Peterson and Davis & Ors

[2020] FamCA 723

FAMILY COURT OF AUSTRALIA

PETERSON & DAVIS AND ORS [2020] FamCA 723

FAMILY LAW – PRACTICE AND PROCEDURE – Adjournment of proceedings – Rule 11.01 of the Family Law Rules 2004 (Cth) – Where party in custody bail refused – Where s 77 order under the Crimes (Administration of Sentences) Act 1999 (NSW) for that party to attend by phone unable to be implemented by reason of coronavirus difficulties – Where appropriate for the Court to adjourn proceedings.

Crimes (Administration of Sentences) Act 1999 (NSW) s 77
Family Law Act 1975 (Cth) s 102NA
Family Law Rules 2004 (Cth) rr 8.04, 11.01

Davis and Anor & Cusson and Ors [2018] FamCA 119

APPLICANT: Ms Peterson

FIRST RESPONDENT: Mr Davis

SECOND RESPONDENT: Mr Cusson

THIRD RESPONDENT: Mr B Davis

FOURTH RESPONDENT: Ms Davis

FILE NUMBER: PAC 1208 of 2016

DATE DELIVERED: 1 September 2020

PLACE DELIVERED: Parramatta

PLACE HEARD: Parramatta

JUDGMENT OF: Foster J

HEARING DATE: 10 and 11 August 2020

REPRESENTATION

COUNSEL FOR THE APPLICANT: Mr George

SOLICITOR FOR THE APPLICANT: Reimers Legal

COUNSEL FOR THE FIRST RESPONDENT: Mr Sansom SC

SOLICITOR FOR THE FIRST RESPONDENT: Adams & Partners Lawyers

COUNSEL FOR THE SECOND RESPONDENT: Mr Marshall SC with him Mr Eardley

SOLICITOR FOR THE SECOND RESPONDENT: Mercantile Legal Services

COUNSEL FOR THE THIRD RESPONDENT: Mr Allen

SOLICITOR FOR THE THIRD RESPONDENT: McEvoy Legal

COUNSEL FOR THE FOURTH RESPONDENT: Mr Allen

SOLICITOR FOR THE FOURTH RESPONDENT: McEvoy Legal

ORDERS MADE ON 11 AUGUST 2020

With The Consent of the Applicant And The Second Respondent And Upon Noting There Is No Appearance By Or On Behalf Of The First Respondent Husband And The Third And Fourth Respondents Not Wishing To Be Heard, It Is Ordered That

1. The property known as C Street Suburb B New South Wales being the land and improvements comprised in folio identifier … (Suburb B Property) be sold.

2. The Second Respondent be authorised and directed to sell the Suburb B Property.

3. The Second Respondent’s powers for the purposes of the sale of the Suburb B Property are as follows:

   (a)The power to execute a Contract for Sale and Transfer for the sale of the Suburb B Property on behalf of the First Respondent and himself.

   (b)The power to authorise the First Mortgagee to the Suburb B Property to discharge its mortgage.

   (c)The power to engage a sales agent for the purposes of the sale of the Suburb B Property.

   (d)The power to engage a solicitor to act on the conveyance of the Suburb B Property and, if necessary, to obtain vacant possession of it.

   (e)The power to remove and store chattels contained on or in the Suburb B Property.

   (f)The power to affect any necessary repairs to present the Suburb B Property for sale.

   (g)The power to obtain an updated valuation of the Suburb B Property, if necessary.

   (h)The power to set the sale price and a reserve price for auction if necessary, having regard to the valuation he holds.

4. In regards to any chattels removed from the Suburb B Property by the Second Respondent, the Second Respondent shall be authorised to place those chattels in commercial storage for six (6) months, such storage fees to be paid from the proceeds of sale.

5. The Second Respondent shall provide access to the Parties or any other person asserting ownership of those chattels for the purpose of inspecting the same and shall be authorised to release claimed chattels on reasonable proof of ownership, and otherwise shall be authorised to dispose of the remaining chattels after six (6) months.

