Magnus & Sandri (No 3)

Case [2024] FedCFamC1F 449


FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA

(DIVISION 1)

Magnus & Sandri (No 3) [2024] FedCFamC1F 449

File number: SYC 3830 of 2019
Judgment of: HARPER J
Date of judgment: 23 July 2024
Catchwords:

FAMILY LAW – PRACTICE AND PROCEDURE – Application to re-open following the conclusion of the final hearing – Where final judgment listed for delivery – Where husband filed application to re-open the day before the listing – Where husband sought to make changes to the balance sheet, including the inclusion of further tax liabilities – Where significant tax liabilities already included on balance sheet – Where additional tax liabilities sought to be included ought to have been reasonably anticipated at the final hearing – Where husband contended that he had experienced a change in circumstance that materially impacted his earning capacity – Where evidence of the circumstances impacting the husband’s earning capacity was before the Court at final hearing – Insufficient evidence to demonstrate a material change occurred – Where wife would suffer prejudice if the leave to re-open granted – Where husband sought to amend his proposed final orders and seek a superannuation splitting order – Where neither party sought a superannuation split at the final hearing – Where orders seeking superannuation split were open to the parties to advance at final hearing – Where application to re-open is antithetical to the overarching purpose and the interests of justice – Application dismissed – Costs ordered in favour of the wife.

FAMILY LAW – INTERIM PROPERTY – Where husband seeks to discharge interlocutory orders made on the last day of trial – Where husband contended he was unable to satisfy his ongoing financial obligations required by interim orders – Where interim orders would be discharged upon delivery of final judgment – Where husband has not demonstrated a material change in circumstances – Application dismissed.  

Legislation:

Family Law Act 1975 (Cth) Pt VIII, s 79(4)(e) and s 117

Federal Circuit and Family Court of Australia Act 2021 (Cth) s 67 and s 68

Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) r 5.01

Cases cited:

 Australian Securities and Investments Commission v Rich (2006) 235 ALR 587; [2006] NSWSC 826

Brimaud v Honeysett Instant Print (1988) 217 ALR 44

EB v CT (No.2) [2008] QSC 306

Gelley and Gelley (No 1) (1992) FLC 92-290; [1992] FamCA 92

Joubert & Verhoeven [2020] FamCA 53

Liu v The Age Company Limited (2016) 92 NSWLR 679

Magnus & Sandri (No 2) [2024] FedCFamC1F 236

McDermott & McDermott [2016] FamCA 613

Paris King Investments Pty Ltd v Rayhill [2006] NSWSC 578

Reid v Brett [2005] VSC 18

Smith v New South Wales Bar Association (1992) 176 CLR 256; [1992] HCA 36

Summitt & Summitt [2009] FamCA 365

Urban Transport Authority of NSW v Nweiser (1982) 28 NSWLR 471

Division: Division 1 First Instance
Number of paragraphs: 59
Date of hearing: 23 July 2024
Place: Sydney
Counsel for the Applicant: Mr Auld
Solicitor for the Applicant: Abbott…

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AGLC
Magnus & Sandri (No 3) [2024] FedCFamC1F 449
Case
[2024] FedCFamC1F 449
Decision Date

CaseChat Overview and Summary

In the case of Magnus & Sandri (No 3), the husband, Mr Sandri, sought leave to reopen the final hearing of the property proceedings between him and his wife, Ms Magnus, following the conclusion of the final hearing. The application was made the day before the final judgment was listed for delivery. The husband sought to make changes to the balance sheet, including the inclusion of further tax liabilities, and sought amendments to the proposed final orders. The wife opposed the application on the grounds that the husband’s evidence did not demonstrate a material change in circumstances, and that she would suffer prejudice if the application was granted.

The court had to decide whether the application to reopen the final hearing should be granted, and whether the husband’s application to discharge interlocutory orders should be successful. The husband argued that he had experienced a change in circumstance that materially impacted his earning capacity and that he was unable to satisfy his ongoing financial obligations required by the interim orders. The court found that the husband had not demonstrated a material change in circumstances, and that the additional tax liabilities sought to be included ought to have been reasonably anticipated at the final hearing. The court also found that the evidence of the circumstances impacting the husband’s earning capacity was before the Court at the final hearing.

The court held that the husband’s application to reopen the final hearing was antithetical to the overarching purpose and the interests of justice. The court found that the husband had not provided a sufficient explanation for not calling the evidence-in-chief at the final hearing, and that the wife would suffer prejudice if the application was granted. The court also found that the husband had not demonstrated a material change in circumstances, and that the orders seeking a superannuation split were open to the parties to advance at the final hearing. The court dismissed the husband’s application to reopen the final hearing and to discharge the interlocutory orders.

The court ordered that the husband pay the wife’s costs of the application in a proceeding filed on 3 July 2024, as agreed or assessed in accordance with the Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth).

Orders

Orders of the court

SYC 3830 of 2019

FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)

BETWEEN:

MR SANDRI

Applicant

AND:

MS MAGNUS

Respondent

ORDER MADE BY:

HARPER J

DATE OF ORDER:

23 JULY 2024

THE COURT ORDERS THAT:

1. The Respondent Husband’s (“the husband’s”) Application in a Proceeding filed on 3 July 2024 is dismissed.

2. The husband pay the Respondent Wife’s costs of the Application in a Proceeding filed on 3 July 2024, as agreed or assessed in accordance with the Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth).

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 10.14(b) Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 10.13 Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth).

Part XIVB of the Family Law Act 1975 (Cth) makes it an offence, except in very limited circumstances, to publish an account of proceedings that identify persons, associated persons, or witnesses involved in family law proceedings.

