Ochoa & Fonseca (No 2)
[2025] FedCFamC1F 279
•1 May 2025
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 1)
Ochoa & Fonseca (No 2) [2025] FedCFamC1F 279
File number: SYC 3210 of 2024 Judgment of: CAMPTON J Date of judgment: 1 May 2025 Catchwords: FAMILY LAW – PRACTICE AND PROCEDURE – Injunctive orders – Where the de facto wife seeks injunctive orders to receive notice prior specified dealings with a unit trust and a discretionary trust of which she contends the de facto husband directs the conduct of – Where the appointor and the trustees of those trusts, being the second, fourth, and fifth respondents, oppose the injunctive orders as sought – Where those respondents contend the evidence does not establish that the de facto wife has an arguable case to justify preservation of the status quo and that, in absence of a risk of dealing with assets to frustrate a judgment, an injunction cannot be grounded by application of the “chicken soup” principle – Where the balance of convenience favours the injunctive orders broadly as sought by the wife amended to a defined scope – Notification orders made. Legislation: Family Law Act 1975 (Cth) Pt VIIIAB, s 90SM Cases cited: Ochoa & Fonseca [2025] FedCFamC1F 278
Tsiang & Wu and Ors (2019) FLC 93-911; [2019] FamCAFC 128
Division: Division 1 First Instance Number of paragraphs: 43 Date of hearing: 25 March 2025 and 30 April 2025 Place: Sydney Counsel for the Applicant: Mr Sirtes SC with Mr Macauley of counsel Solicitor for the Applicant: Pickering Pendleton Counsel for the First Respondent: Mr Kadar of counsel Solicitor for the First Respondent: Jordan Djundja Lawyers Counsel for the Second, Fourth and Fifth Respondents: Mr Richardson SC Solicitor for the Second, Fourth and Fifth Respondents: Ga Lawyers The Third Respondent: No appearance ORDERS
SYC 3210 of 2024 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)
BETWEEN: MS OCHOA
Applicant
AND: MR FONSECA
First Respondent
MS FONSECA
Second Respondent
B PTY LTD (ACN…) (and others named in the Schedule)
Third Respondent
ORDER MADE BY:
CAMPTON J
DATE OF ORDER:
1 MAY 2025
THE COURT ORDERS THAT:
1.On the Applicant’s Undertaking as to Damages dated 30 April 2025, each of the Second, Third, Fourth and Fifth Respondents personally and/or in their capacity as appointors, directors, shareholders and/or trustees of the B Investment Trust (of which the Fourth Respondent is the trustee), and the B Unit Trust (of which the Fifth Respondent is the trustee), be restrained by injunction from:
(a)without first providing the Applicant 28 days’ written notice, transferring, selling, encumbering, or further encumbering the property situated at G Street , Suburb H NSW (“Suburb H Property”) or the units in the B Units Trust held by the B Investment Trust with such notice to include;
(i)details as the proposed transfer, sale, borrowing against, or increase in borrowing against any of the foregoing assets, including the amount of any borrowing, and the reason for the borrowing;
(ii)a copy of the proposed sale or transfer document, mortgage (or encumbrance), or application for borrowing against any of the foregoing assets; and
(iii)any other deed, agreement or other document prepared for the purposes of and/or giving rise to the proposed sale, transfer, borrowing or increase in borrowing against any of the foregoing assets.
(b)taking any steps to cause the present trustee of the B Unit Trust to be removed and/or replaced as trustee of the B Unit Trust and/or causing any new trustee to be appointed to the B Unit Trust;
(c)taking any steps to cause the present trustee of the B Investments Trust to be removed and/or replaced as trustee of the B Investments Trust and/or causing any new trustee to be appointed to the B Investments Trust;
(d)taking any steps to cause the Second Respondent to be removed and/or replaced as Appointor for the B Investments Trust and/or causing any new Appointor to be appointed to the B Investments Trust;
(e)taking any steps to cause the First Respondent to be removed as a named beneficiary (i.e., ‘named person or persons’) of the B Investments Trust and/or causing any new beneficiary (i.e., ‘named person or persons’) to be added to the B Investments Trust;
(f)without first providing the Applicant 28 days’ notice, causing B Investments Trust from making any distribution of income or capital or corpus of the trust, or creating any present entitlement in favour of any beneficiary, or causing the vesting of the trust; and
(g)taking any steps to dispose of, cancel or transfer any of the units held by B Investments Trust in the B Unit Trust and/or causing any new units to be issued in the B Unit Trust to any other person and/or entity.
