Loomis & Ors and Thurston

[2014] FamCA 305

FAMILY COURT OF AUSTRALIA

LOOMIS AND ORS & THURSTON [2014] FamCA 305

FAMILY LAW – PROPERTY – Application for removal of caveat – Appointment of valuer for the valuation of property of the parties.

FAMILY LAW – PRACTICE AND PROCEDURE – Stay – Where pending compliance with disclosure orders, the wife seeks a stay of proceedings – Transfer – Where the parenting component of the substantive proceedings is transferred back to the Federal Circuit Court of Australia.

Family Law Act 1975 (Cth) s 33B

Family Law Rules 2004 (Cth)
Judiciary Act 1903 (Cth) s 79
Land Title Act 1994 (Qld) s 127
Property Law Act 1974 (Qld)

Burman v AGC (Advances) [1994] 1 Qd R 123
Cousins Securities Pty Ltd v CEC Group Ltd [2007] 2 Qd R 520
Ex partGoodlet & Smith Investments Pty Ltd [1983] 2 Qd R 792
Re Jorss’ Caveat [1982] Qd R 458
Rockett v Evans [2008] QSC 227

FIRST APPLICANT: Mr Loomis

SECOND APPLICANT: L Limited

THIRD APPLICANT: C Pty Ltd

RESPONDENT: Ms Thurston

FILE NUMBER: BRC 1010 of 2012

DATE DELIVERED: 13 May 2014

PLACE DELIVERED: Brisbane

PLACE HEARD: Brisbane

JUDGMENT OF: Forrest J

HEARING DATE: 24 April 2014

REPRESENTATION

COUNSEL FOR THE FIRST APPLICANT: Mr Hanlon

SOLICITOR FOR THE FIRST APPLICANT: Rosen Lawyers

FOR THE SECOND APPLICANT
AND THIRD APPLICANT: Mr Loomis in person

SOLICITOR FOR THE RESPONDENT:

Mr Mitchell

Mitchell Lawyers

Orders

1. Pursuant to s 33B of the Family Law Act 1975 (Cth) the competing applications of Mr Loomis and Ms Thurston for parenting orders are transferred by the Family Court, of its own motion, to the Federal Circuit Court of Australia at the Brisbane Registry and the Federal Circuit Court is requested to list them for trial as soon as the matter can be conveniently accommodated in that Court.

2. Unless otherwise agreed in writing between the relevant parties, valuations of all of the shareholdings, in addition to any other interests of Mr Loomis and Ms Thurston such as loans to or from the companies, in the companies, L Limited (a company registered in the United Kingdom), C Pty Ltd and T Pty Ltd as at 30 June 2013, or such later date as might be determined by the selected single expert, are to be obtained from a single expert and filed attached to an affidavit of that single expert as soon as is practicably possible, such affidavit to be prepared and caused to be filed by solicitors acting on behalf of Mr Loomis or by Mr Loomis himself if he has no solicitors on the record as acting for him at the time.

3. The single expert accountant who shall provide the valuations shall be chosen by Ms Thurston within seven days of the date of these orders from the following list:

   (i)Mr A, B Accountants, … , Brisbane; or

   (ii)Mr D or Mr Mr H, E Accountants, … , Brisbane; or

   (iii)Ms F, G Accounting, …, Newcastle NSW … .

4. Ms Thurston shall immediately inform Mr Loomis in writing of the single expert chosen by her as soon as she has made the decision and the parties, including L Ltd and C Pty Ltd, shall each provide a letter of instruction to the selected single expert confirming that he or she has been appointed pursuant to this Court’s order to provide single expert valuation opinion in respect of all of the shareholdings and any other interests of Mr Loomis and Ms Thurston (such as loan accounts, loans or borrowings) in the said three companies.

5. Each of the parties shall provide the selected single expert with all and any documents or information requested of them in the process of the preparation of his or her valuation report as soon as is possible after such documents or information are requested by the single expert.

6. Mr Loomis shall provide to the selected single expert accountant as soon as it is able to be obtained, a copy of a valuation of the real property situated at I Street, Town J, County K in the United Kingdom, the property of L Limited, to assist the single expert accountant in the valuation of the shareholdings and Mr Loomis’s and Ms Thurston’s interests in L Limited, such valuation to be obtained in accordance with the balance of these orders.

7. A single expert valuation of the real property situated at I Street, Town J, County K in the United Kingdom shall be obtained as soon as is practicable from one of the following valuers chosen by Ms Thurston within seven days of the date hereof:

   (a)M Valuers, … ,  Town N, UK; or

   (b)O Valuers, … , Town N, UK; or

   (c)         P Valuers, … , County K, UK.

8. Ms Thurston shall immediately inform Mr Loomis in writing of the single expert real property valuer chosen by her as soon as she has made the decision and Ms Thurston, Mr Loomis and L Ltd, shall each provide a letter of instruction to the selected single expert confirming that he or she has been appointed pursuant to this Court’s order to provide a single expert report as to the current market value of the said I Street, Town J property.

9. Each of the parties shall provide the selected single expert real property valuer with all and any documents or information requested of them in the process of the preparation of his or her valuation report as soon as is possible after such documents or information are requested by that single expert and copies of the said single expert valuer’s report shall be provided to each of the parties by the said single expert valuer as soon as it is completed.