Background

Background to the litigation

These are property proceedings between the applicant wife, Ms Magnus (“wife”) and the respondent husband, Mr Sandri (“husband”) under Pt VIII of the Family Law Act 1975 (Cth) (“the Act”).BACKGROUND It is unnecessary to set much background out for the purposes of this judgment. However, the following is relevant. The wife was born in Australia in 1969 and is 54 years of age. The husband was born in 1967 and is 57 years of age. The husband works as a health professional and the wife works as a health professional three days a week. In 2011, F Street, Suburb C was purchased in the wife’s sole name. It became the matrimonial home. It was used a security for loans taken out by the husband. In 2013, G Investment Company was established in the United States of America, with the wife as the “Member” and the husband as the “Manager”. It was used as a vehicle to purchase and manage the several apartments in a holiday resort. The parties commenced cohabitation in 1995 or 1996 and were married in late 1997. It was an agreed position that the husband moved out of the former matrimonial home in January 2019. The parties divorced in mid-2020. The wife commenced parenting and property proceedings in the Family Court of Australia (as it then was) on 14 June 2019. In orders made on 1 December 2021, notations were included that the parties agreed that the property pool would be divided 53.5 per cent in favour of the wife and 46.5 per cent in favour of the husband, and that the wife would retain Suburb C and the shares in G Investment Company. At trial neither of the parties sought to resile from these broad agreed positions, except to the extent that the husband accepted that 53.5 per cent was a “floor”, and a greater percentage in the wife’s favour was open to the Court after consideration of s 75(2) factors. The asset pool is substantial, being no less than $22 million. Suburb C itself has a value of between $13.5 million and $14.5 million. At the final hearing there were arguments about adding back substantial notional property and some substantial tax liabilities of the husband were included by agreement on the balance sheet. The proceedings have been the subject of a final hearing which completed over three days on 4 April 2024. A previous allocation of five hearing days to commence on 6 November 2023 was vacated because the final hearing had not been adequately prepared and was not ready to proceed. Final judgment was listed for delivery on 3 July 2024. The day before the husband filed material in support of an Application in a Proceeding seeking leave to reopen the evidence. His application also sought a variation to interlocutory orders made by me on 4 April 2024. Those orders were made after delivery of Ex Tempore Reasons delivered on that date, published as Magnus & Sandri (No 2) [2024] FedCFamC1F 236 (“Magnus & Sandri (No 2)”). It is unnecessary to repeat those reasons for the purposes of this judgment. In summary the husband also seeks orders permitting him to use funds in E Bank Account …00 to pay taxation liabilities, some outstanding marketing costs relating to the sale of “[B Street]”, Sydney, and school fees for the balance of 2024 for the parties’ youngest child, who is in Year 12. He also seeks variation of a spouse maintenance liability from $4,500 to $2,416 per week, leave to satisfy his obligation for ongoing mortgage payments from account …00 and a payment to himself of $245,000 from that account.MATERIAL RELIED UPON

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

The High Court in Smith v New South Wales Bar Association observed at 265–266 that:It has long been the common law that a court may review, correct or alter its judgment at any time until its order has been perfected … The power is discretionary and, although it exists up until the entry of judgment, it is one that is exercised having regard to the public interest in maintaining the finality of litigation. Thus, if reasons for judgment have been given, the power is only exercised if there is some matter calling for review. And there may be more or less reluctance to exercise the power depending on whether there is an avenue of appeal. It is important that it be understood that these considerations may tend against the reopening of a case, but they are not matters which bear on the nature of the review to be undertaken once the case is re-opened ……It is again necessary to distinguish between the considerations which may bear on a decision to re-open and the processes involved in reconsideration once a case has been re-opened. If an application is made to re-open on the basis that new or additional evidence is available, it will be relevant, at that stage, to inquire why the evidence was not called at the hearing. If there was a deliberate decision not to call it, ordinarily that will tell decisively against the application. But assuming that that hurdle is passed, different considerations may apply depending on whether the case is simply one in which the hearing is complete, or one in which reasons for judgment have been delivered. It is difficult to see why, in the former situation, the primary consideration should not be that of embarrassment or prejudice to the other side. In the latter situation the appeal rules relating to fresh evidence may provide a useful guide as to the manner in which the discretion to re-open should be exercised …(Footnotes omitted) (emphasis added) In Reid v Brett [2005] VSC 18, Habersberger J said:41.The criteria governing the exercise of the discretionary power to re-open a case to admit further evidence where the hearing has concluded but judgment has not been delivered have been said to be as follows: (a) the further evidence is so material that the interests of justice require its admission;(b) the further evidence, if accepted, would most probably affect the result of the case;(c) the further evidence could not by reasonable diligence have been discovered earlier; and (d) no prejudice would ensue to the other party by reason of the late admission of the further evidence. …(Footnote omitted) In Australian Securities and Investments Commission v Rich (2006) 235 ALR 587 at [18], Austin J outlined the matters to be considered by the court when considering an application to reopen including: a)The nature of the proceeding;b)Whether the occasion for calling the further evidence ought reasonably to have been foreseen;c)Considerations of fairness in respect of the defendant’s notice of the case they have to meet;d)The importance of the issues as to which the further evidence is sought to be adduced to the issues in the case;e)The degree of relevance and probative value of the further evidence;f)The prejudice to the defendant in terms of delay and the completion of the proceedings and consequential costs;g)The public interest in the timely conclusion of the litigation; andh)The explanation offered by the applicant for not having called the evidence-in-chief.