Massalski & Riley (No 7)
[2023] FedCFamC1F 128
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 1)
Massalski & Riley (No 7) [2023] FedCFamC1F 128
File number(s): SYC 496 of 2015 Judgment of: HARPER J Date of judgment: 8 March 2023 Catchwords: FAMILY LAW – PRACTICE AND PROCEDURE – Where wife has been declared a vexatious litigant under s 102QB of the Family Law Act 1975 (Cth) – Where wife seeks leave to institute proceedings against the Court appointed receiver – Whether order made pursuant to s 102QB applies to application against the receiver – No basis for the granting of leave established – Leave refused – Application dismissed.
FAMILY LAW – PRACTICE AND PROCEDURE – Application for leave to intervene by wife’s ex-partner – Where intervention concerns proceedings already concluded – Where no proceedings to intervene in currently on foot – Application dismissed.
Legislation: Family Law Act 1975 (Cth) ss 4, 90SN, 102QB, 102QE
Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) Div 11.1.6, rr 11.53, 11.54
Cases cited: Barre & Barre [2021] FamCA 101
Massalski & Riley [2019] FamCA 1013
Massalski & Riley (2021) FLC 94-047; [2021] FamCAFC 116
Massalski & Riley (2022) 65 Fam LR 73; [2022] FedCFamC1F 36
Massalski & Riley (No 3) [2022] FedCFamC1F 562
Massalski & Riley (No 4) [2022] FedCFamC1F 832
Massalski & Riley (No 5) [2022] FedCFamC1F 835
Massalski & Riley (No 6) [2022] FedCFamC1F 1029
Massalski v The Owners SP 90255 & Ors [2023] NSWSC 23
Division: Division 1 First Instance Number of paragraphs: 25 Date of hearing: 27 February 2023 Place: Sydney The Applicant: Litigant in person Solicitor for the First Respondent: Christopher Farah Solicitor Solicitor for the Second Respondent: Brynes Legal The Intervener: Litigant in person ORDERS
SYC 496 of 2015 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)
BETWEEN: MS MASSALSKI
Applicant
AND: MR AG
First RespondentMR RILEY
Second Respondent
MR K
Intervener
order made by:
HARPER J
DATE OF ORDER:
8 March 2023
THE COURT ORDERS THAT:
1.The Application in a Proceeding filed by the Applicant on 24 October 2022 (“the Application”) be dismissed.
2.The application to intervene filed on 10 January 2023 by Mr K be dismissed.
3.The Applicant pay the First Respondent’s costs of the Application on a party and party basis, as agreed or assessed.
4.The Applicant pay the Second Respondent’s costs of the Application, as assessed on an indemnity basis.
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 the pseudonym Massalski & Riley has been approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
REASONS FOR JUDGMENT
HARPER J:
These are long-running property proceedings between the applicant wife, Ms Massalski (“the wife”), and the respondent husband, Mr Riley (“the husband”). The parties were not married but formed a de facto relationship.
Numerous judgments have already been delivered. The substantive final property orders were made by McClelland DCJ pursuant to s 90SM of Family Law Act 1975 (Cth) (“the Act”) on 10 December 2019: Massalski & Riley [2019] FamCA 1013 (“Final Orders”). Those orders required registration of a strata plan over F Street, Suburb G (“F Street”), with the creation of a strata scheme of two strata lots, Unit 1 in favour of the wife and Unit 2 in favour of the husband. Such a strata was registered, SP ….
After an unsuccessful appeal (Massalski & Riley (2021) FLC 94-047), the wife filed an application to set aside the Final Orders pursuant to s 90SN of the Act.
This application was summarily dismissed by me on 4 February 2022: Massalski & Riley (2022) 65 Fam LR 73. The basis for the summary dismissal was that the wife had no reasonable prospect of success in her application, and that it was in any event an abuse of process, because her claims for relief pursuant to s 90SN of the Act were without merit, and she had failed in her duty to promote the overarching purpose set forth in s 67 of the Act. I further found that the wife’s claim constituted an abuse of process because she sought to re-litigate issues already finally determined, and her multiple applications constituted “no more than a strategy which is designed to delay enforcement of the orders mounting up against her for as long as possible”: Massalski & Riley (2022) 65 Fam LR 73 at [129]. I was satisfied that the conduct of the wife brought the administration of justice into disrepute, requiring dismissal of her applications.
