with whom Mitchell and Jacobs JJ agreed) in Short v Short (1973) 7 SASR 1 at 11);
(c)The rule applies where facts establish disobedience of an order, even though there has been no application for the party to be dealt with for contravention or contempt, and no determination has been made that the party is guilty of a contravention or contempt;
(d)The Court may, in its discretion, refuse to hear a party in breach of an order only if that party makes an application in the same proceedings or in the same cause in which the disobedience of an order has occurred. If the application by that party is not in the same proceedings or in the same cause of action in which the contempt has been committed, no question as to the party in alleged contempt being heard arises;
(e)The question of whether the application is in the same proceeding or in the same cause is crucial and is determined by reference to the structure and content of the definition of “matrimonial cause” in the Act, the relevant parts of the Act and the Family Law Rules 2004 (Cth) that apply and, ultimately whether the proceedings may be identified as distinct because the nature of the relief claimed in them respectively is determinative;
(f)No question as to a party being heard arises:
(i)if that party is defending, rather than bringing, an application;
(ii)on an appeal by the party to set aside the order on which the alleged contempt is founded;
(iii)where a party applies for the purpose of purging the party’s contempt;
(iv)where a party against whom contempt is alleged seeks to be heard on a submission that, having regard to the true meaning and intent of the order which the party is said to have disobeyed, the party’s actions did not constitute a breach of it, or having regard to all the circumstances, the party ought not to be treated as being in contempt.
(g)Where the discretion arises its exercise depends upon the balance between that party’s right to procedural justice, including the right to be heard, and public policy considerations. Those public policy considerations include that if the party’s disobedience is such that, so long as it continues, it impedes the course of justice in the cause by making it more difficult for the Court to ascertain the truth, or to enforce the orders which it may make, or the party’s further application constitutes an abuse of process in the circumstances, then the Court is unlikely to exercise its discretion in favour of hearing the party or entertaining the application of the party.
Neither party before us contended that this statement of principle required any revision, and we accept that it still accurately states the law (Moorcroft & Moorcroft (2018) FLC 93-881).
HAS THE WIFE ESTABLISHED THAT THE HUSBAND IS IN DISOBEDIENCE OF COURT ORDERS IN THE SAME CAUSE
There is no room for argument that the cause which is represented in the husband’s appeal is the same cause that was before Judge Jarrett in the several enforcement hearings. Therefore the only question is whether the wife has established that the husband is in disobedience of those orders.
As to that, the evidence establishes that the husband has:
(a)Failed to pay the wife:
(i)$2,845.48 contrary to order 1(a) of the orders made 26 March 2019;
(ii)$416.35 pursuant to order 1(c) of the orders of 26 March 2019; and
(iii)$3,498.80 pursuant to order 2 of the orders of 26 March 2019.
(b)Failed to re-finance the loan secured over the wife’s home contrary to order 1(b) of the 26 March 2019 orders;
(c)Failed to pay any part of the proceeds of the B Street property settlement monies into the HopgoodGanim trust account, contrary to order 1(a) of the 15 March 2019 orders;
(d)Failed to deliver to the court appointed receiver the [Vintage motor vehicle], contrary to order 7 of the 26 March 2019 orders, and failed to contact the receiver to arrange delivery of the [Vintage motor vehicle], contrary to order 2 of the 17 May 2019 orders;
(e)Failed to answer the wife’s specific questions contrary to order 9 of the 26 March 2019 orders, and failed to file an affidavit verifying answers to them, contrary to order 4 of the 17 May 2019 orders; and
(f)Failed to file a financial statement by 7 June 2019, contrary to order 6 of the 17 May 2019 orders.
We are of the view that the wife has established that the husband has been, and remains, in clear disobedience of enforcement orders of Judge Jarrett.
Critically, no appeal has been brought from those orders, nor have they been sought to be stayed. It is not to the point that the husband’s appeal may, if successful, partially or even wholly undermine the several enforcement orders. Public policy requires that unchallenged orders are complied with. That is all the more so where, notwithstanding the husband’s appeal from the primary judge’s orders, no stay of them has ever been sought.
SHOULD THE DISCRETION BE EXERCISED AS SOUGHT BY THE WIFE
The following points favour the exercise of the discretion as sought by the wife, or are otherwise contrary to the husband’s position:
(a)The husband’s disobedience of the orders has made it more difficult for the Court to ascertain the truth:
(i)The husband has failed to explain the distribution of the proceeds of the sale of the B Street property, in consequence of which any opportunity for the wife to trace them is rendered considerably more difficult;
(ii)The circumstances surrounding the disappearance of the Vintage motor vehicle are unexplained, and hence thwarts the wife’s opportunity for enforcement;
(iii)The husband has failed to answer the wife’s specific questions; and
(iv)The husband has failed to file a financial statement.
(b)The husband’s disobedience of the orders has made their enforcement more difficult:
(i)Plainly the husband has sought to frustrate the enforcement by the wife of the 26 October 2018 orders by distributing the net proceeds of sale of the B property without regard to the wife’s application for enforcement, and to a lesser extent, in breach of enforcement orders which had been communicated to, and later served on, him; and
(ii)The husband has failed to make available the [Vintage motor vehicle], which appears has now likely been disposed of.
(c)On any view, the husband’s disobedience is wilful and flagrant; and
(d)The husband has not sought to stay any of the orders, but has simply defied them, and seemingly intends to continue to do so.
On the other hand we identify the following factors as being in favour of the husband, or are otherwise contrary to the wife’s position:
(a)The husband’s appeal is arguable, in that it cannot be said that it is wholly without merit, although we express no concluded view as to its prospects; and
(b)Ordinarily an appellant has the right to be heard in relation to their appeal.
Weighing those factors in the balance tells strongly in favour of exercising the discretion in favour of the wife, so as to not permit the husband to be heard in relation to his appeal. The husband’s serial defiance of the various enforcement orders should not be accommodated by nonetheless permitting him to press his appeal.
The next question then is the form of order which should ensue. The wife proposes, in the first instance, that the appeal should be dismissed, and in the alternative, that it be stayed. She proposes that any stay continue until such time as the husband complies with the court orders, and ceases to disobey them.
Whilst the alternative order proposed by the wife that the appeal be stayed would do the minimum amount of violence to the husband’s rights (consistent with upholding the public policy considerations which inform the discretion), this is not a case where, before us, the husband indicated any desire or intention to ever comply with his obligations under the several orders. Given his flagrant breaches to date, that is perhaps unsurprising. In those circumstances, a stay would inevitably prove permanent.
OUTCOME
There will therefore be an order that the husband’s appeal be dismissed. That order obviates the need to deal with the husband’s Application in an Appeal filed 5 June 2019, in which he sought an extension of time in which to file his Summary of Argument in the appeal and it will be dismissed.
In the event that the appeal was dismissed, the respondent sought an opportunity to make further submissions as to costs. We will accommodate that by imposing a timetable affording an opportunity to both parties to make written submissions as to costs.
I certify that the preceding thirty four (34) paragraphs are a true copy of the reasons for judgment of the Honourable Full Court (Ainslie-Wallace, Tree & Forrest JJ) delivered on 27 November 2019.
Associate:
Date: 27 November 2019
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