6. The sale of the Suburb B Property by the Second Respondent may be carried out by auction or private treaty as the Second Respondent sees fit.

7. The proceeds of the sale of the Suburb B Property are to be paid as follows:

   (a)To adjustments for rates and land tax.

   (b)Sales agent’s commission and the cost of conveyance.

   (c)The amount required to discharge the first registered mortgage.

   (d)The legal costs, if any, involved in taking possession of the Suburb B Property.

   (e)The cost of chattel storage for up to six (6) months and disposal of the chattels.

   (f)The remuneration of the Second Respondent for conducting the sale charged at his usual rates limited, until further order, to a maximum amount of $10,000.

   (g)The balance to be held by the Second Respondent in his trust account until further order.

It Is Further Ordered That

1. Liberty to apply as to implementation or enforcement of the above orders.

2. The First Respondent have leave to apply in relation to the orders made today on short notice by filing an Application in a Case supported by affidavit.

3. The costs thrown away by reason of the adjournment of the Applicant, the Second Respondent and the Third and Fourth Respondents be reserved.

4. Each of the Applicant, the Second, Third and Fourth Respondents in the event that there is any application for costs thrown away by reason of the adjournment, file and serve short written submissions by no later than Friday, 28 August 2020.

5. Any submissions in response by the First Respondent be filed and served by no later than Friday, 11 September 2020.

6. Thereafter judgment be reserved to chambers.

7. The parties are granted leave to issue such subpoena as they consider relevant to the issues before the Court with such subpoena to be returnable by no later than Friday, 25 September 2020.

8. The solicitor for the Third and Fourth Respondents use their best endeavours to provide to the First Respondent a sealed copy of the orders made today with such notification informing the First Respondent that in the event that he seeks to make any application relating to the orders made he may do so on short notice by filing an Application in a Case and any affidavit in support thereof.

9. Leave is granted to the parties or any of them to relist the matter for further judicial case management in circumstances where the First Respondent is granted bail pending hearing of certain criminal charges.

UPON NOTING that the parties intend to cross-examine each other at the trial of the proceedings, and that there is an allegation of family violence between them:

AND UPON FURTHER NOTING that the parties have each been advised by the Court:

(a)That pursuant to these orders, neither party may cross-examine the other party personally;

(b)That pursuant to these orders, any cross-examination of either party may only be conducted by a legal practitioner acting on behalf of the other party;

(c)As to the availability of the Commonwealth Family Violence and Cross-Examination of Parties Scheme and the means by which they may apply to that scheme for the provision of a lawyer; and

(d)That a copy of these orders will be provided by the Court to Legal Aid NSW, which administers the said scheme.

It Is Ordered that

1. The requirements of s 102NA(2) of the Family Law Act 1975 will apply to any cross-examination occurring in the proceedings on or after 11 September 2019.

2. Short reasons for judgment in respect of the interim orders made today and the adjournment to be published on a date to be advised.

Note: The form of the order is subject to the entry of the order in the Court’s records.

IT IS NOTED that publication of this judgment by this Court under the pseudonym Peterson & Davis has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).

Note: This copy of the Court’s Reasons for Judgment may be subject to review to remedy minor typographical or grammatical errors (r 17.02A(b) of the Family Law Rules 2004 (Cth)), or to record a variation to the order pursuant to r 17.02 Family Law Rules 2004 (Cth).

FAMILY COURT OF AUSTRALIA AT PARRAMATTA

FILE NUMBER: PAC 1208 of 2016

Ms Peterson

Applicant

And

Mr Davis

First Respondent

And

Mr Cusson

Second Respondent

And

Mr B Davis

Third Respondent

And

Ms Davis

Fourth Respondent

REASONS FOR JUDGMENT

1. Rule 11.01 of the Family Law Rules 2004 (Cth) (“the Rules”) provides to the Court wide powers of case management as set out in the Table 11.1 of the Rules. Such powers include the power to adjourn a court event. These proceedings were adjourned with orders made on 11 August 2020.

