KING & KING AND ANOR (NO 3)

[2012] FamCA 1099

FAMILY COURT OF AUSTRALIA

KING & KING AND ANOR (NO 3) [2012] FamCA 1099

FAMILY LAW – Undefended final hearing order for trial where party has not complied with discovery

Family Law Act 1975 (Cth)

AON Risk Services Australia Limited v Australian National University [2009] HCA 27
Black and Kellner [1992] FamCA 2
Briese v Briese (1986) FLC 91-713
Oriolo v Oriolo (1985) FLC 91-653

APPLICANT: Ms King

RESPONDENT: Mr M King

INTERVENOR: Mr B King

INDEPENDENT CHILDREN’S LAWYER:

FILE NUMBER: MLC 9554 of 2011

DATE DELIVERED: 12 December 2012

PLACE DELIVERED: Melbourne

PLACE HEARD: Melbourne

JUDGMENT OF: Cronin J

HEARING DATE: 28 November 2012

REPRESENTATION

COUNSEL FOR THE APPLICANT: Mr Bromley

SOLICITOR FOR THE APPLICANT: Mr McNaught, Kliger Partners

THE RESPONDENT: In Person

COUNSEL FOR THE INDEPENDENT CHILDREN’S LAWYER:

SOLICITOR FOR THE INDEPENDENT CHILDREN’S LAWYER: Bowlen Dunstan & Associates Pty Ltd

Orders

1. That upon the application in a case by the wife filed 6 September 2012, subject to the orders that follow below, paragraphs 3, 4, 5, 6, 7 and 8 of the husband’s response filed 22 November 2011 and paragraph 6 of the response of the husband filed 2 December 2011 are struck out.

2. That subject to the orders that follow, the wife have leave to proceed on a final undefended basis in respect to all outstanding financial matters.

3. That the final hearing of all outstanding financial matters be adjourned for mention at 10.00am on 28 March 2013.

4. That the respondent husband have leave to file and serve an application in a case supported by an affidavit to be filed and served no later than 4.00pm on 1 March 2013 seeking orders that he be able to participate in the final hearing relating to financial matters upon filing with it, an affidavit:

   (a)   setting out the orders that he proposes to seek on a final basis relating to financial matters;

   (b)   explaining why he has not comprehensively complied with interlocutory orders to date; and

   (c)   setting out what evidence he will call to support the orders he seeks on a final basis.

5. That the respondent husband also have leave to file an application in a case supported by affidavit seeking interim parenting orders and the date for such hearing be determined by arrangement with a docketed registrar.

6. That the evidence of the husband this day be recorded on a CD and be made available to the legal practitioners of the parties upon the payment of the usual fee for such audio record and the husband upon payment of the appropriate fee, be at liberty to hear the CD and take appropriate notes in the offices designated by the Court or, if he is represented by a legal practitioner who has filed a Notice of Address for Service on the court file, by those legal practitioners having access to the CD upon the same basis as the solicitors for those currently represented.

7. That the release of all audio recordings be subject to any condition relating to its use as imposed by the Registry Manager of the Family Court of Australia at Melbourne.

8. That all outstanding interim applications are otherwise dismissed.

9. That costs of the wife of this day are reserved.

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

FAMILY COURT OF AUSTRALIA AT MELBOURNE

FILE NUMBER: MLC 9554  of 2011

Ms King

Applicant

And

Mr M King

Respondent

And

Mr B King

INDEPENDENT CHILDREN’S LAWYER

REASONS FOR JUDGMENT

1. On Wednesday 28 November 2012, I may made orders which permit the wife to proceed in the future with her application for financial orders on an undefended basis.  That arose from an application she made and to which the husband sought an adjournment which I refused.  I indicted I would give reasons and set out the details of this unusual case.  These are those reasons. 

