Mahota & Jakhar
[2023] FedCFamC1F 1133
•22 December 2023
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 1)
Mahota & Jakhar [2023] FedCFamC1F 1133
File number(s): SYC 6370 of 2016 Judgment of: CURRAN J Date of judgment: 22 December 2023 Catchwords: FAMILY LAW – PROPERTY – Application in a Proceeding – Where husband seeks orders for disclosure as to the transaction for sale of a property – Where the husband seeks orders to restrain the second respondent from dealing with property – Where the only asset of the parties has been sold – Where the husband seeks orders for the sale proceeds in a controlled monies account – Where no particulars as to the application of the sale proceeds – Where no appearance for the first or second respondent – Where the application was served by substituted service – Orders restraining the second respondent from dealing with property – Orders for sale proceeds to be placed in a controlled monies account.
FAMILY LAW – PRACTICE AND PROCEDURE – Joinder – Where husband seeks the joinder of the wife’s father – Whether the wife’s father was previously joined to the proceedings – Where proposed party has played active role in proceedings to date – Orders made joining wife’s father as second respondent
Legislation: Family Law Act 1975 (Cth) ss 79, 106B, 120NA
Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) pt 3.2, rr 3.01, 3.03, 3.05, 6.06
Cases cited: Black and Kellner (1992) FLC 92-287; [1992] FamCA 2
Darcy & Darcy [2023] FedCFamC1F 923
Weir and Weir (1993) FLC 92-338; [1992] FamCA 69
Division: Division 1 First Instance Number of paragraphs: 80 Date of hearing: 22 December 2023 Place: Sydney Counsel for the Applicant: Ms Bromberger Solicitor for the Applicant: A Plus Legal Solicitor for the First Respondent: Solve Legal (later withdrew) The First Respondent: No Appearance The Second Respondent: No Appearance ORDERS
SYC 6370 of 2016 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)
BETWEEN: MR MAHOTA
Applicant
AND: MS JAKHAR
First Respondent
MR JAKHAR
Second Respondent
ORDER MADE BY:
CURRAN J
DATE OF ORDER:
22 DECEMBER 2023
THE COURT ORDERS THAT:
Application to Join
1.Pursuant to r 3.03(4) of the Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth), the applicant husband is granted leave to seek to join Mr Jakhar (the putative second respondent) to the proceedings.
2.Mr Jakhar is joined to the proceedings.
3.In the event the second respondent wishes to make any application in respect of the joinder order today made that he shall file and serve any application and affidavit in support by close on business 15 January 2024.
Full and Frank Disclosure
4.Pursuant to rule 6.06 Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) and within 21 days from the date of these Orders, the First and Second Respondent are to provide the Applicant with full and frank financial disclosure of the transaction for sale of the property known as B Street, Suburb C, being the whole of the Lot … in Deposited Plan … (B Street Property), including the details of the purchasers of that property.
5.Pursuant to rule 6.06 Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) and within 21 days from the date of these Orders, the Applicant and First and Second Respondent are to provide the other parties with full and frank financial disclosure of all relevant information and records relevant to the parties financial circumstances including those matters set out at 6.06(3) for the determination of this matter.
Restraints
6.Until further order the Second Respondent his servants/agents are restrained from transferring, assigning, encumbering, alienating or adversely dealing with the property known as D Street, Suburb C NSW being the whole of Lot … in Deposited Plan ….
7.That until further order the Applicant and the First and Second Respondent and/or their servants and/or agents are restrained from transferring, assigning, encumbering, alienating or adversely dealing with any property in the name of the applicant or the name of the Applicant or the First and or Second Respondent including any property held overseas.
8.That the proceeds of sale obtained by the First and Second Respondents relating to the transfer of the B Street Property be deposited into to the controlled monies account held by the Applicant’s solicitor Controlled Money Account held with Commonwealth Bank account having BSB: … Account: …43 within 7 days.
Costs
9.Costs of and incidental to the Applications in a Proceeding filed on 19 September 2023 and 15 December 2023 are reserved to the final hearing.