Thereafter, following a further unsuccessful appeal by the wife, under judgment delivered on 5 August 2022 (Massalski & Riley (No 3) [2022] FedCFamC1F 562) on the application of the husband and for the reasons given in that judgment, I made the following orders:
1.Pursuant to s 102QB(2)(a) of the Family Law Act 1975 (Cth) (“the Act”), all extant applications instituted by [Ms Massalski] (“the wife”) in the Federal Circuit and Family Court of Australia be dismissed.
2.Pursuant to s 102QB(2)(b) of the Act, the wife be prohibited from instituting proceedings in any court having jurisdiction under the Act in relation to [Mr Riley] (“the husband”), without first having been granted leave to commence that proceeding pursuant to s 102QE of the Act.
I also made orders appointing a receiver to the income and property of the wife to give effect to a number of court orders for the payment of money previously made in favour of the husband, which remained unsatisfied.
The orders appointing the receiver included the following:
3. Pursuant to Div 11.1.6 of the Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) (“the Rules”), [Mr AG] of [Accounting Firm AH] be appointed as receiver (“the Receiver”) of the income and property of the wife so as to give effect to the following orders:
(a) Order made on 2 November 2020 for payment of costs by the wife to the husband of $209,945.25;
(b) Order made by the Full Court of the Family Court of Australia on 19 August 2021 for payment of costs by the wife to the husband of $30,000.00;
(c) Order made on 20 December 2021 for payment of costs by the wife to the husband of $39,882.78; and
(d) Such further orders as have or may be made by the Federal Circuit and Family Court of Australia for payment of moneys by the wife either to the husband, or in respect of which the husband has made payment which was required to be made by the wife including, but not limited to, the orders made on the following dates:
(i) 11 March 2016;
(ii) 3 June 2016; and
(iii) 24 December 2019
(“the orders”) and the payment of interest on such amounts pursuant to s 117 of the Act.
4. In particular, that the Receiver be appointed to receive the following:
(a) the wife’s bank accounts; and
(b) the property at [F Street, Suburb G], NSW being the land described in Folio Identifier […] (“[Unit 1, F Street]”)
5.Pursuant to r 11.49(3) of the Rules, the Receiver is authorised to do (in the Receiver’s name or otherwise) anything the wife may do.
6. Pursuant to r 11.49(4) of the Rules, the Receiver’s powers operate to the exclusion of the powers of the wife during the receivership in relation to compliance with the orders.
7. The Receiver’s remuneration be paid from the property and financial resources of the wife.
8. No security be given by the Receiver.
Thereafter, several judgments were delivered in relation to costs sought by the husband: Massalski & Riley (No 4) [2022] FedCFamC1F 832; Massalski & Riley (No 5) [2022] FedCFamC1F 835. The wife sought leave to file a further application against the husband’s solicitor and counsel in respect of which leave was refused: Massalski & Riley (No 6) [2022] FedCFamC1F 1029.
The wife also became bankrupt on 9 December 2022. Her Trustee in Bankruptcy (“the trustee”) took no part in the hearing of the application the subject of this judgment, and declined any opportunity to be heard. By email correspondence with chambers, the trustee said that “in accordance with section 60(2) of the Bankruptcy Act1966 (Cth)” he elected to allow the wife to proceed with her application. It can be seen that the orders appointing the receiver gave him control over the wife’s property and powers to dispose of it. Since her bankruptcy, the same property has vested in her trustee, but no point was taken by any party, including the trustee, about this before me. Accordingly, I say no more about it.
On 24 October 2022, the wife filed yet a further application, which sought an order in the following terms:
That leave be granted allowing the Plaintiff to commence a proceeding against [Mr AG] of [Accounting Firm AH], in the Federal Circuit and Family Court of Australia (Division 2), in relation to making decisions affecting the Owners Corporation of the Strata Plan SP […], in abuse of his function as a receiver and in contravention of the Strata Schemes Management Act 2015, with effect of degrading the value of the property at [Unit 1 F Street, Suburb G].
