Peters and Peters and Ors
[2011] FamCA 856
FAMILY COURT OF AUSTRALIA
| PETERS & PETERS & ORS | [2011] FamCA 856 |
| FAMILY LAW – INTERLOCUTORY PROCEEDINGS – contravention, damages and penalties under Corporations law - order for the issue of a replacement Certificate of Title - mandatory injunctions for restoration of funds - injunctions in relation to practice and procedure - declaration of proceedings as vexatious. |
| Family Law Act 1975 (Cth) ss 114, 118 | |
| Corporations Act 2001 (Cth) ss 1317E & 1317J | |
| Real Property Act 1900 (NSW) s 138 | |
One.Tel Limited (In Liquidation) v John David Rich and Ors [2005] NSWSC 226 (23 March 2005); Rich v ASIC (2004) 209 ALR 271; Scott Darren Pascoe in his capacity as liquidator of Charter Workforce Pty Ltd (In Liq) and Anor v Divisional Security Group Pty Ltd and Ors [2007] NSWSC 211 (14 March 2007); The Attorney-General and Wentworth (1988) 14 NSWLR 481 at 491; Oceanic Sun Line Special Shipping Co Inc v Fay (1998) 62 ALJR 389; 79 ALR; Vlug & Poulos [1997] FCA 92-778; Lindberg & Scott [2009] FamCA 465.
| APPLICANT: | Ms Peters |
| RESPONDENT: | Mr Peters |
| FILE NUMBER: | TVC | 1541 | of | 2007 |
| DATE DELIVERED: | 11 March 2011 |
| PLACE DELIVERED: | Sydney |
| PLACE HEARD: | Sydney |
| JUDGMENT OF: | Loughnan J |
| HEARING DATE: | 28 January 2011 |
REPRESENTATION
| THE APPLICANT: | Wife in person |
| COUNSEL FOR THE RESPONDENT: | Mr B Mr Rs |
| SOLICITOR FOR THE RESPONDENT: | Ms F Lawyers Pty Limited |
| Mr R Peters in person |
| SOLICITOR FOR MINISTER NSW | NSW State Crown Solicitor |
SOLICITOR FOR SUNDRY RESPONDENTS: | Mr C. Dimock |
Orders
An order is made in terms of the order sought at paragraph 3 of the husband’s Application in a Case filed 9 September 2010 as follows:
3.That in furtherance of Order 3 of the Orders made by Federal Magistrate Kemp on 27 October 2010 the Court make the following Order to require that the Registrar General of NSW do all things and sign all documents to:
3.1In accordance with Section 138 of the Real Property Act 1900 issue a new edition of Certificate of Title in relation to the property being that parcel of land contained in Certificate of Title Folio Identifier … and known as B Street, Suburb C, Sydney (Suburb C).
3.2That upon the Certificate of Title being issued the Registrar General process the Application for Transfer of the property to D Pty Ltd (as Trustee of the E Super Fund).
3.3That upon completion of the Certificate of Title pertaining to Suburb C to D Pty Ltd the Certificate of Title issued in the name of D Pty Ltd be forwarded to F Pty Ltd, P.O. Box ... G Suburb to be held in safety custody.
Otherwise the Applications in a Case filed on behalf of the wife on 2 August 2010 and 24 September 2010 and her Responses filed 17 September 2010 and 21 September 2010 and the husband’s Application in a Case filed 9 September 2010 and his Response filed 2 November 2010 are dismissed.
IT IS NOTED that publication of this judgment under the pseudonym Peters & Peters is approved
| FAMILY COURT OF AUSTRALIA AT SYDNEY |
FILE NUMBER: TVC 1541 of 2007
| Ms Peters |
Applicant
And
| Mr Peters |
Respondent
And
| Mr R Peters |
REASONS FOR JUDGMENT
Introduction
There are parenting and property proceedings before the Court. The family law proceedings were commenced in December 2007. Many interlocutory applications have been filed. On 22 November 2010 I adjourned the proceedings for hearing on 28 January 2011 in relation to Applications in a Case filed on behalf of the wife on 2 August 2010, 24 September 2010 and 16 November 2010, the husband’s Application in a Case filed 9 September 2010 and his Response filed 2 November 2010. As to the wife’s Application in a Case filed 16 November 2010, the wife filed and served an Amended Application in a Case on 25 November 2010 and it is the Amended Application on which she seeks to move.
The Applications
For the purposes of the hearing on 28 January 2011, the orders sought are as follows. The wife seeks the following orders:
Application in a Case filed on 2 August 2010
i.An order joining H Pty Ltd (formerly known as "H T Pty Ltd") as a third party in the proceedings.
ii.A declaration of contravention by 1) Mr Peters and 2) Mr R Peters and 3) "H" under Corporations Act 2001 - S 1317E, in which that declaration of contravention must specify the following:
1. The Court that made the declaration;
2. the civil penalty provision that was contravened;
3. the person who contravened the provision;
4. the conduct that constituted the contravention;
5. if the contravention is of a corporation civil penalty provision - the corporation to which the conduct related.
iii.An order requiring that Orders 3 and 10 of FM Kemp delivered on 27 October 2009 are vacated, or, alternatively, stayed until final determination of the application.
iv.An order requiring 1) Mr Peters and 2) Mr R Peters to deliver up to the Court their passports and such other documents as the Court thinks fit, until final determination of the application.
v.An order prohibiting 1) Mr Peters and 2) Mr R Peters from leaving the jurisdiction of Australia, without the consent of the Court until final determination of the matter.
vi.A pecuniary penalty order relevant to 1) Mr Peters and 2) Mr R Peters, for the amount of $200,000 each.
vii. An order requiring the production of authenticated/apostilled (whichever is the acceptable form for the relevant jurisdictions of Country I and Country J) of financial records kept outside of this jurisdiction, including, but not limited to, bank statements of and Tax Invoices issued by:
1.K Pty Ltd,
a. account number: …, at Bank L, Country I
2. M Pty Ltd,
a. account number: …, at Bank N , Country J,
3. since July 2007 - to date.
4.All original documents, or alternatively, all copies certified by a Notary Public, are to be:
a.produced to the Court, and
b.to me by electronic transmission on my email address …,
c.by 21 days of the date of the Order.
d.Costs to be borne by the defendants.
viii. An order that this application sworn 19 July 2010 is dealt with urgently and independently of the Hague Convention proceedings and independently of substantive proceedings.
ix. Alternatively, to the Order above, I seek the order that this application sworn 19 July 2010 is dealt with urgently and independently of the Hague Convention proceedings and orders are made on an interim basis.
x. Costs
Application in a Case filed on 24 September 2010
1. Leave to serve short notice of this application.
2.An injunction of the representative of the other party or parties to serve short notice and/or no service of court documents on me.
3.The order that the representative of the other party or parties are to serve court documents in a timely manner at all times.
4.That the husband, Mr Peters is to personally appear in court or alternatively is to present to the local police station on a weekly basis to report his whereabouts for the next 12 months, which is to be informed to the court and to me.
Amended Application in a Case filed on 25 November 2010
1. That this matter is listed urgently. 2. That the following persons/a are joined as parties in proceedings: a) O University Graduate School; b) O University; c) Minister, NSW; d) Mr P, O University; e) Mr Q, O University Graduate School; f) Mr R, O University; g) Ms S, O University Graduate School h) Mr T, O University; i) Mr U, O University Graduate School j) Mr V, O University Graduate School k) Mr W O University Graduate School; 3. That the Chairperson of the Board of Directors of O Graduate School is immediately stood down until final determination of this matter. 4. An award of damages for the amount of $20 million plus:.
a) interest on that amount calculated from 1 November 2007 up to the time of settlement,
b) linked to the CPI from 1 November 2007 up to the time of settlement, and c). capitalised from I November 2007 up to the time of settlement.
5. A robust order of the court's own initiative which will deter corporate crime and maintain society's
expectations for corporate compliance with the laws of the land and affirm society's confidence in the court to administer justice.