Family Violence Cross-Examination
10.The requirements of s 102NA(2) of the Family Law Act 1975 (Cth) will apply to any cross-examination occurring in the proceedings on or after 11 September 2019 by an unrepresented person.
11.Within seven days of the date of these orders, the unrepresented party(s) shall complete the “Scheme Application Form” and provide the completed form to Legal Aid NSW for the allocation of a legal practitioner.
12.In the event that they fail to avail themselves of this order, and at the hearing they are unrepresented, they will not be permitted to cross examine the other party.
THE COURT NOTES THAT THE PARTIES HAVE EACH BEEN ADVISED IN THE FOLLOWING TERMS:
A.There are allegations of family violence in the proceedings;
B.The requirements of s 102NA(2) of the Family Law Act 1975 will apply to any cross‑examination occurring in these proceedings by an unrepresented person;
C.That pursuant to these Orders, neither party may personally cross-examine the other party;
D.That pursuant to these Orders, any cross-examination of either party may only be conducted by a legal practitioner acting on behalf of the other party;
E.The unrepresented party(s) has been advised as to the availability of the Commonwealth Family Violence and Cross-Examination of Parties Scheme and the means by which they may apply to that scheme for the provision of a lawyer; and
F.That a copy of these Orders will be provided by the Court to Legal Aid NSW, which administers the said scheme.
THE COURT FURTHER NOTES THAT
G.Order 3 is made noting no appearance by the second respondent and noting the information emailed via Ms H on 11pm 20 December 2023 to my associate of the alleged ill health of the second respondent supported by a medical certificate prepared by a GP and noting Mr Jakhar has previously been represented in these proceedings and has participated in the proceedings as if he was a party and noting that the court has been told he and the other parties consented to an order that he be joined.
H.The parties are reminded of the filing directions made in respect of the final hearing of the matter and reminded that compliance with those directions is not optional and in the event of non-compliance the matter may proceed on the basis of evidence filed in compliance with the orders.
I.An undertaking as to damages has been provided by the applicant husband, which will continue to have effect until the first day of trial.
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).
Section 121 of the Family Law Act 1975 (Cth) makes it an offence, except in very limited circumstances, to publish proceedings that identify persons, associated persons, or witnesses involved in family law proceedings.
IT IS NOTED that publication of this judgment by this Court under a pseudonym has been approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
EX TEMPORE
REASONS FOR JUDGMENTCURRAN J:
These reasons for judgment were delivered orally in court and have been corrected from the transcript.
INTRODUCTION
These proceedings are competing applications for property settlement between the applicant husband, the first respondent wife, and the purported second respondent, being the wife’s father.
The matter is listed for final hearing as to the substantive property applications for three days commencing on 28 February 2024.
THE COMPETING APPLICATIONS
The husband filed two Applications in a Proceeding. This first was filed on 19 September 2023 (“the first application”) and the second was filed on 15 December 2023 (“the second application”).
Mr E, who had been appearing pursuant to a grant of legal aid for the first respondent appeared but sought leave to withdraw, citing an inability to obtain instructions. That leave was granted. There was no appearance by the first respondent or Mr Jakhar at the commencement of the hearing and the parties were called a short time ago, and again there is no appearance.
Counsel for the husband was not instructed that the first application was listed today and indicated that it would be withdrawn, however, during submissions it became apparent that the orders sought in both applications were pressed. Ultimately counsel moved on both applications. I have permitted her to do so. Both applications had been served on the first respondent and Mr Jakhar pursuant to earlier orders made by me.
The first application seeks orders for full and frank disclosure by the first and second respondents as to the transaction of sale of the property at B Street, Suburb C NSW Lot … (“the B Street property”); that pending further order, the second respondent be restrained from transferring, assigning, encumbering, alienating or adversely dealing with the property at D Street, Suburb C NSW Lot … (“the D Street property”); that pending further order, the first and second respondents be restrained from transferring, assigning, encumbering, alienating or adversely dealing with any property in their name, including property held overseas; that the proceeds of sale obtained by the first and second respondents in relation to the B Street property be deposited into the controlled monies account of the applicant’s solicitor; and that the first respondent comply with a costs order made in favour of the applicant in November 2022 made by Brasch J.
