Lynette Susan Montgomery v Jason Porter - [2021] NSWSC 1378

Supreme Court

New South Wales

Medium Neutral Citation: Lynette Susan Montgomery v Jason Porter [2021] NSWSC 1378
Hearing dates: 12 October 2021
Date of orders: 12 October 2021
Decision date: 27 October 2021
Jurisdiction: Equity - Expedition List
Before: Sackar J
Decision:
See [14] and [39]

Catchwords:
CIVIL PROCEDURE — Cross-vesting — Transfer to Federal Court — Special federal matter — Motion for an order under s 6(1) of the Jurisdiction of Courts (Cross-vesting) Act 1987 (NSW) to transfer Supreme Court and Federal Court proceedings back to the latter court — in circumstances where the proceedings engage the jurisdiction in bankruptcy within the meaning of s 27 of the Bankruptcy Act 1966 (Cth) and therefore special federal matters arise

Legislation Cited:
Bankruptcy Act 1966 (Cth) ss 27, 33, 129AA, 194, 306
Judiciary Act 1903 (Cth) s 39B(1A)(c)
Jurisdiction of Courts (Cross-vesting) Act 1987 (Cth) ss 3-4, 6
Property (Relationships) Act 1984 (NSW)

Cases Cited:
Docherty v Porter, in the matter of Docherty (Bankrupt) [2021] FCA 1227
Fencott v Muller (1983) 152 CLR 570
Goodwin v Phillips (1908) 7 CLR 1
Henry v Hancock [2016] NSWSC 71
James & Ors v James (No. 2) [2019] NSWSC 116
Jiu Niu Investments Pty Ltd v Wang [2019] NSWSC 1697
Montgomery v Porter [2019] NSWSC 1524
Palmer v Ayres [2017] HCA 5; 259 CLR 478
Sallway and Newman in their capacity as liquidators of MB Australia Pty Ltd (In Liquidation) v Citadel Group Properties Pty Ltd [2021] NSWSC 709
Truthful Endeavour Pty Ltd v Condon (Trustee), in the matter of Rayhill (Bankrupt) [2015] FCAFC 70; 233 FCR 174

Category: Procedural rulings
Parties: Lynette Montgomery (plaintiff)
Jason Porter and Anne Meagher (first defendant)
James Docherty (second defendant)
Representation:
Counsel:
J Baird (plaintiff)
A Spencer (first defendant)
M Castle (second defendant)
Solicitors:
Keypoint Legal (plaintiff)
O’Neill Partners – commercial Lawyers (first defendant)
Stephen Noss Lawyers (second defendant)

File Number(s): 2019/214287
Publication restriction: n/a

Judgment

These proceedings were listed before me for a five day hearing commencing 26 October 2021. A preliminary issue had arisen, however, as to whether the hearing dates in this Court should be maintained or whether the proceedings should be transferred to the Federal Court.
The proceedings were originally commenced in this Court on 10 July 2019 by way of summons. Ms Montgomery makes a claim in relation to two properties, at Llandilo and Kingswood, purchased in 1999 and 2000 respectively. Mr Docherty, the plaintiff’s de facto partner, was the sole registered proprietor of these properties. He was made bankrupt in 2011 and his interest in the properties was vested in equity in his trustees in bankruptcy, the first defendant to these proceedings. Ms Montgomery seeks relief in the form of the specific performance of a financial agreement document, or alternatively declaration of a constructive or resulting trust in her favour, or declaration of interest pursuant to the Property (Relationships) Act 1984 (NSW). A more detailed history of the matter can be found at [5] to [14] of Montgomery v Porter

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2021] NSWSC 1378
Decision Date: 27 October 2021

CaseChat Overview and Summary

Lynette Susan Montgomery, the plaintiff, filed a lawsuit against Jason Porter, the defendant, in the Supreme Court of New South Wales. The nature of the dispute involves cross-vesting jurisdiction and the transfer of proceedings between the Supreme Court and the Federal Court. The court was tasked with determining whether the Federal Court should exercise jurisdiction over the matter due to the special federal matters that arise from the proceedings. The Supreme Court was asked to decide whether the Federal Court had the appropriate jurisdiction under the Jurisdiction of Courts (Cross-vesting) Act 1987 (NSW) and the Bankruptcy Act 1966 (Cth).

The primary legal issues before the court were whether the Federal Court had jurisdiction to hear the case and if the special federal matters under the Bankruptcy Act warranted the transfer of proceedings from the Supreme Court to the Federal Court. The court had to consider the definitions and scope of the relevant sections of the Cross-vesting Act and the Bankruptcy Act, as well as the implications of these provisions on the current proceedings. The court also needed to assess whether the matters in dispute were indeed special federal matters and if they warranted the transfer of the case to the Federal Court.

The court held that the Federal Court had the jurisdiction to hear the proceedings because the matters in dispute related to bankruptcy, which constituted special federal matters. The court found that the provisions of the Cross-vesting Act and the Bankruptcy Act allowed for the transfer of the case to the Federal Court. Consequently, the court granted the plaintiff's motion for an order under section 6(1) of the Cross-vesting Act to transfer the proceedings back to the Federal Court.

As a result of the court's decision, the proceedings were transferred from the Supreme Court of New South Wales to the Federal Court of Australia. The court's order directed that the case be re-filed in the Federal Court, ensuring that the appropriate jurisdiction was exercised in light of the special federal matters involved.

Orders