Lerrada & Wilkins (No. 2)

[2021] FamCA 395

FAMILY COURT OF AUSTRALIA

Lerrada & Wilkins (No. 2) [2021] FamCA 395

File number(s):	CAC 1831 of 2019
Judgment of:	GILL J
Date of judgment:	15 June 2021
Catchwords:	FAMILY LAW – PROPERTY PROCEEDINGS – application for interim injunction – injunction granted to restrain sale of property pending further hearing.
Number of paragraphs:	8
Date of hearing:	15 June 2021
Place:	Canberra
Counsel for the Applicant:	Dr Leslie
Solicitor for the Applicant:	Australian Family Lawyers
Solicitor for the Respondent:	Self-representing

ORDERS

CAC 1831 of 2019
BETWEEN:	MS LERRADA Applicant
AND:	MS WILKINS Respondent

ORDER MADE BY:	GILL J
DATE OF ORDER:	15 JUNE 2021

THE COURT ORDERS THAT:

1.Ms Wilkins is restrained by injunction from disposing of, encumbering, or entering into an obligation for the sale of 5 C Street, Suburb D, pending further hearing of this matter on 28 June 2021, with such restraint being subject to a release provided in writing from the solicitors for Ms Lerrada.

2.The proceedings are adjourned for further hearing to 2 pm on 28 June 2021.

3.The Respondent shall forthwith provide to the Applicant:

(a)Copies of any outstanding rates, land tax or other liabilities, other than the mortgages, associated with any of the properties;

(b)Copies of all documents received by her from any financial institution which state that she has been approved to borrow funds from them in the past 6 months, and the sum that she has been approved to borrow.

(c)Copies of bank statements evidencing payment by her of any of the mortgages held over the properties known as 3C, 5C and 7 C Street, Suburb D during the past 3 months;

(d)A letter from the financial institution or institutions indicating the financial arrangements approved for the refinance of any loans associated with any of:

(i)5 C Street, Suburb D;

(ii)3 C Street, Suburb D;

(iii)7 C Street, Suburb D;

including but not limited to approval amounts and borrowing capacity for Ms Wilkins and Mr G.

IT IS NOTED THAT

4.Mr G is not a party to the proceedings and cannot be compelled to produce the above documents but he may elect to do so so that the Respondent's proposal can be considered.

IT IS ORDERED THAT

5.The parties are each to file and serve an updated Financial Statement by 4 pm on 22 June 2021.

6.Ms Lerrada is to file and serve an affidavit annexing to it such documents as are being produced in accordance with the above orders by Ms Wilkins, along with the current valuations as obtained by the parties.

7.Either party is at liberty to file and serve an affidavit annexing to it updated valuations from the valuers should they choose to obtain them by 4 pm on 25 June 2021.

IT IS NOTED THAT

8.The parties’ appearance before the Deputy Chief Justice on 18 June 2021 remains listed.

Note:   The form of the order is subject to the entry in the Court’s records.

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 17.02 Family Law Rules 2004 (Cth).

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

EX TEMPORE REASONS FOR JUDGMENT

GILL J

1. These proceedings concern an urgent application by Ms Lerrada in relation to the sale of properties owned either jointly or variously by herself and Ms Wilkins, being properties that are subject to part of the dispute between the parties in this Court.  That application comes in what appears to be an acknowledged context of the various mortgages in respect of their three subject properties, being significantly in arrears and increasing in terms of being in arrears.  That occurs in the further context that there has been some communication from the bank as to the necessity to bring that state of affairs to an end. 

2. The application was filed by Ms Lerrada on 26 May 2021 and listed for hearing today, 15 June 2021.  Ms Wilkins, the respondent to the Application in a Case, filed her material today.  In her material she proposes an alternate way of dealing with the current difficulties faced by the parties which would involve various non-arm's length transactions between herself and her brother, whereby her brother would acquire interests in a number of the properties, displacing interests currently held by Ms Lerrada. 

3. An adjournment is necessary by virtue of the late filing of material by Ms Wilkins.  However, it is important that the adjournment only be for a short period.  Even though an adjournment is available for a short period, Ms Wilkins has advised of her intention to engage, in any event, the non-arm's length sale to her brother of the property at 5 C Street in Suburb D, being a property solely in her name.  She is of course entitled to sell that property subject to a restraint.  She indicates the importance of selling that property, or at least entering into a contract for the sale of property, this financial year on the reasonable basis that sale of the property is likely to attract a higher Capital Gains Tax liability if it is sold next financial year, rather than this financial year, by virtue of the change in her income earning status.

4. There are also other advantages to a sale taking place to her brother, including the advantage of not having to pay sale costs, along with other more personal advantages that would flow from the arrangement. 

5. Ms Lerrada has been granted leave to orally apply for an injunction pending the further hearing of this matter to restrain such a sale.  The power to grant such an injunction occurs within a broad discretionary context of the powers of the Court to protect the subject matter of the dispute that is before the Court, conditioned on such orders being just and convenient. 

6. As noted, any such injunction would be for a short period of time.  It is intended to bring this matter back before the Court at 2 pm on 28 June 2021 for the further hearing of the matter.  That timing would allow, dependent on the complexity of the matter and dependent on further adjournments being obtained, determination of Ms Wilkins’s right to sell to her brother in a manner that would allow her to attract whatever Capital Gains Tax advantages she is able to receive should the sale take place in this financial year.  That timing is to allow a determination to be made in order not to prejudice those advantages but to give enough time for the proper consideration of and filing of relevant material that is not being able to take place due to late filing of the matter today. 

7. The basis for the injunction is to protect against the risk that the non-arm's length transaction, even reliant on a recent valuation obtained by the parties, would fail to secure the proper market value for the property.  Under those circumstances, it is just and convenient to protect against that risk pending a more fulsome consideration, with that fulsome consideration to be in a timeframe designed, although not guaranteed, to protect against the detriment that flows from the adjournment of the matter and a restraint of the sale pending that adjournment. 

8. Accordingly, it is ordered that Ms Wilkins is restrained by injunction from disposing of, encumbering, or entering into an obligation for the sale of 5 C Street, Suburb D, pending further hearing of this matter on 28 June 2021, with such restraint being subject to a release provided in writing from the solicitors for Ms Lerrada.

I certify that the preceding eight (8) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Gill.

Associate:

Dated:       15 June 2021