The first respondent sought orders, as set out in the Response to Application in a Proceeding filed 5 December 2023, that the husband’s application be dismissed, or alternatively, that the application be stood over to the first day of the final hearing.
The second application filed sought orders, amongst other things, that the orders made by a Judicial Registrar dated 21 August 2023 be set aside; that within 24 hours the second respondent deposit the amount of $150,000 into a Controlled Money Account; and for indemnity costs to be paid by the first respondent.
In relation to the second application, the first respondent did not file a response, nor did Mr Jakhar.
There was no appearance on behalf of either respondents when the matter was listed. I had my associate call the matter outside court prior to determination of the matter. There was again no appearance.
RELEVANT PROCEDURAL HISTORY
These proceedings have a long, drawn-out history since the husband commenced proceedings on 3 October 2016 by way of filing an Initiating Application in the then Federal Circuit Court. I do not seek to reiterate the entire history of the matter but will cavass some relevant procedural developments.
On 12 May 2020, a Registrar made orders with a notation, noting what was not contentious:
As [Mr Jakhar’s] interest in the property as a joint tenant with his daughter is likely to be effected, he needs to be joined as a party to the proceedings under Rule 11.01(1) of the Federal Circuit Court Rules 2001.
On 3 July 2020, Judge Smith, as he then was, made orders for wife’s father to file and serve any Application in a Case to be joined to the proceedings. His Honour made a notation that “It is agreed that the proposed intervener be joined to the proceedings and leave is granted to file terms in Chambers once the appropriate documents have been filed.”
It appears from the file no terms were filed, and no order was made to join Mr Jakhar although all parties continued the proceedings on the basis that the order had been made.
On 25 August 2020, Mr Jakhar filed an application, seeking that he be solely entitled to his 50 per cent interest in the B Street property. Although his application did not seek leave to be joined to the proceedings as the second respondent, his affidavit filed in support stated at paragraph 2 that he sought leave to be joined as a second respondent to the proceedings. The husband’s evidence is that the application to be joined was not opposed and he subsequently became noted as the second respondent in the proceedings.
On 12 November 2020, a Ms F appeared for the first and second respondents, and Mr Jakhar was noted as the second respondent.
On a review of the orders, it appears that no order was formally made joining Mr Jakhar to the proceedings, although I have not had the benefit of listening to the transcript of the proceedings.
On 17 January 2022, Mr Jakhar filed an Application in a Proceeding for the matter to be expedited.
On 2 March 2022, all extant applications were dismissed by a Senior Judicial Registrar. This order dismissed the Application filed 17 January 2022, and the Senior Judicial Registrar then transferred the matter to Division 1 of the Federal Circuit and Family Court of Australia. At this time Mr Jakhar was represented.
The final hearing before Brasch J commenced on 29 November 2022, where Mr Jakhar appeared in person and was again noted as the second respondent. On 30 November 2022, the final hearing was vacated, and her Honour made orders for the wife to pay the husband’s costs in the sum of $29,790, with the payment of those costs deferred until final resolution of the matter.
Her Honour also ordered the filing of a Notice of Address for Service.
For all intents and purposes all parties behaved on the mistaken belief that Mr Jakhar had been joined and was a party to the proceedings.
On 4 April 2023, orders were made listing the matter for trial commencing on 28 February 2024. On this occasion, there was no appearance by or on behalf of the first respondent or Mr Jakhar. Directions were made for the filing of material in preparation for trial.
Mr Jakhar filed a Notice of Discontinuance on 18 August 2023, seeking to discontinue the Application in a Case filed 25 August 2020 (the application to be joined) and seeking to discontinue the Application in a Proceeding filed on 17 January 2023. There was no Application in a Proceeding filed on 17 January 2023 but there was one filed 17 January 2022. I infer the application has a typographical error and it intended to refer to the Application in a Proceeding filed on 17 January 2022 (seeking expedition).
