Kershaw and Kershaw and Anor

[2016] FCCA 3470

FEDERAL CIRCUIT COURT OF AUSTRALIA

KERSHAW & KERSHAW & ANOR [2016] FCCA 3470

Catchwords:
FAMILY LAW – Interim parenting and property – where the parties agree to adjourn the parenting aspect of the proceedings – where it is alleged that the husband has withdrawn and has failed to account for various funds drawn against the mortgage encumbering the parcel of real estate which forms one of the more substantial assets of the relationship – where disclosure is incomplete – where there is a contest between the parties as to whether there is or is not an interest created in favour of the Second Respondent – where there is a caveat recorded against title of the parcel of real estate by the Second Respondent.

Legislation:

Federal Circuit Court Rules 2001, 4.03

Crimes Act 1900 (NSW)

Cases cited:

Blueseas Investments Pty Ltd & Mitchell & McGillivray [1999] FamCA 745
Allesch v Maunz [2000] HCA 40
Aon Risk Services & Australian National University [2009] HCA 27
Haset Sali v SPC Ltd [1993] HCA 4

Applicant: MS KERSHAW

First Respondent:	MR B KERSHAW
Second Respondent:	MR A KERSHAW

File Number: PAC 3095 of 2016

Judgment of: Judge Harman

Hearing date: 29 September 2016

Date of Last Submission: 29 September 2016

Delivered at: Parramatta

Delivered on: 29 September 2016

REPRESENTATION

Counsel for the Applicant: Mr Kenny

Solicitors for the Applicant: Sydney Lawyers & Associates

Counsel for the First Respondent: Mr Brezniak

Solicitors for the First Respondent: Raihani Lawyers

Counsel for the Second Respondent: Mr Ridley

Solicitors for the Second Respondent: Matthews Folbigg Pty Ltd

ORDERS

1. By consent as regards to paragraphs 1-10 inclusive and paragraph 12, Orders are made in accordance with the Terms of Settlement executed by the parties marked Exhibit ‘A’ attached hereto.

2. An Order is made in accordance with paragraph 11 of the minute marked Exhibit ‘A’ attached hereto, with the consent of the Applicant and the first Respondent and against the objection of the second Respondent.

3. Direct the solicitor for the Applicant to provide a typescript of the Terms of Settlement made today in word format direct to my Associate by email within 7 days of today’s date.

4. Pursuant to section 45 of the Federal Circuit Court of Australia Act 1999 and Rule 14.02 of the Federal Circuit Court Rules 2001, I declare that it is appropriate that the parties give formal discovery on oath.

5. Each party shall no later than close of business 4 November 2016 provide discovery on oath of all documents presently in existence and within their possession, custody or control which:

   (a)Relate to any issue presently in dispute between the parties and as apparent or as might be ascertained from the material filed to date;

   (b)All documents that are suggested to prove or disprove any allegation of fact in the proceedings relevant to the relief that is sort by that party.

6. Any document that is not disclosed and discovered in accordance with the above Order will not (subject to such submission that may be put by counsel at hearing) be admitted into evidence.

7. The second respondent, Mr A Kershaw shall no later than close of business 4 November 2016 file and serve:

   (a)A Response that shall specifically plead any allegation that is to be raised with respect to the creation or the existence of a trust (no matter how expressed or alleged) or equitable interest held  by Mr A Kershaw in the property Property C;

   (b)Statement of financial circumstances;

   (c)Affidavit sufficient to comply with Federal Circuit Court Rules 2001.

8. Pursuant to s.11F of the Family Law Act1975, the parties are directed to attend with a Family Consultant for the purpose of a Child Inclusive Child Dispute Conference at 9:00am on 16 February 2017 and:

   (a)The parties shall continue to attend at such times, dates and places as the consultant may advise;

   (b)The parties and each of them shall do all things necessary to ensure the attendance of their child/ren the subject of these proceedings to attend at the conference and to be available to meet with the Family Consultant;

   (c)The Family Consultant is requested to provide to the Court (and if, in the Consultant’s view it is appropriate to do so, the parties) a memo outlining and reporting on:

   (i)Any agreement reached between the parties;

   (ii)The issues raised by the parties and which will require determination by the Court;

   (iii)Any views or opinions expressed by the child/ren interviewed and any comment regarding the factors perceived to influence or impact upon those views and opinions or otherwise relevant to same;

   (iv)Any recommendations by the Consultant including as to Case Management, referral to external (community based or private) services and/or programs and resources to be allocated to the matter including but not limited to expedition, Independent Children’s Lawyer and/or full Family Report or Part 15 experts report.