10. A single expert valuation report as to the value of the Jaguar … motor vehicle Reg … , the Jet Ski, the Rolex watch, the gold bracelet, the gold ring with diamond rings, and the gold necklace shall be obtained as soon as practicable from Q Valuers and filed attached to an affidavit of the said valuer caused to be prepared and filed by the solicitors for Ms Thurston or by Ms Thurston herself if there are no solicitors on the record as acting for her at the time.

11. Should any of the items referred to in paragraph (10) hereof have formerly been in the possession of Mr Loomis but are no longer able to be presented for valuation by Q Valuers in accordance with paragraph (10) hereof, Mr Loomis shall file and serve an affidavit in which he deposes to the explanation he gives as to why such items can no longer be presented for valuation.

12. The same single expert accountant chosen by Ms Thurston pursuant to paragraph (3) hereof, who is to value the three companies, shall also provide a single expert report as to the value of the R Superannuation Fund and Mr Loomis’s and Ms Thurston’s interests in the said self-managed superannuation fund as at 30 June 2013, or some later date as might be determined by the said single expert and the same single expert accountant shall undertake such audit or other such necessary activities so as to provide his or her expert opinion as to the factual issues that are in dispute between Mr Loomis and Ms Thurston in respect of monies alleged to have been withdrawn from the said superannuation fund and alleged to be owing by one or both of Mr Loomis and Ms Thurston to the R Superannuation Fund, as well as his or her professional opinion as to whether the R Superannuation Fund remains a fund compliant with all statutory and regulatory provisions relating to the operation of self-managed superannuation funds. 

13. Each of Mr Loomis and Ms Thurston shall provide a letter of instruction to the selected single expert accountant confirming that he or she has been appointed pursuant to this Court’s order to provide a single expert report as set out in paragraph (12) of these Orders.

14. Each of Mr Loomis and Ms Thurston shall provide the selected single expert with all and any documents or information requested of them in the process of the preparation of his or her report as soon as is possible after such documents or information are requested by the single expert and such documents shall include but not be limited to any and all audit reports previously prepared by the R Superannuation Fund’s SMSF auditor for any of the financial years ending from 30 June 2008 to 30 June 2013.

15. The said single expert accountant’s report on the R Superannuation Fund shall be filed in these proceedings attached to an affidavit of that single expert as soon as is practicably possible, such affidavit to be prepared and caused to be filed by solicitors acting on behalf of Mr Loomis or by Mr Loomis himself if he has no solicitors on the record as acting for him at the time.

16. All of the costs of obtaining single expert valuation reports as required by these Orders shall be paid in the first instance in equal shares by Mr Loomis and Ms Thurston with each of those parties having the right to make application to the Court at the trial or after the delivery of judgment following the trial for the costs of same to be apportioned in some other way as between them.

17. Ms Thurston’s half share of the costs of obtaining the single expert valuation reports required by these Orders in the first instance shall be paid from the money held on trust for her pursuant to the Orders of this Court of 24 April 2014 in the trust account of Mitchell Lawyers and the characterisation and treatment of such payments on her behalf in these property adjustment orders proceedings shall be a matter for the Judge who, in due course, presides over the trial of the competing applications of the parties.

18. The hearing of so much of the amended Application in a Case of Mr Loomis currently listed before Justice Hogan on 8 July 2014, not already dealt with by the Orders made on 24 April 2014 or by these Orders, is vacated and it is listed instead for hearing before his Honour Justice  Forrest at 10.00 am on 4 August 2014. 

19. Each of Mr Loomis and Ms Thurston shall file and serve an updated Statement of Financial Circumstances or an affidavit in which each deposes in detail to their current financial circumstances, including assets and liabilities, superannuation interests, and weekly income and expenditure on a gross and net basis, by no later than Thursday 31 July, 2014. 

20. The question of whether Ms Thurston pays the professional costs incurred in the preparation of affidavits by Mr S, Mr U and Ms V is reserved to the Judge who presides, in due course, over the trial of the competing property adjustment orders applications of the parties.

21. All other interim applications heard on 24 April 2014 not already dealt with by the Orders made on 24 April 2014 or by these Orders are dismissed.

22. All directions made by Registrar Stoneham on 4 March 2014, insofar as they are applicable to the preparation for trial of the competing property adjustment orders applications of all of the parties, including the two companies party to the proceedings, and in so far as they are not otherwise varied by any of these Orders made this day, remain extant and are to be complied with by the parties.

IT IS NOTED that publication of this judgment by this Court under the pseudonym Loomis and Ors & Thurston 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 BRISBANE

FILE NUMBER: BRC 1010 of 2012

Mr Loomis

First Applicant

And

L Limited

Second Applicant

And

C Pty Ltd

Third Applicant

And

Ms Thurston

Respondent

REASONS FOR JUDGMENT

1. On 24 April 2014, I heard competing applications for interim orders in property adjustment proceedings between former parties to a de facto relationship. Two companies related to the applicant, Mr Loomis, are also parties to the property proceedings, having been joined on the application of Ms Thurston. The former de facto couple are also involved at the same time in highly conflictual, parenting orders proceedings at the same time in respect of their four year old son. Child support is also a matter of serious dispute and part of the proceedings between them.

2. All of these proceedings were only recently transferred to this Court from the Federal Circuit Court where they have been progressing to trial since 2012 and where final trial dates have been set and vacated on a number of occasions. Ultimately, the Judge in whose docket the proceedings were listed was persuaded that the trial of all matters in dispute was going to take multiple days to hear. Counsel who appeared for the mother before the FCC Judge, arguing that the matter should be transferred to this Court, apparently informed that Court that the trial of the matters would likely take ten days, with his cross-examination of the father alone likely to take five days and his cross-examination of the family report writer likely to take one day. His Honour, being persuaded by that, transferred it to this Court.