2.Nothing in Order 1 is to prevent or restrain the Third Respondent from transferring the legal title to the Suburb H Property or any other property held by the B Unit Trust to the Fifth Respondent, and causing the Fifth Respondent to become the registered proprietor thereof, to hold such property on trust for the B Unit Trust.
3.Upon the Third Respondent complying with the transfer of property provided for in Order 2 hereof, including transferring the legal title of Suburb H Property to the Fifth Respondent, the Third Respondent is to be removed as a party to these proceedings, with no order as to costs.
Note: The form of the order is subject to the entry in the Court’s records.
Note: This copy of the Court’s Reasons for judgment may be subject to review to remedy minor typographical or grammatical errors (r 10.14(b) Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 10.13 Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth).
Part XIVB of the Family Law Act 1975 (Cth) makes it an offence, except in very limited circumstances, to publish an account of proceedings that identify persons, associated persons, or witnesses involved in family law proceedings.
IT IS NOTED that publication of this judgment by this Court under the pseudonym Ochoa & Fonseca has been approved pursuant to subsection 114Q(2) of the Family Law Act 1975 (Cth).
REASONS FOR JUDGMENT
CAMPTON J:
These reasons determine the application of Ms Ochoa (“the de facto wife”) for interlocutory relief for the preservation of property as against the second, third, fourth, and fifth respondents in substantive proceedings as to the adjustment of property between she and Mr Fonseca (“the de facto husband”) pursuant to s 90SM of the Family Law Act 1975 (Cth) (“the Act”). The second to fifth respondents were joined as parties to the proceeding subsequent to ex tempore reasons for judgment delivered and orders made yesterday, on 30 April 2024 (Ochoa & Fonseca [2025] FedCFamC1F 278). These reasons assume familiarity with that judgment.
By way of short context, the B Unit Trust (“the Unit Trust”) was established by way of a deed on 6 January 2005. The trustee of the Unit Trust was, from 6 January 2005 until 12 March 2025, B Pty Ltd, now the third respondent. The de facto husband and his brother, Mr F, have at all times been the equal shareholders and directors of that trustee corporation.
In February 2005 B Pty Ltd, on behalf of the Unit Trust, acquired the property at G Street, Suburb H (“the Suburb H property”) for $7 million. In September 2023 a valuation expert opined that, with vacant possession, the value of the Suburb H property was $32 million. The property is subject to mortgage encumbrances broadly in the range of $10 million.
All of the issued units in the Unit Trust have at all times been beneficially held for the B Investments Trust (“the Discretionary Trust”).
The Discretionary Trust was established by deed in January 2005. B Investments Pty Ltd was the corporate trustee of that trust from 6 January 2005 until 12 March 2025. From the time of its incorporation, the de facto husband and Mr F have been the equal shareholders and directors of that trustee corporation.
The trustee has an unfettered discretion to distribute the capital and income of the Discretionary Trust, which, in turn, by way of its ownership of the units in the Unit Trust, could access and distribute the Suburb H property, its proceeds of sale, or funds raised by way of mortgage against it. The de facto husband and Mr F are the named income and capital beneficiaries of the Discretionary Trust and hence the de facto husband can obtain the beneficial interest in the property of the Discretionary Trust.
On 7 July 2007 the de facto husband entered a deed removing himself as the appointor of the Discretionary Trust, having the power to appoint and remove trustees of that trust, and replaced himself with his mother, now the second respondent, as the appointor of that trust. She remains as the appointor of the Discretionary Trust to this time.