9. The matter is adjourned for further mention and directions to 20 March 2017 at 12:00 noon.

10. Reserve the Applicants costs as against the Second Respondent with respect to today’s appearance, issues of disclosure and removal of caveat.

11. Pursuant to S.65DA(2) and S.62B, the particulars of the obligations these orders create and the particulars of the consequences that may follow if a person contravenes these orders and details of who can assist parties adjust to and comply with an order are set out in the Fact Sheet attached hereto and these particulars are included in these orders.

EXHIBIT “A”

1. That both the Applicant Wife and the Respondent Husband shall take all necessary steps and execute all necessary documents to cause the property located at Property C, in the State of New South Wales, being lot (omitted) in Deposited Plan (omitted) being the whole of the land contained in Certificate of Title Folio Identifier (omitted) ("the Property C") to be sold by private sale at the earliest possible date at a listing price to be agreed on between the parties and with (omitted) Real Estate, agent (omitted), and shall proceed to a sale of the Property C at a sale price agreed upon between them and that the proceeds of the sale shall be disbursed as follows:

   1.1Payment of the real estate agent’s commission and advertising expenses, and legal expenses of the sale;    

   1.2Payment of any outstanding charges relating to the Property C, such as council rates and water rates;    

   1.3Payment of any monies due and owing to discharge the existing mortgage over the Property C, being registered mortgage (omitted);

   1.4The sum of $60,000.00 to the Applicant Wife;

   1.4.1$30,000.00 to the Respondent Husband;

   1.5The net balance to be deposited into a controlled monies account by the Applicant Wife’s solicitor’s, being Sydney Lawyers & Associates.

   1.6The solicitor having carriage of the conveyance shall be Sydney Lawyers & Associates.

2. That in the event that the Property C does not sell by private sale within three (3) months from the date of these orders then both the Applicant Wife and the Respondent Husband shall take all necessary steps and execute all necessary documents to cause the Property C to be sold by public auction with an auction agent agreed upon between them at a reserve price agreed upon between them and shall proceed to a sale at a sale price agreed upon between them and the Respondent Husband shall be responsible for all costs and expenses of the auction payable prior to the auction sale and following the sale the proceed of sale be applied as provided in order 1 herein.

3. That in the event the Property C does not sell by public auction in accordance with order 2 herein, the Property C shall be resubmitted for sale by private treaty in accordance with the provisions of order 1 herein and the Property C shall be resubmitted for sale by public auction at three (3) monthly intervals from the last public auction or private treaty and the proceeds of sale shall be distributed in accordance with order 1 herein.

4. That in the event that both the Applicant Wife and the Respondent Husband are unable to reach agreement for more than seven (7) days in relation to an agent or auctioneer, whether a sale by public auction or by private treaty then both the Applicant Wife and the Respondent Husband shall and do hereby appoint the President for the time being of the Real Estate Institute of New South Wales or his or her nominee acting as an expert not as an arbitrator to nominate and/or appoint such agent or auctioneer and both the Applicant Wife and the Respondent Husband shall thereafter act in accordance with that nomination and appointment and the Respondent Husband shall be responsible for the costs and expenses of the President or his nominee making such determination.

5. That in the event that the Applicant Wife and the Respondent Husband are unable to reach agreement for more than seven (7) days in relation to a listing price, reserve price or selling price whether by public auction of private treaty, then both the Applicant Wife and the Respondent Husband shall and do hereby appoint the President for the time being of the New South Wales Division of the Australia Property Institute Inc or his or her nominee acting as an expert not as an arbitrator to make such determination and the Respondent Husband shall be responsible for the costs and expenses of the President or his nominee making such determination.

