Malta and Malta and Ors (No. 2)

[2008] FamCA 718

FAMILY COURT OF AUSTRALIA

MALTA & MALTA AND ORS [2008] FamCA 718

FAMILY LAW – PRACTICE AND PROCEDURE – Adjournment – Application granted

Family Law Act 1975 (Cth)

APPLICANT: MS MALTA

RESPONDENT: MR MALTA

SECONDNAMED RESPONDENT: GOULBURN-MURRAY RURAL WATER AUTHORITY

PETITIONER: MR TRIM

R GROUP PTY LTD

FILE NUMBER: MLF 4121 of 2002

DATE DELIVERED: 22 AUGUST 2008

PLACE DELIVERED: Melbourne

PLACE HEARD: Melbourne

JUDGMENT OF: THE HONOURABLE JUSTICE CRONIN

HEARING DATE: 22 AUGUST 2008

REPRESENTATION

COUNSEL FOR THE APPLICANT: MR HERBERT

SOLICITOR FOR THE APPLICANT: NEEDHAM LEGAL & FINANCIAL PTY LTD

COUNSEL FOR THE RESPONDENT: MR INDOVINO

SOLICITOR FOR THE RESPONDENT: ACQUARO & CO

COUNSEL FOR THE PETITIONER: MR SANGER

SOLICITOR FOR THE PETITIONER: WATKINS BOAG O’CONNOR & DUNNE

COUNSEL FOR R GROUP PTY LTD: MS HISHON

SOLICITOR FOR R GROUP PTY LTD: DEACONS LAWYERS

Orders

1. That all extant application be adjourned to 9.30am on 1 September 2008 before me part-heard.

2. That if the wife proposes to file and serve any further material upon which she may seek to rely, she do so by no later than 4.00pm on Wednesday 27 August 2008.

IT IS NOTED that publication of this judgment under the pseudonym Malta & Malta and Ors is approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth)

FAMILY COURT OF AUSTRALIA AT MELBOURNE

FILE NUMBER: MLF 4121  of 2002

MS MALTA

Applicant Wife

And

MR MALTA

Respondent Husband

And

GOULBURN-MURRAY RURAL WATER AUTHORITY

Secondnamed Respondent

And

MR TRIM

Petitioner

And

R GROUP PTY LTD

REASONS FOR JUDGMENT

1. On 22 August 2008, an application was made by Ms Malta to whom I shall refer as the “wife” in these proceedings, for an adjournment of the substantive proceedings.

2. I refused the application and directed that the trial proceed.  I indicated at the time that I would give written reasons.  These are those reasons.

3. This case has an extraordinary litigious history.  It commenced in this Court in 2002.  Six years later, it is still being conducted.  The path of the litigation has seen it travel into the Federal Magistrates Court of Australia in relation to bankruptcy issues and into the Supreme Court of Victoria in relation to questions of the ownership of a farming property in north-east Victoria.

4. I took over the management of the matter at the end of 2007.  It appeared to me at that time that the case had been languishing because a critical piece of litigation in the Supreme Court of Victoria had not been finalised.  I made an order that the wife be proactive in relation to the Supreme Court proceedings because if she was not, I intended to otherwise determine the property proceedings between the husband and the wife on the basis of the evidence then available.

5. I gave reasons at the time.  I have also delivered reasons in relation to a bankruptcy petition against the wife which is now part of the proceedings before me.  I do not intend to traverse those issues again.

6. Having ordered the wife to be proactive, she ventured into the Supreme Court.  It came to my attention that Robson J of the Supreme Court of Victoria had concluded the proceedings and made significant orders for costs against the wife.  Reading between the lines, his Honour brought those proceedings to an end on the basis that the wife did not prosecute her case.

7. All parties were aware that I was managing the case in this Court and that I was simply awaiting the outcome of the Supreme Court proceedings.  I held a mention of the matter at which the then solicitor for the wife appeared and it was agreed that I would adjourn the matter for further mention because the proceedings before Robson J had been delayed.  It was agreed that Mr Indovino of counsel would advise me with the knowledge of all participants, the outcome of the hearing before Robson J.  Mr Indovino faithfully did that and his comments were on transcript should anybody wish to see them.

8. The matter came before me on 24 July 2008.  On that day, Mr Randles appeared and announced that he would no longer be appearing on behalf of the wife and that his instructions had been terminated.  Somewhat to my surprise, he handed me a copy of the letter from his client indicating her dissatisfaction with his professional assistance.  My surprise was less so when I was handed a letter sent to the Court by the wife indicating that she wanted an adjournment for two weeks to get legal representation.  As it transpired, I was not able to deal with the matter within a fortnight anyway.

9. On 24 July 2008, I made orders for the matter to be heard on a final basis.  Based upon the information that I had available, I estimated that the hearing would take one day.  I made a variety of orders for the parties to file material.  I directed that my Associate send to the wife at a South Australian address a copy of the orders.