3. Many sets of orders designed to ready the matter for final hearing have been made over the last few years by the Federal Circuit Court Judge. There are clearly many issues of complexity in the property adjustment proceedings and, in my preliminary assessment, those proceedings are still some way off from being ready for trial. As to the child support issue, an appeal against a decision of the Social Security Appeals Tribunal in respect of a child support assessment has already been listed for hearing by me on one day alone in a few months’ time. 

4. However, as to the parenting orders dispute, a family report and an updated family report were prepared by a very experienced family report writer to assist the Court. The first of those, prepared in May 2012, recommended that the parties’ little boy continue to live with the mother and spend time with the father. In the second of those, prepared in November 2013 as an update for the trial that was to take place early this year, the report writer expressed the opinion that although the child’s primary attachment lies in his relationship with his mother, the father is the more grounded of the parents and more able to distinguish the child’s needs from within the tangle of adult conflict. The report writer went on to express the opinion that the father offers greater security and predictability for the child’s growth and development than does the mother, but nevertheless recommended, if the residence of the child was to be with the father that the boy still should spend four consecutive nights per fortnight with the mother as well as half school holidays on a week-about basis until he reaches school age.

5. During the hearing on 24 April, I sought submissions from the parents as to the issue of separating parenting and property adjustment proceedings so that the parenting orders dispute could be heard as quickly as possible. I was told the father supported that idea. The solicitor who appeared for the mother informed the Court that the mother did not support that course. Rather, he pressed her application for a stay of all of the proceedings pending compliance by Mr Loomis with numerous orders already made dealing with disclosure and valuations in respect of financial matters. Further, he pressed her application for the determination of the validity of a document called a “cohabitation agreement”[1] to be set down and heard as a preliminary matter to the hearing and determination of the balance of the property adjustment and parenting orders dispute.

   [1]A document said to have been prepared for the parties and signed by them pursuant to Part 19 of the Property Law Act 1974 (Qld) to establish property rights between them in the event of separation that the respondent female partner argues is binding upon them.

6. Having read both of the family reports that have been prepared in the parenting orders dispute, I am not convinced that the parenting orders dispute in itself involves matters of complexity that necessitate it being heard by this Court or in conjunction with the property adjustment proceedings at all. If it is to stay in this Court to be heard with the property adjustment proceedings at a trial which would take ten days, it will not be heard before the very end of this year, perhaps not even before next year. Even separated from the property adjustment proceedings, as a two or three day trial, it will not be heard in this Court before the latter quarter of this year.

7. I am of the view that the parenting orders dispute by itself would take less than five days and would be a matter which a Federal Circuit Court Judge is well capable of hearing and determining. I am also of the view that it is apparently ready for trial and that its hearing and determination should not now be delayed whilst complex matters relating to the preparation of the property adjustment orders dispute for trial are finalised. Accordingly, I will transfer the parenting orders dispute between these parents back to the Federal Circuit Court for hearing whilst retaining the property adjustment orders proceedings in this Court. I have every expectation that the parenting orders dispute will be able to be dealt with far sooner in the FCC than it could in this Court, even if it were to be listed and heard as a separate trial here. Regrettable as it seems for part of a matter that was transferred to this Court by that Court to be transferred back to the FCC, I consider it is certainly in the best interests of the four year old boy for the parenting orders dispute to be heard and determined as quickly as possible, so that the family can have certainty, at least about that issue. That is what I will do.

8. Otherwise, actually listed for hearing by me on 24 April were competing applications by Ms Thurston, Mr Loomis and by the two companies. As I have already observed, Ms Thurston applied for orders that the proceedings be stayed until Mr Loomis complies with a large number of orders about disclosure that were made by the FCC Judge on 4 February 2013 and until certain valuations are obtained by Mr Loomis and the company, C Pty Ltd. Ms Thurston also applied for an order that the determination as to the validity and enforceability of the document called a “Cohabitation Agreement” executed by her and Mr Loomis dated 13 February 2007 be heard and determined as a separate and discrete issue prior to the hearing and determination of any other final issue in these proceedings. Ms Thurston also applied for an order that a caveat lodged by the company, C Pty Ltd, over her property at W Street, Suburb X in Queensland be removed.

9. The company, L Ltd, the Second Respondent in the proceedings, the company, C Pty Ltd, the Third Respondent in the proceedings and Mr Loomis applied for many orders. Those included:

   ·That the company, L Ltd, be released from the proceedings;

   ·That a previous order restraining Mr Loomis from causing or permitting L Ltd to deal with real property it owns in England to the possible prejudice of Ms Thurston’s interest in these proceedings be discharged;

   ·That a previous order restraining Mr Loomis, L Ltd or C Pty Ltd from “instituting, maintaining, executing or otherwise enforcing any claim, entitlement or cause of action against [Ms Thurston], the [R] Superannuation Fund or [R] Pty Ltd” be discharged;

   ·That, alternatively, Ms Thurston provide security for costs in the minimum sum of $203,640 to L Ltd in respect of these proceedings;

   ·That an injunction issue restraining Ms Thurston from drawing against or further encumbering the equity in her property at W Street, Suburb X;

   ·That the W Street, Suburb X property be sold and the proceeds retained in the trust account of Mr Loomis’s solicitors pending finalisation of these proceedings;

   ·That valuation reports be prepared in respect of the companies, L Ltd, C Pty Ltd, the R Super Fund, T Pty Ltd with the costs of same to be paid by Ms Thurston;

   ·That Ms Thurston’s application described in  paragraph 8 hereof be dismissed;

   ·That Ms Thurston provide security for costs in the minimum sum of $203,640 to C Pty Ltd in respect of these proceedings;

   ·That Mr Rosen, solicitor, be appointed as agent for the parties in negotiations with the Financial Ombudsman and ANZ and Westpac Bank in connection with certain loans described as “Lo-Doc” loans.