6. A robust order for pecuniary fines 'of a quantum as determined by the court for all named persons/a which demonstrate to the public that corporate crime is not tolerated by those entrusted to fulfill society's expectations of ethics, integrity and sound corporate and personal citizenship. 7. A community service order of the court's determination for each named person/a appropriate for the level of fault. 8. A declaration of contravention by O Graduate School under Corporations Act 2001 - S1317E, in which that declaration must specify the following:
a) the Court that made the decision;
b) the civil penalty provision that was contravened;
c) the person/a who contravened the provision;
d) the conduct that constituted the contravention.9. Costs.
Response filed 17 September 2010 and Response filed 21 September 2010
1.That the application in a case of the applicant husband seeking a court ordered Title in the name of H Pty Ltd is:
(a)dismissed; or
(b)Vacated, pending the outcome of the wife’s appeal before the Full Court EA 105/2010 filed 17 August 2010 in relation to lump sum child maintenance; or
(c)Vacated, pending the outcome of the wife’s application for relief in relation to fraud in respect of Respondents: husband Mr Peters and Mr R Peters and H Pty Ltd.
2.That the husband pay the costs of, and all incidentals of, the application and the response.
The husband seeks the following orders:
Application in a Case filed on 9 September 2010 seeking:
1. That this application be listed for Hearing at the earliest available date.
2. Leave to serve short notice of this application.
3.That in furtherance of Order 3 of the Orders made by Federal Magistrate Kemp on 27 October 2010 the Court make the following Order to require that the Registrar General of NSW do all things and sign all documents to:
3.1In accordance with Section 138 of the Real Property Act 1900 issue a new edition of Certificate of Title in relation to the property being that parcel of land contained in Certificate of Title Folio Identifier … and known as [B Street, Suburb C], Sydney ([Suburb C]).
3.2That upon the Certificate of Title being issued the Registrar General process the Application for Transfer of the property to [D Pty Ltd] (as Trustee of the [E Super Fund]).
3.3That upon completion of the Certificate of Title pertaining to [Suburb C] to [D Pty Ltd] the Certificate of Title issued in the name of [D Pty Ltd] be forwarded to [F Pty Ltd], P.O. Box …. [G Suburb], NSW … to be held in safety custody.
4. That the wife pay the costs of and incidental to this application.
Response to an Application in a Case filed on 2 November 2010 seeking:
1.That the Application in a Case filed 2 August 2010 by the wife [Ms Peters] be dismissed.
2.That the wife pay the costs of and incidental to the husband.
3.That the Application in a Case filed 24 September 2010 by the wife [Ms Peters] be dismissed.
4.That the wife pay the costs of and incidental to the husband in reference to the above applications.
5.That pursuant to Section 118(1)(c) of the Family Law Act 1975, the wife shall not henceforth, without leave of the Court in the first instance, institute an interim or interlocutory application in reference to File number TVC 1541/2007.
6.For the purposes of Order 5 the Court’s leave may be sought ex-parte,
Written evidence
Pursuant to the order made on 7 January 2011, I received in my chambers by email from the wife notice of the documents to be relied on by her for the purposes of the proceedings. I have omitted from the list Applications and Responses that were not included in the list of matters set down for hearing in accordance with the orders of 22 November 2010. The wife relied on the following documents:
Application filed 2 August 2010:
· Affidavit of wife filed on 23 December 2010 entitled “Plunders or Blunders”;
· Affidavit of wife said to be sworn on behalf of D Pty Ltd also filed 23 December 2010;
· Affidavit of the wife filed 22 November 2010 entitled “Miscarriage of Justice”;
· Affidavit of the wife filed 21 September 2010;
· Affidavit of the wife filed 2 August 2010;
· Affidavit of the wife filed 20 August 2010;
· Affidavit of the wife entitled “Sham Transactions of [Mr R Peters] Third Party” filed 21 December 2009;
· Affidavit of the wife filed 17 September 2009 entitled “[Mr R Peters’] Duplicitous Invoicing Scam and other Fraudulent Acts”; and
· Affidavit of the wife filed 3 November 2009 entitled “My Refusal of Divorce Application”.
The wife sought but was not permitted to rely on an Appeal and Appeal Books numbered EA105/2010 “in relation to [Mr Peters’] failure to pay any child support”, said to be dated 17 August 2010; nor an Affidavit of the wife filed 3 December 2008 entitled “[Mr Peters] Misleads and Deceives the Court”. I did not have access to those documents and therefore did not take them into account.
Application filed 24 September 2010
· Affidavit of the wife filed 23 December 2010 entitled “Plunders or Blunders”;
· Affidavit of the wife filed 22 November 2010 entitled “Miscarriage of Justice”;
· Affidavit of the wife filed 24 September 2010 in relation to an injunction against F Pty Ltd and another party;
· Affidavit of the wife filed 3 December 2010;
· Affidavit of the wife filed 23 June 2010.
The wife sought but was not permitted to rely on an Appeal and Appeal Books numbered EA105/2010 “in relation to [Mr Peters’] failure to pay any child support”, said to be dated 17 August 2010. I did not have access to those documents and therefore did not take them into account.
In Response to the husband’s application filed 9 September 2010, the wife relied on:
· Affidavit of the wife filed 23 December 2010 entitled “Plunders or Blunders”;
· Affidavit of the wife purportedly sworn on behalf of D Pty Ltd filed 23 December 2010;
· Affidavit of the wife entitled “Miscarriage of Justice” filed 22 November 2010;
· Response and supporting affidavit of the wife filed 17 September 2010;
· Response and supporting affidavit of the wife filed 21 September 2010;
· Affidavit of the wife filed 2 August 2010;
· Affidavit of the wife entitled “[Mr Peters’] Duplicitous Invoicing Scam and other Fraudulent Acts” filed 17 September 2009; and
· Affidavit filed 3 November 2009 entitled “My Refusal of Divorce Application”. Finally, she relied on again the orders of Federal Magistrate Coker of 18 December 2007.
The wife sought but was not permitted to rely on an Appeal and Appeal Books numbered EA105/2010 “in relation to [Mr Peters’] failure to pay any child support”, said to be dated 17 August 2010. The wife sought to rely on her affidavit filed 3 December 2008 entitled “[Mr Peters] Misleads and Deceives the Court”. That affidavit could not be located. I did not have access to those documents and therefore did not take them into account.
The wife provided a case outline document in respect of an Application in a Case filed 3 December 2010 and included a list of affidavits, many of them the same affidavits referred to in relation to her other applications. That was not an application listed before me on 28 January 2011 and so I had no regard to those documents except insofar as they were already before me.
An amended Outline of Case was provided on behalf of the husband on 27 January 2011 in which the husband notified that he intended to rely on:
·an Application in a Case filed 9 September 2010;
·and affidavit of Ms F filed 9 September 2010;
·a Response of the husband filed 2 November 2010;
·an affidavit of Mr Peters filed 2 November 2010;
·a Financial Statement filed by the husband of 2 November 2010;
·an affidavit filed by Mr X on 3 November 2010;
·an affidavit of Ms F filed 2 November 2010;
·an affidavit of Mr Peters filed 14 December 2010
·a transcript of proceedings before me 22 November 2010; and
·the reasons for judgment of Federal Magistrate Kemp of 27 October 2009.
Short history
The husband was born in 1939 and is now 72 years of age. The wife was born in 1957 and is now 53 years of age. They married in 1992 and separated on 4 December 2007. Their divorce became final on 4 January 2010.
Child
There is one child of the marriage, Y (the child) born in 1996. He is aged 14 years.
Background
I do not understand the following propositions to be controversial.
The husband was born in 1939. The wife was born in 1957.
They married in 1992 and separated on 4 December 2007. Their divorce became final on 4 January 2010.
Their child, Y, was born in 1996.
At some point in late 2007 the wife and child travelled to Country J.
The husband filed the application that commenced these proceedings in the Townsville Registry of the Federal Magistrates Court on 18 December 2007. He sought detailed parenting orders, including that the child live week about with the parties, and an equal division of property.
On 4 February 2008, on the husband giving an undertaking as to damages, the following orders were made by Federal Magistrate Coker:
1.The Directors of the company, [H Pty Ltd] CAN … be restrained and an injunction issue restraining that company from selling, mortgaging, encumbering or in any way dealing with its interest in the property described as [B Street, Suburb C], Sydney in the State of new South Wales, Title Reference Folio ...
