Matech and Matech
[2019] FamCA 36
•31 January 2019
FAMILY COURT OF AUSTRALIA
| MATECH & MATECH | [2019] FamCA 36 |
| FAMILY LAW – PRACTICE AND PROCEDURE – STAY – where the Applicant seeks a stay of interlocutory orders for the sale of an unencumbered property – where there are substantive enforcement proceedings on foot – application dismissed. |
| Family Law Act 1975 (Cth) |
| Matech & Matech (No. 2) [2018] FamCA 1029 Aldridge & Keaton (Stay appeal) [2009] FamCAFC 106 |
| APPLICANT: | Mr Matech |
| RESPONDENT: | Ms Matech |
| FILE NUMBER: | BRC | 2432 | of | 2018 |
| DATE DELIVERED: | 31 January 2019 |
| PLACE DELIVERED: | Brisbane |
| PLACE HEARD: | Brisbane |
| JUDGMENT OF: | Baumann J |
| HEARING DATE: | 21 January 2019 |
REPRESENTATION
| THE APPLICANT APPEARED IN PERSON |
| SOLICITOR FOR THE RESPONDENT: | Evans & Company Family Lawyers |
Orders
That:
(a)the Application in a Case filed 7 January 2019 be dismissed; and
(b)the Applicant husband pay the Respondent wife’s costs of the Application to be agreed or fixed, with the time for payment of such costs to be reserved to the trial of the substantive proceedings.
Note: The form of the order is subject to the entry of the order in the Court’s records.
IT IS NOTED that publication of this judgment by this Court under the pseudonym Matech & Matech has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
Note: This copy of the Court’s Reasons for Judgment may be subject to review to remedy minor typographical or grammatical errors (r 17.02A(b) of the Family Law Rules 2004 (Cth)), or to record a variation to the order pursuant to r 17.02 Family Law Rules 2004 (Cth).
| FAMILY COURT OF AUSTRALIA AT BRISBANE |
FILE NUMBER: BRC 2432 of 2018
| Mr Matech |
Applicant
And
| Ms Matech |
Respondent
REASONS FOR JUDGMENT
Introduction
On 7 December 2018 the Court delivered Reasons (see Matech & Matech(No. 2) [2018] FamCA 1029) in respect of its jurisdiction to hear and determine substantive enforcement proceedings commenced by the wife, Ms Matech against the husband, Mr Matech arising from a financial agreement between the parties dated 26 July 2005.
The wife contends that the financial agreement is a binding financial agreement and that various provisions in the agreement, which provide for the payment of monies and also transfer of real property, are enforceable under s.90KA of the Family Law Act 1975.
Although the husband has previously had legal representation, he is currently unrepresented. However, during the proceedings at no time has the husband made an application to set aside the financial agreement.
The determination of the jurisdictional issue delayed the pending application by the wife for enforcement – inter alia, to take control of and effect a sale of a property situated on G Street, which proceeded to hearing on 7 December 2018 and resulted in orders made on that date as per Appendix One to these Reasons.
The husband informed the Court on 7 December 2018, that he was travelling overseas within days and as a result, some of the orders which allowed for the wife to be registered on the title as Trustee permitted a Registrar of the Court to sign documents on behalf of the husband. At the hearing of the husband’s stay application on 21 January 2019, the solicitor for the wife (Mr Brandon) informed the Court that the wife is now the registered proprietor (as Trustee) of the G Street property and has instructed agents to provide suitable proposals for the marketing of the property. It is common ground that the property is not encumbered by any registered mortgage.
Stay application
On 3 January 2019, the husband filed an appeal against the orders made on 7 December 2018 (“the said orders”) and seeks the said orders be discharged and that the parties “attend at mediation to finalise the proceedings”. The grounds of appeal are articulated to be:
1. The Judge failed to take into account the [G Street] property provides equity to enable me to operate my business.
2. The Judge failed to consider any taxation implications as a result of the sale of the property.
Having filed the appeal on 7 January 2019, the husband sought a stay of the said orders, pending the hearing of the appeal.
The wife opposes the stay being granted and her advocate Mr Brandon made written submissions, with both parties making further oral submissions.
