Krik and Kirk and Ors

[2011] FamCA 23

FAMILY COURT OF AUSTRALIA

KRIK & KIRK AND ORS [2011] FamCA 23

FAMILY LAW – PRACTICE AND PROCEDURE – Case management – Out of court undertaking provided by second and third respondents – Should it be an undertaking given to court – Further affidavits to be filed – Independent experts and issues of their evidence – further affidavits and listing required

Family Law Act 1975 (Cth)

APPLICANT: MS KIRK

RESPONDENT: MR KIRK

FILE NUMBER: MLC 3322 OF 2009

DATE DELIVERED: 24 JANUARY 2011

PLACE DELIVERED: MELBOURNE

PLACE HEARD: MELBOURNE

JUDGMENT OF: YOUNG J

HEARING DATE: 24 JANUARY 2011

REPRESENTATION

COUNSEL FOR THE APPLICANT:

SOLICITOR FOR THE APPLICANT: MS FORMICA

COUNSEL FOR THE RESPONDENT:

SOLICITOR FOR THE RESPONDENT: MS SUBRAMANIAN

Orders

IT IS ORDERED:

1. THAT on or before 2 March 2011 the Second and Third Respondents are to make, file and serve:

   (a)a Response to the wife’s further amended initiating application filed 3 September 2010;

   (b)a Response to the wife’s application in a case filed 3 September 2010;

   (c)an affidavit in reply to the wife’s affidavit filed 3 September 2010;  and

   (d)any further affidavit upon which they intend to rely.

2. THAT the wife’s solicitors are to serve upon each of the Second and Third Respondents a sealed copy of this Order by prepaid post to their address, … in the State of Victoria.

3. THAT all extant applications be otherwise adjourned for mention and case management before Young J at 10.00 a.m. on Wednesday 23 March 2011.

4. THAT the husband and wife and their solicitors are forthwith to do all acts and things and have all documents and information prepared and available so as to ensure that each of the personal accountants for the husband and wife (or as engaged by them) and the independent expert accountant, Mr M of M Firm, confer upon the assets and liabilities of the parties and all other relevant financial and property issues and prepare a joint statement identifying those issues that are agreed and those issues that remain in dispute (including their consideration of all issues of unaccounted funds and assets) and that such report be available to the parties and the Court on or before Monday 28 February 2011.

5. THAT all costs of and associated with the hearing this day be reserved to the adjourned hearing date.

6. THAT on the adjourned hearing date each of the husband and wife, through their solicitors, are to have prepared a one (1) page balance sheet of all assets, liabilities, financial resources and superannuation and serve that upon all other parties and provide a copy to the Court on that day.

IT IS NOTED:

A.THAT the Court has expressed the view that it is preferable if the parties are personally present in Court on the adjourned hearing date.

B.THAT if the Second and Third Respondents elect to take no part in these proceedings and not appear personally or be represented then they are to advise each of the other parties and the Court, in writing, of their decision in that regard.

C.THAT if the Second and Third Respondents are to appear personally or be represented by solicitors then a Notice of Address for Service is to be filed forthwith in compliance with the Family Law Rules 2004.

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

FAMILY COURT OF AUSTRALIA AT MELBOURNE

FILE NUMBER: MLC 3322 of 2009

MS KIRK

Applicant

And

MR KIRK

Respondent

REASONS FOR JUDGMENT

1. The matter of Kirk was before me this morning with Ms Formica, solicitor, appearing for the applicant wife and Ms Subramanian, solicitor, appearing for the respondent husband. There was no appearance by the second or third respondents and they are not legally represented.  Mr Mulvany, solicitor, is the appointed Independent Children’s Lawyer and he has been excused from attendance at this Court on property and financial hearings.

2. The application that brings the matter to court is that filed by the wife on 3 September 2010.  That was first returnable on 8 October of last year and by consent was adjourned to this day for the purposes of a two day interim defended hearing on financial matters.  The response of the husband to that application was filed 6 October 2010 and it sought its dismissal, together with an order for costs in favour of the husband.  The court file records that the following day, 7 October 2010, an affidavit of service upon the second and third respondents was filed with the Court by a Ms BE.  That affidavit now forms part of the court record.