2.The Respondent be restrained and an injunction issue restraining the Respondent from dealing with, withdrawing, remitting or causing to be remitted any money out of the account or accounts held by [Ms Peters] or … with the [Z Credit Union].
3.The [Z Credit Union] AB N … of [AA Street, Suburb BB] in the State of New South Wales provide to the Applicant, upon the Applicant paying the bank’s reasonable costs, all records in relation to the account or accounts held by [Ms Peters] or … for the preceding two years.
4.The Respondent be restrained and an injunction issue restraining the Respondent from dealing with, withdrawing, remitting or causing to be remitted any money out of the account or accounts held by [Ms Peters] or … with the [CC Bank] and in particular the [DD Town] branch.
5.The [CC bank] provide to the Applicant, upon the Applicant paying the bank’s reasonable costs, all records in relation to the account or accounts held by [Ms Peters] or … for the preceding two years.
6.The Respondent Mother file and serve a Response and Affidavit(s) by 4.00pm on 3 March 2008.
7.The Application be adjourned for further consideration, including the application for change of venue, to 9.30am on 10 March 2008 at Townsville.
8.The costs of both parties of today be reserved.
On 10 March 2008 Federal Magistrate Coker made the following orders:
1.Pursuant to Rule 8.01 of the Federal Magistrates Court Rules 2001 the venue for the hearing of the application filed on 18 December 2007 be changed to the Federal Magistrates Court of Australia in Sydney for mention on 28 May 2008 at 9:30am.
2.The Wife pay the Husband’s costs of today fixed in the sum of $205.00 and such payment to be made unless otherwise agreed in writing within 28 days of today.
Hague Convention recovery proceedings were commenced in Country J as a result of an allegation by the father that the mother wrongfully removed the child from Australia. At some point, Y was under the guardianship of the District Court of City EE, Country J and the wife was granted sole custody.
On 21 October 2008 a Conciliation Conference was held in respect of the property proceedings. The matter did not settle and was adjourned to 21 November 2008 before Federal Magistrate Kemp.
On 21 November 2008 Federal Magistrate Kemp made directions and adjourned the proceedings to 11 February 2009.
On 11 February 2009 Federal Magistrate Kemp fixed the matter for hearing on 10 September 2009 in respect of an issue about the property of a superannuation fund. The parties were required to attend in person. His Honour also foreshadowed orders for the preservation of matrimonial property.
On 17 March 2009 Federal Magistrate Kemp made the orders foreshadowed for the preservation of matrimonial property, in chambers.
On 23 March 2009 Federal Magistrate Kemp ordered that the case be listed on 5 May 2009 in relation to another interim issue.
On 5 May 2009 Federal Magistrate Kemp adjourned the wife’s application in a case filed 16 February 2009 (for $4.35 million in damages) to the final property hearing. The wife’s application in a case filed 10 November 2008 seeking the discharge of ex parte and parenting orders and a Watch List order and an AVO against the husband was also adjourned to the final hearing but leave was granted to the parties to restore that application upon the conclusion of the Hague proceedings in Country J.
On 17 August 2009 Federal Magistrate Kemp adjourned the matter to 31 August 2009.
On 31 August 2009 Federal Magistrate Kemp made further directions, noting that the matter was listed on 10 September 2009 and that the parties were required to attend in person.
On 2 October 2009 the wife applied to the Federal Magistrates Court for an order of lump sum child maintenance to be paid by the husband. The lump sum sought was to be comprised of:
(a) Child Support arrears 18th December 2007;
(b) Child support to 8 May 2014;
(c) penalties;
(d) late payment penalties;
(e) interest;
(f) linked to the CPI; and
(g) capitalised.
The wife sought ancillary orders to provide for seizure of certain real estate; that a warrant issue for the arrest of the husband and that his passport be impounded should he fail either to comply with the order for lump sum maintenance or should the real estate be not available for seizure. The application also sought an order restraining the husband from dealing in any way with that real estate.
On 10 September 2009 Federal Magistrate Kemp heard interim proceedings. The wife applied and was granted leave to attend by telephone, citing financial problems. Federal Magistrate Kemp reserved judgment.
On 17 September 2009 the wife filed a further Application in a Case. On 14 October 2009 the return date of that application (19 October 2009) was vacated and the application was made returnable on a date to be fixed after judgment in the proceedings heard on 10 September 2009. On 27 October 2009 Federal Magistrate Kemp delivered judgment and made the following orders:
(1)That [D Pty Ltd] be joined as a party to the proceedings and as second respondent.
(2)That within 14 days of the date of this order (and subject to order 5 below), the husband and the wife do all acts and things and sign all documents, instruments and writings as may be necessary to transfer to [D Pty Ltd] (as trustee of the [E Super Fund]) all that piece and parcel of land contained in certificate of title reference … and known as [FF Town Resort, GG Street, FF Town] (“the [FF Town] property”).
(3)That within 14 days of the date of this order (and subject to order 5 below), the husband as sole director of [H Pty Ltd] (formerly known as “[H Training Pty Ltd]”) do all acts and things and sign all documents, instruments and writings as may be necessary to transfer to [D Pty Ltd] (as trustee of the [E Super Fund]) all that piece and parcel of land contained in certificate of title, folio identifier … and known as [B Street, Suburb C], Sydney (“the [Suburb C] property”).
(4)That the transfers referred to in orders 2 & 3 above are to be effected conditional upon [D Pty Ltd] being appointed the trustee of the [E Super Fund].
(5)That within seven days of the date hereof the husband do all acts and things and sign all documents necessary pursuant to clause 4.5 and 4.6 of the deed of variation of the [E Super Fund] dated 6 June 2006 to appoint [D Pty Ltd] as trustee of the said fund.
(6)That, pending further order, the husband be restrained from causing the removal of [D Pty Ltd] as trustee of the said fund.
(7)That so far as the wife contends that it is necessary, within seven days the husband do all acts and things and sign all documents necessary for her to become a director of [D Pty Ltd].
(8)Pending further order, and upon the wife’s undertaking as to damages, [D Pty Ltd] be restrained from transferring or encumbering the properties transferred to it, pursuant to orders 2 & 3 above.
(9)In the event the husband or the wife has refused or neglected to comply with the signing of documents as required pursuant to these orders within seven days of being requested to do so then the Court shall appoint a registrar of the court to execute the deed or instrument or any other document as may be required to give effect to compliance with the orders and authorising the registrar to execute such documents and do all acts and things necessary to give validity and operation to the documents to be signed.
(10)That order 1 of the orders dated 4 February 2008 be discharged.
(11)The matter is stood over for mention on 3 December 2009 at 9.30am which will include the wife’s application in a case filed 17 September 2009.
(12)The further application in a case filed by the wife on 2 October 2009 with a return date of 30 November 2009 at 9.30am will also be vacated and listed on 3 December 2009 at 9.30am.
NOTATION
(13)The Court is of the preliminary view that the proceedings should be transferred to the Family Court of Australia at Sydney, but the Court wishes to provide the parties with an opportunity to be heard with respect to that issue.
On 19 November 2009 a divorce order was made, to become final on 20 December 2009. The wife sought a review of that decision.
On 3 December 2009 Federal Magistrate Kemp dismissed the divorce review and transferred the property and parenting proceedings to the Family Court.
By force of s 55(3) of the Family Law Act, the parties divorce became final on 4 January 2010.
On 23 December 2009 a Registrar executed a real property transfer under s 106A, pursuant to order 9 of the orders of 27 October 2009.
On 18 January 2010 leave was granted to the wife to attend by phone at a procedural hearing on 29 January 2010.
On 27 January 2010 the matter was listed in the Judicial Registrars Duty List but was adjourned by a Registrar to 29 January 2010, also before a Registrar.
On 29 January 2010 a Registrar adjourned the case management aspects of the case to 26 February 2010.
On 3 February 2010 a Registrar adjourned an interim issue to 26 February 2010.
It is not clear what happened on 26 February 2010.
On 3 March 2010 leave was granted to inspect documents produced on subpoena. Further subpoenas were adjourned to 19 March 2010.