1. Mr Loomis also sought to argue further applications contained in an amended Application in a Case that had been filed on 16 April 2014 in which orders for the sale of three real properties, investment of the proceeds in his solicitor’s trust account and an interim litigation costs funding order are sought. Those applications had, however, actually been listed for hearing by Justice Hogan on 8 July 2014 and Ms Thurston and her solicitor came unprepared to argue those on the day of the hearing on 24 April.

2. Events had significantly overtaken those applications, with the three properties that Mr Loomis was seeking to have sold all already having been sold by Ms Thurston. I indicated to the parties that I would not hear those applications but, after having read the evidence and heard argument, would be prepared to entertain any oral application brought by Mr Loomis for interim injunctions preserving the proceeds of the sale of the properties at the same time as hearing and determining that part of Ms Thurston’s application for the removal of the caveat lodged over one of those properties that would otherwise prevent the scheduled settlement of the sale of that property.

The Orders made on 24 April 2014 and reasons for those

1. It was common ground at the hearing that the property at W Street, Suburb X in the State of Queensland had been sold by Ms Thurston. Her evidence was that the sale was scheduled to settle on 30 April 2014 but that it would not be able to settle with the caveat lodged by L Ltd still registered on the title to the property. The essence of her application for the caveat to be removed was so that sale could settle.

2. Ms Thurston’s evidence was that she expected to obtain about $450,000 in net sale proceeds from the sale of the Suburb X property and that she had already agreed with her mother, Ms Y, to contribute that amount to the purchase of another property that Ms Y had contracted in her own name to buy for $490,000 at Z Street, Suburb AB. Ms Thurston’s evidence was that Ms Y was buying that property “on behalf” of Ms Thurston because further borrowings were needed to buy the property and that Ms Thurston was unable to secure bank finance whereas Ms Y was able to. Ms Thurston’s evidence was that the property was being bought for her and the parties’ child to live in, and that if she could not use the $450,000 net sale proceeds of the Suburb X property towards its purchase then the contract would not be able to be settled and she and the parties’ child would have nowhere to live.

3. Through her solicitor, Ms Thurston proffered the following personal undertaking to the Court for consideration in determining the matter:

   To do all such things to ensure that any property purchased (to the extent of the amount of the sale proceeds received from the sale of [W Street, Suburb X]) in the name of Ms [Y] will be available and subject to any Order of the Court in these proceedings, including obtaining from Ms [Y] a written acknowledgment that the property being purchased is purchased on behalf of Ms [Thurston].

4. That day, 24 April 2014, upon that undertaking, I made the following orders:

   1.   That the third applicant, [C] Pty Ltd, shall take all steps necessary, including paying all necessary costs, for the removal of the caveat no. … lodged over the real property situated at Lot …, RP …, County of …, Parish of …, Title Reference No. …, and for such caveat to be removed forthwith upon the filing in this Court of an Undertaking to the Court by Ms [Y] in which she acknowledges that she is purchasing the property situated at [Z Street, Suburb AB] in the State of Queensland on behalf of Ms [Thurston] and in which she undertakes that she will not deal with the property in any way that prejudices Ms [Thurston’s] equity in the property equal to the amount of the sale proceeds received from the sale of [W Street, Suburb X], that she contributes towards the purchase of [Z Street, Suburb AB] in the State of Queensland.

   2.   That the net sale proceeds of the [Suburb X] property shall be held in the Trust Account of Mitchell Lawyers until they are required to be contributed to the settlement of the purchase of the property at [Z Street, Suburb AB] in the State of Queensland.

   3.   …

   4.   That the wife’s solicitor, Mr Mitchell, shall notify the husband’s solicitor, Mr Rosen, in writing immediately the sums of money ordered to be deposited into his Trust Account are secured in his Trust Account.

5. The company, C Pty Ltd, represented at the hearing before me by Mr Loomis himself, who is a director of the company, opposed the removal of the caveat, even after Ms Thurston proffered the said undertaking and even after I foreshadowed the orders that I was minded to make in terms of those that I did ultimately make.

6. A copy of the caveat lodged by C Pty Ltd on the title of the Suburb X property was in evidence. The interest claimed was “an equitable interest in the property on the basis of a constructive trust arising from contributions to the conservation and improvement”. The Grounds of Claim were described as “Direct payment of Construction Costs to [Business BB], [CC Pty Ltd], [Business DD] and [EE Pty Ltd]”.

7. The application for removal of the caveat is brought pursuant to s 127 of the Land Title Act 1994 (Qld) by the caveatee who is Ms Thurston. She clearly has a right to apply to the Supreme Court for an order that a caveat be removed.[2] This Court has the jurisdiction to hear and determine that application for the removal of the caveat with the Court exercising federal jurisdiction and picking up and applying Queensland State law by s 79 of the Judiciary Act 1903 (Cth).[3]

   [2]See s 127 of the Land Title Act 1994 (Qld) and the definition of caveatee contained in the Dictionary in schedule 2 of that Act.