2. In AON Risk Services Australia Limited v Australian National University [2009] HCA 27 French CJ observed that as part of a court’s case management principles and rules, it was appropriate to consider the potential for loss of public confidence in the legal system which could arise where a court was seen to accede to applications made without adequate explanation or justification. To that philosophical concept can be added that for a court to simply ignore a failure by a litigant to meet deadlines about which other litigants complain can clearly have an impact on the confidence in the justice system. It aggravates and frustrates not just the litigants in the particular proceeding but others who watch waiting and hoping to have their cases determined. Particularly relevant to this Court is the clear and unambiguous requirement of its rules (see r 1.04 Family Law Rules 2004).

3. In AON Gummow, Hayne, Crennan, Keifel and Bell JJ referred to rule 21 of the relevant Territory court civil procedure rules that set out that the purpose of the rules was to facilitate the “just resolution” of the “real issues” in (proceedings) with minimum delay and expense.  The rules required the parties to “help” the court to achieve the objectives.  Their Honours without specifically deciding the point, observed that the real issues may extent beyond pleadings.  It was noted that other courts have this same objective.  It is clear that this Court has as well.

4. The High Court said there can be no doubt about the importance of speed and efficiency in the sense of minimal delay and expense.  Those are essential to a just resolution of proceedings.  Those same principles however must not be seen to detract from the proper opportunity being given to parties to plead their case.  All of those observations of the High Court are pertinent in this case.

5. Unlike some other courts, the Family Court of Australia has rule 13.01 which imposes a duty on a party to give full and frank disclosure of all information relevant to the case in a timely manner.  That disclosure includes details of a litigant’s financial circumstances and also disclosure and production of documents.  The failure to comply with that obligation has stated consequences.  This issue is not new (see Briese v Briese (1986) FLC 91-713; Oriolo v Oriolo (1985) FLC 91-653, and; Black and Kellner [1992] FamCA 2).

6. By her application filed 6 September 2012, the wife sought to have specific parts of two responses of the husband struck out because he had failed to comply with orders.  The wife said the application and affidavit were served upon the husband by both letter and email.  The letter was addressed to the residence shown in the Notice of Address for Service on the court file and the email address was that apparently provided by the husband.  The husband denied he received either.  He said in respect of the letter that it had never arrived and he had not used the email address for two years.  Ironically, according to counsel for the wife, neither the email bounced back nor the letter was returned undelivered.

7. I gave the husband an opportunity to digest the documents because they were relatively short.  He then sought an adjournment “to get counsel” which I refused having regard to the evidence I had earlier heard in the day.  That evidence arose from an oral examination of the husband which I had previously ordered by the wife’s counsel.  The evidence does not need to be stated here but it showed that the husband had significant involvement in entities which he described as a family business.  Whilst maintaining no legal ownership or control, the evidence disclosed not only significant involvement in the day to day running of those businesses but also extraordinary use of credit card facilities.  That evidence indicated to me an entirely inconsistent picture with that portrayed by the husband of impecuniousity, lack of possession of any documents and an abdication of all responsibility for finances to the wife. 

8. I am not asked to, nor am I in a position to, make any findings in this case but it must be observed that even on the husband’s statement, that after a year in the court process he now intended to get counsel.  Something was clearly amiss.

9. In response to my questions upon his oral application for an adjournment, the husband said his impecuniousity would mean he could go to legal aid.  The evidence shows that the husband had lent another man involved in the liquor retail business his own credit card to buy large amounts of stock on the basis that he trusted the person to pay the money back.  The husband does not receive any social security benefits and either lives off his wits or the assistance of his family.  He does not have any job.  He said he was moving into a house which I understand from previous hearings, carries a significant mortgage obligation.  That hardly seems to be the sort of case for funding by Victoria Legal Aid knowing as I do, their restrictive guidelines and desperate shortage of funds.  The husband’s response to that comment was that he would go to see his family.  His family had apparently not come to his aid before and I saw no reason just on his statement to accept that they would inevitably help him.  In this case, the wife asserts large transaction have been made by the husband in the retail industry.  I am also conscious in this case from having had previous control of the management of it that there has been involvement in another court by a liquidator of one of the “family business” entities.  This is not a simply financial dispute.

10. The court file began not long after separation occurred in August 2011.  Since then, even taking into account that there are unresolved parenting issues between the parties, the documents of the Court are in four volumes and the latest document number is 68.