On 30 March 2010 leave was granted to inspect documents produced on subpoena.
On 1 June 2010 the matter came before Judicial Registrar Johnston in the Judicial Registrars Duty List. He made the following orders:
1.That the wife’s application filed on 21 December 2009 for orders including an order that [Mr R Peters] be joined as a third party in the proceedings is consolidated with the substantive proceedings.
2.That the Application filed by the wife in the Federal Magistrates Court on 2 October 2009 seeking lump sum and other child support is dismissed.
3.That the Application in paragraph 1 of the orders sought in the wife’s Application in a Case filed on 17 September 2009 is dismissed.
4.That the applications in paragraphs 2, 3 and 4 of the said Application are consolidated with the substantive proceedings.
5.That the substantive proceedings are listed for directions before the docket Registrar at 9:00 am on 20 August 2010.
The wife has sought to join Mr Peters’ adult son, Mr R Peters to the property proceedings. The application about the proposed joinder of Mr R Peters to the proceedings has been adjourned to the final hearing.
The wife sought a review of the Judicial Registrar’s decision and on 22 July 2010 Ainsley-Wallace J published reasons for judgment and made the following orders:
(1)That the application for lump sum child maintenance of [Ms Peters] be dismissed.
(2)The application for injunctions filed in Court on 16th July 2010 be stood over to a date to be considered with the balance of the applications between the parties.
The husband filed an Application in a Case on 9 September 2010. That came before the Court on 27 September 2010, supported by an Affidavit of the husband’s solicitor, Ms F, sworn 7 September 2010 and filed on 9 September 2010. The Application is in aid of the orders of Federal Magistrate Kemp of 27 October 2009. It seeks that steps be taken by the husband and wife to ensure that assets owned by the parties in Australia but held by their superannuation fund are held by the trustee of the fund. It is submitted that before that can happen, fresh Certificates of Title must issue because those documents are lost to the parties.
The wife was permitted to attend by electronic communication on 27 September 2010 but when the matter came before Cleary J on that date, technical reasons prevented the wife contacting the court. As a result the matter was adjourned to 2:15 pm on 22 November 2010 before me.
On 22 November 2010 the husband was represented by Ms F and the wife appeared by telephone, apparently from Country J. I made the following orders:
1.These proceedings are adjourned to 10:00 am on 28 January 2011 before Justice Loughnan in relation to Applications in a Case filed on behalf of the wife on 2 August 2010, 24 September 2010 and 16 November 2011 and also Application in a Case of the husband filed 9 September 2010 and his Response filed 2 November 2010.
2.Leave to the wife to attend by telephone at her own expense on the adjourned date.
3.That the wife serve her Application in a Case and the affidavit in support filed on 16 November 2010 on the solicitor for the husband within 7 days.
4.That the solicitor for the husband serve on the wife any documents filed on behalf of the husband which have not yet been served on her, within seven days.
5.That any further documents to be relied on on 28 January 2011 be served on the other party not later than 17 December 2010. The parties are not permitted without leave to rely on any document served outside the terms of that order.
6.In relation to the Application in a Case filed 16 November 2010 that application is listed on 28 January 2011 for mention only.
On 7 January 2011 I made the following orders in chambers.
1.Not later than 10:00 am on 24 January 2011 the wife and the solicitor for the husband provide to:
a. each other;
b. the Associate to Justice Loughnan; and
c. to any other person or entity against whom orders are sought in an application or response listed on 28 January 2011.
a list of the affidavits to be relied on by the wife or the husband on that date, being only affidavits filed in the proceedings that have been served in accordance with the orders of 22 November 2010.
2.Where practicable that list may be provided by email.
On 28 January 2011 the wife appeared by telephone, apparently from Country J, the husband appeared by his Counsel and Mr R Peters appeared in person. In addition, Ms Shirm of the NSW State Crown Solicitor appeared for the Minister, NSW and Mr C. Dimock appeared for several other respondents. I made the following orders:
IT IS NOTED
1.That the wife’s Amended Application in a Case filed 25 November 2010 is withdrawn.
IT IS ORDERED
2.That the wife pay to the solicitor for the [Minister NSW] costs assessed in the sum of $900.00. That payment to be made within three (3) months from today’s date.
3.That the wife pay to the solicitor for the remaining respondents to the Amended Application in a Case filed 25 November 2010 costs assessed in the sum of $900.00. That payment to be made within three (3) months from today’s date.
4.Otherwise judgment is reserved. The parties and their legal representatives are excused attendance on delivery of judgment.
5.That until further order where practicable all further applications for interim orders are to be listed in the first instance before Justice Loughnan.
As at the date of the hearing I understand that the wife was living in Country J. Since separation I understand that the husband has lived in both Australia and Country J. At all relevant times since 18 December 2007 Y has lived with the wife in Country J.
The Applications
Wife’s Amended Application in a Case filed 25 November 2010.
At the commencement of the hearing, submissions were made on behalf of the respondents to the Amended Application. Ultimately the wife sought leave to withdraw her application. That leave was not opposed and was granted. An application was made by the representatives for the respondents for costs. As is set out above, and for reasons given at the time, I made orders in favour of the Minister, NSW and in favour of the remaining respondents. The representatives for the respondents to that application were then excused.
Objections to evidence
I discussed with the remaining parties, the husband’s counsel, the wife and Mr R Peters, how we would deal with objections to evidence. Ultimately counsel for the husband did not take formal objections and left the matter to me. The wife said that she was aware of the process of taking objections to evidence from a hearing before Federal Magistrate Kemp in 2009. She commenced taking objections to the affidavits relied on by the husband. That process proved largely unsuccessful and after a period of time the wife asked that I take the same approach as had been proposed on behalf of the husband.
Mr R Peters asked that I read his affidavit which I think was filed on 24 January 2011. The wife objected. On the basis that the affidavit fell outside the timeframe fixed on 22 November 2010 for the filing and service of documents, I said that I would not read it. However, Mr R Peters remained in the courtroom and took part in the proceedings not withstanding that his evidence was not before the court. I hoped that any outcome of similar proceedings against the husband might be relevant to the proceedings against Mr R Peters. Late in the day the wife said something to me to the effect that she would like me to read the affidavit of Mr R Peters of the 24 January 2011. In the course of a submission made at the very end of proceedings Mr R Peters renewed his application that I read his affidavit. I indicated to the parties that by that stage the affidavit did not seem to go to any relevant application before me. I did not read the document.
While a very practical approach, it should be noted that leaving the decisions about admissibility to the Court has the obvious disadvantage that the parties do not know what was taken into account and what was excluded. Nevertheless, in the circumstances, there was no other practical option.
The hearing then proceeded on the basis that submissions were made in respect of each application in turn. With the agreement of the wife, learned counsel for the husband made submissions first and then the wife responded in relation to each application.
Dealing with the remaining applications in turn:
The wife’s Application in a Case filed 2 August 2010.
Order (i):
The wife seeks that H Pty Ltd be joined as a third party in the substantive property proceedings.
It is submitted on behalf of the husband that no orders are sought against H Pty Ltd in those proceedings and therefore the application should be dismissed. Exhibit 1 is the wife’s Response filed 17 October 2008 to the Initiating Application filed by the husband. That document contains no orders sought against H Training Pty Ltd.
The wife’s submissions in relation to that issue were to the effect that she was looking for evidence to substantiate her case as to fraudulent conduct by the husband and by Mr R Peters.
Conclusion
The orders sought against H Pty Ltd that were brought to my attention were those set out in (ii) of the application of the wife filed 2 August 2010. For reasons set out below, that application could not succeed. The only purpose of joining an entity as a party to proceedings is to allow for orders to be made against that entity or where orders sought might affect the rights of that entity. There is no evidence to that effect before me. I note that it is the husband’s case that H Pty Ltd has not traded since December 2007. In any event the wife’s application must fail.
Orders (ii) and (vi):
At (ii) the wife seeks a declaration of contravention by the husband by Mr R Peters and by H Training Pty Ltd under Section 1317E of the Corporations Act 2001. At Order (vi) the wife seeks a pecuniary penalty against Mr Peters and Mr R Peters in the sum of $200,000.00 each.