6. That both the Applicant Wife and the Respondent Husband shall forthwith do all acts and execute all documents necessary to give effect to the orders hereof.

7. That in the event that either the Applicant Wife or the Respondent Husband refuses or neglects within thirty (30) days from the time to execute any deed or instrument required to give effect to these orders: 

   7.1 The Registrar of the Court or their appointee pursuant to section 106A of the Family Law Act (Cth) 1975 may execute such deed or instrument in the name of such party and do all acts and things necessary to give validity to the operation of such deed or instrument.

   7.2The party in default is ordered to pay all reasonable    solicitor/client costs incurred by the non-defaulting party for the   purpose of enforcing these orders such costs to be assessed if not agreed.

8. That the Applicant Wife shall be permitted to attend on Saturday, 1 October 2016, the Property C for the purpose of collecting her personal belongings as listed in the Schedule annexed hereto.

9. That Mr A Kershaw:

   9.1 Remove the caveat lodged on the Property C, being registered    caveat (omitted) within seven (7) days from the date of these orders; and

   9.2Be restrained by injunction from registering any further caveat on   the Property C.

10. That the parties’ costs of these proceedings be reserved.

THE COURT NOTES THAT:

A.That these terms of settlement were interpreted to the Respondent Husband by a (language omitted) interpreter.

SCHEDULE

1. x1 Springfree trampoline

2. x1 Brand new cubby house (stored in three boxes)

3. x1 Brand new basketball net in a box

4. x1 Bicycle

5. x2 Filling cabinets (one dark yellow, and one dark green)

With respect to the dark green filing cabinet:

(i)The Respondent Husband does not agree to the Applicant Wife collecting the cabinet;

(ii)The Respondent husband shall make available to the Applicant Wife any documents within that cabinet for photocopying and return upon request; and

(iii)The Respondent Husband is restrained from disposing of any documents within the cabinet.

IT IS NOTED THAT

A.The x1 springfree trampoline shall be collected by the Applicant Wife on a later date by agreement between the parties.

IT IS NOTED that publication of this judgment under the pseudonym Kershaw & Kershaw & Anor is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).

FEDERAL CIRCUIT COURT
OF AUSTRALIA
AT PARRAMATTA

PAC 3095 of 2016

MS KERSHAW

Applicant

And

MR B KERSHAW

First Respondent

And

MR A KERSHAW
Second Respondent

REASONS FOR JUDGMENT

1. These proceedings involve pleas for relief with respect to both property adjustment and parenting. 

2. The parenting aspect of the matter does not occupy the Court’s attention today, save in a peripheral fashion in that the parties to the parenting aspect of the proceedings concur to adjournment to permit the parties and their children attending upon a Family Consultant for the purpose of a Child Inclusive Conference. The date for such a Conference will be ordered and the proceedings will be adjourned.  That is an entirely appropriate course of action to be adopted by the parties concerned with that aspect of the proceedings, bearing in mind that there are concurrent proceedings under the Crimes Act1900 (NSW) pending before the Local Court, Burwood and, until the conclusion of those proceedings, it would be prudent or desirable to avoid one or both of those parties being compelled to give evidence.

3. The parties to the proceedings comprise a triumvirate, namely, the Applicant wife, Ms Kershaw, the Respondent husband, Mr A Kershaw, and a second Respondent, Mr B Kershaw. Mr A Kershaw is the brother of Mr B Kershaw.  Mr A Kershaw’s interest in the proceedings is purely in relation to a suggested trust, however expressed or suggested to arise, in relation to a parcel of real estate which forms one of the more substantial assets of the relationship.  There are other assets, including a (omitted) business and at least one plate with respect to a (omitted) comprising that business, (there being no dispute that there were previously two (businesses omitted)). Issues with respect to the suggested diminution in (business omitted) can be addressed at a later time.

