PATRICK and NOSCHESE

[2005] FCWA 12

JURISDICTION : FAMILY COURT OF WESTERN AUSTRALIA

ACT: FAMILY LAW ACT 1975

LOCATION: PERTH

CITATION: PATRICK and NOSCHESE [2005] FCWA 12

CORAM: THACKRAY J

HEARD: 10 JANUARY 2005

DELIVERED : 9 FEBRUARY 2005

FILE NO/S: PT 5372 of 2004

BETWEEN: MS PATRICK

Applicant

AND

MR G NOSCHESE
Respondent

MS A NOSCHESE
Second Respondent

MR B NOSCHESE
Third Respondent

MR H NOSCHESE
Fourth Respondent

Catchwords:

SUMMARY DISMISSAL - claim against third parties - Court's powers to order sale of property owned by third parties pursuant to s 90AE - accrued jurisdiction - cross vested jurisdiction.
PRACTICE & PROCEDURE - amendment of application to ensure issues properly identified.

Legislation:

Family Law Act 1975, s 79, s 90AE
Property Law Act 1969, s 126
Jurisdiction of Courts (Cross-Vesting) Act 1987, s 4(2), s 4(6), s 11

Category: Not Reportable

Representation:

Counsel:

Applicant: Mr R Butcher

Respondent: Ms H Athanasiou

Second Respondent : Mr A Davies

Third Respondent : Mr A Davies

Fourth Respondent : Mr A Davies

Solicitors:

Applicant: Butcher Paull & Calder

Respondent: Ferrier Athanasiou & Kakulas

Second Respondent : O'Sullivan Davies

Third Respondent : O'Sullivan Davies

Fourth Respondent : O'Sullivan Davies

Case(s) referred to in judgment(s):

Bigg v Suzi (1998) FLC 92-799

C & C Accrued jurisdiction (2001) FLC 93-076

Re Wakim; Ex Parte McNally (1999) 198 C.L.R. 511

Warby & Warby (2002) FLC 93-091

WORDS IN SQUARE BRACKETS REPLACE WORDS USED IN THE ORIGINAL
JUDGMENT - PARTIES’ NAMES AND IDENTIFYING DETAILS HAVE BEEN

CHANGED

1I am asked to rule on a preliminary issue concerning the Court’s jurisdiction to make orders affecting third parties.

Background

2The husband and wife commenced cohabitation in 1992, were married [in] 2001 and separated [in] 2002.

3In 1995 the husband, together with three of his relatives, acquired a property at [N Street, Suburb A] as tenants in common in equal shares.

4On 21 October 2004 the wife commenced proceedings in the Family Court of Western Australia seeking an order in the following terms:

“The land situate at [N Street, Suburb A] (Certificate of Title Volume [xxxx] Folio [xxx]) which land is owned equally by the four Respondents be sold and after discharging Mortgage [xxxxxxx] the Applicant be paid 20% of the net proceeds of sale.”

5The wife named the husband and the three relatives as respondents to the application. The husband, the wife and the relatives attended a case assessment conference on 24 November 2004. The Registrar conducting the conference made the following notation:

“Counsel for [the relatives] raised a jurisdictional issue regarding the ability of the Applicant to seek orders against [the relatives]. I considered it appropriate this issue be placed before a Duty Judge for determination.”

6The Registrar made directions for the filing of written submissions and affidavit evidence. The relatives filed their written submissions on 24 December 2004, along with a Response seeking the dismissal of the wife’s application against them. On 6 January 2005 the wife filed her submissions. She also filed an affidavit by her solicitor, attaching items of correspondence that had passed between the parties.

7On 10 January 2004, the matter came before me, at which time counsel for all parties made supplementary oral submissions. I reserved my decision.

8In their written submissions, the relatives drew attention to certain matters they argued should be considered in the event “the Court considers that the applicant’s application has an equitable cause of action which may fall within its accrued jurisdiction”. On 13 January 2005, the Acting Principal Registrar received a letter in the following terms from the relatives’ solicitors:

“We are concerned that during the exchange [i.e. at the hearing on 10 January 2005] his Honour may have been left with the impression that we were seeking a ruling from him on the issue as to whether accrued jurisdiction should be applied in this case. That is not our position as it would be most unfair to seek a ruling on such a complex matter at this stage without detailed submissions including reference to the appropriate list of authorities.”

Defects in the form of order sought

9Before considering the various submissions made, I draw attention to two difficulties in the drafting of the order sought by the wife.

10The first arises from the common (and inappropriate) practice of framing orders for sale of property in the passive form, rather than directing named individuals to do specific acts necessary to effect a sale of the property. The unsatisfactory consequences of this practice are highlighted in the present case, which involves multiple owners of the property. Precisely what would each of them be required to do in order to comply with an order made in the vague terms proposed? However, this defect is not fatal to the application and can be remedied by amendment.