The reasons delivered on 30 April 2025 record the de facto wife’s case that the husband’s mother, the second respondent, is the puppet of the de facto husband, he directing the conduct of the Discretionary Trust. She seeks a finding that the Discretionary Trust is the property of the de facto husband amenable to adjustment in the s 90SM proceedings. She contends the de facto husband has the ultimate control of the vesting and distribution of the income and capital of the Discretionary Trust, including to himself, and that the income and capital includes all the units in the Unit Trust and hence the Suburb H property and the other assets of the Unit Trust. The reasons delivered yesterday record the pleadings and evidence of the de facto wife to support her contentions.
The de facto wife since the commencement of the property litigation on 29 April 2024 in the Federal Circuit and Family Court of Australia (Division 2) has sought an adjustment in her favour of 55 per cent of the property of she and the de facto husband. It is the de facto husband’s case that the de facto wife ought to receive 20 per cent of that property.
It is the de facto wife’s case that the property held by the discretionary trust through the unit trust and its ownership of the Suburb H property is central to the determination identifying the items and value of property of she and the de facto husband.
Order 6 made by consent on 15 July 2024 provides that, subject to providing the de facto wife 28 days written notice, for the de facto husband to “be restrained by injunction from alienating, further encumbering and/or dealing with any interest he has in any company, trust, partnership and/or real property (including but not limited to any asset of any company, trust, or partnership, including any real property thereof) he may have within Australia and outside Australia,” except as to each of the corporate trustees. The de facto wife sought that the order have application to each of the then-trustees of the Unit Trust and the Discretionary Trust. The de facto husband opposed the order being extended to include those trustees. This dispute, together with other interlocutory matters, was adjourned for hearing to 26 July 2024.
On 26 July 2024 consent orders were made recording:
Notice Requirement:
9.That the Husband (in his personal capacity, his capacity as director and/or trustee [including as a director of a corporate trustee]) provide the Wife 21-days written notice of any intent to alienate, further encumber and/or deal with any interest he (“the Actions”), or any entity in which he has an interest, or any trust of which he is a beneficiary or unit holder, has in the entities listed in Schedule 1 and the Real Property listed is Schedule 2 (the Assets”).
10.That the Husband shall not give effect to any of the proposed acts as set out in the immediately preceding Order until the said 21-day notice period has elapsed.
11.That when complying with Order 9 above, the Husband provide to the Wife the following information and details with respect to the proposed action:
a)A description of the proposed action including the nature of the proposed action, the material facts relating to the proposed action and the relevant parties to the proposed action;
b)When the Husband estimates that the proposed action will occur; and
c)Any deed, agreement or other document prepared for the purpose and/or giving rise to the proposed action.
Carve-Out:
12.The Husband shall not be required to provide notice as set out in Order 9 where the Actions with respect to the Assets are for the purpose of borrowing funds from [B Pty Ltd] at/f [B Unit Trust] and/or [B Investments Pty Ltd] at/f [B Investments Trust] (being no more than $600,000 in total borrowing whether such borrowings are effected by one or more transactions) to be lent to Husband for the following purposes:
a)the payment of legal costs necessary to prosecute and/or defend the proceeding in relation to Supreme Court proceeding No […] ;
b)a payment or payments made in the ordinary course of business related to the Real Property identified in Schedule 2 including but not limited the mortgage, council rates, land tax, water rates and/or any other expense for the maintenance and upkeep of the property situated at [R Street, Suburb Q] NSW […];
c)a payment or payments made in the ordinary course of business to or for the benefit of [E Pty Ltd] provided that the payment is made to [E Pty Ltd];
d)a payment made to or for the benefit of the Wife including but not limited to spousal maintenance; interim property distribution or a funding order/agreement;
e)a payment made in relation to the Child; and
f)a payment for any debt and/or administration costs associated with [S Pty Ltd].
For the purposes of Order 9 made on 26 July 2024, Schedule 1 included each of the corporate trustees, and Schedule 2 included the Suburb H property. Other orders made on 26 July 2024 included amendments to interim parenting orders, for the de facto husband to pay $2,000 each week by way of spouse maintenance to the de facto wife, for the de facto husband to pay $20,000 to the de facto wife with the characterisation of such funds to be determined at the final hearing, for the de facto husband to pay $35,000 by way of litigation funding to the de facto wife’s solicitors, for further disclosure, for the progression of expert valuations and a mediation, and for the de facto husband, in his capacity as director of E Pty Ltd (“E Pty Ltd”), to ensure that all expenses relating to a motor vehicle in the possession of the de facto wife are met.