As referred to above, both of the Applications in a Proceeding had already been dismissed by the Senior Judicial Registrar on 2 March 2022, and accordingly the orders then sought by Mr Jakhar are otiose where the applications had already been dismissed.
On 21 August 2023, the Judicial Registrar made orders in Chambers discontinuing the second respondent’s Application in a Case filed 25 August 2020, and as I say, there was no need to make any order as the application had already been dismissed.
On 19 September 2023, the Judicial Registrar made a Chambers order about subpoenas, and then on 20 September 2023, appears to have varied the named parties listed on the coversheet purportedly pursuant to the slip rule at r 10.13 of the Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) (“the Rules”).
These circumstances leading to the striking out of the name of the second respondent are not clear and may be explained by the fact that it appears no order was made joining him in the first place, despite all parties and the court proceeding on the basis that he had been joined. Noting that it had occurred, the amendment to the named party was made by the Judicial Registrar on the coversheet only, cannot be, and was not a determination that he is not a “necessary party” under the Rules. There had been no application made pursuant to r 3.05 of the Rules for a party to be removed, and in any event, on one view no order had been made for Mr Jakhar to be joined at that time.
On 19 September 2023 the husband filed the first application, being dealt with today, which came before McClelland DCJ on 20 September 2023.
McClelland DCJ relevantly noted:
B. The Respondent wife’s father who is the Second Respondent in these proceedings has discontinued his application, however the court has been advised that the Applicant husband seeks to have the Second Respondent remain a party to the proceedings in circumstances where orders are now being sought pursuant to section 106B of the Family Law Act 1975 (Cth) to set aside the sale of the [Suburb C] property.
On 6 December 2023, the matter was listed before me for compliance in preparation for trial that is listed in February 2024. At that time, I became aware of the urgent application filed on 19 September 2023. Accordingly, I listed the Application in a Proceeding filed by the husband for interim hearing today. Mr E appeared under a s 102NA of the Family Law Act 1975 (Cth ) (“the Act”) grant. Mr Jakhar was not in attendance. On that date I asked Mr G, who had previously acted for Mr Jakhar, to attend court via AVL at the mention, as he had previously represented Mr Jakhar. He did as a courtesy to the court but was not instructed. Orders were made for the Application to be served on Mr Jakhar, and for the filing of an affidavit of service by the husband in respect of that service.
On 6 December 2023, the legal representative for the husband filed an affidavit of service, stating that the relevant material had been served on Mr G electronically.
On 15 December 2023, the husband filed a second urgent Application in a Proceeding. On 18 December 2023, orders were issued from my Chambers listing the Application also today for interim hearing, with orders made for substituted service, and an order for the filing of an affidavit of service evidencing the substituted service.
On 19 December 2023, the legal representative for the husband filed two affidavits of service, stating that the relevant material had been served electronically on the email address previously used by the wife, and Mr G, for Mr Jakhar.
My Chambers received an email from a Ms H at 11.09pm on 20 December 2023, stating that she was assisting Mr Jakhar “as a friend only”, seeking that the interim hearing listed for today be vacated as he is in hospital, attaching a medical certificate including one dated 19 December 2023. The husband’s legal representative advised in response that their client opposed the hearing date being vacated.
I am satisfied that both applications listed today have been brought to the attention of the first respondent and Mr Jakhar, both due to the orders I made for substituted service and also because of contents of email from Ms H, which became Exhibit 1.
JOINDER
Schonell J in Darcy & Darcy [2023] FedCFamC1F 923 identified the applicable law in respect of joinder of parties from [20] – [26]. I respectfully repeat and adopt his Honour’s summary:
20. Section 79(10)(b) of the Family Law Act 1975 (Cth) (“the Act”) provides that any other person whose interests would be affected by the making of an order is entitled to be joined to the proceedings.