   [3]See my discussion of this very issue in paragraphs [29] – [31] of Auricchio & Auricchio & Ors [2014] FamCA 240 and the references to Philip Morris Inc v Adam P Brown Male Fashions Pty Ltd (1981) 148 CLR 457; Fencott v Muller (1983) 1543 CLR 261; Stack v Coast Securities (No 9) Pty Ltd (1983) 154 CLR 261 and Re Wakim: Ex parte McNally (1999) 198 CLR 511; Australian Securities and Investments Commission v Edensor Nominees Pty Ltd (2001) 204 CLR 559contained therein.

8. Even though the determination of the application is being made as part of the exercise of federal jurisdiction, the onus is on the caveator to satisfy the Court that:

   (i)there is a serious question to be tried which involves showing “a sufficient likelihood of success to justify in the circumstances the preservation of the status quo”; and

   (ii)it is fairly arguable that the caveator has a caveatable interest in the land, and, if so [my emphasis]

   (iii)the balance of convenience favours the retention of the caveat on the title.”[4]

   [4]Re Jorss’ Caveat  [1982] Qd R 458; Ex part Goodlet & Smith Investments Pty Ltd [1983] 2 Qd R 792; Burman v AGC (Advances) [1994] 1 Qd R 123; Cousins Securities Pty Ltd v CEC Group Ltd [2007] 2 Qd R 520 and Rockett v Evans [2008] QSC 227.

9. The evidence that Mr Loomis pointed to on behalf of C Pty Ltd in attempting to fulfil its onus to satisfy the Court that there is a serious question to be tried was very limited. In paragraph 58 of his affidavit filed 5 April 2014 he swore simply:

   [C] Pty Ltd has an equitable interest in the property as it was directly paying the contractors for the construction work to [W] Street and advanced further monies to Ms [Thurston] and her company [T Pty Ltd] which appears to have been utilised to pay for the construction of the property.

10. The difficulty for Mr Loomis though is that in other evidence he deposes to the fact that monies advanced by him, the companies, L Ltd and C Pty Ltd, to pay for the cost of construction work at W Street were treated as loans to Ms Thurston that she currently still owes to the companies and for which the companies seek to take action to recover.

11. Without more evidence about these matters, the amounts actually advanced, the nature of the conversations and agreements pursuant to which the money was advanced to Ms Thurston or paid to contractors and more detail as to the difference between money loaned and money advanced in respect of which an equitable interest in the property is asserted, and without any pleading in proper form of the material facts upon which it is alleged an equitable interest actually came into existence, I was not satisfied that there was an arguable case that the caveator had a caveatable interest in the property and that there was a serious question to be tried.

12. Furthermore, as to the balance of convenience question, I was quickly satisfied that the balance of convenience considerations actually weighed in favour of ordering the removal of the caveat. There were two factors involved at this stage of the process.

13. First, there was an existing order of the FCC Judge made on 18 September 2013 in the following terms:

    11. That an injunction issue restraining [Mr Loomis], [L] Limited or [C] Pty Ltd from instituting, maintaining, executing or otherwise enforcing any claim, entitlement or cause of action against [Ms Thurston], the [R] Superannuation Fund or [R] Pty Ltd (ACN).

    The caveat was lodged on 19 February 2014, well after that order was made. I am of the view that by causing a caveat to be registered against the title to real property of Ms Thurston, C Pty Ltd was acting consistently with maintaining a claim or cause of action against Ms Thurston at a time when subject to Court ordered restraint from doing so. Application should have been made for the discharge of that order before a caveat was lodged if that order was not to be contravened. In my view, good reason to allow a caveat lodged in such circumstances to remain in place would need to clearly exist before that could be allowed to happen.

14. Second, it is Ms Thurston’s equity in the Suburb X property that Mr Loomis and the companies he represents seeks to protect. With the undertaking given by Ms Thurston and the orders that I made for the undertaking to be provided by Ms Y and the deposit of the funds into Mr Mitchell’s trust account until used to be contributed to the purchase price of the new property being bought “on behalf” of Ms Thurston, I was satisfied that equity was being protected for the time being and that Ms Thurston and the parties’ son would have somewhere to live pending finalisation of all of the proceedings.

15. For all those reasons, I ordered the removal of the caveat. I now note that Ms Y did file an Undertaking in the terms sought on 28 April 2014. I can only presume, at this point in time that Mr Loomis caused C Pty Ltd to remove the caveat and the settlement of the sale of the Suburb X property went ahead.

16. On 24 April, I also made the following Order:

    3. That all of the net proceeds of the sale of the blocks of land at [Properties 1 and 2, FF Street, Suburb GG], after payment of sale expenses and discharge of the respective mortgages, be paid by Ms [Thurston] forthwith into the Trust Account of Mitchell Lawyers to be held on trust for the wife pending written agreement between all of the parties or further Order of this Court.

17. There was agreement between the parties that the two blocks of real property described in the Order just set out were properties registered in the name of Ms Thurston and had been the subject of a number of orders of the FCC judge over the last year or so.

18. On 4 February 2013, the FCC Judge ordered, by consent, that those two blocks of land be sold with the sale proceeds to be applied in payment of the sale expenses, in payment out of the respective mortgages, in repayment of any funds payable to the R Super Fund, and the balance to be held in trust pending further agreement or order.

19. Further, on 18 September 2013, the FCC Judge ordered, by consent, that the block of land at Property 1, FF Street, Suburb GG be sold for no less than $550,000 and that any surplus from the sale of the land is to be held in the trust account of Mitchell Lawyers until further Order.