It is submitted on behalf of the husband that the wife has no standing to bring proceedings for an order under Section 1317E of the Corporations Act 2001. The wife did not concede that proposition nor did she want to be heard further against it.
Section 1317E provides:
(1) If a Court is satisfied that a person has contravened 1 of the following provisions, it must make a declaration of contravention:
(a) subsections 180(1) and 181(1) and (2), 182(1) and (2), 183(1) and (2) (officers' duties);
(b) subsection 209(2) (related parties rules);
(c) subsections 254L(2), 256D(3), 259F(2) and 260D(2) (share capital transactions);
(d) subsection 344(1) (requirements for financial reports);
(e) subsection 588G(2) (insolvent trading);
(f) subsection 601FC(5) (duties of responsible entity)
(g) subsection 601FD(3) (duties of officers of responsible entity)
(h) subsection 601FE(3) (duties of employees of responsible entity)
(i) subsection 601FG(2) (acquisition of interest in scheme by responsible entity)
(j) subsection 601JD(3) (duties of members)
(jaaa) subsection 601UAA(2) (duties of officers of licensed trustee company);
(jaab) subsection 601UAB(2) (duties of employees of licensed trustee company);
(ja) subsection 674(2), 674(2A), 675(2) or 675(2A) (continuous disclosure);
(jaaa) subsection 798H(1) (complying with market integrity rules);
(jaa) subsection 985E(1) (issuing or increasing limit of margin lending facility without having made assessment etc.);
(jab) subsection 985H(1) (failure to assess a margin lending facility as unsuitable);
(jac) subsection 985J(1) (failure to give assessment to retail client if requested before issue of facility or increase in limit);
(jad) subsection 985J(2) (failure to give assessment to retail client if requested after issue of facility or increase in limit);
(jae) subsection 985J(4) (demanding payment to give assessment to retail client);
(jaf) subsection 985K(1) (issuing or increasing limit of margin lending facility if unsuitable);
(jag) section 985L (making issue of margin lending facility conditional on retail client agreeing to receive communications through agent);
(jah) subsection 985M(1) (failure to notify of margin call where there is no agent);
(jai) subsection 985M(2) (failure to notify of margin call where there is an agent);
(jb) section 1041A (market manipulation);
(jc) subsection 1041B(1) (false trading and market rigging--creating a false or misleading appearance of active trading etc.);
(jd) subsection 1041C(1) (false trading and market rigging--artificially maintaining etc. market price);
(je) section 1041D (dissemination of information about illegal transactions);
(jf) subsection 1043A(1) (insider trading);
(jg) subsection 1043A(2) (insider trading);
(k) subclause 29(6) of Schedule 4.
These provisions are the civil penalty provisions .
Note: Once a declaration has been made ASIC can then seek a pecuniary penalty order (section 1317G) or (in the case of a corporation/scheme civil penalty provision) a disqualification order (section 206C).
(2) A declaration of contravention must specify the following:
(a) the Court that made the declaration;
(b) the civil penalty provision that was contravened;
(c) the person who contravened the provision;
(d) the conduct that constituted the contravention;
(e) if the contravention is of a corporation/scheme civil penalty provision--the corporation or registered scheme to which the conduct related.
Section 1317J of the Corporations Act 2001 provides as follows:
Who may apply for a declaration or order
Application by ASIC
(1) ASIC may apply for a declaration of contravention, a pecuniary penalty order or a compensation order.
Application by corporation
(2) The corporation, or the responsible entity for the registered scheme, may apply for a compensation order.
Note: An application for a compensation order may be made whether or not a declaration of contravention has been made under section 1317E.
(3) The corporation, or the responsible entity for the registered scheme, may intervene in an application for a declaration of contravention or a pecuniary penalty order in relation to the corporation or scheme. The corporation or responsible entity is entitled to be heard on all matters other than whether the declaration or order should be made.
Compensation order relating to financial services civil penalty provision--any other person who suffers damage may apply
(3A) Any other person who suffers damage in relation to a contravention, or alleged contravention, of a financial services civil penalty provision may apply for a compensation order under section 1317HA.
Note: An application for a compensation order may be made whether or not a declaration of contravention has been made under section 1317E.
No one else may apply
(4) No person may apply for a declaration of contravention, a pecuniary penalty order or a compensation order unless permitted by this section.
(5) Subsection (4) does not exclude the operation of the Director of Public Prosecutions Act 1983 .
In One.Tel Limited (In Liquidation) v John David Rich and Ors [2005] NSWSC 226 (23 March 2005), Bergin J of the New South Wales Supreme Court, Equity Division, said at paragraph 26 referring to the joint judgment of the Chief Justice, Justices Gummow, Hayne, Callinan and Heydon, in Rich v ASIC (2004) 209 ALR 271:
26 …. The joint judgment referred to s 1317E as giving the power to “seek” declarations. With the greatest respect, that appears to be a typographical error or slip because s 1317J(1) is the section giving the power, or entitlement, to ASIC to “seek” declarations of contravention. Section 1317E is a section requiring the Court to make a declaration of contravention if it is satisfied that there has been a contravention of the civil penalty provision listed in the subsection.
Later at paragraph 28 Justice Bergin went on:
28. Importantly the joint judgment identified the respective "relief" provided by the two sections. The so-called "relief" provided for in s 1317E could only be the declaration of contravention, for which it is necessary to demonstrate contravention of a civil penalty provision. Only ASIC has standing to make such an application. …
In Scott Darren Pascoe in his capacity as liquidator of Charter Workforce Pty Ltd (In Liq) and Anor v Divisional Security Group Pty Ltd and Ors [2007] NSWSC 211 (14 March 2007), Justice White of the NSW Supreme Court, Equity Division, said at paragraph 14:
14.Neither the corporation nor its liquidator has standing to apply for a declaration of contravention under s 1317E (ss 1317J(1) and (4)). Accordingly, the Court could not make a declaration of contravention under s 1317E upon an application by the liquidator under s 588M (One.Tel Limited (In Liq) v Rich at [67]). Section 1317E deals with a case where an application is made by ASIC under s 1317J(1) for a declaration under s 1317E. In other words, it is to be understood as providing that if in a proceeding brought for a declaration under that section, a Court is satisfied that a person has contravened a civil penalty provision, then the Court must make a declaration of contravention.
Conclusion
The wife has no standing to bring proceedings for the orders she seeks in paragraphs (ii) and (vi). The application must fail in relation to those orders sought.
Orders (iv) and (v)
The orders sought by the wife at (iv) and (v) are in aid of the orders sought by the wife at (ii) and (vi). As the wife’s application for the substantive relief must fail, the orders sought in aid of that relief must also fail. It should be said that, in any event, the provisions of the orders sought at paragraphs (iv) and (v) represent draconian orders which would be made only in the most extreme circumstances and would rarely be made in relation to one of the principal parties to proceedings, let alone against a third party. In this case the husband has been involved in litigation under the Hague Convention on the Civil Aspects of International Child Abduction in Country J and for that purpose, at least, he has resided in Country J for considerable periods. To require the husband in those circumstances to remain in Australia would be inappropriate. Although formal evidence of it has yet to be produced, it is said by the wife that the Hague proceedings have been dismissed. If so the dismissal came long after this application was filed on 2 August 2010. That is to say, when the wife sought that the husband remain in Australia, the Country J proceedings were still on foot.
Mr R Peters is permanently based in Country I, having an executive role with the Australian Graduate School. It would be particularly onerous to require him, as a third party in these proceedings to remain in Australia. Insofar as the application seeks those orders it must fail.
Order (iii)
At (iii) the wife seeks that orders 3 and 10 made by Federal Magistrate Kemp on 27 October 2009 be vacated or in the alternative, that they be stayed until the final determination of “the application”. I am not sure which application she means.
The orders of Federal Magistrate Kemp of 27 October 2009 include the following:
3.That within 14 days of the date of this order (and subject to order 5 below), the husband as sole director of [H Pty Ltd] (formerly known as “[H Training Pty Ltd]”) do all acts and things and sign all documents, instruments and writings as may be necessary to transfer to [D Pty Ltd] (as trustee of the [E Super Fund]) all that piece and parcel of land contained in certificate of title, folio identifier … and known as [B Street, Suburb C], Sydney (“the [Suburb C] property”).