21.The Act reflects what McHugh J observed in Victoria v Sutton (1998) 195 CLR 291 that:
77.The rules of natural justice require that, before a court makes an order that may affect the rights or interests of a person, that person should be given an opportunity to contest the making of that order. Because that is so, it is the invariable practice of the courts to require such a person to be joined as a party if there is an arguable possibility that he or she may be affected by the making of the order. …
(Footnote omitted)
22.Rule 3.01 of the Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) (“the Rules”) provides:
3.01 Necessary parties
A person whose rights may be directly affected by an issue in a proceeding, and whose participation as a party is necessary for the court to determine all issues in dispute in the proceeding, must be included as a party to the proceeding.
23.While r 3.03(4) provides that a party who seeks to join someone to the proceedings after the first Court date must seek leave to do so.
24.In Wayne v Dillon (2008) 40 Fam LR 543 (“Wayne v Dillion”), Warnick J observed in respect of the old Family Law Rules 2004 (Cth) that “necessary” meant:
18. … something more than “useful” or “expeditious”. In my view, if there are available alternative means to joinder to the substantive proceedings, of obtaining from a third person or someone already a party what is needed to allow an applicant for joinder to establish an identified “case”, joinder is unlikely to be “necessary”.
19. However, if a cause of action, recognisable at law, against a “third person” is particularised, then it is at least highly likely that joinder will be “necessary for the court to completely and finally determine all matters in dispute”. …
25.The Full Court in B Pty Ltd and Ors & K and Anor (2008) FLC 93-380 held as follows:
52. We do not accept that it is proper to allow joinder of third parties merely upon the formulation of a paragraph in, or to be added to, an application, on the basis that at trial facts to support the application may be asserted and proved. Sufficient facts must be asserted to demonstrate that, if proved, the law arguably provides the relief sought.
26.In Riemann & Riemann and Ors (No. 3) [2017] FamCA 911 at [37], McClelland J (as his Honour then was) cited with approval the judgment of Le Miere J in Hancock Family Memorial Foundation Ltd v Fieldhouse (No 3) [2010] WASC 223 where Le Miere J observed as follows:
27.The applicant on a joinder application must show that there is an arguable case sufficient to resist the entry of summary judgment by the parties sought to be joined: Universal Music Australia Pty Ltd v Cooper [2004] FCA 78 [6] (Tamberlin J). The test is that stated by Barwick CJ at 128 - 129 in General Steel Industries Inc v Commissioner for Railways (NSW) [1964] HCA 69; (1964) 112 CLR 125: Universal Music Australia Pty Ltd v Cooper [7] (Tamberlin J); Review Australia Pty Ltd v Red Berry Enterprises Pty Ltd [2003] FCA 1009 [5] (Heerey J). It would be futile to order that a person be joined as a defendant if the material before the court disclosed that if the person, having been joined as a defendant, applied for summary judgment the application would succeed.
WHAT IS THE STATUS OF THE SECOND RESPONDENT
There has been no order that I can find that Mr Jakhar has to date been joined to these proceedings.
Annexure E of the husband’s affidavit filed 15 December 2023 annexes a bundle of correspondence with the Court as to Mr Jakhar’s medical issues, and his non-attendance at court, together with Exhibit 1 from Ms H. The first respondent also gives evidence of her father’s health issues
Notwithstanding those issues, Mr Jakhar has actively participated in the proceedings since the filing of the application where he was seeking to be joined on 25 August 2020, until the adjournment of the final hearing before Brasch J on 30 November 2022.