The hearing of this application took place on 27 February 2023. Although it was open to the Court to dispose of the application in chambers, I took the view that the wife should be provided the opportunity to make her arguments, both in writing and in open court. Through her case outline, it became apparent that the wife not only sought leave to institute proceedings in respect of the receiver, but also sought orders for his removal.
Division 11.1.6 of the Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) (“the Rules”) deals with receivership. Pursuant to r 11.53, the Court may set aside the appointment of a receiver at any time and make orders about the receivership and the receiver’s remuneration. Pursuant to r 11.54, if the receiver contravenes an order or the Rules, the Court may:
(a) set aside the receiver’s appointment; and
(b) appoint another receiver; and
(c) order the receiver to pay the costs of an application under this rule; and
(d) deprive the receiver of remuneration and order the repayment of remuneration already paid to the receiver.
For the purposes of s 102QE of the Act, “institute” includes “the taking of a step or the making of an application that may be necessary before proceedings can be started against a party” (s 102Q(1)) and “proceedings” means “a proceeding in a court…and includes…an incidental proceeding in the course of or in connexion with a proceeding” (s 4(1)). The wife’s application falls within these definitions for the purposes of Order 2 made on 5 August 2022. By seeking leave, the wife clearly took the view that leave was required by Order 2 prior to commencing proceedings against the receiver. The receiver took the same view. He contended that the critical issue was whether the words “in relation to” the husband were wide enough to include proceedings against the receiver. If not, it appeared the wife’s application may not be caught by Order 2.
There is ample authority that the meaning of a court order is objectively found in its plain words, construed in their totality and in the context; reference to extrinsic material is permitted to resolve any ambiguity: Mendicino & Mendicino (Contravention) [2015] FamCA 1179 at [34]; Timms & Chapman [2018] FamCA 327 at [17]; Farina & Lofts [2019] FamCA 228 at [23]. I do not accept there is any relevant ambiguity in the order. The phrase “in relation to” is well known to the law and deliberatively broad. I repeat and adopt what I have written in Barre & Barre [2021] FamCA 101:
216. The phrase “with respect to”, like “in relation to”, is of wide ambit but takes its meaning from the statutory context in which it is used: see for example Workers' Compensation Board (Q) v Technical Products Pty Ltd (1988) 165 CLR 642 at 653-654; Commissioner of Taxation v Scully (2000) 201 CLR 148; [2000] HCA 6; 201 CLR 148; 169 ALR 459; 74 ALJR 504 at [35]; Muslimin v The Queen (2010) 240 CLR 470; [2010] HCA 7 at [15]. In Kennon v Spry; Spry v Kennn (2008) 238 CLR 366; [2008] HCA 56 at [217] Kiefel J said “The expression "in relation to" is of wide and general import and should not be read down in the absence of some compelling reason for doing so” citing the judgment of Toohey and Gummow JJ in PMT Partners Pty Ltd (In liq) v Australian National Parks and Wildlife Service (1995) 184 CLR 301; [1995] HCA 36; at 330-331, where they said the words are “prima facie broad and designed to catch things which have a sufficient nexus to the subject”.
In my view, the order made appointing the receiver was for the purpose of enforcing court orders made in favour of the husband. I am satisfied that this situation falls within the broad ambit of the phrase “in relation to” the husband in Order 2. Accordingly, the wife is prohibited from instituting proceedings against the receiver without being first granted leave pursuant to s 102QE of the Act. Therefore, the question is whether the wife has demonstrated any basis upon which leave ought to be granted.
I accept that if the wife was able to demonstrate on the evidence that the receiver had acted in bad faith and or contravened either court orders or the Rules, that may constitute an arguable basis for the granting of leave. However, there is nothing in the evidence or submissions of the wife which demonstrates any basis upon which the Court would be persuaded to grant leave to institute proceedings against the receiver.