….
5.That within seven days of the date hereof the husband do all acts and things and sign all documents necessary pursuant to clause 4.5 and 4.6 of the deed of variation of the [E Super Fund] dated 6 June 2006 to appoint [D Pty Ltd] as trustee of the said fund.”
….
“10.That order 1 of the orders dated 4 February 2008 be discharged.”
I note that Order 1 of 4 February 2008 reads:
1. The Directors of the company, [H Pty Ltd] CAN … be restrained and an injunction issue restraining that company from selling, mortgaging, encumbering or in any way dealing with its interest in the property described as [B Street, Suburb C], Sydney in the State of new South Wales, Title Reference Folio ….
It is submitted on behalf of the husband that the wife is seeking to challenge, long after the event, orders made by the Federal Magistrate after a contested hearing and that in those circumstances the court does not have the power to simply vacate those orders and should not, in the exercise of its discretion, stay the orders. It is submitted that it is clear from the Federal Magistrate reasons for judgment that the purpose of the orders was to allow the parties’ superannuation fund to return to the status of a compliant fund and thereby avoid financial penalties which would adversely affect the parties by reducing the pool of assets to be divided between them.
In response the wife submitted that she had a fear of the property and other assets being the subject of a fraudulent disposition.
At paragraph 24 of his Honour’s reasons, Federal Magistrate Kemp said:
24.[Mr HH], the accountant, deposes to the need for the [Suburb C] property and the [FF Town] property to be transferred into the name of the trustee of the relevant superannuation fund for the purposes of ensuring compliance with the Superannuation Industry (Supervision) Act 1993 (Cth) (SIS Act). At paragraph 20 of his affidavit, he specified a number of potential breaches of the SIS Act, including the following:-
(a)The trustee's name in the superannuation fund differs to the entity identified as the trustee on all assets noted in the accounts as belonging to the fund;
(b) for a number of years the trustee name reported in the fund's income tax returns differed from that of the trustee in the fund's deed;
(c) failure to submit annual income tax and regulatory terms in a timely fashion;
(d) failure to keep proper records;
(e) failure to adhere correctly to the superannuation fund's investment strategy;
(f) gaining improper and early access to superannuation benefits;
(g) bank account of the fund showing an overdraw balance - overdrawn balance; and
(h) the member account for the wife in the superannuation fund showing an overdrawn balance.
25.[Mr HH] also deposes to a likely consequence for the above alleged breaches as being a potentially serious tax penalty that could be applied to the total assets, the subject of the superannuation fund, at the highest marginal rate of 45 per cent. He says any income in any year in which a fund is found to be non complying is also taxed at that rate.
Later in the reasons the Federal Magistrate goes on:
32.The wife’s principal concern arises out of what she says is correspondence from the husband which indicates that he wishes to obtain access to the superannuation funds to live on pending the final hearing.
33.The Court’s concern is to ensure, prior to final hearing, that there is no depletion of property the subject of the matrimonial pot. The wife seemed to understand that point, provided she said that she could obtain appropriate protection and that there would not be a premature disposition of fund assets, pending the final hearing. The wife submits that the subject properties, the subject of the superannuation fund, are the only remaining assets available for distribution to the parties in Australia. Mr Schonell submitted that the Court had power under both s.79 and s.114 of the Act to deal with the husband’s current application. The Court is concerned in this matter to preserve the parties assets or claims to such assets.
34.There must first be some clear evidence going to actual disposition of property (or other conduct by that party) from which the Court might reasonably infer that a party had embarked (or was about to embark) upon a course of action which was designed to (or irrespective of design would be likely to) defeat any anticipated order in the substantive proceedings in the other parties’ favour. See the Full Court of the Family Court of Australia’s decision in Waugh & Waugh [2000] FamCA 1183 (Lindenmayer, Coleman and Brown JJ).
35.The evidence or conduct must establish an objective risk of disposal or dissipation see Stowe & Stowe (1981) FLC 91-027.
36.The Court must consider issues of the balance of convenience and hardship as between the parties.
37.The Court must also consider whether any injunction is necessary and goes no further than is necessary to prevent abuse or frustration of the Court’s process in relation to the matter within its jurisdiction, particularly having regard to the nature of the injuncting parties claim in the substantive proceedings; see Waugh & Waugh [2000] FamCA 1183 referred to above.
38.No injunctive relief should be contemplated without the provision of an undertaking as to damages see National Australia Bank Ltd v Bond Brewing Holdings Ltd (1990) 169 CLR 271 at 277.
39.By the making of the orders sought by the husband it is likely that the fund will become compliant and the parties exposure to potential penalties of tax and the like minimised. Without such orders, the Court is of the view that it is likely that these exposures will reduce the property and financial resources available to the parties prior to any final hearing.
The thrust of the wife’s submissions before me is that she continues to have the same concerns she harboured when she was before the learned Federal Magistrate in 2009. She also said that there may be other reasons, to do with the husband being out of the jurisdiction and other matters, that may mean that the fund is non-compliant in any event.
Conclusion
There is no basis for vacating the orders made by the Federal Magistrate on 27 October 2009. An issue came before the learned Federal Magistrate in a contested hearing. A decision was made and no appeal was lodged in relation to that decision. As to whether the orders should be stayed, no cogent reason was advanced for such an order. The learned Federal Magistrate made orders for the joint benefit of the husband and wife and nothing has happened since then to suggest that those orders should be stayed.
Order (vii)
At (vii) the wife seeks orders for the production of documents. She seeks:
vii. An order requiring the production of authenticated/apostilled (whichever is the acceptable form for the relevant jurisdictions of Country I and Country J) of financial records kept outside of this jurisdiction, including, but not limited to, bank statements of and Tax Invoices issued by:
1. K Pty Ltd,
a. account number: …, at [Bank L], [Country I]
2. M Pty Ltd,
a. account number: …, at [Bank N], [Country J]
3. since July 2007 - to date.
4.All original documents, or alternatively, all copies certified by a Notary Public, are to be:
a.produced to the Court, and
b.to me by electronic transmission on my email address …
c.by 21 days of the date of the Order.
d.Costs to be borne by the defendants.
The wording of the application is not clear. The application does not specify who is to produce the documents. There is no evidence that the named entities have been served. In those circumstances, I will assume that the wife seeks that Mr R Peters produce documents of K Pty Ltd and that the husband produce documents of M Pty Ltd. As the application is framed there would be an option for the person producing to provide the original or a certified copy. If the originals were produced then there would be no scope for provision of documents to the wife under 4(b).
Although the type of financial record required is not exclusively defined, the wording of the application requires that the records must relate to the bank accounts specified in the order - account number: 808104814838, at the Bank L, Country I in respect of K Pty Ltd and account number: 1117005398, at the Bank N, Country J in relation to M Pty Ltd. I do not understand why those accounts are relevant.
By his Response filed 2 November 2010 the husband seeks that the wife’s Application in a Case filed 2 August 2010 be dismissed. Therefore, the order for production is opposed. Insofar as an order is sought against him, I take it that Mr R Peters also opposes such an order.
In the normal course orders for production are rarely necessary between the principal parties and in any event are usually only made after there has been discovery and in any event, after a failure to comply with a Notice to Produce. There is no evidence to me about those matters. In any event the critical issues are of relevance to the substantive proceedings and the capacity to produce.
I may be that the records sought of the husband are relevant. In advance of the final hearing it is difficult to rule out the relevance of financial records of an entity closely associated with one of the parties. The husband says that he holds an honorary position with M Pty Ltd. I take it that is the same company that the wife refers to as M Pty Ltd. It is the husband’s evidence that he holds the position of Chairman of the company and that he is not paid for that role. It appears to be common ground that the company was at some point, a vehicle for hiring out the husband’s services.
As to K Pty Ltd the wife seems to found her application for production by Mr R Peters on an agreement she asserts in paragraph 23 of her affidavit sworn 24 September 2009 was made between the husband and Mr R Peters to hide funds and information from her. She attaches to that affidavit at annexure C what purports to be a printout of a course of email correspondence between the husband and Mr R Peters on 16 January 2007. She does not establish the provenance of the document and, on the face of it, the wife was not a party to the email communication. Without more, no weight could be attached to the document.