10. When I say that I was intending to hear the matter on the best evidence available, I was of the view that the only outstanding issues as between the husband and the wife related to a property settlement.  The matter in the Supreme Court related to a property that was not included in the pool of assets that I had been dealing with on the basis that the husband had asserted that he did not have a beneficial interest in the farming property but rather, it was held on trust by him.  That is the position that was determined by Mandie J in the Supreme Court and which was the ultimate dispute before Robson J.  Clearly, the outcome of that dispute affected the pool of assets that I had to deal with.  It having been resolved, I presumed that the parties were then only arguing about the assets that were otherwise left.

11. The husband filed an affidavit on 15 August 2008.  Whilst the husband did not strictly comply with the order that I made in that I also ordered he file a financial statement, having now read his affidavit, there is sufficient information in it to satisfy me that I understand his financial circumstances as he portrays them.  Whether that is ultimately the case depends upon cross-examination by other parties.

12. The wife filed nothing.

13. Each of the other intervening parties filed brief affidavits as to the costs that they had incurred.  I do not see that they needed to file anything else.

14. On the morning of 22 August 2008, Mr Herbert of counsel appeared on behalf of the wife who was present in court.  He said that he had only received instructions the previous day and that his instructing solicitor was providing an affidavit setting out what had occurred.  That affidavit as ultimately filed. 

15. The affidavit of Gary Ronald Needham set out that he was instructed on behalf of the wife by a Mr S who he believed to be acting as the agent of the wife.  He said he got instructions on Monday 18 August and was then informed that the trial was listed for Friday 22 August.  He told Mr S what he needed including funds for the proceedings.

16. He said:

    I understand the preparation for this trial has been complicated by an action in the Supreme Court of Victoria between the parties to this proceeding which has only been resolved very recently.  I did not act in this matter.

17. He said he finally received the documentation and the funds that he needed on the afternoon of Thursday 21 August 2008. 

18. There is no evidence otherwise from the wife as to what caused the delay between the orders that I made on 24 July and Monday 18 August.  I find it somewhat disconcerting that the wife is acting through an agent Mr S.  I am not entirely sure what all of that is about and for the purposes of these reasons, it does not matter.

19. Mr Herbert was given leave to file the affidavit on behalf of the wife and his instructor has come on the record as her solicitor. 

20. Mr Herbert asked for some time to discuss matters because he was bereft of a number of documents and instructions.  He mentioned that one of the issues in dispute was the ownership of a farming property.  I indicated my understanding was that the dispute was finished because of the Supreme Court proceedings and certainly consistent with the paragraph to which I have just referred in the affidavit of Mr Needham.  Mr Herbert however said that this as a different issue and as he ultimately submitted, the wife does not, nor can she, contest the issues that were determined by Mandie J and Robson J.

21. I was then informed at 12.30pm that the parties had not resolved matters.

22. Mr Herbert said that he was seeking an adjournment.  He relied on the affidavit of Mr Needham.

23. Mr Herbert said that his client was impecunious and she regretted not furnishing documents pursuant to the orders that I had made.  He conceded she had filed nothing.  He said that her understanding was that it was to be a directions hearing and that therefore the full trial of the proceedings on 22 August came as something of a surprise.  He said that he had not had sufficient time to get full instructions.  He said he had background knowledge of the case because he had been involved in it three years ago but that his information was sketchy.

24. He said to me that the dispute related to the farming property which was in the vicinity of $1.5 million and that it was still in the husband’s name.

25. He said the receiver of the company R Group Ltd had not taken possession of the land and therefore it remained property of the husband.  That was a rather odd position to adopt having regard to the fact that Mandie J had declared that the husband did not have any ownership of the land. 

26. As I understand the position of the wife, there is some argument that the husband has done a deal so that he still retains an interest in the land.  This had not been a matter canvassed in this Court and certainly not mentioned to me earlier in the year. 

27. Mr Herbert otherwise agreed that the assets were around about $400,000.

28. Mr Herbert said that the wife had to subpoena documents from the lender of the money that gave rise to the agreement for the transfer of the farming property by the husband to a company which I now understand is controlled by the husband’s brother.  He said there was also a dispute about the valuation of the property.  He said that the husband had breached injunctions by raising money on the matter.  He asserted that the wife had been poorly represented up until now.

29. I did not hear very much from any of the other parties other than to have them clearly articulate that they were opposed to any adjournment.

30. In relation to Mr Herbert’s comment that the wife was surprised about the trial proceeding rather than it being a further mention.  She had the orders which clearly indicated that it was to be a final hearing.  She had the orders clearly indicating that she had to file material in respect of that.  There was no suggestion that there was to be any further directions hearing or mention.  Having regard to the conclusion of the Supreme Court proceedings and what had been discussed at the end of 2007 and into the first part of 2008, there could be no argument about what it was that was to be litigated.  In so far as it was suggested that there were interlocutory issues not concluded, I reject that as well.  At no time has the wife raised the issue of the value of the land which was the subject of the Supreme Court proceedings.  In relation to questions of discovery, the wife had never raised the issue of the land still belonging to the husband because the transfer of land had not been completed.  She did not raise the fact that she wanted to pursue issues of where the funding came from that was paid to the liquidator. 