It is uncontroversial that E Pty Ltd, being an enterprise established by the de facto husband’s parents, historically by way of its then name of E Pty Ltd, operated out of the Suburb H property after its acquisition. E Pty Ltd produced various products for third parties . The de facto husband, Mr F, and the de facto husband’s mother are the shareholders of E Pty Ltd. At least until August 2024, E Pty Ltd paid a salary to the de facto husband, the de facto wife, and Mr F. E Pty Ltd, together with others including the third respondent, are defendants in Supreme Court litigation listed to commence in May 2025. The third respondent in its capacity as trustee of the Unit Trust has provided funds to the de facto husband for the purposes of paying Supreme Court litigation costs, to make spouse maintenance payments to the de facto wife, to make payments for working capital to E Pty Ltd, and to pay some of his costs in these proceedings.
On 6 December 2024 the de facto wife filed an Application in a Proceeding seeking, inter alia, that the de facto husband’s mother be joined as the second respondent to the proceedings and the trustee of the Unit Trust be joined as the third respondent and injunctive orders against them as follows:
14. That, pursuant to s. 114 of the Act and pending further Order, each of the Respondents be restrained by injunction from:
14.1. causing any borrowing secured upon or in any way related to the [Suburb H] Property or the [Suburb Q] Property to be increased in any way;
14.2. causing any new borrowings to be created in any way related to the [Suburb H] Property or the [Suburb Q] Property, whether by way of refinance or increased finance and whether secured or not;
14.3. taking any steps to cause the Third Respondent to be removed and/or replaced as trustee for the [B Unit Trust] and/or causing any new trustee to be appointed to the [B Unit Trust]; Investments Pty Ltd to be removed and/or replaced as trustee and/or causing any new trustee to be appointed to the [B Investments Trust];
14.4. taking any steps to cause the present trustee of the [B Investments Trust] (being [B Investments Pty Ltd]) to be removed and/or replaced as trustee and/or causing any new trustee to be appointed to the [B Investments Trust];
14.5. taking any steps to cause the Second Respondent to be removed and/or replaced as Appointor for the [B Investments Trust] and/or causing any new Appointor to be appointed to the [B Investments Trust]; and
14.6. taking any steps to dispose of, cancel or transfer any of the units held by [B Investments Trust] in the [B Unit Trust] and/or causing any new units to be issued in the [B Unit Trust] to any other person.
On 11 December 2024 orders were made providing for the de facto husband to file and serve a Response to the de facto wife’s Application in a Proceeding filed on 6 December 2024 on or before 27 January 2025, for the de facto wife to file and serve Points of Claim setting out particulars upon which she relies for the joinder of the proposed parties, and for proposed second and third respondents to file and serve any defence they sought to rely upon. The de facto wife filed her Points of Claim on 17 January 2025.
On 7 March 2025 the de facto relationship parties and the de facto husband’s mother appeared before McClelland DCJ. Mr T of counsel appeared for the de facto husband’s mother. The Points of Claim filed by the de facto wife on 17 January 2025 pleaded, albeit ineloquently, at least 50 per cent of the Suburb H property, by way of the trust structures, was the property of the de facto husband amenable for adjustment in the s 90SM cause. The Points of Claim also specifically sought injunctive orders restraining any dealings with the Suburb H property, including increasing liabilities secured upon it and “from altering the trustees or appointors of” the Unit Trust and the Discretionary Trust.
Counsel for the proposed second and third respondents successfully submitted on 7 March 2025, by reference to the Points of Claim filed, that until they were joined to the proceedings, the order for them to file Points of Defence be discharged. They were successful in obtaining that relief.
On that day further orders were made listing the Application in a Proceeding of the de facto wife filed on 6 December 2024 for hearing “at the first reasonably practicable date”. The matter was transferred to Division 1.
On 12 March 2025 orders were made for the Application in a Proceeding of the de facto wife filed on 6 December 2024 to be listed for hearing on 25 March 2025.