Principles to be applied
The principles when a Court is asked to stay the operation of an order, pending the hearing of an appeal, are well settled and the Full Court Aldridge & Keaton (Stay appeal) [2009] FamCAFC 106 said:
18. The principles to be applied in determining an application for a stay of orders both in the general law and in respect of parenting proceedings are also well known (see The Commissioner of Taxation of the Commonwealth of Australia v Myer Emporium Limited [No.1] (1986) 160 CLR 220 at 222; Alexander v Cambridge Credit Corporation (1985) 2 NSW LR 685; Jennings Construction Limited v Burgundy Royale Investments Pty Limited (1986) 161 CLR 681; Clemett & Clemett (1981) FLC 91-013; JRN & KEN v IEG & BLG (1998) 72 ALJR 1329 at 1332). The authorities stress the discretionary nature of the application which should be determined on its merits. Principles relevant to this matter include the following:
· the onus to establish a proper basis for the stay is on the applicant for the stay. However it is not necessary for the applicant to demonstrate any “special” or “exceptional” circumstances;
· a person who has obtained a judgment is entitled to the benefit of that judgment;
· a person who has obtained a judgment is entitled to presume the judgment is correct;
· the mere filing of an appeal is insufficient to grant a stay;
· the bona fides of the applicant;
· a stay may be granted on terms that are fair to all parties - this may involve a court weighing the balance of convenience and the competing rights of the parties;
· a weighing of the risk that an appeal may be rendered nugatory if a stay is not granted – this will be a substantial factor in determining whether it will be appropriate to grant a stay;
· some preliminary assessment of the strength of the proposed appeal – whether the appellant has an arguable case;
· the desirability of limiting the frequency of any change in a child’s living arrangements;
· the period of time in which the appeal can be heard and whether existing satisfactory arrangements may support the granting of the stay for a short period of time; and
· the best interests of the child the subject of the proceedings are a significant consideration.
I make the following findings within the matrix of the above considerations noting that this is a financial matter and not a parenting matter. In that respect, I merely observe that it is likely the Appellant will need leave to appeal as the order is interlocutory in nature, and whilst the order does require the sale of the G Street property, it does not determine finally the respective interests of the parties on the substantive proceedings for enforcement.
The onus rests upon the husband to establish a proper basis for the stay. His affidavit in support of the application fails to do so – merely making legal assertions. It is clear from the oral submissions that the husband contends that, effectively, converting his interest in the G Street property to cash rather than an interest in property, will mean he is unable to use the “equity” for future borrowings to maintain his business as a property developer. On balance, I do not regard his application for a stay as improper. I accept the Applicant brings the appeal bona fide.
The wife is entitled to the benefit of the judgment which is presumed to be correct. The terms of the order do not actually materialise in a payment to the wife in part payment of what she claims she is entitled to receive under the financial agreement. The distribution of any funds as between the parties, is yet to be determined.
The husband made it clear that he is not able to make any “open offer” of payment to the wife if the stay were to be granted. This is, at least consistent with the assertions of the husband (not accepted by the wife) that he has no funds to pay her. He acknowledges he is not paying the mortgage and rates and other charges on the unit occupied by the wife, or the motor vehicle, as previously ordered by the Court and not set aside by the Court.
The husband asserts that if the order is not stayed, the appeal is rendered nugatory in that the G Street property may well have been sold by the time the appeal is heard.
Without knowing when the appeal is likely to be heard, I could not dismiss the husband’s concerns about a likely sale being effected. However, the substantive proceedings are for enforcement. The nett funds will still be available (albeit reduced by sale costs). The husband contended that it is likely in his view, in the current market, that the G Street property will be sold for less than it was acquired – such that no taxation implications apply. It is noted the husband’s appeal asserts otherwise. The wife contends there is “nothing specific or special about the [G Street] property”. I agree, save that on the husband’s evidence it is registered in his name and is unencumbered – unlike most of his other interests.
Whilst it is always difficult for a trial judge to make an assessment of any appeal against their own order, on the grounds currently articulated in the Notice of Appeal, the prospects of obtaining leave and, if granted, successfully appealing the orders for the sale of the G Street property, are not strong. In essence, the husband seeks to continue to operate his property development business without any recognition of his obligations under the terms of the financial agreement. Whilst I can understand the essential modus operandi of a property developer is to move from one development to another, the wife raises serious concerns about the husband’s sale of property and interests (e.g. management rights) and dissipation of those funds including to his children. The G Street property represents the only unencumbered property of the husband and her enforcement application, in those circumstances, targeted the property so that its sale and movement of sale proceeds did not occur – at least until her application for enforcement is determined.