2. These are short reasons for the adjournment and in relation to the orders set out above.

3. These proceedings are proceedings for property adjustment as between the applicant de facto wife and the first respondent.

4. The second respondent is the wife’s Trustee in Bankruptcy.  The wife has been discharged from her bankruptcy but her trustee continues to administer her bankrupt estate for the benefit of outstanding creditors and the trustee’s fees.

5. The third and fourth respondents are the parents of the respondent de facto husband who have intervened in the proceedings seeking a declaration that certain property at D Town is held by the wife and husband in trust for them.  The circumstances giving rise to the alleged trust remain for determination.

6. However, as a consequence of the wife’s bankruptcy, the wife’s interests in the former matrimonial home at Suburb B and the property at D Town have vested in her trustee in bankruptcy who holds his interest in both properties as tenants-in-common with the husband.

Context

1. The background to the proceedings was succinctly summarised by Hannam J in reasons for judgment delivered 2 March 2018 (Davis and Anor & Cusson and Ors [2018] FamCA 119) as follows:

   8.The wife and husband began living together in 1999. They did not marry but had three children currently aged 16, 13 and 11. Parenting proceedings in relation to the children, who live with the wife and spend supervised time with the husband, are ongoing.

   9.The parties purchased a property at Suburb B in 2002 for $225,000. That property is encumbered by a mortgage to the National Australia Bank which is a secured creditor of the wife.

   10.In 2001 and then 2003 the Respondents purchased the properties that were the subject of their Application in a Case.

   11.In 2008 the properties were transferred to the husband and wife by the Respondents. Both properties are subject to mortgages with the Commonwealth Bank of Australia which is a secured creditor of the wife. There is significant dispute as to the nature of the transfer and whether consideration was paid to the Respondents by the husband and wife. The Respondents and the husband contend no money was exchanged (despite signed transfers indicating otherwise) and that the husband and wife hold the properties on trust for the Respondents. The wife and Trustee dispute these contentions.

   12.      The parties separated in 2010. 

   13.In October 2011 the wife filed a debtor’s petition in the Federal Court of Australia which included a signed Statement of Affairs in which the wife declared she and the husband jointly owned the properties. The Official Trustee in Bankruptcy was appointed as the trustee of her estate and subsequently registered caveats on the wife’s properties. 

   14.On 2 February 2012 the Trustee in these proceedings was appointed trustee of the property of the wife. Correspondence was sent to the husband seeking a response from him to the Official Trustee in Bankruptcy’s report to creditors dated 10 October 2011.

   15.While the Trustee did not receive a response from the husband, in March 2012 he received a letter from solicitors for the Respondents asserting that the wife and husband held the properties on trust for the Respondents. The Trustee responded to that letter indicating that the properties were owned by the husband and wife and the mortgages secured over those properties were in their joint names.  

   16.Having received no evidence supporting the Respondent’s assertion of a trust, on 31 July 2013 the Trustee was registered on the title of the properties as tenant in common with the husband.

   17.The Trustee subsequently became aware that one of the subject properties was being rented and in early 2016 requested that the real estate agents pay the rent from that property into the Trustee’s trust account. At a later date the Trustee became aware the second subject property was also being rented. No rent had been received by the Trustee for either of the properties. 

   18.The wife commenced parenting and property proceedings in March 2016 in the Federal Circuit Court.

   19.In her Initiating Application, the wife sought orders that she be granted leave to commence proceedings out of time, that she receive 65 per cent of the matrimonial property, there be a superannuation splitting order made in her favour and that the debts associated with her bankruptcy be treated as debts of the relationship and deducted from the asset pool.

   20.On 19 September 2016 the Respondents filed an Application seeking to be joined to the property proceedings and on 15 November 2016 an order was made to that effect.

   21.      On 23 June 2017 the matter was transferred to this Court.

2. The wife and husband resolved parenting issues with final consent orders being made on 24 April 2019.  The two children under the age of 18 years were to live with the mother and they continue to do so to date.