11The second, and more serious, defect became apparent only during the course of hearing the oral submissions of counsel for the wife. During his argument, counsel made clear that the wife’s claim was based on a belief that the Certificate of Title for the N Street property does not reflect the beneficial ownership. It appears the wife wishes to assert that she and/or her husband are entitled in equity to more than a 25% interest in the property. According to her counsel, the 20% share the wife wishes to receive from the proceeds of sale of the property would not all be derived from the husband’s 25% interest.

12In view of this assertion, it is apparent the Application needs to be amended to put the Respondents on notice as to the precise declarations/relief the wife is seeking.

Submissions in relation to summary dismissal

13Although there has been no Form 2 filed, the relatives have, in effect, asked the Court to dismiss the wife’s case against them summarily. The basis upon which it is asserted this should occur is set out in what is described as the “primary submission” in their written argument.

14The first of the primary submissions made by the relatives relates to an alleged failure of the wife to comply with “any pre-action procedures”. I am satisfied from reading her solicitor’s affidavit that the wife did make some attempt to comply with the pre-action procedures. Although it seems the wife may not have complied strictly with all of the pre-action procedures, I make no final finding for two reasons. First, I do not consider the issue was fully argued before me. Secondly, I am not satisfied failure to comply with all of the pre-action procedures provides a foundation for summary dismissal of a substantive application. There may be other consequences, for example in relation to costs, but those matters will be determined at a later stage of the proceedings.

15The second primary submission made on behalf of relatives is that the wife’s application “discloses no cause of action” against them. The submissions go on to note that the wife seeks only 20% of the proceeds of sale of the N Street property; that the husband has a 25% interest in the property; and that accordingly, “there is no need to involve [the relatives]” in the proceedings at all. The submissions also draw attention to the fact that the land is currently listed for sale.

16In her written submissions, the wife responds in these terms:

“In order for the wife to receive a settlement at all, the land in [N Street] needs to be sold. As this affects the rights of [the relatives] it was necessary for that reason alone for them to be joined.”

17The wife’s submissions went on to say that she had only became aware a “for sale” sign had been placed on the property after the proceedings were commenced.

18In his supplementary oral submissions, counsel for the wife correctly asserted that the mere naming of the relatives as respondents to the application does not require them to take any part in the proceedings. It is open to them simply to await the decision of the Court. He drew attention by analogy to the practice in the Supreme Court of joining the Registrar of Titles as a Respondent to proceedings involving property. Although the Registrar is a party to the proceedings, and abides by the orders of the Court, the Registrar does not ordinarily take any active part and therefore incurs no legal costs.

19If the only claim against the relatives were an order requiring them to sell a property they already wished to sell, it would have been open to them to take no part in the proceedings after they were formally served. There was little prospect a judicial officer would interpret the wife’s application (in its current form) as suggesting anything other than that her 20% of the proceeds of sale would come from the husband’s share. On the other hand, persons named as Respondents to litigation are perfectly entitled to take part if they wish to do so. It may well have been unwise for the respondents not to seek at least limited involvement, since the proposed order was entirely silent as to the method of sale of their property and the terms and conditions on which it was to be sold.

20Having elected to exercise their right to take part in the proceedings, the relatives have also exercised another right open to all parties, and that is to seek summary dismissal of the claim against them.

21In opposing summary dismissal, the wife asserts there are two bases upon which she is entitled to pursue her claim against the relatives. The first relies on the Court’s accrued jurisdiction, and the second relies on the powers of the court pursuant to s 90AE of the Family Law Act 1975. The relatives do not appear to deny that the Family Court of Western Australia has the same accrued jurisdiction as the Family Court of Australia - see Warby & Warby (2002) FLC 93-091. There is also no doubt that s 90AE of the Act is now operative, albeit it was not in force at the time the wife’s application was made.

Section 90AE

22I will consider the s 90AE argument first, as in my view it is determinative of the application for summary dismissal.

23Prior to the very recent commencement of s 90AE, the wife arguably could not have invoked the jurisdiction of the Family Court of Western Australia to make orders requiring third parties to sell their interest in real estate. That power ordinarily rests with Judges of the Supreme Court pursuant to the provisions of s 126 of the Property Law Act 1969. However, s 90AE(2)(b) of the Family Law Act 1975 now permits the Family Court to make an order in proceedings under s 79 that “alters the rights, liabilities or property interests of a third party in relation to the marriage”. The extent of the Court’s powers under Part VIIIAA of the Family Law Act, of which s 90AE forms an important part, has not yet been the subject of judicial consideration.

24The Court’s power to dismiss proceedings summarily is rarely and sparingly exercised. In order to secure such relief, the relatives must show it is clear on the face of the wife’s documents that she lacks a reasonable cause of action: Bigg v Suzi (1998) FLC 92-799.

25In my view, it is arguable the provisions of s 90AE(2)(b) could be invoked to require third parties who share the ownership of real estate with a party to a marriage, to sell the land to facilitate a just and equitable distribution of property between husband and wife. Such an order, prima facie, “alters the rights, liabilities or property interests of a third party in relation to the marriage” and is therefore arguably within the jurisdiction of the Court. On this basis alone, it would be inappropriate to dismiss the wife’s application summarily.