4. For today’s purposes, Ms Kershaw moves upon an Application in a Case filed in these proceedings on 12 September 2016.  That Application in a Case was served upon each of Mr A Kershaw and Mr B Kershaw shortly before the last Court event, 15 September, 2016.  On that date, and in somewhat curious and regrettable circumstances, it was not possible to deal with the totality of issues then present, predominantly as:

   a)Mr A Kershaw had not, at that time, produced various documents the production of which was necessary to enable the appropriate disposal of the proceedings; and

   b)The interpreter that had been engaged by the Court to assist Mr A Kershaw in providing instructions to his Counsel departed the Registry for another engagement and without notice to the Court. 

5. Accordingly, the proceedings were adjourned. 

6. In addition to the above circumstances, the proceedings were also adjourned as the second Respondent, Mr A Kershaw, had sought adjournment to enable him to prepare his case and file material. 

7. I make clear that the adjournment of the proceedings was brief, from 15 September, 2016 to 29 September, 2016. 

8. At the time that these proceedings were adjourned other matters were listed today for Hearing. Thankfully, those matters have completed.  The brevity of the adjournment was prefaced upon the agreement of the parties that there is urgency with respect to the matter, particularly the financial aspects of the proceedings, arising from a variety of circumstances, including but not limited to:

   a)The suggestion that the husband has withdrawn and has failed to account for various funds drawn against the mortgage encumbering the said parcel of real estate;

   b)Disclosure is incomplete and which has caused further concern to Ms Kershaw in light of that which is alleged by her; and

   c)Ms Kershaw denies knowledge of any trust to or any contribution by Mr A Kershaw with respect to the purchase of the parcel of real estate, being a property at Property C.

9. Mr and Ms Kershaw, through their Counsel and no doubt with their substantial and wise assistance, have reached an accord between themselves.  Mr A Kershaw is also in agreement with those Orders, save and except for one Order, Order 11 of the document marked Exhibit A, signed and dated by me today. That Order seeks that Mr A Kershaw forthwith remove a caveat recorded against Title of the Property C property.  Mr A Kershaw is the sole registered proprietor of that property.  The Order for removal of the caveat is resisted by Mr A Kershaw. Mr A Kershaw would submit to an Order that the caveat be removed contemporaneous with settlement. That is not acceptable to Ms Kershaw and thus that limited portion of Ms Kershaw's Application must be determined.

10. Having regard to that which is agreed it is unclear upon what basis Mr A Kershaw suggests that the Order for immediate removal of the caveat against Title registered by him would be prejudicial to his interests. 

11. There is agreement between the parties with respect to the majority of Interim and Interlocutory issues and that agreement is evidenced by Exhibit A.  Those Orders can be made consensually. By consent Orders will be made to affect a sale of the Property C property and there will be a dispersal of funds in specific fashion.

12. Exhibit A provides Orders for sale of the Property C property and a partial, interim distribution of the proceeds of sale and the investment of the balance of proceeds of sale in either a solicitor’s trust or a controlled monies account. 

13. There is no expectation within the document to which all parties agree that any distribution would be made to Mr A Kershaw upon completion of the sale of the property.  Thus, Mr A Kershaw would not be required to attend settlement and exchange a withdrawal of caveat for consideration. It is, as I have indicated, difficult to comprehend the basis upon which it is thus asserted that there could be prejudice to Mr A Kershaw arising from the immediate withdrawal of his caveat. 

14. Orders are to be made by consent which provide that the Property C property is not to be dealt with, save in accordance with these Orders.  It is open to the wife to seek to make a request for the Orders to be recorded against Title of the property pending its sale, and that may well be a prudent step, although entirely a matter for the wife. 

15. The Orders apprehend that both the husband and the wife will be involved in the sale and will provide instructions.  Both the husband and the wife will be involved in matters such as selecting the agent to be engaged by the parties, the solicitor or conveyancer and ultimately the sale price of the property.  Thus, one would hope, with one or more of those safeguards in place, that the property would not be dealt with other than in accordance with the Orders that are made today by consent of all parties. Importantly, Mr A Kershaw will not be involved in such matters.

