KAPPAS & KAPPAS
[2020] FamCAFC 227
•10 September 2020
FAMILY COURT OF AUSTRALIA
| KAPPAS & KAPPAS | [2020] FamCAFC 227 |
| FAMILY LAW – APPEAL – PROPERTY – SECTION 79A Family Law Act 1975 (Cth) – Where no error by the primary judge is identified – Where none of the grounds of appeal have merit – Appeal dismissed. FAMILY LAW – COSTS – Where the respondent seeks costs – Where the appellant has been wholly unsuccessful in the appeal – Costs ordered in favour of the respondent. |
| Family Law Act 1975 (Cth) ss 79A, 117 |
| Kappas & Kappas(No.3) [2017] FCCA 577 La Rocca and La Rocca (1991) FLC 92-222; [1991] FamCA 97 |
| APPELLANT: | Mr Kappas |
| RESPONDENT: | Ms Kappas |
| FILE NUMBER: | MLC | 7430 | of | 2015 |
| APPEAL NUMBER: | SOA | 65 | of | 2019 |
| DATE DELIVERED: | 10 September 2020 |
| PLACE DELIVERED: | Adelaide |
| PLACE HEARD: | Adelaide |
| JUDGMENT OF: | Strickland J |
| HEARING DATE: | 9 April 2020 |
| LOWER COURT JURISDICTION: | Federal Circuit Court of Australia |
| LOWER COURT JUDGMENT DATE: | 11 October 2019 |
| LOWER COURT MNC: | [2019] FCCA 3010 |
REPRESENTATION
| THE APPELLANT: | In person |
| COUNSEL FOR THE RESPONDENT: | Ms Swann |
| SOLICITOR FOR THE RESPONDENT | Kennedy Guy Lawyers |
Orders made 9 April 2020
The appellant husband have leave to rely on the email forwarded to the Southern Appeal Registry on 6 April 2020 which email sets out the appellant’s summary of argument and orders sought.
The appeal be dismissed.
The appellant husband pay the respondent wife’s costs of and incidental to the appeal, such costs to be as taxed or assessed on a party/party basis in default of agreement.
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 Kappas & Kappas 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).
|
Appeal Number: SOA 65 of 2019
File Number: MLC 7430 of 2015
| Mr Kappas |
Appellant
And
| Ms Kappas |
Respondent
REASONS FOR JUDGMENT
Introduction
By Notice of Appeal filed on 8 November 2019, Mr Kappas (“the husband”) appeals against orders made by a Judge of the Federal Circuit Court of Australia on 11 October 2019.
The appeal is opposed by Ms Kappas (“the wife”).
The appeal was heard on 9 April 2020, and orders were made, including dismissing the appeal with costs. However, because of the behaviour of the husband, and time constraints, it was not possible to deliver reasons for judgment, and I indicated that I would do so as soon as possible. These are those reasons.
The applications before the primary judge were the husband’s application pursuant to s 79A of the Family Law Act 1975 (Cth) (“the Act”), to set aside orders for property settlement made by another Judge of the Federal Circuit Court of Australia on 24 March 2017. The wife opposed that application, and sought orders clarifying the orders of 24 March 2017, for the sale of one of the properties of the parties, and orders incidental to that property’s sale.
Her Honour dismissed the husband’s application, and made the other orders sought by the wife, as well as an order for costs in her favour.
Procedural Background
In order to appreciate the relevant background to the orders the subject of the appeal, it is necessary to set out in full the background identified by her Honour in her reasons for judgment. I do so because the importance of that background may be lost in translation if I attempt to summarise the same. Her Honour said this:
4.It is fair to say that this matter has had a very long and litigious history before this Court.
5.The final decision handed down by [a Judge of the Federal Circuit Court of Australia] on 24 March 2017 is subtitled judgment “(No 3)”, which reflects the amount of litigation that predated her Honour finally determining property matters between the parties. Subsequent to her Honour handing down her decision, the Husband exercised his right to appeal those orders. His appeal went before Strickland J and was unsuccessful.