As set out at paragraph 36 of the husband’s affidavit filed 15 December 2023, Mr Jakhar caused multiple documents to be filed on his behalf including but not limited to:
(a)Application in a Case filed on 25 August 2020;
(b)Affidavit filed on 25 August 2020;
(c)Notice of Address for Service filed on 12 July 2021;
(d)Financial Statement filed on 30 July 2021;
(e)Financial Statement filed on 2 August 2021;
(f)Application in a Proceeding filed on 17 January 2022;
(g)Affidavit filed on 17 January 2022;
(h)Affidavit filed on 10 February 2022;
(i)Affidavit filed on 10 February 2022;
(j)Affidavit filed on 28 February 2022;
(k)Notice of Objection filed on 24 March 2022;
(l)Affidavit filed on 1 November 2022; and
(m)Notice of Discontinuance filed on 18 August 2023.
He attended court on various occasions in the period when he was actively involved, including, most significantly, the final hearing before Brasch J when it was vacated.
Part 3.2 of the Rules deals with adding and removing parties to proceedings.
Rule 3.01 the Rules states that:
A person whose rights may be directly affected by an issue in a proceeding, and whose participation as a party is necessary for the court to determine all issues in dispute in the proceeding, must be included as a party to the proceeding.
Rule 3.03 of the Rules states:
(1) A party to a proceeding may include any person as a party by:
(a) naming the person as a party in the application, response or reply; and
(b)serving on the person a copy of the application, response or reply and all other relevant documents filed in the proceeding.
(2)A party may add another party after a proceeding has started by amending the application or response to add the name of the party.
(3) A party who relies on subrule (2) must:
(a)file an affidavit setting out the facts relied on to support the addition of the new party, including a statement of the new party’s relationship (if any) to the other parties; and
(b) serve on the new party:
(i)a copy of the application, amended application, response or amended response; and
(ii) the affidavit referred to in paragraph (a); and
(iii) any other relevant document filed in the proceeding; and
(c) serve on the other parties:
(i)a copy of the application, amended application, response or amended response; and
(ii) the affidavit referred to in paragraph (a).
(4)A party may only add another party after the first court date with the leave of the court.
(5) A party who relies on subrule (4) must:
(a) file:
(i) an Application in a Proceeding; and
(ii)an affidavit setting out the facts relied on to support the addition of the proposed new party, including a statement of the proposed new party’s relationship (if any) to the other parties; and
(b) serve on the proposed new party:
(i) a copy of the Application in a Proceeding; and
(ii) the affidavit referred to in subparagraph (a)(ii); and
(iii) any other relevant document filed in the proceeding; and
(c) serve on the other parties:
(i) a copy of the Application in a Proceeding; and
(ii) the affidavit referred to in subparagraph (a)(ii)
The second respondent has participated in, and been treated as though he was joined, and this is evident in the role he has taken through the filing of documents, making and responding to applications, and attendance at court events.
The husband today made an oral application to join the second respondent.
In so far as it is necessary, I dispense with rules in respect of any application for joinder or affidavit being filed in support of an application to join Mr Jakhar. The evidence before me, including from the wife responding to this application as to the joint ownership and sale and disposition of assets, together with the history of the matter, speaks for itself. I order that Mr Jakhar, the named second respondent, be joined as a party to the proceedings because I am satisfied that such an order is necessary for the Court to determine all issue in dispute as required by r 3.01. I do not propose to identify all aspects of the evidence I rely upon, but the history and facts speak for themselves, including the wife’s evidence in relation to dealing with the property.
Noting, however, there has been no appearance today from Mr Jakhar; noting the information emailed by Ms H at 11.09pm on 20 December 2023 to my Associate of the alleged ill health of the second respondent, which was supported by a medical certificate prepared by a GP; and noting Mr Mr Jakhar has previously been represented in these proceedings and has participated in the proceedings as if he was a party; and noting that the Court has been told he and the other parties has previously consented or at least indicated consent to an order that he be joined; I will order that if the second respondent wishes to make any application in respect of the joinder order made today made, that he shall file and serve any application and affidavit in support by close on business 15 January 2024.
WHAT ARE THE ASSETS OF THE PARTIES
The B Street property
The husband gives evidence that on the purchase of the property in 2011, the second respondent was recorded as holding a 20 per cent interest in the property. He contends that the funds paid for the purchase of the property were from savings of him and the wife. He asserts that he does not believe that the second respondent contributed to funds to purchase the property or expected to receive a benefit from the property. The husband deposes that after the commencement of these proceedings in October 2016, the first respondent transferred a further 30 per cent share in the property to the second respondent.