31. Mr Indovino made the observation that the wife had made an application for an adjournment like this before.  He said there was a remarkable similarity between the affidavit of Mr Needham and some previous affidavit.

32. There are a number of authorities in relation to adjournments.  The High Court in Sali v SPC Limited [1993] HCA 47 examined the question of an adjournment. The majority Brennan, Deane and McHugh JJ said that in determining whether to grant an adjournment, the judge of a busy court is entitled to consider the effect of an adjournment on court resources and the competing claims by litigants in other cases awaiting hearing in the court as well as the interests of the parties. That case however was about the inability of a litigant to obtain the representation that he wanted and where a specific amount of time had been set aside by the court.

33. More recently, in Queensland v JL Holdings Pty Ltd [1997] HCA 1, the High Court dealt with a question of practice and procedure in relation to a trial judge’s refusal to allow a defence to be amended. The amendment was clearly out of time. Ultimately, the High Court allowed the appeal and indicated that the amendment should have been permitted. In canvassing the issue, Dawson, Gaudron and McHugh JJ said that nothing in the Sali case suggested that there was a principle that a party could be shut out from litigating an issue which was fairly arguable.  Their Honours said:

    Case management is not an end in itself.  It is an important and useful aid for ensuring the prompt and efficient disposal of litigation.  But it ought always be borne in mind, even in changing times, that the ultimate aim of a court is the attainment of justice and no principle of case management can be allowed to supplement that aim.

34. Their Honours ultimately said that the reasons given by the trial judge were insufficient to justify the refusal to amend a defence.  They went on to say:

    Justice is the paramount consideration in determining an application such as the one in question.  Save in so far as costs may be awarded against the party seeking the amendment, such an application is not the occasion for the punishment of a party for its mistake or for its delay in making the application.  Case management, involving as it does the efficiency of the procedures of the court, was in this case a relevant consideration.  But it should not have been allowed to prevail over the injustice of shutting the applicants out from raising an arguable defence, thus precluding the determination of an issue between the parties.  In taking an opposite view, the primary judge was, in our view, in error in the exercise of her discretion.

35. Kirby J supported the majority and went on to examine a variety of cases in which indulgences had been sought by litigants.  His Honour said:

    Considerations which tend to argue against the grant of an indulgence include many which are the counterparts of the foregoing (those that he had set out).  Thus, by failure of a party to offer anything by of way of explanation for a late application has been held relevant.

    …

    Courts now take into account the strain which litigation may place upon those involved and the natural desire of most litigants to be freed, as quickly as possible, from the anxiety, distraction and disruption which litigation causes.

    ..

    Because justice cannot be measured solely in monetary terms, costs orders are not necessarily an adequate balm to the other party.  Thus, the proximity of the hearing is clearly a most important consideration.

36. Kirby J then said:

    Courts are entitled to react unfavourably to repeated default on the part of a litigant whose conduct has the effect of frustrating a proper timetable fixed for the trial.  Justice will not necessarily require that a party should have multiple opportunities to plead and present its case.  A court must accord justice to the particular litigant.  But it must also maintain its responsible use of scarce public resources and consider, in a general way, the impact which its orders have on other litigants and on the public generally.

37. There is no plausible explanation for why the wife was not ready to proceed.  There is no evidence as to what preparation she was undertaking not so much from the time that I had the matter before me on 24 July but rather, what preparation she was undertaking subsequent to the conclusion of the proceedings before Robson J having regard to what I had said earlier in the litigation at which time she was represented.

38. This litigation has an enormous impact upon other people.  Part of the process that I have had to determine was the discretionary exercise to extend a bankruptcy petition which cannot be extended again.  The suggestion by Mr Herbert that the case could proceed in October and if necessary the petitioning creditor could serve another bankruptcy notice, does nothing to alleviate the problem having regard to the litigation that the petitioning creditor has been through to try and sort out his claim.

39. One of the significant features of granting an adjournment is that the person seeking the indulgence can be ordered to pay costs and to some extent, that ameliorates the inconvenience of the other parties who are ready to proceed.  It is troubling in this case that there are significant amounts of costs owed by the wife arising out of the Supreme Court proceedings and the very application before me by the petitioning creditor under the Bankruptcy Act relates to unpaid legal fees for a solicitor who acted for the wife in the Family Court proceedings a number of years ago.

40. If as it is urged upon me to find, the pool of assets is limited to $400,000, the wife may not be able to pay costs from any entitlement she may have because of the size of those costs which I am led to believe are extremely high.

41. This is not just a case in which case management issues determine the outcome.  To not proceed immediately would not only create the sort of stress that Kirby J referred to but also significantly delay the resolution of matters involving the petitioning creditor and also the liquidator of the R Group.

42. An adjournment application in a case like this is the pursuit of a significant indulgence.  I see no basis upon which the wife should be entitled to that indulgence after all this time to pursue an issue that had not been raised until now.  Mr Herbert for the wife said that the wife had been poorly represented previously.  I make no comment on that other than that is an issue that she can take up in another place.

43. The application is therefore refused.

I certify that the preceding Forty Three (43) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Cronin

Associate: 

Date:  26 August 2008