The husband’s affidavit filed 2 November 2010 is similarly unhelpful. The husband responds to paragraphs 22 – 29 of the wife’s affidavit with “Denied”. One might well ask, “what is denied?”[1].
[1] Long after the family law experiment with pleadings was abandoned, the admonishment of Justice Young of the NSW Supreme Court about “pleading affidavits” has yet to sink in. See (1992) 66 ALJ 163.
It is conceded by Mr R Peters that K Pty Ltd is his company.
In relation to M Pty Ltd it is asserted in the husband’s case that he is not an officer of that company and that he has no power to compel compliance with a direction for production. It is for the wife to satisfy the court that the husband can comply with the order. I am not satisfied that he can comply with the order and therefore no order will be made for the production of documents by the husband in relation to M Pty Ltd.
In relation to K Pty Ltd although Mr R Peters is a party to the proceeding, at least as a respondent to an application that he be joined as a party, he is a stranger to the marriage. It is a matter of some import to require a stranger to a marriage to produce his or her or its financial records.
On the evidence before me I am not satisfied that the husband and Mr R Peters should be required to produce to the Court or if copies are provided, to the wife, documents not already within the jurisdiction.
Orders (viii) & (ix)
It was conceded that the orders sought at paragraphs (viii) and (ix) do not require further attention and are not pressed.
The husband’s application filed 9 September 2010
It is submitted that the purpose of the orders sought in this application is to give effect to orders made by Federal Magistrate Kemp on 27 October 2009. For the purposes of achieving a transfer of the Suburb C property to “the Trustee of the parties’ superannuation fund, it is necessary to have a Certificate of Title. The Certificate of Title has allegedly been lost. The submissions in relation to this issue were similar to the submissions related to the application at (iii) in the wife’s application filed 2 August 2010. I will not repeat what I have said above in relation to those matters.
The wife’s objection to these orders is in relation to the risk of disposal of assets. The learned Magistrate’s orders deal with the wife’s concern in that, subject to the wife giving an undertaking as to damages, an injunction was made restraining the Trustee from transferring or encumbering the properties transferred to it - being the Suburb C and FF Town properties. The wife has elected not to give the undertaking. I explained to the wife on an earlier occasion, perhaps 22 November 2010, the meaning and purpose of the usual undertaking as to damages and I took some time to explain that to her again on 28 January 2011. She initially said that she would give the undertaking. However, when I asked for her to reduce the undertaking to writing and to provide it to the court, she declined to give the undertaking. I explained to her that the orders made on 27 October 2009 provide an injunction in the terms that I have set out, if she gives the undertaking as to damages. In that way the concerns behind the wife’s position can be addressed.
Conclusion
For the reasons given in relation to the orders sought at (iii) of the wife’s application of the 2 August 2010, paragraph 3 of the orders sought on behalf of the husband in his application of 9 September 2010 is appropriate and I will make that order.
The wife’s Application in a Case filed 24 September 2010
Orders 2 & 3
This application seeks orders at paragraphs 2 and 3 in relation to the capacity of the parties, other than the wife, to serve short notice or to not provide notice of court documents to the wife and to require that documents be served on the wife in a timely manner.
Conclusion
I explained to the wife that these orders could not be made. In effect such orders would be against public policy. I explained to her that there were times when it is necessary for a court to consider applications on an urgent basis and indeed in the course of explaining that to the wife, she volunteered that orders on occasions, could be made ex parte. It is not appropriate to make those orders and, to be fair to the wife, she did not seek to further agitate that issue.
Notwithstanding that her application could not succeed, courts are careful about the requirements of natural justice and the requirements to provide and to ensure that parties are provided with due process.
Order 4
At paragraph 4 the wife seeks that the husband be required to personally appear at court or to be present at a local police station on a weekly basis and to report his whereabouts for the next 12 months. I pointed out to the wife that there was a level of hypocrisy about her seeking those orders in circumstances where she appears and has appeared to my knowledge on virtually all occasions for the purpose of these proceedings, by telephone from Country J. She explained that the orders were sought out of frustration in her quest for maintenance and child support and that because she could not identify his location in Australia, her causes of action for that relief were frustrated.
Conclusion
It is not appropriate to make the orders sought by the wife. The fact of the principal parties living outside Australia has added to the complexity of these proceedings. It may be that, as has already occurred in relation to specific court events, the parties will be ordered to attend personally. For example, it does not seem to me to be practicable to hold an effective hearing for quasi criminal relief or a final property trial without the primary parties being physically present. Nevertheless, in the circumstances of this case and particularly with the wife outside Australia, the order she seeks is not appropriate.
The husband’s Response filed 2 November 2010
Apart from the formal prayers in the Response, the issue of substance is at paragraph 5 whereby an order is sought:
5.That pursuant to Section 118(1)(c) of the Family Law Act 1975, the wife shall not henceforth, without leave of the Court in the first instance, institute an interim or interlocutory application in reference to File number TVC 1541/2007.
It is submitted that such an order is appropriate because of the costs that have been incurred by the husband facing multiple applications which are supported by voluminous and duplicated material. It is submitted that the reason for the order is demonstrated in the applications dealt with by the court this day. It is submitted that the application filed 25 November 2010 for orders against the Minister, NSW and the other respondents, which application was ultimately withdrawn, was on its face, utterly hopeless. Similarly it was submitted that the wife’s application of 2 August 2010 was utterly hopeless.
It was argued that the court need not be satisfied that there was any intent on behalf of the wife but only that the wife had commenced proceedings that were hopeless. I was referred to the decision of The Attorney-General and Wentworth (1988) 14 NSWLR 481 at 491. At page 491 where there is a reference to Oceanic Sun Line Special Shipping Co Inc v Fay (1998) 62 ALJR 389; 79 ALR.
The wife opposed the making of such an order. Her repeated concerns are that she have an opportunity to raise issues of alleged fraud in the conduct of the husband and what she alleges has been supportive or related conduct of a similar type by Mr R Peters.
Courts have always jealously guarded the freedom of citizens to access to the courts and an order under s 118 of the Family Law Act places a restriction on access to the Court. Such orders are rarely made. Here the order is sought only in relation to interlocutory applications. Even there, the courts recognise that issues can arise suddenly and any barrier to a citizen having ready access to a court must be carefully considered.
Mr R Peters made submissions at some length in relation to the impact on him of the litigation between his father and Ms Peters. He said that he holds a significant and responsible position with the Australian Graduate School, and other professional positions and that as a result of those positions he has been required to adhere to standards of the utmost probity. He said that in the course of these proceedings information has been provided to work colleagues, professional colleagues, Ministers of the Crown and to important organisations, which has called into question his professional integrity. He cited an example of an occasion when he was at a public venue to address at an important conference and a tattooed process server, instructed by the wife, served him with documents related to these proceedings while he was on the way to the podium to give his speech. He displayed some emotion in describing the impact on him of that event, of the series of explanations he was then required to give to professional colleagues and others as a result of that incident and as a result of other communication by the wife.
Even the proceedings in the form of the wife’s application which was initially filed on 16 November 2010, and amended by her in the form of her application of 25 November 2010, had the effect of putting before the Minister NSW, the officers of O University, the Australian Graduate School and a number of named individuals, allegations against him, which he contends are entirely unfounded. It is submitted that those allegations call his professional integrity into question.
The wife consistently uses florid language throughout the documents she has filed. In her affidavit filed 2 August 2010 at paragraph 22, she says “[Mr Peters], [Mr R Peters] and [H Pty Ltd] conspired to manipulate their financial affairs for the purpose of the fraudulent concealment or removal of any part of the property of [H Pty Ltd]”, at 30 “[Mr R Peters] is a person who has violated his professional ethics and who has put his professional knowledge and expertise not for a good purpose, but for evil..”.