16. During the course of dealing with the proceedings today, a document is tendered in the wife’s case, Exhibit A1, suggesting to be a copy of an agreement between Mr A Kershaw and his brother Mr B Kershaw that agreement suggested to create an express trust in favour of Mr A Kershaw. It is the only document before the Court which relates to the alleged creation, in favour of Mr A Kershaw, of an equitable interest in the property.

17. It is instructive to consider the evidence that is advanced by the parties with respect to the purchase of this property, although such consideration need only be brief, as this determination is limited to the removal of the caveat. 

18. The wife asserts that the property was purchased for a sum of $403,000.  That is corroborated through provision of a copy of the Transfer of the property which was obtained by search undertaken on 1 June 2016.  At that point in time, no caveat was recorded against Title of this property. 

19. The only dealing recorded was a mortgage to the (omitted) Bank.  It would now appear common ground that as at the date of separation of these parties, 19 May 2016, that the balance outstanding with respect to that mortgage was approximately $165,000.  The balance outstanding with respect to that mortgage has grown somewhat since that time and has increased by a little over $87,000.  Those issues need not be further considered for the purpose of this determination, nor is any Application pressed today seeking relief regarding those transactions.

1. Following the above Title search being undertaken, the caveat has been recorded against Title. Thus, it would appear that for the period from August 2008 when, in accordance with Exhibit A1, it is suggested that an express trust was created in favour of Mr A Kershaw and until such date as the caveat was filed Mr A Kershaw was the sole registered proprietor of the property with no notice to any third party (including, the mortgagee) of any circumstance suggested to affect Title. The first document suggested to have referred to such alleged trust was created in July 2016.  Prior to that time no action was taken by Mr A Kershaw, nor, one can infer, was action considered necessary to protect his interests. That, again, makes it difficult to comprehend the basis for opposition by Mr A Kershaw to an Order that he forthwith remove the caveat especially when there are safeguards in place as regards retention of the nett proceeds of sale, Mr A Kershaw after all joining in and agreeing to a sale of the property.

2. The wife asserts that the property had been purchased with a mortgage from the (omitted) Bank of $318,000 or thereabouts and that the balance of funds applied to the purchase and associated costs had been derived from savings and various small loans from various persons, not including Mr A Kershaw. The husband denies the wife’s position.  The husband has deposed that the wife’s assertion that he had borrowed, for example, funds in the sum of $10,000 from a Mr S is incorrect and has, in fact, filed an Affidavit by Mr S.

3. Further, the husband has filed an Affidavit by Mr J, another person from whom the wife suggests the husband borrowed funds or had other financial dealings at different times, which assertion the husband denies.  Mr J has sworn an Affidavit corroborating the husband’s evidence.  Notably, Mr J is suggested to be the witness to the document Exhibit A1 and suggested to create the express trust.

4. Mr A Kershaw’s evidence is that at the time of purchase of the Property C property and in addition to the mortgage that he borrowed a sum from his brother specifically to be applied towards the purchase of the property. 

5. In his Affidavit sworn or affirmed 26 August 2016, the husband asserts that he and his brother had agreed with each other prior to purchase that they would purchase the property in equal shares, although Mr A Kershaw would be a “silent partner”.  I can infer therefrom that it was intended by both Mr and Ms Kershaw that the husband would be the sole registered proprietor of the property.  It is suggested that a sum of $40,000 was advanced by Mr A Kershaw in cash in a number of instalments prior to the mortgage being obtained and that the property was then purchased. 

6. The husband is silent as to the mortgage that was initially obtained.  The wife asserts that the purchase price was $403,000 and that a mortgage of $318,000 was obtained.  Thus, one would think that funds, including the balance of the purchase price, the cost of the conveyance and any stamp duty as might have been payable, would have exceeded $100,000. Thus, on the husband’s evidence, there remains no explanation for the additional $60,000 that would have been required to complete the transaction. Those matters and any suggested incongruities will await final determination. 

7. I have referred to them as there is no evidence placed before the Court at this time by Mr A Kershaw with respect to any suggested interest in the property by him. The only evidence with respect to Mr A Kershaw’s suggested interest comes from that of his brother (the husband) and the wife’s denial that it is so. 

