Pirani & Pirani (No 4)
[2024] FedCFamC1F 694
•17 October 2024
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 1)
Pirani & Pirani (No 4) [2024] FedCFamC1F 694
File number: SYC 3987 of 2023 Judgment of: CHRISTIE J Date of judgment: 17 October 2024 Catchwords: FAMILY LAW – INTERIM PROPERTY –– Where administrators seek company vehicle keys in wife’s possession – Where company is legal owner of vehicle – Where wife asserts vehicle was a gift from husband – Where husband supports wife’s assertion – Where husband did not and could not transfer title of vehicle to wife – Where husband failed to perfect the gift – Wife ordered to return vehicle keys to company. Legislation: Family Law Act 1975 (Cth) Pt VIIIAA, s 90AE Division: Division 1 First Instance Number of paragraphs: 28 Date of hearing: 30 September 2024 Place: Sydney Counsel for the Applicant: Mr Pesman SC Solicitor for the Applicant: Harris Freidman Lawyers Counsel for the First Respondent: Ms Druitt Solicitor for the First Respondent: MPM Legal Second Respondent: Litigant in person ORDERS
SYC 3987 of 2023 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)
BETWEEN: B PTY LTD
Applicant
AND: MS PIRANI
First Respondent
MR PIRANI
Second Respondent
ORDER MADE BY:
CHRISTIE J
DATE OF ORDER:
17 OCTOBER 2024
THE COURT ORDERS THAT:
1.Order 9 of the Orders of 7 July 2023 is discharged.
2.Within 7 days of the making of these Orders, the first respondent deliver to the applicant the keys for Motor Vehicle 4 ("the vehicle") to the applicant’s place of business located at UU Street, Suburb PP, NSW.
3.The applicant be authorised to sell the vehicle and retain the proceeds of sale.
4.Within 14 days of these Orders, the first respondent pay to the applicant $691.99 by way of reimbursement of parking fines and tolls incurred by the applicant by the first respondent’s use of the vehicle.
5.Within 14 days, the first respondent pay to the applicant the amount of any parking fines and tolls incurred with respect to the vehicle from mid-2023 until the date on which the vehicle came into possession of the applicant.
Note: The form of the order is subject to the entry in the Court’s records.
Note: This copy of the Court’s Reasons for judgment may be subject to review to remedy minor typographical or grammatical errors (r 10.14(b) Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 10.13 Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth).
Part XIVB of the Family Law Act 1975 (Cth) makes it an offence, except in very limited circumstances, to publish an account of proceedings that identify persons, associated persons, or witnesses involved in family law proceedings.
IT IS NOTED that publication of this judgment by this Court under a pseudonym Pirani & Pirani has been approved pursuant to subsection 114Q(2) of the Family Law Act 1975 (Cth).
REASONS FOR JUDGMENT
CHRISTIE J:
On 30 September 2024, I consolidated a number of different applications. One thing unifies the third parties; they all seek to be paid money as a consequence of a claim against the assets of either the husband, the wife or a company in which the husband has had an interest.
Until such time as the identity and value of all assets, and in particular, all liabilities are known, it is not possible to approach the matter piecemeal, and I resolved to list the matter for final hearing and make directions designed to clarify the matters for adjudication.
The interim application - which was listed for hearing on 30 September 2024 proceeded. That application was amended on 26 September 2024. That application now deals solely with Motor Vehicle 4. The application had originally sought orders for sale of a property at VV Street, Suburb G, NSW. That property is to be sold by the mortgagee - Westpac Banking Corporation. The sale is unlikely, on present advice, to settle anytime in 2024.
The orders which the applicant sought are:
4. Order 9 made by this Honourable Court on 7 July 2023 be discharged.
5.Within 7 days of the making of this order the Applicant deliver up to the Second Respondent [Motor Vehicle 4] by delivering the Motor Vehicle and the keys thereto to the Second Respondent's place of business at [UU Street, Suburb PP].
6.The Second Respondent be authorised to sell the Motor Vehicle and retain the proceeds of sale.
7.Within 14 days of this order the Applicant pay to the Second Respondent $691.99 by way of reimbursement of parking fines and tolls incurred by the Second Respondent by her use of the Motor Vehicle.
8.Within 14 days the Applicant pay to the Second Respondent the amount of any parking fines and tolls incurred with respect to the Motor Vehicle from [mid] 2023 until delivery up of the motor vehicle to the Second Respondent.
(Applicant's Amended Application in a Proceeding filed 26 September 2024)
The respondent wife opposed the making of the orders but agreed, through her counsel, that she would pay the tolls and fines owing.