On the same day, being some five days after appearing before McClelland DCJ, the husband’s mother, in her capacity as appointor of each of the Unit Trust and the Discretionary Trust and without notice to the de facto wife, appointed C Pty Ltd (now the fourth respondent) as trustee of the Discretionary Trust, and appointed D Pty Ltd (now the fifth respondent) as trustee of the of the Unit Trust.
On 25 March 2025 the hearing of the de facto wife’s Application in a Proceeding filed on 6 December 2024 was adjourned part heard to 30 April 2025. On 16 April 2025 the de facto wife filed Amended Points of Claim.
The injunctive relief sought
The terms of the injunctive relief sought by the de facto wife was initially prosecuted by way of her Application in a Proceeding filed on 6 December 2024, as amended on 25 March 2025 by way of paragraphs 16 and 17 of Exhibit 1. It was further amended by way of Exhibit 7 adduced on 30 April 2025, and again further amended in terms of Exhibit 9 adduced on 30 April 2025. Exhibit 9 records the relief as follows:
1.That, on a without admission basis, and on the Applicant’s Undertaking as to Damages dated 30 April 2025, pursuant to s. 114 and 90AF of the Family Law Act 1975 (Cth) [sic], each of the Second, Third, Fourth and Fifth Respondents personally and/or in their capacity as appointors, directors, shareholders and/or trustees of any relevant entity or trust, be restrained by injunction from:
a.without first providing the Applicant 28 days’ written notice, transferring, selling, encumbering, or further encumbering the property situated at [G Street, Suburb H] NSW […] (“[Suburb H] Property”); any other property of the [B Unit Trust]; or any property of the [B Investments Trust], with such notice to include;
i.details as the proposed transfer, sale, borrowing against, or increase in borrowing against any of the foregoing assets, including the amount of any borrowing, and the reason for the borrowing;
ii.a copy of the proposed sale or transfer document, mortgage (or encumbrance), or application for borrowing against any of the foregoing assets; and
iii.any other deed, agreement or other document prepared for the purposes of and/or giving rise to the proposed sale, transfer, borrowing or increase in borrowing against any of the foregoing assets.
b.taking any steps to cause the present trustee of the [B Unit Trust] to be removed and/or replaced as trustee of the [B Unit Trust] and/or causing any new trustee to be appointed to the [B Unit Trust];
c.taking any steps to cause the present trustee of the [B Investments Trust] to be removed and/or replaced as trustee of the [B Investments Trust] and/or causing any new trustee to be appointed to the [B Investments Trust];
d.taking any steps to cause the Second Respondent to be removed and/or replaced as Appointor for the [B Investments Trust] and/or causing any new Appointor to be appointed to the [B Investments Trust];
e.taking any steps to cause the First Respondent to be removed as a named beneficiary (i.e., ‘named person or persons’) of the [B Investments Trust] and/or causing any new beneficiary (i.e., ‘named person or persons’) to be added to the [B Investments Trust];
f.without first providing the Applicant 28 days’ notice, causing [B Investments Trust] from making any distribution of income or capital or corpus of the trust, or creating any present entitlement in favour of any beneficiary, or causing the vesting of the trust; and
g.taking any steps to dispose of, cancel or transfer any of the units held by [B Investments Trust] in the [B Unit Trust] and/or causing any new units to be issued in the [B Unit Trust] to any other person and/or entity.
2.Nothing in Order 1 is to prevent or restrain the Third Respondent from transferring title to the [Suburb H] Property to the Fifth Respondent, and causing the Fifth Respondent to become the registered proprietor thereof, to hold such property on trust for the [B Unit Trust].
3.Upon the Third Respondent transferring the [Suburb H] Property to the Fifth Respondent, the Third Respondent is to be removed as a party to these proceedings, with no order as to costs.
The de facto wife adduced an undertaking as to damages (Exhibit 8) in support of her relief sought.
The de facto husband did not seek to be heard on the injunctive relief sought by the de facto wife. The third respondent did not appear. The second, fourth, and fifth respondents opposed the orders sought by the de facto wife.