3. Leave was granted to the applicant wife on 15 November 2016 to commence property proceeding out of time.

4. The continuation of proceedings has been fraught with difficulties not the least of which is the intervention of the third and fourth respondents in the proceedings and the participation of the wife’s trustee in bankruptcy.

5. In this Court, orders were made by a registrar for valuations of the subject properties on 19 October 2017 together with orders requiring the parties to make appropriate financial disclosure as required by the Rules.

6. Property proceedings were again before a registrar on 18 December 2017.  It was noted that valuations had not been undertaken as the parties were in dispute as to who would fund those valuations.  The proceedings were before a registrar on 30 January 2018 and again the husband was required to provide particular disclosure, he not having complied with previous orders as to same.  Valuation issues were resolved by consent with an order that the third and fourth respondents contribute to the cost of valuations.

7. On 19 March 2018 a registrar was informed that valuations had still not been obtained although a valuer had been agreed.  The husband remained in default of disclosure as previously ordered. 

8. On 23 April 2018 the registrar was informed that valuations had been obtained and orders were made for the preparation of a draft joint balance sheet.  On that day the third and fourth respondents were directed to file and serve points of claim supporting their assertion of an express trust in their favour in relation to the properties at D Town.

9. On 24 May 2018 trial directions were made in respect of both property and parenting.  As to the issue of property, the parties were to file consolidated affidavit evidence by 3 August 2018 and the second respondent trustee was to file his evidence by 17 August 2018.  Proceedings were listed before a registrar for compliance on 23 August 2018.

10. Proceedings were before the registrar for compliance on 23 August 2018 and in circumstances where the matter was not ready for allocation of trial dates as to property, proceedings were adjourned for judicial case management to 19 October 2018.  On 19 October 2018 the Court was informed that the parties had filed affidavit material as to property and the matter was remitted to the list clerk to allocate four days for hearing as to property.

11. Prior to allocation of trial dates as to property, proceedings were listed for hearing as to final parenting for trial commencing 23 April 2019.  On that day final orders as to parenting were made by consent.  On 3 December 2019 proceedings were listed for hearing as to property commencing 6 April 2020 allocating four days for hearing.

12. As a consequence of community concerns arising from the coronavirus pandemic, proceedings were listed for judicial case management on 1 April 2020.  On that date all parties were represented and the allocated trial dates were vacated and proceedings listed for further judicial case management on 14 April 2020.

13. On 14 April 2020 in anticipation of the amelioration of conditions in the community arising from the coronavirus pandemic trial dates were allocated commencing 10 August 2020 allocating four days for hearing.

14. Subsequently, on 23 July 2020, the Court was informed that the husband was in custody bail refused arising from serious assault charges.  Proceedings were relisted for directions on 31 July 2020.  On that day all parties were represented.  The Court made the following orders:

    (1)The Second Respondent Mr Cusson or his nominee be authorised to attend at the property C Street, Suburb B for the purposes of facilitating the property being valued by the appointed Single Expert Valuer for the purposes of the hearing commencing 10 August 2020 and for the purposes of such attendance the Second Respondent or his nominee be authorised to enter upon that property by force if necessary.

    (2)The Second Respondent have leave to file an Amended Response setting out, with particularity, the orders sought by the Second Respondent and Amended Points of Defence to the Points of Claim filed by the Third and Fourth Respondents with such documents to be filed and served by Wednesday, 5 August 2020.

    (3)Trial dates commencing 10.00 am on Monday, 10 August 2020 by way of face-to-face trial are confirmed, but noting that the First Respondent is presently in custody in relation to certain criminal matters, and his attendance, if required, for cross examination during the trial will sought to be facilitated by appropriate section 77 orders.

15. On 6 August 2020 an order was made pursuant to s 77 of the Crimes (Administration of Sentences) Act 1999 (NSW), that the NSW Commission of Corrective Services shall cause the prisoner, MR DAVIS MIN …, and who is held at F Correctional Centre, to be made available to attend by way of AAPT telelink at the Family Court Parramatta at 10.00 am on Monday, 10 August 2020.