3. What occurred this morning was that solicitors appeared before me seeking orders by consent as were negotiated by counsel over the past few days.  The Court was advised that Mr Geddes, One of Her Majesty’s Counsel, is retained by the wife and Mr Melelli retained on behalf of the husband.  I have read those consent orders that have declined to make them in their entirety this day.  Primarily, and for reasons not wholly explained, they ignore the second and third respondents and proceed to have the matter set for a defended hearing in the second half of this year on the basis that there will evidence only from the husband and wife, as parties. 

4. As background to those orders I have been referred to and have carefully read, the husband’s affidavit filed 6 October 2010, and in particular, paragraphs 58-65 (inclusive) thereof.  The husband there deposes as to the age and state of health of each of his parents and their limited understand and knowledge of the English language.  At paragraph 61, the husband deposes to what he says to be the current and available assets and liabilities of himself and his wife.  They are said to total approximately $5.1 million plus superannuation.  They exclude moneys or assets transferred to or provided by the husband to his parents or otherwise now owned or controlled by the parents.  Ms Formica has submitted to the Court that the true pool of assets, would approach $10 million or thereabouts.  That crystallises the dispute as between the husband and wife.

5. In paragraph 62, the husband deposed:

   “My parents do not need to be involved in these proceedings as there are sufficient assets within the matrimonial asset pool to satisfy the wife’s claim as particularised in her second further amended initiating application filed 3 September 2010”.

6. He continued in paragraph 63 and stated that, at its highest:

   “It is unlikely that the wife would succeed in terms of that application as she is seeking to retain all matrimonial assets save for [R Company] and 50 per cent of the combined superannuation”.

   He observes in that paragraph that the wife sought to retain all of the funds in the parents’ bank account and part of their property in W.

7. In paragraph 64, the husband asserted that the wife, had at all times, been fully aware of all of the distributions made to his parents.  It is said that it is only now that she had sought to join them in the proceedings. 

8. Notwithstanding the matters deposed by the husband, there is a reality to this case, and that is that the husband’s parents have been individually joined as the second respondent and third respondent in the proceedings.  True it is that they had not obtained independent legal advice.  Currently they are wholly supportive of their son and it has been generally submitted to me this day by the husband’s solicitor that the evidence of the parents and their case is wholly aligned to that of their son and there may be no need for any independent legal representation or evidence from one or both of them. 

9. On the hearing on 8 October 2010 the Court made an order by consent which required the second and third respondents to make, file and serve a response to the wife’s applications before the Court, supported by affidavit.  It has been highlighted to the Court today that the order was made on the basis that the parents “may” file such documents – that is giving them the option to comply with the court order as they may so determine.  I intend to vary that order and to make it compulsory for the parents, named as second and third respondents to the proceedings to file, as they may be so advised, a response and an affidavit.  It is for them to choose whether they obtain independent legal advice. 

10. In the case management of this case and having regard to the current consent orders that are before me this day it is wholly inappropriate to ignore the second and third respondents.  The actions of the husband in transferring, gifting or properly providing to them money and assets will be a factual matter in dispute.  Indeed, from Ms Formica’s submissions today, it may be that it is the very heart of the financial dispute between the husband and wife, and goes to the very identity of the available pool of assets and liabilities which, of course, is the first step for the Court to identify in section 79 proceedings. 

11. Interestingly the Court is advised that the parents have provided a letter of undertaking, a somewhat informal document that is not before the Court and indeed is not even in Court today, to be better identified in these proceedings.  That undertaking was seemingly prepared by the husband’s solicitor visiting his client’s parents and obtaining from them in their native language an undertaking as to their actions in holding and/or not disposing of certain identified assets.

12. I have carefully observed that it is not in the form of an undertaking to the Court.  There perhaps one day could be issues of and concerning the manner of the obtaining of that undertaking and the role of the husband’s solicitor in so involving himself in that exercise.  That may, or may not, be wholly prudent and appropriate and I carefully express no opinion of the Court whatsoever.  The issue for the Court is largely the proper management of these proceedings pending trial and whether the respondents should make, file and serve an affidavit as to their position, and of course, prepare any response for orders they may seek. 