8. To the extent that there is complaint by Mr A Kershaw that he has not been afforded procedural fairness with respect to the matter such as to be heard in relation to the Order that is now sought by consent as between the husband and the wife, I reject that assertion. 

9. It is clear that the evidence in relation to Mr A Kershaw’s suggested interest comes from his brother, not the wife and importantly not from Mr A Kershaw himself.  The wife was silent in her first Affidavit as to any suggested interest in the property held by Mr A Kershaw whether by way of legal or equitable interest.  The first assertion of a trust issue was raised by Mr A Kershaw in his Affidavit referred to above. 

10. Thus, to the extent that there is complaint that the wife’s Affidavit of 12 September 2016 has only reached Mr A Kershaw recently, it would not appear relevant to that which is problematic.  On the basis of the failure of Mr A Kershaw to file a Response or any evidence asserting an interest in the property might raise question as to whether there is standing by Mr A Kershaw to be heard with respect to the wife’s Application.  I need not determine that issue as it is not pressed. 

11. It is convenient to deal with the Order that is sought by reference to relevant authorities such as, Blueseas Investments Pty Ltd & Mitchell & McGillivray [1999] FamCA 745.

12. The discretion that is given to the Court by section 114 of the Family Law Act 1975 as regards injunctive relief, the Order that is sought on this occasion squarely falling in those terms, is broad.  The Order that is sought is essentially interlocutory in nature, thus it does not materially affect interests in property.  Indeed, the caveat recorded does not do so.

13. To the extent that it is asserted by Mr A Kershaw that the caveat is required to protect Mr A Kershaw’s interest in property, the submission is ill-conceived.  The Order that is sought will not, in any fashion, affect Mr A Kershaw’s alleged interest should he ultimately file a document which seeks to assert such an interest. 

14. The injunction would be granted if the Court is satisfied that there are circumstances which make it proper to do so.  As is discussed in the authority to which I have referred to above, I must consider a number of matters and I will deal with them individually.

Is there some prima facie claim for property settlement or evidence that there is a real dispute to be determined

1. At this point in time there is no evidence by Mr A Kershaw.  There is certainly the evidence of Mr A Kershaw asserting the existence of a trust.  Although, not referred to as an express trust, the document today tendered, Exhibit A1, a document which has not been referred to in any previous evidence placed before this Court, is suggested to be the basis for that assertion.

2. It is suggested by the brothers that there is a real issue to try.  The issue is substantially a contest, as it were, between Ms Kershaw and Mr A Kershaw as to whether there is or is not an interest created in favour of Mr A Kershaw and thus, a requirement for payment to be made to Mr A Kershaw from the proceeds of sale. If it is alleged at Hearing that there is such a requirement of payment, then the terms of any trust, constructive, resulting or express, and whether it should be enforced, will be addressed at Trial. 

3. I am not satisfied that those rights and interests, albeit not at this point asserted by Mr A Kershaw, are in any way prejudiced by the Order that is sought.  Thus, on its face, the Order is proper.     

Whether the property is in danger of being dissipated

1. Clearly, it is not.  Orders are made today which will determine the sale of the property, the manner in which the property is to be sold, and permitting both parties to make a request of the LPI to record the Order against Title to ensure that there is no further dealing.  Even absent the caveat by Mr A Kershaw, that will be a protection to all three parties. 

2. One would also think that the prospect of a dealing with the property other than in accordance with the Orders that are made today, at a time when all parties are present and competently legally represented, is slight.  Each party would be concerned as to future actions and that which might be advanced against them by way of contravention or contempt in the event that there was departure from the Orders made today. 

3. I am satisfied the Orders made by consent today are sufficient protection for Mr A Kershaw’s position, particularly in circumstances where he has not placed material before the Court, albeit that he has had opportunity.  As I have indicated, to the extent that it is suggested that Mr A Kershaw has not been afforded procedural fairness before the determination of this issue, I reject that submission. 

4. As the High Court of Australia was clear, particularly Kirby J in Allesch v Maunz [2000] HCA 40, and to paraphrase the plurality of the High Court, the provision of due process requires that a party whose rights or interests are to be affected by an Order made by the Court is afforded a reasonable opportunity to be heard – an opportunity not of the litigant’s choosing, but reasonable in the circumstances, having regard to the prejudice to their rights, the consequences of the Order being made and the urgency of the circumstance.  