THE LAW
Longstanding principle identifies that the de facto wife must establish both an arguable case with sufficient likelihood of success to justify the preservation of the status quo, and that the balance of convenience favours the grant of the injunction, in that there is a danger or risk of dissipation of, or dealings with, assets which will frustrate any judgment in her favour; see Tsiang & Wu and Ors (2019) FLC 93-911:
20. The grant of an injunction is discretionary and the basis on which such an order is made is well established. A purpose, as in this case, is to preserve the status quo pending resolution of the controversy. An applicant must demonstrate first that there is a serious issue to be tried. While that statement has been the subject of various iterations, in essence it requires the demonstration of an arguable case or as was said in Australian Broadcasting Corporation v O’Neill (2006) 227 CLR 57 at [65], the applicant must “show a sufficient likelihood of success to justify in the circumstances the preservation of the status quo”.
21. Next the applicant must demonstrate that the balance of convenience favours making the order sought. As part of this, the applicant must show that there is a “danger” or risk of dissipation of or dealings with assets which will frustrate any judgment in favour of the applicant.
(Footnotes omitted)
CONSIDERATION
The de facto wife submits that integral to her substantive s 90SM relief is the preservation of the property of the Discretionary Trust, specifically its ownership of the units in the Unit Trust, that in turn owns the Suburb H property.
Exhibit 3, being the de facto wife’s contended balance sheet, records the property of the relationship parties including superannuation to be in the range of approximately $16 million and that the valuation of the de facto husband’s contended property interest in the Suburb H property, ultimately held through the Unit Trust and the Discretionary Trust, is in the range of 75 per cent of the total property.
The relevant subject matter of the litigation is the de facto wife’s right to claim orders for property adjustment under Pt VIIIAB of the Act, particularly s 90SM, and the pool of assets that are subject of that claim, of which the interests of the de facto husband as contended by her in the Discretionary Trust and the Suburb H property forms a fundamental part of the property. The dispute between the de facto husband and the de facto wife concerns the specie and the quantum of a final property adjustment between them including the value of the property and the form it should take.
The de facto wife submits that the form of the orders now sought to achieve that preservation pending the determination of her substantive relief are not traditional “freezing orders” in the strict Mareva sense, but an order mandating the provision of notice, such that on receipt of notice as to the dealing with property that she contends would prejudice her substantive relief, she would have the opportunity thereafter to agitate for further orders to protect and promote her interests. She contends that there is a risk of dissipation of the property interest she seeks to injunct.
The second, fourth, and fifth respondents submit that the evidence adduced by the de facto wife in support of the injunctive relief sought is insufficient to establish a likelihood of success in establishing her contentions as to the de facto husband having ultimate control over the vesting and distribution of the income and corpus of the Discretionary Trust, including to himself, and which corpus includes the totality of the units in the Unit Trust, therein having the entirety of the beneficial interest in the Suburb H property. I do not accept that submission. I find that, as identified in the reasons of 30 April 2025 (Ochoa & Fonseca [2025] FedCFamC1F 278) that while the case as pleaded by the de facto wife and her evidence in support thereof may not have significant merit, the de facto wife has established that the issue as to control of the Discretionary Trust is a serious issue to be tried. Accepting her evidence at its highest, including considering the representations made by the de facto husband to third party financiers as to his interest in the Discretionary Trust, his capacity to access and apply funds from the Unit Trust, and evidence as to admissions in the de facto wife’s affidavit, I accept she has an arguable case to achieve her relief sought. That evidence included the reasons for the de facto husband entering the 2007 deed to cease in his role as the sole appointor of the trustee of the Discretionary Trust and the appointment of his mother in that role:
58.In or around 2013, I suffered a miscarriage while in a relationship with [the de facto husband]. While we were in hospital, I asked [the de facto husband] why he had not had any children at that stage of his life, as he was already in his forties. [The de facto husband] said to me words to the effect of: “In my last relationship with [Ms J], she fell pregnant with twins at or around the time we separated from our last round of IVF. As we were separating and I was already seeing someone else, I made her terminate the pregnancy. I did not have any intention to be with her anymore and I did not want to just be in a relationship with her just because of children”. I was shocked to hear this, as [the de facto husband] had previously told me on several occasions that he and [Ms J] separated as they could not have children, due to her age and some other fertility issues. When I asked him why she terminated the pregnancy, as it may have been her last chance to have children [the de facto husband] said words to the effect of “she knows who I am and what I am capable of”. I took this to mean that [the de facto husband] had threatened her. After I enquired as to what this meant, [the de facto husband] explained that [Ms J] had discovered through viewing his personal emails that he was having an affair. [The de facto husband] later explained that [Ms J] had hired a private investigator and had discovered that the individual with whom [the de facto husband] was having an affair worked at the bank, with [the de facto husband] having dealt with her to obtain loans from the bank. [The de facto husband] explained that the individual with whom he was having an affair also had become pregnant, however, she had decided to terminate their pregnancy. When [Ms J] confronted him about these matters to separate, he said to me that he demanded that she have an abortion and for her to leave their home
59. I asked [the de facto husband] about what else occurred during the separation and [the de facto husband] explained to me: “At the end of our relationship, [Ms J] and her father were working at [E Pty Ltd]. While she was working there, she had access to my emails, which resulted in her finding out about the affair. Before this, in early 2007, my father became sick […] and was in hospital. My mother was living in [Country K] at the time, and she flew back to Australia to help take care of my father and be with us. While my father was in hospital, my mother was living with [Ms J] and I. Our relationship was not going well. I was afraid of my father passing away and a separation occurring with [Ms J], so I transferred my assets into my mother’s name. I wanted to protect my money from any money grabbers. When [Ms J] and I eventually separated, I allowed her father to continue working at [E Pty Ltd] for a year. I gave her a [vehicle] and some cash as a settlement.”.
60. Around 2012, I was cooking in [Suburb M] and taking to [the de facto husband’s mother], who was very upset due to some family problems involving [Mr F] and [Ms L], her daughter in law. They had not been speaking to her for a couple of years and she had very little access to visit her grandsons. [The de facto husband’s mother] explained that it was deeply affecting her and said words to the effect of: "If it was not for the kids, I would ask [Mr F] to divorce [Ms L]." She then started talking about [the de facto husband’s] relationship with [Ms J]. [The de facto husband’s mother] said to me words to the effect of: “When I was staying with [the de facto husband] and [Ms J], I noticed that their relationship was not good. The whole time I was with them in their property at [Suburb M], [Ms J] would go into their bedroom and would never talk to me or [the de facto husband]. She would not come out even to eat. The only thing she was eating were pills. I felt sorry for [the de facto husband]. One time, after my husband passed away, I was so sad I went to the casino. [the de facto husband] came to get me and found me crying. I pleaded with him that I did not want him to ever marry [Ms J] and that I was glad he was protecting himself against her. When I went back to [Country K] after my husband died, [the de facto husband] came to visit me. When he visited, he informed me that he had separated from [Ms J]. When I asked whether it was because of me, he only told me that I was one of the reasons. He did not tell me anything else”.
The de facto husband denied the conversations. The husband’s mother had the capacity to put the fact and terms of the conversation in issue and elected not to do so. Currently, there is no reason not to accept it.
The second, fourth and fifth respondents submit that the de facto wife has failed to adduce sufficient evidence of any dealings with the Discretionary or Unit Trust to pose any future danger or risk of dissipation that will frustrate any judgment in her favour. They submit that any risk is at best theoretical, akin to “chicken soup”, said to be injunctive order sought to make her “feel better”. That submission is not accepted.
An evaluation of prospective risk as to the possibility of the substantive relief of the de facto wife being defeated is informed by the evidence to date.
The gravamen of the case promoted by the second, fourth, and fifth respondents as to the reason for the change of the identity of each of the trustees in March 2025 was as the trustees were “left in a conflicted position… for effective conduct of this litigation”. No express evidence of that decision was adduced by the de facto husband or the other respondents through an affidavit by the de facto husband’s mother or Mr F. The highest the de facto husband’s evidence reached was his summary as to expressions of frustration, dissatisfaction and disappointment having a nexus to this and the Supreme Court proceedings. This is somewhat at odds with the submission of the respondents that the beneficial ownership of the Suburb H property has not changed in that the Discretionary Trust ultimately retains that real property, it is merely the managers of the trusts’ property, by way of the trustees, that has changed.