6.In effect, [the] orders of 24 March 2017 made provision for Property H1 to be sold and that after the payment of sale costs and the discharge of the mortgage on Property H2, the balance be divided equally between the parties with a set sum to be paid to the Wife from the Husband’s half share.
7.The orders also made provision that within 14 days of the sale of Property H1 the Husband pay the Wife the sum of $600,000. If the Husband failed to make that payment, Property H2 was to be sold.
8.In her Honour's reasons for judgment in support of the orders of 24 March 2017, her Honour attributed a value to Property H1 of $1.35 million. The parties thought that Property H1 would receive well in excess of $1.6 million upon sale and both were optimistic that they would each receive the resultant windfall.
9.Subsequent to the determination of the Husband’s appeal, Property H1 was put on the market for sale. It went to auction. There was no bid received. It is fair to say that the parties had an expectation in relation to the value of that property that was not reflected in the market.
10.After Property H1 was unsuccessfully put on the market for sale, the Wife was forced to bring an Application to this Court on the basis the parties were unable to agree on the manner in which Property H1 was to be sold. This had been one of the issues that had complicated the first attempt at the sale of the property.
11.[Her Honour] subsequently heard the Wife’s application and on 2 July 2018 ordered that Property H1 be listed for sale with an agent solely appointed by the Wife and with a reserve price of $1.5 million. The orders also provided for the Wife to determine at her sole discretion whether Property H1 was to be sold by private treaty or auction.
12.[Her Honour] made a further order on 2 July 2018 that the Wife have sole conduct of the sale, including who the selling agent was to be and giving her the power to determine the sale price upon offers being received. Her Honour also ordered the Wife be solely responsible to sign any contract for sale. The Husband was ordered to vacate Property H1 within seven days of the date of her Honour’s orders in order to facilitate its sale.
13.From her Honour’s orders of 2 July 2018 I note that up until that time the Husband had been residing in Property H1. Her Honour’s orders of 24 March 2017 provided that the Husband was to be solely liable for outstanding council rates, water rates and land tax in relation to that property.
14.Subsequent to the orders of 2 July 2018, the Wife retained the same agents that had carriage of the unsuccessful sale of Property H1 by way of auction. The Wife took advice from them in relation to the preparation of the property for sale as they expressed concerns that in its then-present state it was not going to attract the buyers that they were hoping for. The Wife authorised the expenditure of $41,000, for the purposes of some minor repairs and painting and to hire furniture to present the property in its best light.
15.Property H1 again went to auction. On that occasion there was an offer received of $1.425 million. The Wife, on the advice of the agent, rejected that offer as the agent indicated that she believed by doing so there would be a higher offer subsequently received. Unfortunately, the agent turned out to be wrong in that prediction. No further offers were received and some 11-12 weeks later, after discussion with the agents, the Wife accepted an offer that had been put at $1.3 million and the property was then sold for that amount.
16.On 26 March 2019 the Wife filed an Application in a Case seeking to enforce the 24 March 2017 orders as the Husband had failed to pay the Wife $600,000 within 14 days of the settlement of the sale of Property H1.
17.The Wife’s application came before [her Honour] on 15 April 2019. As mentioned earlier in this judgment, by this stage the protracted proceedings had been before her Honour on many occasions over a considerable period of time. Therefore, on 15 April 2019 her Honour dealt with some of the enforcement issues raised in the Wife’s application on an interim basis only and otherwise recused herself from any further involvement in the matter on the basis she could no longer bring an objective mind to the matters in dispute before the Court.
18.The matter was subsequently transferred to me and listed for mention on 12 June 2019. On that occasion, the Husband’s legal representative indicated that the Husband was intending to bring an application pursuant to section 79A of the Act to have [her Honour’s] original orders of 24 March 2017 set aside. As a result of that indication very clear orders were made setting a date by which such an application had to be filed and what would thereafter ensure [sic], subject to what was or was not filed.