5. All parties agreed on 15 September 2016 that there was urgency to the address of these issues. Accordingly, the matter was accommodated urgently and quickly and with the potential, although thankfully and through circumstances beyond the control of these parties, not the reality, of prejudice to other Court users, (a serious concern as discussed by the High Court in Aon Risk Services & Australian National University [2009] HCA 27 and Haset Sali v SPC Ltd [1993] HCA 47).

6. The Federal Circuit Court Rules 2001 at rule 4.03, provide a period of 14 days from the date of service with an Application for a Respondent to file a Response.  It could not be asserted by Mr A Kershaw that he was served and given notice of the proceedings other than prior to the last Court event.  He appeared, he was aware of the Application made by Ms Kershaw for his joinder as a party, prudently undertaken in light of the allegation raised by Mr A Kershaw.  Mr A Kershaw appeared, sought and consented to joinder and indicated that it was his intent to agitate for relief from this Court on the basis of asserting an equitable interest in the property. 

7. The period of 14 days which the rules provide for the filing of a Response has expired.  A Response to the Application in a Case and an Affidavit have been filed by Mr A Kershaw.  Those documents do not make any assertion, let alone provide evidence in support of any assertion, of an interest in the Property C property.  Those documents as filed, and appreciating that those documents have been prepared in a limited time period, go solely to issues of disclosure. 

8. An Order is sought by Mr A Kershaw (Order 2 of the Orders sought in his Response to Application in a Case filed 28 September 2016 – i.e. yesterday), that the caveat recorded by him be withdrawn simultaneous with settlement of the sale of the property.  Thus, he is clearly on notice of the nature of relief that is sought by Ms Kershaw.  That relief is set out in her Application in a Case served prior to 15 September 2016. Mr A Kershaw has responded to the Application in a Case. It simply cannot be asserted that he has been denied due process.  He has sought relief in response.

9. That the Affidavit of Mr A Kershaw goes only to issues of suggested delay in provision of material and seeking an extension of time to provide disclosure, renders Mr A Kershaw’s evidence ineffective in resisting the relief sought by Ms Kershaw or in creating any basis which could possibly be seriously agitated in opposition.

Lack of prejudice to any party or third party

1. As I have struggled to make clear above, there is simply no demonstrated prejudice to Mr A Kershaw arising from the immediate withdrawal by him of his caveat.  His “rights” can be protected, as can those of Ms Kershaw, through making a request of the Land and Property Information Service to record these Orders against Title. That will have the same effect as a caveat, albeit without it being recorded upon the Certificate of Title.

2. The potential prejudice to Mr and Ms Kershaw, indeed, to Mr A Kershaw, arises from the existence of the caveat and the potential for it to create some apprehension in the mind of any prospective purchaser.  It would need to be disclosed in the Contract for Sale as a registered dealing. 

3. Any prospective purchaser might then have some qualms in relation to proceeding with a transaction whereby the registered proprietor is asserted to not be in a position to pass good Title. Thus, there is potential prejudice through the caveat remaining on foot in light of the Orders that are consented to by all three parties for the property’s sale.  An Order for sale is an Order expressly sought by Mr A Kershaw in his Response to an Application in a Case. 

4. There is also the prejudice that the mortgage upon the property is not being serviced or serviced entirely as to required payments of principle and interest. Any delay with respect to sale will further erode that which is available for division between the parties such as may ultimately be determined.  

Any undertaking as to damages or why it is inappropriate

1. I am not satisfied that it is at all necessary, let alone appropriate, for an undertaking as to damages to be given in these circumstances.  The damages that would flow, should Mr A Kershaw seek to engage in any form of chicanery regarding the sale of the property and as the sole registered proprietor (and I make clear that I do not assert that Mr A Kershaw would be so engaged), can be readily avoided as there are now Orders of this Court which bind all parties and the availability of a request to the Registrar of Titles in relation to recording these Orders against Title.