20. On 24 April 2014, at the hearing before me, through her solicitor, Ms Thurston informed the Court that both properties had been sold in late 2013. She has deposed in an affidavit filed 23 April 2014 that $255,296.75 in net sale proceeds had been realised on the sale. The Court was told that money was in a bank account of Ms Thurston waiting to be transferred to the SMSF. I did not understand the reason advanced for the money not being held in a trust account, particularly the trust account of Mitchell Lawyers as was required pursuant to the Orders I have just referred to. However, I was informed by both sets of lawyers representing Mr Loomis and Ms Thurston that there is serious dispute between them as to the factual question of whether money is owed to the R Super Fund. It may be that dispute explains why the money has been retained in Ms Thurston’s sole control since the sale of the properties but I am not prepared to say at this point that I accept that is a reasonable explanation for the fact that the money has not been deposited to the trust account of Mitchell Lawyers as otherwise required.

21. I indicated that I considered, in those circumstances, that all remaining net proceeds of sale of those two properties should be deposited to the trust account of Mitchell Lawyers and Mr Mitchell, the solicitor for Ms Thurston made no serious argument against that course. Whilst counsel for Mr Loomis submitted that Mr Loomis’s preference would be for it to be deposited to his solicitor’s trust account, I was not persuaded that there was a good reason for doing that as opposed to simply making yet another order that the money be deposited to the trust account of Mitchell Lawyers. These are the reasons why I made that order and also the order that Mr Mitchell advise Mr Loomis’s solicitor immediately the money was received into his trust account.

The Balance of the Applications heard

1. As to the balance of the applications listed on 24 April 2014, I heard submissions from Mr Mitchell, solicitor, for Ms Thurston, Mr Hanlon of counsel for Mr Loomis and Mr Loomis himself representing the two companies.

2. In essence, there were many allegations and counter-allegations made by each of the parties against the other with respect to failure to disclose relevant documents, failure to comply with orders about disclosure and failure to comply with orders about valuation. At the same time, Mr Loomis for the companies was seeking orders letting the company, L Ltd, out of the proceedings or, alternatively, requiring Ms Thurston to pay security for costs to the company so that it may be legally represented in the proceedings. The other company, C Pty Ltd, did not seek to be let out of the proceedings but did also seek security for costs.

3. I shall turn firstly to the companies’ applications.

4. L Ltd is a company, registered in the UK, of which Mr Loomis is a director. He says he is not a shareholder and that the shares are held through a trust structure set up through the British Virgin Islands.   The evidence is that the company has been in existence since before the relationship between Mr Loomis and Ms Thurston began and that it holds amongst its assets a single real property situated in Town J in the United Kingdom. In addition, it is asserted, to have substantial debts owed to it by Ms Thurston. It also has substantial liability secured by mortgage held over the UK real property for money borrowed from a bank and said to have been advanced to Ms Thurston during the parties’ relationship.

5. The FCC Judge was persuaded to join the company as a party to these proceedings sometime last year. As I understand the matter, that was in circumstances where Ms Thurston seeks final property adjustment orders that include the sale of the UK property that is owned by the company and she argues a case that the company is the puppet or alter ego of Mr Loomis and actually controlled completely by him as his creature. By this fact, she seems to assert, all of its net assets are really his net assets, regardless of the ostensible ownership and control of the company held out to the world through its share register and directorships. It is also common ground that she seeks orders that relieve her of any liability to the company for any debts owed to it by her.

6. Mr Loomis appeared for the company as its director. He questions this Court’s jurisdiction to make orders against the company but at the same time makes no submissions to the effect that it has no such jurisdiction. Whilst representing the company and deposing to factual matters about the ownership and control of the company, he made no effective submissions in support of an argument that the Court could not possibly find that the company is not his creature, puppet or alter ego and he made no submission that the Court has no jurisdiction to make orders binding the company.

7. In the circumstances, Mr Loomis was not able to persuade me, either through the affidavit evidence that he filed or by any of the submissions he made at the hearing, that there is good reason, at this point in time, to release the company from the proceedings. Similarly, he was not able to persuade me that this is a suitable case in which to order Ms Thurston to provide around $200,000 in security for the company’s legal costs. Even on his own evidence, the shareholdings and directorships of the company appear to have been changed at some point to “give the appearance” (my words) that he does not own the company and that it is owned through a trust structure so as to protect the company’s assets from the reach of his former wife (not Ms Thurston) in property adjustment proceedings arising on the breakdown of his marriage. The Court was also informed that at some point subsequent to those changes he still acknowledged that the company was “his”. 

8. Of course, I am unable to actually determine at this point in the proceedings the dispute about whether the company is Mr Loomis’s creature such that he is actually the controller and, ultimately, the owner of its assets or otherwise, although there is a strong suggestion that may be the case.  I am far from persuaded that the interests of the company are different and distinct from his interests in these proceedings, particularly whilst he represents the company as its director. I am not persuaded that the company, registered in the UK, having been joined in the proceedings and now being represented in the proceedings by its director, cannot be subject to this Court’s jurisdiction, particularly whilst orders can be directed at it through its director Mr Loomis. 

9. If Mr Loomis or the company have insufficient funds to pay for and secure ongoing legal representation, whilst that is unfortunate, it is not sufficient reason to order that Ms Thurston provide security for the company’s costs. I consider there are no circumstances that justify the making of an order for security for costs at this point in the proceedings. 