The wife seeks that the application be dismissed, which would preserve Order 9 of the Orders of 7 July 2023 which reads:
9.By consent and pending further order, the husband shall do all such things as are necessary to ensure and facilitate:
(a)The wife having the exclusive use as against all others of [Motor Vehicle 4]; and
(b)Payments of, as and when fall due, all registration, comprehensive insurances and service costs of the said vehicle.
While the husband had no direct interest in the subject matter of the interim application, he supported the position of the wife and contended that Motor Vehicle 4 had been gifted to her and should remain with her.
I was informed by the applicant that they have possession of Motor Vehicle 4 but not the keys for same.
The following matters were not controversial:
(a)In late 2018, Motor Vehicle 4 was purchased in the name of B Pty Ltd.
(b)The invoice was issued in the name of B Pty Ltd.
(c)From the time of purchase, the expenses of Motor Vehicle 4 were met by B Pty Ltd.
(d)Motor Vehicle 4 was driven by the wife.
(e)In mid-2023, B Pty Ltd was placed into voluntary administration.
(f)On 7 July 2023, Justice Campton made Order 9.
(g)On 20 November 2023, B Pty Ltd filed an application in a proceeding seeking orders for return of the Motor Vehicle 4.
CONSIDERATION
As I understand the applicant's submissions, they argue that the terms of their appointment as administrators oblige them to recover and realise the assets of the entity.
The wife submits that Motor Vehicle 4 is not an asset of the entity, as while she accepts that the car was (and is) registered in the name of the company, it was a gift to her from her husband.
Given the car was registered in the name of the company, it is for the wife to establish that she is the legal owner. The argument she advanced appeared to rely predominantly on the fact of the husband having indicated verbally that he was giving her a car and thereafter, allowing her the use of that car.
While counsel for the wife submitted that Motor Vehicle 4 was a "family car" and necessary to transport the parties' children, this submission can have no bearing on the adjudication of the ownership of the car - it speaks only to its use.
The applicant submitted that even if the Court accepted this declaration of gift, it would fail as the husband did not have title to the car - it was an asset of the company.
The records which were attached to the affidavit of the administrator filed 21 November 2023 confirm that the car was treated by the company as a company asset including provision (and subsequent discharge) of a chattel mortgage: at [80].
There was no transfer of title either before or after the encumbrance was discharged.
The making of Order 9 occurred on the same day as B Pty Ltd was placed into administration. The husband cannot comply with Order 9.
I am conscious that this application relates to an asset which is legally owned by a third-party entity (in administration), and therefore, an application in respect of its ownership must mean a consideration of Pt VIIIAA of the Family Law Act 1975 (Cth) ("the Act").
I accept that s 90AE empowers me to alter the property interests of a third-party, provided due regard is paid to the matters in s 90AE(4) of the Act.
Accordingly, I have concluded that the only circumstances in which I could dismiss the applicant's application are either:
(a)I accept that the husband was able to gift to the wife (and did indeed gift to the wife) an asset which was owned by B Pty Ltd; or
(b)All of the matters in s 90AE(3) of the Act are satisfied and I have taken into account the relevant matters in s 90AE(4).
Did the husband gift Motor Vehicle 4 to the wife?
Motor Vehicle 4 has a title which records legal ownership. In order to gift Motor Vehicle 4 it was necessary for the husband to transfer the legal ownership of the vehicle to the wife. This did not occur.
Had the husband procured the transfer of the title of the vehicle into the name of the wife then the gift would have been perfected and the issue would not arise.
The wife is, in effect, seeking to have ongoing use of an asset which belongs to the applicant.
I was not assisted by submissions which engaged with the legality of a company gifting its assets to a third-party. The husband submitted that the value of the vehicle and the expenses had been debited to his loan account and accordingly he was free to "gift" the vehicle to the wife. First, it should be said that no party placed any evidence of the financial statements of B Pty Ltd for the relevant period before the Court. Second, even if the husband's submission is factually accurate, that circumstance did not perfect the gift.
I was not assisted by any submissions which engaged with the exceptions to the rule that equity will not perfect an imperfect gift, but note that counsel for the applicant submitted, and I accept, that a gift by the husband to the wife could not be perfected because the husband could not give what he did not have (nemo dat quod non habet).
It is appropriate that the wife pay the costs incurred by her referable to her use of the car and no submissions were advanced contrary to that position and so I will order.
I did not have evidence of the matters in s 90AE(4) of the Act. In any event I could not be satisfied that the evidence satisfies the requirements of ss 90AE(3)(a) or (d).
In the above circumstances, I propose to make Orders in accordance with the applicant's application.
I certify that the preceding twenty-eight (28) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Christie. Associate:
Dated: 17 October 2024
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