The wife gives evidence in her affidavit filed 4 December 2023 that the second respondent purchased the B Street property to assist the husband and the wife with a place to live, that he paid all costs including the deposit, stamp duty and legal fees related to the purchase. She deposes that a mortgage was obtained for the purpose of the purchase in the joint names of her and her father.
The wife contends that the property was purchased in 2011 and the parties finally separated in or about late-2011. Although, in her 4 December 2023 affidavit she says that they separated in early-2012. The wife contends that the husband resided at the property for just under a year. As at 8 November 2022, the wife’s evidence was that she and her father owned the property as tenants in common in equal shares.
The wife gives further evidence that her father never intended to gift or will the property to her or her husband. She deposes that she did not contribute to the purchase of the property, other than assisting with mortgage repayments while living there. She asserts that the husband made no contribution to its purchase or mortgage, or otherwise.
The transfer of B Street, Suburb C
The first respondent’s evidence is that she and her father purchased B Street, Suburb C in 2011. Counsel for the husband was instructed that date of separation was 2014, the wife’s evidence was that they separated in 2011 or 2012. The wife deposes that the B Street property was sold in early-2023. I was taken to the Annexures including the NSW title searches that establishes that the wife was on title in 2018 but was not on title when the search was done in September 2023, with that event occurring in mid-2023.
Annexure C to the husband’s affidavit filed 15 December 2023 includes two title searches and I rely on that evidence.
The husband gives evidence that the property had been transferred without his knowledge or approval or consent, and that he only became aware of the transfer when the title searches were undertaken. There was no disclosure of these matters.
The consideration noted on the transfer is $750,000. The husband deposes that “the property was sold well under value”. I note that there is a valuation report, at Annexure D of the husband’s affidavit filed 19 September 2023, values the property as $925,000 as at 23 November 2022.
Annexure D of the husband’s affidavit filed 15 December 2022 is the contract of sale of the B Street property, dated early 2023.
The second respondent appears to have received $154,357.64 from the transfer of the property, consisting of $22,000.00 on exchange from the deposit, $55,000.00 distributed through the sale proceeds on settlement, and $77,357.64 distributed through the sale proceeds on settlement. This is evidenced through the settlement statement at Annexure D of the husband’s affidavit filed 15 December 2023.
The wife gives evidence that she received $89,309.48 from the net proceeds of sale of the B Street property.
Correspondence to the vendors from the vendor’s solicitor regarding settlement of the transfer is annexed at Annexure D of the husband’s affidavit filed 15 December 2023. This correspondence is dated late 2023. It confirms that the sale settled in mid-2023.
Proceeds of sale
The wife gives evidence that, of the $89,309.48 she received from the sale of the B Street property, she had various personal loans to pay back which she paid back from May to “mid” this year, including:
(a)$21,000 for moving costs and cleaning of B Street property;
(b)$30,000 to repay money borrowed for renovations of the B Street property; and
(c)$30,000 to a previous boyfriend who has left for Country K and not returned.
The D Street property
The wife gives evidence that her father mainly lives at the D Street property, which he has owned and lived at for about 35 years. She asserts that she and the husband have no interest in the D Street property. Orders are sought in respect of the D Street property, and to that end, I note the undertaking as to damages which has been forwarded to the court and will take effect.
SHOULD THE ASSETS BE PRESERVED PENDING FINAL DETERMINATION OF THIS MATTER AS SOUGHT?
The second respondent has previously put on evidence of his significantly deteriorating health in his Application in a Proceeding filed 17 January 2022 and supporting affidavit, and the court has received various correspondence about the alleged health issues of the second respondent, including the recent medical certificates sent on 20 December 2023 which became Exhibit 1.