2. In all of those circumstances, I can simply see no basis upon which it could be argued by Mr A Kershaw that his caveat should remain or that he is prejudiced by the immediate removal of the caveat. I accept that it is not for Mr A Kershaw to demonstrate that it is improper, but for the wife and Mr A Kershaw to assert and demonstrate that it is proper.  It is curious that all parties agree to immediate sale and that both husband and wife agree to the Order for immediate removal of the caveat and the later Order is resisted by Mr A Kershaw. 

3. In circumstances, whereby it would seem that only since becoming aware of either these proceedings or the separation of these parties that Mr A Kershaw has seen fit or considered it necessary to record a caveat, a caveat which, on its face, in light of that which is now tendered (Exhibit A1), is inaccurate, resistance of the Order is curious.  They are matters, however, that need not give rise to anything but curiosity.  When the evidence is fully and properly on and before this Court, those issues can be dealt with and that curiosity satisfied.  Accordingly, I propose to make Order 11 of the document Exhibit A1 as sought.

4. I am also conscious that there are ongoing issues with respect to disclosure. I propose to make further Orders for disclosure and in a more formal manner than has occurred to date.  I accept and appreciate that there are some contentions raised by Counsel for the husband and wife as to the extent of disclosure that has occurred to date as between them.  There is no suggestion that Mr A Kershaw has yet given full or proper disclosure. That is not raised as a criticism of him; I am conscious of that which is advanced as to the reasons for such non-disclosure, including the speed with which the matter has come on. 

5. However, a further limited window for proper disclosure to occur is appropriate.  I have indicated to Counsel for Mr A Kershaw that a further period of 14 days would be allowed.  In light of the intended adjournment of the matter, I will make the period the 28 days that are sought. I propose to proceed on the basis of a declaration that it is appropriate for formal discovery to occur.  It may be that an Application for further interrogatories will be made at some point in time.  I need not deal with that today.  

6. This is a case in which discovery is fundamentally important.  Disclosure and discovery is intended and focused to enable the parties to understand the issues that are in dispute between them and to fully comprehend that which can or cannot be proved.  It is, by analogy to the statements of General Marshall[1] at the conclusion of the Second World War, albeit analogously, a means by which a party can demonstrate the strength of their case and the weakness of the other.  Disclosure and discovery are an investment in settlement and very much a means of efficiency and expedition of proceedings. 

   [1] “We are determined that before the sun sets on this terrible struggle, Our Flag will be recognized throughout the World as a symbol of Freedom on the one hand and of overwhelming force on the other” Statement 29 May 1942.

7. This matter cannot reach Hearing without proper disclosure and discovery.  It will dramatically increase the amount of time that is required to dispose of the matter, particularly as one or more parties require the assistance of an interpreter. Various documents have already been annexed to material in other languages which will require interpretation. That will take extra time as translation is already a significant (but necessary) drain upon the resources of the parties in the Court. 

8. That drain can be dramatically limited by these parties now turning their attention, fully and wholesomely, to proper disclosure with the very focus that some two centuries of jurisprudence dictate: to identify the issues in dispute, to identify that which is available to prove or disprove fact and to signal strength of a position or acknowledge weakness.  In that fashion, these parties might be assisted by their legal advisors to reach a conclusion of the matter.

9. For those reasons, the declaration will be made and I will require that each party file an Affidavit of documents.  I will also make an Order that any document that is not disclosed and discovered in accordance with those Orders and within the time period provided, to the extent that they are documents which are already in existence and which are within the possession, custody or control of any party, will not be admitted into evidence. 

10. There are, at this point, real concerns as to the unsatisfactory nature of the evidence going to proof of serious contentions.  Concerns are all they are at this stage. Those concerns must be considered as they will impact the ability of one or more of the parties to conduct their case properly without disclosure. It would thus be akin to a denial of due process to one or more of the parties if full and proper disclosure did not occur.

11. For the above reasons, Orders are made as follows (see Orders).

I certify that the preceding sixty (60) paragraphs are a true copy of the reasons for judgment of Judge Harman

Date: 10 March 2017