13. Ms Formica has forthrightly asserted to the Court that the parents will need to be cross-examined, and thus, currently, the intention of the wife’s solicitor would be to subpoena them to give evidence.  Given they are joined as individual respondents that course of action is not an appropriate and certainly not one that most properly affords each of them the opportunity to put their evidence before the Court.  There will be significant issues of their age, state of health, language, and thus, a carefully drawn affidavit by each of them is most likely the best way for their evidence to be fairly before the Court and for them to be cross-examined upon the basis of that document. 

14. There are decisions that need be made by each of the parents as to whether they intend to participate in the proceedings, and ideally, they should advise the court in affidavit form of their decision in that regard, given that they are already joined as parties.  It may ultimately be that their financial and property interests accord identically with that of their son, as has been asserted by him in his affidavit.  But these are matters which properly and wholly should be reflected upon by each of his parents, and they should advise the Court in affidavits, or in a joint affidavit of that scenario. 

15. I intend, therefore, to make orders requiring the parents to make, file and serve a response and their affidavits by 2 March 2011.  Otherwise, the minutes of consent orders will endeavour to prepare a timetable for hearing.  I do not intend to make such orders today, as the timetable will largely depend upon the affidavits to be filed and the position to be adopted by each of the other respondents.  I have indicated to both solicitors in court that this matter will not be listed for any defended hearing prior to late July of this year, or thereafter.  I will ensure a listing of the matter before me is scheduled shortly after the conclusion of the filing date for the respondents, and in that regard, I will list the matter for mention in case management at 10am on 23 March 2011.  If there are to be any issues before the Court that day, then all parties should be present with their solicitors. 

16. I carefully record that I am not listing the matter for any form of interim defended hearing on that day.  It is to receive further and more considered consent orders and then to structure a timetable for a defended hearing.  One of the orders sought today relates to the various accountants and the preparation of joint statements as to their evidence, and requiring a conciliation of financial experts to occur.  I record that is essential, and the scenario and cost of the parties of having both an independent expert, Mr M, and two other accountants representing the financial interests and entitlements of the husband and wife otherwise giving evidence is far from ideal. I reserve the position of the Court in relation to the acceptance of that evidence and, clearly, their financial input and scenarios should be carefully channelled through the independent expert accountant. 

17. I am aware of previous court orders, but I put all parties on notice that the evidence of these accountants and the manner in which they may be involved in the final hearing are issues which must be addressed to the Court on 23 March.  If there is to be any updated valuation of real property, I require the solicitors to be in a position to confirm that evidence on the adjourned hearing date. 

18. I will of course make appropriate orders for the filing of a single affidavit of evidence of all parties, and other case procedural documents as are proper, but I will not make that order until the adjourned hearing date.  Likewise, the parties remain free to issue proper subpoenae to produce documents to the Court and that information, if it is to be meaningful, should be obtained now and prior to the drafting of affidavits of final evidence. 

19. I have already raised, but I leave with solicitors the issue of the casual, out of court undertaking already delivered.  It may be that such an undertaking should be more formally provided to the Court, and that may be the basis for the consideration of excusing the second and third respondent from the proceedings.  Again, I make no further comment, and certainly, I hold no position in that regard. 

20. I do intend to give the second and third respondents every opportunity to present their position and/or their evidence or orders sought to the Court in a manner as is proper and as they may so elect upon such legal advice as they are prepared to accept and act upon.  I record that, at the least, they should have a very clear understanding and knowledge of their right to obtain independent legal advice.  What they do and whether they accept such a circumstance is a matter for their informed and proper decision. 

21. I will have these brief ex tempore reasons for judgment transcribed, placed upon the court file, and made available to the legal practitioners for the parties.  I require these reasons to be delivered up by the husband’s solicitors to each of his parents, as soon as practicable, for their consideration. 

22. I will adjourn to 23 March the wife’s application in a case filed 3 September 2010, and the husband’s response thereto.

I certify that the preceding twenty- two
(22) paragraphs are a true copy of the reasons
for judgment of the Honourable Justice Young
 delivered on 24 January 2011.

Associate: ……………………………………………………………

Date:  …………………………………………………………………