Accrued jurisdiction

26The real issue between the parties, however, appears not to be the sale of the N Street property, but the determination of its true ownership. The wife asserts this issue comes within the accrued jurisdiction of the Family Court of Western Australia in resolving the property dispute between the husband and the wife.

27It is important the parameters of the real dispute be identified as early in the proceedings as possible, so the relatives will be aware of the nature of the claim against them. In my view, the wife’s application should be amended to identify precisely the relief sought. However, she says that “until a full disclosure is given, [she] cannot say who should receive what out of the proceeds of sale of the property. The sum sought is an estimate made in good faith”.

28Whilst it may (possibly) be reasonable in proceedings between husband and wife in this Court for one party to be permitted to delay specifying their claim until after full disclosure is provided, I am far from convinced such indulgences should be extended where third parties are drawn into the proceedings. If the wife considers she has a claim against the third parties, she should state it with particularity and not embark on what otherwise might appear to be a “fishing expedition”.

29Is there anything more the Court should do at this stage, other than requiring the wife to specify exactly the relief she seeks? In this regard, the relatives’ submissions conclude by saying:

“The Court should consider whether to decide the issue of jurisdiction as a discrete matter by way of a preliminary point of law and whether any of the Rules of the Supreme Court of Western Australia should apply to the claim.”

30The relatives’ submissions appear to be founded in part upon the belief that parties may initiate proceedings in the Family Court of Western against third parties in all “State matters” pursuant to the “cross-vesting” legislation. In my experience, this is a common misapprehension. It confuses the position of this Court with the position that prevailed in the Family Court of Australia prior to the decision in Re Wakim; Ex Parte McNally (1999) 198 C.L.R. 511. That confusion may arise from failure to observe that the reference to “the Family Court” in s 4(2) of the Jurisdiction of Courts (Cross-Vesting) Act 1987, is a reference only to the Family Court of Australia. Consideration of s 4(6) shows that in disputes involving what can be called Western Australian State matters, the Family Court of Western Australia is entitled to exercise “cross-vested jurisdiction” only in those cases formally transferred from the Supreme Court of Western Australia. There can therefore be no suggestion that the wife’s current claim against the relatives arises under the Court’s “cross-vested” jurisdiction.

31It would only be in the event the wife commenced proceedings in the Supreme Court, and was successful in having them transferred to this Court, that it would be appropriate to consider whether any of the Rules of the Supreme Court should apply - see s 11 of the Jurisdiction of Courts (Cross-Vesting) Act. If the wife elects simply to continue to seek to invoke the accrued jurisdiction of this Court, there would be no basis for importing the Supreme Court Rules, as suggested in the submissions made on behalf of the relatives.

32The relatives’ submissions also foreshadow the possibility of the Court considering whether to have a discrete hearing to determine whether it has, and will exercise, accrued jurisdiction. If the wife does amend her application to press her claim that she and/or her husband hold a greater than 25% interest in the property, the observations made by Jerrard J in C & C Accrued jurisdiction (2001) FLC 93-076 could prove to be of assistance in determining whether the issue comes within the court’s accrued jurisdiction. However, I consider it is premature to determine whether this matter should be the subject of further preliminary jurisdictional argument until such time as the wife has amended her application and laid on the table the evidence upon which she relies in seeking relief against the relatives.

33In coming to my decision, it seems to me from the submissions that the wife’s claim is a very modest one. In my view it would be highly desirable for the parties (including the relatives) to settle the dispute without incurring further substantial legal costs in arguing jurisdictional points. Accordingly, I consider the following to be the appropriate manner in which this litigation should proceed: -

34First, the wife should amend her application setting out with particularity the relief she seeks against the relatives.

35Secondly, the wife should file an affidavit setting out the evidence upon which she relies in seeking relief against the relatives, so they will have some idea of the nature of her claim and the strength of the evidence upon which she intends to rely.

36Thirdly, the parties should attend the conciliation conference already fixed for March 2005, and attempt to resolve the dispute by negotiation.

37Fourthly, if the parties consider jurisdictional arguments should be the subject of further preliminary consideration by the Court, they should file a formal application after the conference, seeking such orders as they consider to be appropriate. In the absence of such an application the matter will simply make its way through the Court’s usual Case Management system, and the trial Judge will rule on jurisdictional issues at the time of trial.

38Although I consider the wife’s current application to be defective in form, I do not propose to strike it out, as I was invited to do by counsel for the relatives. Whether the Court still has such a power under the new Rules is, in my view, a moot point, which I find it unnecessary to decide. Even if I have such power, I consider it more appropriate to require the wife to amend her application.

Orders

39For these reasons, and subject to hearing further from counsel, I propose making the following orders:

1.The wife shall file an amended application on or before 14 March 2005.

2.Not later than 14 March 2005 the wife shall file and serve an affidavit setting out the evidence upon which she intends to rely in seeking orders against the second, third and fourth respondents.

3.There be liberty to apply.

I certify that the preceding [39] paragraphs are a true copy of the reasons for
judgment delivered by this Honourable Court

Associate