11. In her affidavit in support of her application, the wife made mention of the fact that the husband had been ordered to pay spousal maintenance in November 2011.  That order was reiterated on 24 January 2012.  According to the wife, a maintenance order is currently in arrears to the extent of $7700.  It was paid to some extent by a garnishment order on the tenants who had occupied the house that the husband had bought.  The husband’s complaint at the time was that he needed the tenants’ money to pay the mortgage.  How the mortgage has been paid is not known.

12. The obligation upon the husband to provide documents to which the rule applies that I have earlier mentioned began as early as November 2011.  In May 2012, the wife sought specific documents.  On 28 June 2012, on an application of the wife about the husband’s lack of response, I ordered the husband to file an affidavit to respond to the wife’s complaints about discovery.  I directed that the affidavit be filed by 13 July 2012.  Four months late, the husband filed an affidavit.  Pertinently, it only contained one line.  It read:

    I do not have any of the documents in my position [sic] that the other party has requested from me.

13. In cross-examination of the husband, it became clear that that statement was not accurate.  After initially saying he had no bank accounts, he said he had a Mastercard which he used for his expenses and for which, he received statements.  When asked about what had been requested of him, the husband said he had misread the document.  He agreed that he had previously had an accountant who was responsible for tax returns but he could not remember when they were last filed but he thought that he had not met the accountant for two years. 

14. There was an obvious inference that there were still documents in the accountant’s possession.

15. Of the husband’s house and mortgage, he said that he had nothing but equally, he had done nothing about getting documents from the mortgagee.

16. The husband’s financial statement in November 2011 which he prepared himself, referred to weekly payments for life insurance.  He said that that policy had lapsed.  When pushed, he said it had been acquired for the protection of the mortgage.  All of this occurred after separation so it is hard to understand how these documents would not be in his position or control.  Almost mantra-like in cross-examination he said that documents were in the possession of his wife.  That is clearly an example of where that is not the case.

17. Similar answers were given by the husband about his superannuation.  Even if they were at his former home, he had not pursued the trustee of the fund for copies.  I acknowledged that the superannuation fund may have limited funds but the obligation under the rules is absolute.

18. The husband had a telephone which he declined to nominate but he did not produce any records either which had been redacted if he was troubled about security. 

19. Details of a job that he had for four weeks were scantily referred to in his financial statement in November 2011 and even more vaguely in answers to cross-examination yet still, no documentation was produced.  Presumably, if he only worked for four weeks, as an employee, he would have had a group certificate.  But it was in this particular business that on his American Express card, he acknowledged thousands of dollars had been spent buying cards for his employer for reasons he did not know or understand but for which he was later reimbursed.  The truth of all of these matters will ultimately come out but the point at this stage was that no documents were produced and the one line to which I have referred was put seriously by the husband.  All of the evidence points to the existence of documents.

20. The wife would not be prejudiced if the husband remained as a party but the husband after a year, now intends to seek advice.  In cross-examination he accused the wife’s counsel of fishing and as I observed, he was correct.  It seemed to me, the wife had no alternative.

21. I consider this is a case where all indicia point to the fact that the husband has not complied with his obligations not only under the rules but also the court orders.  He has not paid the spousal maintenance.  His impecuniousity may very well be the reason but he has made no application to discharge the order.  Further, he has not comprehensively fulfilled his obligation for discovery.  His affidavit which he was obliged to file in July was four months late.

22. Because the trial is sometime away as a result of the liquidation process, the husband will have an opportunity to participate if he explains his behaviour in ignoring the various rules and orders of the Court but he will also have to show that he can fulfil his obligations as a litigant.  To ignore what has occurred here would have the potential for reasonably-minded members of the community to ask why the Court was ignoring its own rules and orders whilst at the same time causing delay and expense to the wife in endeavouring to sought out the things to which the husband could and should contribute.  Justice delayed is justice denied.

23. The wife should therefore have the opportunity to proceed on the best evidence she can and if the husband is serious, he can apply properly to show that he wants to genuinely participate.

I certify that the preceding twenty three (23) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Cronin delivered on 12 December 2012.

Associate: 

Date:  12 December 2012