In the wife’s affidavit filed 19 November 2009, at 23 “he has already embarked on a duplicitous invoicing scam to siphon off and his income from me, his wife”. The wife has annexed a copy of an email to this affidavit and explains that the email demonstrates that Mr Peters and Mr R Peters were “elaborating their plan to plot to defraud me, disinherit me and divorce me”. Also at paragraph 33(c), she says “[Mr Peters] has abused and misused the Australian judicial system, and that of [Country J], to maliciously bring a Hague Court case against me. The need to be in, and to remain in, [Country J] for the purpose of a court case is a façade so he can be secretly engaged and uninterrupted in the pursuit of his business activities based in [Country J]” and at 36, “I object to the free position [Mr Peters] is in which engenders within him the hubris to act with impunity against Australia’s institutions, and citizens, and to commit crimes against society at every turn and further taunts Australia and Australia with his pejorative opinion that ‘Australian intelligence is an oxymoron’”
In relation to her complaint of the husband’s solicitor, the wife says in her affidavit dated 3 December 2010 at paragraphs 23 and 24 “[Ms F] engages in deplorable and deceitful conduct in relation to my participating in the proceedings and manipulates a court event to occur without my attendance, at worst, or preparation, at best. [Ms F] is toying with me and taking advantage of me as a self-represented litigant” and at 30, “in reference to [Ms F’s] deliberate and unprincipled tactics to obtain a litigation advantage by whatever means, including deceit, I state that her conduct is provocative and misleading”.
Section 118 provides:
Frivolous or vexatious proceedings
(1) The court may, at any stage of proceedings under this Act, if it is satisfied that the proceedings are frivolous or vexatious:
(a) dismiss the proceedings;
(b) make such order as to costs as the court considers just; and
(c) if the court considers appropriate, on the application of a party to the proceedings--order that the person who instituted the proceedings shall not, without leave of a court having jurisdiction under this Act, institute proceedings under this Act of the kind or kinds specified in the order;
and an order made by a court under paragraph (c) has effect notwithstanding any other provision of this Act.
(2) A court may discharge or vary an order made by that court under paragraph (1)(c).
In Vlug & Poulos [1997] FCA 92-778 the Full Court said:
There was, in our view, no power conferred by s 118 to impose either of the prohibitions contained in the order made by Moss J. This is because the power in s 118 to order that a person shall not institute further proceedings without leave can only, in our view, be exercised where the Court has already dismissed or is simultaneously dismissing proceedings which it was satisfied are frivolous or vexatious instituted by the person (against whom the order is to be made).
However, it noted:
….that in O'Sullivan and O'Sullivan (1991) FLC ¶92-216, the Full Court (Barblett DCJ, Nygh and Mullane JJ) appears to have taken the view (at 78,459) that the Court can exercise the power in s 118(1)(c) at any stage of the proceedings if it is satisfied that the proceedings are frivolous or vexatious. In other words they did not suggest (as we have suggested) that it is a necessary condition precedent for the exercise of the power in s 118(1)(c), that an application had been, or is to be, dismissed on the basis that it was frivolous or vexatious.
The Full Court in Vlug & Poulos did not feel the need to resolve this issue as:
….it is clear that whatever view is taken of that question, the Court must be satisfied before it exercises the power under s 118(1)(c) to prevent the institution of further proceedings, that proceedings which are then before it (or have just been dismissed by it) are frivolous or vexatious.
and that had not occurred at first instance in that case.
It also observed:
The Full Court of this Court in O'Sullivan emphasised the fundamental importance in our legal system of the right to commence proceedings in the courts and that the power to limit that right contained in s 118(1)(c) should ''be exercised with caution'' and reserved for the clearest of cases. In laying down these principles the Full Court relied on the High Court authorities of Dey v. Victorian Railways Commissioners [1948-1949] 78 CLR 62 especially at 91-92 per Dixon J; General Steel Industries Inc. v. Commissioner for Railways (N.S.W.) & Ors [1964] 112 CLR 125; Co- Ownership Land Development Pty. Ltd. v. Queensland Estates Pty. Ltd. [1973] 1 ALR 201 at 206 per Walsh J with whom Stephens J agreed.
More recently Kirby J as a member of the High Court has said:
"... it is regarded as a serious thing in this country to keep a person out of the courts. The rule of law requires that, ordinarily, a person should have access to the courts in order to invoke their jurisdiction. It is a rare thing to declare a person a vexatious litigant. It is extremely rare in this court to use the power, whether under the inherent power or under O 63, to require leave before a person may commence proceedings invoking the court's jurisdiction."(Ex parte Skyring 135 ALR 29 at 31-32)
We consider that the same caution and reserve referred to by the Full Court in O'Sullivan should be employed in any exercise by this Court of the power to prohibit the institution of further proceedings without leave under O 40 r 6 of the Family Law Rules or under s 118 of the Family Law Act, and also in the use by this Court of O 63 rr 1 and 2 of the High Court Rules (or of O 4 r 3 of the Family Law Rules if it is applicable) or of any residual inherent power to stay proceedings instituted on grounds that they are vexatious, oppressive or an abuse of process, or disclose no proper cause of action.
In Lindberg & Scott [2009] FamCA 465, Cronin J considered the meaning of the terms used in s 118. He found:
231.The Shorter Oxford English Dictionary (3rd ed) defines “frivolous” as meaning “of little or no weight or importance; paltry, trumpery; not worth serious attention.” “law. In pleading: manifestly futile…characterised by lack of seriousness, sense or reverence; given to trifling, silly.”
232.The word “frivolous” in combination with “vexatious” is a technical legal term, which means that there is no legal basis for the proceedings; it does not necessarily connote that an applicant has acted frivolously in bringing proceedings (see Pitt v OneSteel Reinforcing Pty Ltd [2008] FCA 923 at [9].)
233.The expression “vexatious” can include proceedings brought with the intention of annoying or embarrassing or harassing the other party, or for some collateral purpose other than having the court or tribunal adjudicate on the issues raised by the proceedings, or, irrespective of the motive of the litigant, if the proceedings are “so obviously untenable or manifestly groundless as to be utterly hopeless” (Attorney-General v Wentworth (1988) 14 NSWLR 481 at 491 per Roden J, or if the proceedings have “no reasonable prospect at all of success”: Abrahams v Comcare (2006) 93 ALD 147at [24], per Madgwick J.)
234.“Futile” in the dictionary means incapable of producing any result.
Conclusion
This application will fail. I have not dismissed any application of the wife as being vexatious.
The unusual feature of the proceedings before me is that unlike most of the cases referred to above, there has been no opportunity to finally determine the issues between Mr & Ms Peters. Despite the passage of over three years, the proceedings remain at an interlocutory stage. This is not a case whereby one party seeks to re-visit a determination of the substantive issues or whereby there has been a failure to prosecute the substantive proceedings. In circumstances where the only proceedings dealt with to date have been heard on the papers it is impossible to make findings about the motivation of the parties or to identify whether one party alone is responsible for the state of the litigation.
The most concerning aspect of the proceedings in terms of s 118 was the wife’s Amended Application of 25 November 2010. However, that application cannot provide the precondition for an order under s 118, as it was not dismissed as vexatious. It was withdrawn.
The wife has filed many interim applications. She has been largely unsuccessful. She has filed some applications that had no chance of success. There are concerning aspects of the proceedings insofar as they would seek to involve Mr R Peters. By reference to the manner in which he was served with documents, he makes a good argument that the proceedings are being used against him in an oppressive and abusive way. However, the substantive issues in relation to him have been expressly reserved to the final hearing and therefore it is not possible to make findings or draw conclusions about the wife’s conduct in those circumstances. Having said that, there must be no repetition of the service incident or anything akin to it, by the wife. It is an abuse of process to bring proceedings for any purpose other than to obtain the relief sought. Proceedings must not be brought or conducted for the purpose of embarrassing or otherwise damaging an individual or entity. Ms Peters is a person of obvious intelligence and the explanation she gave for having Mr R Peters served as he was, is ridiculous and insulting.
There are features of the conduct of the proceedings by the wife that give rise to the concern that her prosecution of the proceedings is vexatious but it is not appropriate to make an order under s 118(c) at this stage.
I certify that the preceding one hundred and twenty three (123) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Loughnan delivered on 11 March 2011.
Associate:
Date: 11 March 2011
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