The Appeal
There are four grounds of appeal, three apparently drawn by the husband’s solicitors at the time, and a fourth plainly added by the husband, but seemingly only to the original Notice of Appeal, and not to the Notice of Appeal served on the wife. Thus, in the summary of argument filed by the wife on 7 April 2020, the fourth ground is neither referred to nor addressed.
However, that does not provide a difficulty with determining the appeal, because that ground is a nonsense, and has no merit. It provides as follows:
4.We wish the court order stipulating a reserve price of $1.5m be respected and restitution made as the reserve was violated when the property was SOLD FOR $1.3m without authorisation.
(As per the original)
As can be seen, this ground fails to identify any appealable error by the primary judge. Further, the complaint that it seems to raise is better described in the second ground numbered “1.”. As will be seen shortly, that ground asserts error by the primary judge in “failing to give appropriate weight to the existence of an Order for a reserve price of $1,500,000 and the [wife’s] entering into a contract of sale for $1,300,000 without consent of the [husband]”.
At this stage I also note that by order made on 27 March 2020, the time for the husband to file his summary of argument was extended to 6 April 2020. On 6 April 2020, the husband sent an email to the Appeal Registrar setting out the orders that he sought, and what could loosely be described as a summary of argument. I refer to it in that way, because it fails to provide an argument in support of the appeal which is either relevant, or easily understood in the context of what her Honour had to decide, and what can be raised on appeal. It is of little assistance to this Court in determining the husband’s appeal, because it fails to demonstrate any appealable error by her Honour.
Further, the husband’s oral submissions at the hearing of the appeal were, with respect, no better, and revealed an unfortunate lack of understanding by the husband of what s 79A of the Act entails, the husband suggesting that what he was really wanting was “enforcement” of the orders, and not their setting aside, and particularly enforcement of the order that there be a reserve of $1.5 million in relation to the sale of Property H1.
It is readily apparent from that summary that apart from the issue of costs, and despite the first three grounds of appeal, the complaints of the husband were primarily with matters that were not the subject of the orders under appeal. For example, the husband was fixated on the fact that nothing was done about the sale of Property H1 for $1.3 million, when a reserve price had been set at $1.5 million, and that subsequent to that sale the value of Property H2, had allegedly reduced by $100,000, and the primary judge had therefore acted on an incorrect value.
It was difficult to discern how these matters could legitimately found an application pursuant to s 79A of the Act, although the husband did attempt to argue that the wife’s conduct in selling the property amounted to a miscarriage of justice, and that the reduction in value of the property made it impracticable for part of the final order to be carried out.
In any event, I now turn to the other three grounds of appeal.
Ground 1 – In making Order 7 of the Orders of 11 October 2019 Her Honour failed to properly consider the [wife] conceded an error in her calculations of the amount payable to her by the [husband] only a day before the hearing, meaning the [wife’s] application was improperly founded and the Court should not have therefore departed from the usual presumption as to costs.
Order 7 was the order for costs made against the husband, and related to both the husband’s unsuccessful s 79A application, and the wife’s successful enforcement application filed on 26 March 2019.
The calculation of the amount owed by the husband to the wife was just one aspect of the proceeding, and although it was resolved the day before the hearing, at the hearing the husband still sought unsuccessfully to reduce the amount. Indeed, as her Honour said at [67]:
That there was a dispute about the math that was only resolved yesterday is not a basis upon which I could not make a costs order. One cannot help but think that if on the first date this matter came before the Court, if that had been the only issue between the parties, calculators would have been brought out and that matter could have resolved quickly and painlessly that day.
The husband suggests in his documents that the difference in the calculation was approximately $4, 600. However, that is not correct. The wife’s initial calculation in June and September 2019 of the amount owing, was $256,807.39, and the amount that was conceded on 11 October 2019 by her legal representatives was $257,025.51. Thus, a difference of $218.12, in favour of the wife.