In support of her application, the wife filed an affidavit on 24 October 2022. The evidence contained therein, and taken at its highest, alleges that the receiver conducted a general meeting of the owners corporation of the strata scheme created over F Street, excluded her from such meeting, proposed irregular resolutions, engaged in malicious conduct by nominating another individual to function as the strata manager without power, and acted against the “Integrity Principles of Trustees and Debt Agreement Administrators” developed by the Australian Financial Security Authority. Beyond bare assertions, the wife provided no evidence which could substantiate them.
The wife then proceeded to rake over, yet again, factual matters which had been determined against her several times in earlier proceedings. In particular, she claimed, again, that there had been a failure to rectify building defects, which should have been rectified prior to the partition of F Street, by reason of the husband’s failure to comply with the Final Orders. She then contended that the judgment in Massalski & Riley (2022) 65 Fam LR 73, delivered on 4 February 2022 summarily dismissing her application pursuant to s 90SN of the Act, was based upon misleading or fraudulent submissions made by the husband’s counsel.
The wife further contended that the receiver had moved a resolution to approve legal fees which were, in her view, unjustified and made after the wife had been ejected from the meeting. The wife made reference to proceedings commenced by her in the Supreme Court of New South Wales, in which she sought the termination of SP … and a range of damages. I note those proceedings were determined against the wife on 1 February 2023 who summarily dismissed her proceedings against all parties, other than the owner’s corporation: Massalski v The Owners SP 90255 & Ors [2023] NSWSC 23.
The receiver gave evidence that the wife had been disruptive and obstructive to his attempts to carry out his functions as a court appointed receiver. The husband filed an affidavit on 27 February 2023, giving evidence that Unit 1 located at Unit 1 F Street has been transferred into the name of the wife. He also gave evidence that he has incurred legal fees, by reason of the conduct of the wife, including her failure to remove a caveat.
I note here that the appointment of the receiver was to enable enforcement of the substantial costs orders already made in the husband’s favour against the wife. It is quite obvious that her conduct, since the appointment of the receiver, has led to the generation of further costs for the husband while she is self-represented, including the costs of further appearances before this Court.
I am comfortably satisfied that the wife has demonstrated no basis for any leave to be granted pursuant to s 102QE of the Act.
Even if I were wrong in my conclusion that s 102QE was engaged and no leave was in fact required, for the reasons already given I am not persuaded that the wife has demonstrated any reason why the Court should exercise its discretion to set aside the appointment of the receiver, or otherwise make any orders about the receivership. The wife’s application will be dismissed.
That leaves for determination a further application by Mr K to intervene filed on 10 January 2023. As noted in the judgment of 4 February 2022, Mr K made an earlier application to intervene, which was dismissed by reason of the fact that there were no existing proceedings into which Mr K could intervene: Massalski & Riley (2022) 65 Fam LR 73 at [107]. When asked to explain why he claimed an entitlement to intervene, he repeated his assertion that he was a creditor of the wife. Whilst this may create entitlement to intervene in s 90SN proceedings, there are no such proceedings on foot. He further claimed that the receiver had wrongfully written to him claiming an interest in a property he holds in Victoria. However, he conceded in submissions that he had made a declaration of trust in favour of the wife, over 5 per cent of his interest in that property. Accordingly, it is clear that the 5 per cent interest forms part of the property of the wife, which the receiver is duty-bound to collect pursuant to the orders made appointing him. Mr K’s application to intervene will therefore be dismissed.
The husband sought indemnity costs against the wife while the receiver sought costs also against the wife. The wife has been wholly unsuccessful against both the receiver and the husband. The husband had an interest in resisting the wife’s application, since the appointment of the receiver was for his benefit. I am satisfied that the wife’s conduct sought to interfere with the enforcement processes of the Court, and accept the husband’s argument that her application was an abuse of process that brings the administration of justice into disrepute. Costs will be ordered against her. I am also persuaded that the circumstances fall within the recognised “exceptional” category to justify an award of indemnity costs in the husband’s favour.
I certify that the preceding twenty-five (25) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Harper. Associate:
Dated: 8 March 2023
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