The danger or risk of dissipation of property is anchored in the change of ownership and control of the trustees, and in the removal of the de facto husband from any day-to-day running of the trusts. The de facto husband now has no capacity to influence or direct the distribution of the income or capital of the Discretionary Trust. On the current version of the de facto wife’s case, the de facto husband previously had complete control of each trust by way of directing his mother’s power of appointment. On a prior version of her case, he had at least half of that control, being a power of veto as between he and Mr F as directors and equal shareholders of the trustees. The de facto husband in his personal capacity and his capacity as a director of the trustees was the subject of restraint in dealing with the subject matter of the litigation by way of prior orders. The changes made to the identity of the trustees on 12 March 2025 extinguished that restraint.
The de facto wife was told about changes to the trustees after they had occurred. Prior to the changes, notice was given of the application for joinder of the now second and third respondents. Each had the benefit of experienced legal advice as to the fact and content of the de facto wife’s Application in a Proceeding filed on 6 December 2024 and her Points of Claim filed 17 January 2025. Each of the fourth and fifth respondents were incorporated on 26 February 2025, after the filing and service of the de facto wife’s December Application in a Proceeding and Points of Claim.
No evidence was filed by the second, fourth, or fifth respondents as to knowledge of the issues in the substantive s 90SM dispute between the de facto husband and the de facto wife and how these issues were considered in making the changes to the trusts on 12 March 2025. Opportunity existed to call direct affidavit evidence from the de facto husband’s mother and Mr F on these subject matters. Implicitly, the de facto husband’s mother and Mr F (as a director of the third respondent) were aware on 7 March 2025 of the de facto wife’s relief sought to join them to this proceeding, of the fact of her contentions as to the de facto husband’s interest in the Suburb H property, and as to the injunctive relief sought.
Notwithstanding the de facto husband’s mother was in hospital from 4 March 2025 until 18 March 2025, she and Mr F had opportunity to provide notice to the de facto wife as to the fact of the imminent changes to the trustee of the Unit Trust and Discretionary Trust and the reasons for them, prior to them being implemented. They did not explain why they considered it appropriate to disclose the fact of the changes to the de facto wife only after the event and not before it. This, in the shadow of, and coupled with, the injunctive orders consented to by the de facto husband as to dealing with property made on 15 July 2024 and 26 July 2024, underscore a reality to the risk contended by the de facto wife.
The de facto wife has demonstrated a prospective risk to her substantive relief sought to the extent to achieve at least notice prior to further changes to the structures managing the trust and their primary property, the Suburb H property.
The balance of convenience favours the de facto wife to receive notice prior to changes being made to the relevant corporate and trust entities or as to any dealing with the identified real property interest. The second, fourth, and fifth respondents did not adduce any evidence as to how a provision of notice will stymie their day-to-day operations or prejudice them. They have a capacity to apply to vary injunctions as to notice on such terms as they consider appropriate. The time frame of the notice period will give the de facto wife an opportunity to digest and evaluate proposed arrangements or transactions to be undertaken. She will thereafter have the onus to make application, if so advised, to prevent the arrangement or transaction proceeding or being implemented, if she considers them to be objectionable.
The orders as sought by the de facto wife will be amended to delete “any relevant entity or trust”. She did not submit the identity of any such entity or trust. The de facto wife did not identify any other asset of value of either trust sought to be included in the property of the parties if it was sold or further encumbered other than the Suburb H property or the units in the Unit Trust. The order will reflect that circumstance. The words “any property” will be deleted from the order sought.
The third respondent remains the registered legal owner of the Suburb H property. The parties who appeared yesterday agreed that it is appropriate that the title of that property be transferred to the fifth respondent, as trustee for the Unit Trust, and upon that event, the third respondent be removed as a party to these proceedings. Such order will be made.
I certify that the preceding forty-three (43) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Campton. Associate:
Dated: 1 May 2025
SCHEDULE OF PARTIES
SYC 3210 of 2024 Respondents
Fourth Respondent:
C PTY LTD (ACN…)
Fifth Respondent:
D PTY LTD (ACN…)
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