16. It was readily apparent by reason of coronavirus restrictions that at the time of the s 77 order that there was little prospect of the husband who was being held on remand being produced to the Court in person for the purposes of the hearing and the s 77 order required his availability by telephone.

17. The final property proceedings came on for hearing on 10 August 2020.  All parties were represented by counsel including senior counsel appearing for the applicant wife, the first respondent husband and the second respondent trustee in bankruptcy.

18. During the course of the morning, difficulties were occasioned in the husband appearing by telephone link from custody. 

19. Counsel for the husband made application for proceedings to be adjourned in circumstances whereby it was asserted that there had been difficulties in obtaining instructions from the husband as a consequence of his incarceration.  Yet it appears that the husband has only been incarcerated since mid-July and in circumstances where trial affidavits were filed and served many months earlier it would have been expected that preparation for trial particularly conferences relating to cross examination and as to obtaining detailed settlement instructions would have been conducted well before the trial. 

20. The application for adjournment was opposed by senior counsel for the wife and senior counsel for the trustee in bankruptcy but was supported by counsel for the third and fourth respondents, the parents of the husband.  There was no determination of the adjournment application as the parties sought that proceedings be stood down to facilitate the parties having discussions as to prospective resolution of the proceedings.

1. The matter was again before the Court late in the afternoon with the Court being informed that the matter had not been resolved, that difficulties continued in relation to the husband being made available by phone from custody.

2. The parties were informed that the matter was to be adjourned to the next day with again an attempt being made to have the husband available by telephone link by reason of the s 77 order already made. The Court was informed in that circumstance that counsel and solicitor for the husband would cease to act as they had no further instructions.

3. The proceedings returned before the Court on 11 August 2020. At 9.30 am there was no appearance by counsel and solicitor for the husband and shortly thereafter the Court received electronically a Notice of Ceasing to Act purportedly pursuant to the provisions of Rule 8.04 of the Rules that provides:

   (1)A lawyer may cease to act for a party:

   (a)by serving on the party a Notice of Ceasing to Act and, no sooner than 7 days after serving the notice, filing a copy of the notice; or

   (b)with the court's permission.

   (2)If:

   (a)a party's address for service is the party's lawyer's address; and

   (b)the lawyer ceases to act for the party;

   the party's last known residential address is the address for service until the party files a Notice of Address for Service.

4. There was no application by the solicitor acting for the husband for permission to file a Notice of Ceasing to Act without first serving the husband as provided for by the Rule, nor was there any application for leave to withdraw.

5. Once again on 11 August 2020 there were difficulties in making contact with the husband in custody with all attempts to endeavour to do so being futile.

6. In the circumstances the parties were informed of the Court’s intention to adjourn proceedings by reason of the circumstances set out above. Further, by reason of the husband now being unrepresented and with issues of family violence as between the husband and wife, it will be necessary to facilitate the husband being represented at the further hearing of the proceedings as to property.  In that respect an order was made under the provisions of s 102NA of the Act to facilitate such representation.

7. Otherwise, leave was granted to the second respondent trustee in bankruptcy to seek an order for sale of the property at Suburb B that was the former matrimonial home and that had been occupied by the husband since the parties’ separation in 2010.  The order sought by the second respondent trustee in bankruptcy was supported by the applicant wife, and the third and fourth respondents did not seek to be heard on the issue.

8. It was common ground that in the event that the husband was granted bail, it would be on condition that he reside with his parents.

9. The effect of the order for sale would be that the net proceeds of sale would be held in trust pending final determination of property proceedings and a determination of the entitlements of the applicant wife, first respondent husband and second respondent trustee in bankruptcy to those proceeds of sale.

10. The third and fourth respondents were agreeable to providing notice of the orders made to the husband and he was granted leave to make application in respect of the orders made on short notice.

11. In all of the circumstances it is appropriate that proceedings be adjourned and orders made as set out above.

I certify that the preceding thirty seven (37) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Foster delivered on 1 September 2020.

Associate: 

Date:  1 September 2020