Conclusion
I am satisfied that applying the appropriate principles, I must order the husband’s application for a stay be dismissed.
Mr Brandon, for the wife, seeks an order that the husband pay costs of the application for a stay, fixed in the sum of $4,000. It is entirely unclear how this sum is estimated.
I am satisfied that, as the husband was wholly unsuccessful, an order for costs in the wife’s favour is justified. I would prefer that costs be fixed, so as to save additional costs of taxation, but without any indication of how the costs claimed have been estimated (and whether they are sought on an indemnity basis or not), a fixing of costs is likely to be seen as purely arbitrary. In the circumstances, I propose to make an order for the husband to pay the wife’s costs of the application for a stay, but leave the assessment of those costs and when payment should be made, to be determined within the broader context of the enforcement proceedings.
I certify that the preceding nineteen (19) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Baumann delivered on 31 January 2019.
Associate:
Date: 31 January 2019
APPENDIX ONE
That the property situated at G Street, Suburb H in the State of Queensland (“the G Street property”) be sold.
That for the purpose of Order 1 hereof:
a. the wife is hereby appointed trustee for sale for the G Street property; and
b. the husband as sole Director of J Pty Ltd ATF J Trust shall cause the transfer and assignment to the wife as Trustee, for the purpose of Order 2(a) hereof, the whole of the interest in the G Street property and for this purpose:
i.the wife shall forthwith prepare a memorandum of transfer of the interest to the wife as Trustee;
ii.the wife shall forthwith serve the memorandum of transfer upon the Registrar of this Honourable Court; and
iii.the Registrar is appointed pursuant to s.106A of the Family Law Act 1975 to execute the transfer in the name of the owner of the G Street property, namely J Pty Ltd ATF J Trust, and to do whatever other acts and things that may be necessary to give validity and operation to the said transfer.
That as at the wife becoming Trustee for sale:
a. the wife shall have the sole right to give effect to the choosing of an agent and/or auctioneer (if necessary) and the choosing of a solicitor or conveyancer to act on the sale;
b. the wife shall before setting the listing price or reserve price (if applicable), consult with the husband with her proposal and any supporting evidence not less than seven (7) days before setting or appointing the listing price or reserve price (if applicable);
c. the wife shall provide the husband with details of all genuine offers received by her as Trustee within forty eight (48) hours of receipt;
d. the wife shall give the husband not less than seven (7) days’ notice in writing of her intention to accept any offer to purchase to be accompanied by a copy of the contract of sale setting out full terms and conditions of the offer to purchase;
e. if the parties are unable to agree on acceptance of any offer then either party shall have leave to re-list the application, to allow the Court to decide whether the contract should be accepted; and
f. if no such application is made, the wife as Trustee shall be entitled, if she elects to do so, to accept the offer.
That, for the purposes of giving effect to Orders 1 to 3 of these Orders:
a. the wife as Trustee be empowered to sign all documents in respect of the G Street property including but not limited to entering into an agency agreement on behalf of the owner of the property, entering into a costs agreement with a solicitor or conveyancer on behalf of the owner the G Street property, entering into a contract and signing a transfer in respect of the said sale on behalf of the owner of the G Street property; and
b. the wife as Trustee shall cause the G Street property to be sold for the market price reasonably obtainable.
That upon completion of the sale of the G Street property, the proceeds be distributed in the following order and priority:
a. In payment of agents commission and selling costs;
b. In payment of legal costs associated with the sale; and
c. In adjustment of rates and other outgoings in accordance with usual conveyancing practice.
That the remaining proceeds from the sale of the G Street property be paid to the Evans and Company Family Lawyers Trust Account to be held in the parties’ joint names, not be disbursed unless by written agreement of the parties or further Court Order or as follows:
a. In payment of the loan secured against the motor vehicle, Registration number ...
That within fourteen (14) days of completion of the sale of the G Street property, or prior to completion of the sale if the wife elects, the wife shall file an Application in a Case specifying how the remaining proceeds from the sale of the G Street property should be distributed.
That pursuant to Rule 17.02 of the Family Law Rules 2004:
a. Order 4(b) of the Orders dated 3 April 2018 be varied by replacing “sixty (60)” with “thirty (30)”; and
b. Order 6 of the Orders dated 3 April 2018 be set aside.
That the costs of today’s application be reserved.
10. That these proceedings be adjourned for Case Management Hearing at 9.30am on 25 March 2019 in the Family Court of Australia at Brisbane.
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