10. Similarly, Mr Loomis failed to persuade me that there are circumstances that exist that justify the other company, C Pty Ltd, being paid $200,000 as security for its costs in the proceedings. He asserts that Ms Thurston owes it large amounts of money. He asserts that it had an equitable interest in the Suburb X property that could potentially, if correct, be traceable through the proceeds of sale of that property into the new property being purchased on behalf of Ms Thurston at Suburb AB. Mr Loomis does not want that company to be let out of the proceedings and, as its director, is also representing it himself. I am again not convinced that the company’s interests are any different to the interests of Mr Loomis in the property adjustment proceedings and equally unconvinced that the burden of a security for costs order should now be imposed on Ms Thurston. I will not do so.

11. An order was also sought by Mr Loomis and L Ltd for the discharge of paragraph 10 of the FCC Judge’s Orders of 25 June 2012. That Order restrained Mr Loomis from causing or permitting L Limited from dealing with the English real property it owns save for the renegotiation of the mortgage secured over that property provided the capital debt secured is not increased. That order was actually made by consent when Mr Loomis was represented by counsel before the FCC. It is an injunction directed singularly at Mr Loomis, restraining him from causing or permitting the company from dealing with the English real property. There is no doubt about this Court’s jurisdiction to grant such an injunction directed at a party to a de facto relationship. Neither Mr Loomis’s counsel nor Mr Loomis representing L Limited convinced me by reference to any evidence before me that the said Order should be discharged because L Ltd now needs to be able to deal with the particular real property. At this point in time, I will not discharge that order.

1. Another order was sought by Mr Loomis and L Ltd for the discharge of paragraph 11 of the FCC Judge’s Orders of 18 September 2013. That is the Order set out in paragraph 24 of these reasons. Mr Loomis submitted that the companies should be allowed to take legal action against Ms Thurston even in the UK for the recovery of the substantial debts it is alleged she owes them. However, it is clear that questions surrounding the existence, enforcement and recoverability of these debts are matters that are within the same substratum of facts being considered in the property adjustment proceedings between Mr Loomis and Ms Thurston. Ms Thurston seeks final adjustment orders that discharge her from any liability to those companies. It is to be expected that Mr Loomis and the companies will seek orders against Mr Thurston in the property adjustment proceedings in this Court for repayment of the debts alleged to be owed to the companies. I am not persuaded that the injunction contained in paragraph 11 of the Orders of 18 September 2013 should be discharged at this point in time.

2. Mr Loomis also sought the following orders:

   Should the parties, or either of them, receive any proceeds from Westpac Banking Corporation and/or ANZ Banking Corporation arising from any claim relating to the various “Lo Doc” loans entered into by the parties, or either of them, such proceeds are to be deposited into the trust account of solicitors nominated to hold the proceeds of sale of the real estate properties and on the same interest bearing terms as identified …

   That Lance Warren Rosen of Rosen Lawyers be appointed as Agent for the parties in negotiations with the Financial Ombudsman and ANZ and Westpac Bank in connection with the Lo-Doc loans.

3. At the hearing on 24 April 2014, no submissions were advanced to me about these matters and I was referred to no evidence about it.  Accordingly, I will not make such orders at this point in the proceedings. Of course, this does not stop either of the parties again seeking such orders at a later date if it is still considered necessary.

4. An order was also sought by Mr Loomis and L Ltd in the following terms:

   That the Respondent mother indemnify [L] Ltd and [Mr Loomis] or any Director or Officer of [L] Ltd from any criminal and civil or financial action from the ATO, should the court report the respondent mother to the ATO for criminal prosecution in respect of filing falsified GST reports and Joint Venture agreements as ‘serious dishonest conduct’ for the purposes of section 126B of the Superannuation Industry (Supervision) Act 1993 (Cth) (SISA).

5. As I have not determined to report Ms Thurston to the ATO at this point in the proceedings I will make no such order at this time. That is not to say that none of the parties will be reported to the ATO at any time. Of course, if the Court determines at any time in these proceedings that referral of the papers and the transcripts of evidence to the ATO or any other Commonwealth or State authority is appropriate or necessary that might yet occur. Any applications by any of the parties in respect of such referral naturally must await such an event occurring.

6. An order was also sought by Mr Loomis and L Ltd in the following terms:

   That the respondent mother pay the professional costs of in (sic) the preparation of affidavits from [Mr S], [Mr U], and [Ms V].

7. Again, I heard no submissions going to this order sought. I consider it appropriate simply to reserve the question of costs in respect to the preparation of these affidavits to the trial judge before whom the issue can be agitated if Mr Loomis still considers that necessary.

8. An order was also sought by Mr Loomis and L Ltd in the following terms:

   That [G Accounting] are appointed to examine and report on the books of [L] Ltd, [C] Pty Ltd, the [R] Superfund, [T] Pty Ltd and any other entity deemed required by the court the respondent mother to pay the costs of said examination and report.

9. This application is, in my view, an application for a single expert to be appointed to provide valuations of the companies and the self-managed superannuation fund of the parties. I will deal with this at the same time as my consideration of Ms Thurston’s application for further disclosure and valuations.