He has previously given evidence in the proceedings that he has had a major surgery. The court has received multiple emails from Mr G, a solicitor not on the record for the second respondent but who is assisting him, informing of the second respondent’s significantly deteriorating health.
After the adjournment of the final hearing, the first and second respondent transferred the Suburb C property, which had been identified in the final hearing as the primary asset within the matrimonial pool. The balance sheet became an Exhibit in this application. They failed to disclose the sale and, other than in the most general description, have failed to disclose what has happened to the proceeds. It is contended that this conduct has the potential effect of defeating the husband’s potential claim for property settlement under s 79 of the Act. I agree.
The conduct alleged in selling and disposing of the asset, subject to the competing claims, supports the contention that the court would be concerned about further dissipation of assets before this matter is able to be determined.
The matter is listed for final hearing before me in February 2024, only two months from now.
Based on the evidence before me, I find that there is no prejudice to the parties in making injunctions that have been sought as against the first respondent and second respondent, preventing them from dissipating further assets. Both have been aware of the first application since September 2023 and have been served with the second application. They have not filed any evidence of prejudice in relation to the injunctive orders being made.
The first respondent’s evidence is she has used all the funds she received of $89,000 but has provided no specific evidence. For example, she says she spent $30,000 to repair the property prior to sale, which she had to repay to improve the sales price, yet unusually she does not appear to share this repair cost with her father. She also says she gave “a previous boyfriend’ $30,000 thinking she could trust him. There is no further evidence in relation to this alleged transfer.
Her evidence, most importantly, is that now there is “No property and no proceeds of sale for a family law property settlement in this case”. On one view the decision to sell pre-emptively dictates the outcome of these proceedings. The conduct of the first and second respondents will no doubt be further scrutinised at the final hearing.
The wife may well have a strong case to support her application for an 80 per cent division if her assertions as to contributions, the purchase date, the separation date, the contributions to mortgage, sole care of the 4 children, and her post separation and s 75(2) factors are all considered. However, it is not up to her to pre-determine the findings of fact that will be made by the court, nor pre-determine the disposition of the property of the parties or either of them. I accept the submissions of counsel for the applicant husband in relation to the matters raised in support of this application.
I am also satisfied that the first and second respondents should be required to deposit the sale proceeds into account as proposed to prevent further diminishment of the asset pool. If it transpires that the second respondent ought not have been joined or restrained, there may be costs or other consequences for the husband following the final hearing. He is well aware of those costs and has provided the undertaking that has been referred to earlier.
I am satisfied that there should be full and frank disclosure made by both the first respondent and the second respondent, and the husband in the circumstances of this case. The wife complains that the husband has not disclosed his interest in overseas property or what happened to the $336,000 allegedly received from the Suburb J sale. I will remind all of the parties of their obligations in that regard and failure to make such disclosure has the risk of the application of the principles of Black and Kellner (1992) FLC 92-287 and Weir and Weir (1993) FLC 92‑338, in determination of the pool of assets absent full, frank, and ongoing disclosure.
I am not satisfied on the evidence before me that a s 106B order would be applicable at this time, but I note that this was not pressed and was acknowledged by the husband’s counsel sensibly that this is a matter for final determination.
There is no basis upon which I am satisfied it is appropriate to vary terms of the costs order made by Brasch J on 30 November 2022, again acknowledged by counsel for the husband as an order that was ultimately not pressed.
There is no basis to set aside the order made by the Judicial Registrar on 21 August 2023 for the reasons set out and, again. I note that counsel did not press the making of that order.
I do not make the order for the parties to attend personally, it is a matter for the parties to make an application if they wish to attend by AVL which would be considered in Chambers.
Other than those matters for the reasons set out I make the orders sought by the husband; I remind the parties of the filing directions made in the proceedings. I reserve the costs of both applications to the final hearing.
I certify that the preceding eighty (80) numbered paragraphs are a true copy of the Ex Tempore Reasons for Judgment of the Honourable Justice Curran. Associate:
Dated: 22 December 2023
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