As her Honour said, it was not that issue which caused the proceedings to continue. It was the husband’s failure to comply with the final property settlement order, his desire to pursue the s 79A application in order to justify that non-compliance, and which application was ultimately unsuccessful, and his unsuccessful opposition to the wife’s application that the amount of $41,438.37 spent in bringing the property up to a suitable condition for sale was a cost to be met from joint funds.
Finally, I note that her Honour spent a good deal of time in her reasons for judgment addressing the issue of costs (at [57]-[78]), and no error is apparent in those reasons.
There is no merit in this ground of appeal.
Ground 2 (described as a second “1” in the Notice of Appeal) – Her Honour failed to give appropriate weight to the existence of an Order for a reserve price of $1,500,000 and the [wife’s] entering into a contract of sale for $1,300,000 without consent of the [husband].
This is a ground of appeal which is misconceived.
As highlighted above, on 2 July 2018, the order made by the previous judge was that the property be listed for sale with an agent appointed by the wife, and with a reserve price of $1.5 million. However, the wife was given sole discretion as to whether the property was to be sold by private treaty or by auction, and by a further order made on the same day, the wife was given sole conduct of the sale, including who the selling agent was to be, and the ability to determine a sale price upon offers being received. The wife also had sole responsibility for signing any contract of sale.
Thus, although a reserve price was set, the wife was able to sell for a lesser price without the consent of the husband. The orders gave the wife complete control over how the property was sold, and for what price.
I note, of course, that the husband did not complain at the hearing before the primary judge that the property was not sold for $1.5 million, but that the wife did not accept an offer of $1.425 million. It was this action that the husband claimed at the hearing resulted in the miscarriage of justice required by s 79A(1)(a). In other words, the wife should not have acted on the advice of the agent in rejecting that offer, and/or she should have engaged a different agent. However, as the authorities explain, the miscarriage of justice must arise out of the judicial process (La Rocca and La Rocca (1991) FLC 92-222), and that clearly is not the case here.
In any event, her Honour found that the wife had acted appropriately in following the advice of the agent.
It seems that in addition to relying on an alleged miscarriage of justice, the husband also relied on s 79A(1)(b), namely that it was impracticable for the orders to be carried out. This brought into play the alleged reduction in value of the other property following the sale of the first property.
However, as submitted by the wife’s counsel, there is “clear authority that a rise or fall in the value of assets after final orders are made does not constitute circumstances that make it impracticable for orders to be carried out within the meaning of s.79A(1)(b)” (summary of argument filed on 7 April 2020, paragraph 28).
There is no merit in this ground of appeal.
Ground 3 (numbered “2” in the Notice of Appeal) – Her Honour in error assumed that the Judgment of Judge Harland on 24 March 2017 operated on the basis of a valuation for Property H1 of $1,350,000 when it operated on the basis of a valuation of $1,430,000.
This is a ground that cannot be maintained. It is not correct to make the assertion that appears in the ground.
At [66] of the reasons for judgment of the previous Judge (Kappas & Kappas (No.3) [2017] FCCA 577), her Honour says, “Property H1 was valued at $1,350,000”, and at [119] there is a table of assets and liabilities in which the value of this property is identified as $1.350 million.
Thus, this ground of appeal must fail.
Conclusion
Having found no merit in any of the grounds of appeal, the appeal must be dismissed.
Costs
In the event the appeal was dismissed, the wife sought an order for costs against the husband.
The husband has been wholly unsuccessful in the appeal and that circumstance justifies an order for costs being made (ss 117(2) and (2A)(e) of the Act). Accordingly, there will be an order as sought by the wife.
I certify that the preceding thirty-four (34) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Strickland delivered on 10 September 2020.
Associate:
Date: 10 September 2020
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