10. Ms Thurston applied for orders as follows:

    That these proceedings be stayed until such time as:

    (a)The 1^st Respondent complies with Order 1 (a) – 1 (ll) of the Orders of the Federal Circuit Court of Australia made on 4 February 2013;

    (b)[Q Valuers] have provided to the Applicant and the 1^st Respondent a written valuation report in respect of a certain Jaguar … motor vehicle Reg … , a certain Jet Ski, a certain Rolex watch, a certain gold bracelet, a certain gold ring with diamond rings and a certain gold necklace mentioned and referred to in the Orders of the Federal Circuit Court of Australia made on 4 February 2013;

    (c)The 1^st Respondent and the 2^nd Respondent have done all such things and provided all such documents to [FF] Estate Agents to enable the said [FF] Estate Agents to conduct a valuation of the property situate at [I Street, Town J, County K], England;

    (d)[FF] Estate Agents have provided a valuation of the property situate at [I Street, Town J, County K], England;

    (e)The 1^st Respondent and 3^rd Respondent have do (sic) all such things and provide all such documents to [Mr GG] of [HH Valuers] to enable him to prepare a written valuation of the business, [C] Pty Ltd and the cost of same to be paid by the 1^st Respondent; and

    (f)[Mr GG] of [HH Valuers] has provided a written valuation of [C] Pty Ltd to the Applicant, 1^st Respondent and 3^rd Respondent.

11. Order 1(a) – 1 (ll) of the Orders of the Federal Circuit Court of Australia made 4 February 2013 set out an extensive list of matters about which Mr Loomis was required to provide disclosure and particulars. Ms Thurston baldly asserts that he has failed to do that as required. She does not particularise any disclosure he has actually not yet given or any particulars he was required to give that he has not yet provided. On the other hand, Mr Loomis’s evidence includes depositions that he has provided an enormous number of documents by way of compliance with that Order and by way of compliance with more recent directions of Registrar Stoneham in respect of disclosure. He attaches to his affidavits copies of emails that appear to support his assertions that he has provided such documents as well as copies of lists of documents provided by way of disclosure.

1. In her directions of 4 March 2014, Registrar Stoneham made the following orders:

   7. Each party by written request to the other no later than 18 March 2014:

   a) make disclosure pursuant to Rule 13.20(2) of the Family Law Rules 2004 as amended (the Rules); and

   b)file a written undertaking as to disclosure pursuant to Rule 13.15 of the Rules by 6 May 2014.

2. Mr Loomis exhibited copies of disclosure lists already provided pursuant to that direction to one of his affidavits. Those lists appear extensive.

3. I do not intend to make an order staying the proceedings until Mr Loomis “complies with” those 4 February Orders. The property adjustment proceedings can proceed towards trial with the parties doing all that has to be done to ready it for trial so that it may be listed as soon as it can be. Should either party remain unsatisfied with the extent of the disclosure the other party has given or require further particulars about any matter of relevance in the form of sworn answers to specific questions, the Rules provide the procedure by which those matters can be approached. Further procedural applications to this Court can be made if they are considered necessary and can be supported with more precise evidence that would better assist the Court.

4. As to the remaining issues of dispute about valuations, Registrar Stoneham also made directions directed at matters of valuation.  Agreement as to value of property or single expert valuers to value property the value of which remains in dispute, was to be effected by 31 March 2014. I heard little in the way of submissions about this on 24 April 2014, but from affidavit evidence I read and some of the submissions I heard I am satisfied that some matters remain in dispute and must be addressed by me.

5. Agreement as to the valuation of a number of companies appears to be impossible to reach. I will make orders that provide for this to occur and how it is to occur. I will make orders that provide for valuation of the parties SMSF and an audit of that fund so that the factual issues about funds withdrawn by the parties from that fund and, potentially still owed to that fund, are better illuminated. I will make orders for the valuation of the remaining chattels Ms Thurston seeks to have valued specifically and the swearing of an affidavit by Mr Loomis explaining if and why any of those items are not able to be valued.

6. My orders will also provide for the costs of the valuation reports to be paid for equally by Mr Loomis and Ms Thurston in the first instance with each having the right to apply for orders apportioning the costs of same differently at the end of the trial. No evidence or submission persuaded me that such an approach to the meeting of the costs of valuation reports is inappropriate. The orders will also provide for Ms Thurston’s equal share of the costs of obtaining those valuation reports to come out of the money held in Mitchell Lawyers trust account in the first instance and for the categorisation of such payments on Ms Thurston’s behalf to be a matter for the trial Judge.

7. I do not intend to stay the proceedings at all pending valuation matters being finalised. The matter can continue to be readied for trial in accordance with these Orders and the directions of Registrar Stoneham of 4 March, 2014.

8. I do not intend, at this point in time, to list the issue of the validity and enforceability of the document called a “cohabitation agreement” as a separate and discrete issue prior to the final hearing of the property adjustment orders dispute. A copy of that document was not even adduced in evidence but rather a copy was simply handed up from the bar table at one point during the hearing on 24 April 2014 and taken back, not having been tendered into evidence by any party. At this point, I consider it appropriate for issues surrounding that to be dealt with as part of the trial of the property adjustment orders proceedings in this matter.

9. As I am now familiar with the nature of this dispute and the issues that are being raised, I will order that the hearing of the remainder of the amended application in a case of Mr Loomis currently listed before Justice Hogan on 8 July 2014 be vacated and listed instead before me at 10.00 am in the duty list on 4 August 2014.  I consider it appropriate that I manage this matter on an interim basis, in conjunction with Registrar Stoneham, until it is ready for trial. At this point in time, whether or not I ultimately preside over the trial of the property adjustment proceedings is another matter.

10. I make the orders set out at the commencement of these reasons.

I certify that the preceding sixty-four (64) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Forrest delivered on 13 May 2014.

Associate: 

Date:  13 May 2014