Puddy & Grossvard & Anor
[2010] FamCAFC 54
•19 March 2010
FAMILY COURT OF AUSTRALIA
| PUDDY & GROSSVARD AND ANOR | [2010] FamCAFC 54 |
| FAMILY LAW – THIRD PARTY PROPERTY PROCEEDINGS – APPEAL FROM FAMILY COURT – JURISDICTION – APPLICATION OF LAW – Husband’s appeal against order that he pay liquidator sum of $250 000 – Not established that the trial judge did not have jurisdiction to make orders in favour of liquidator of company owned by husband – Not established that the trial judge erred in exercising such jurisdiction – Not established trial judge erred in making an order in favour of liquidator, or in finding the claim of the liquidator established – Accrued jurisdiction and other possible bases of jurisdiction discussed – Court not expressing concluded view, but disinclined to accept that jurisdiction to entertain liquidator’s claim able to be enlivened other than in reliance upon accrued jurisdiction – Application to adduce further evidence dismissed – Appeal dismissed – Husband pay liquidators costs of Appeal |
| Family Law Act 1975 (Cth) – s 75(2)(ha), s 79(10) |
| Biltoft& Biltoft (1995) FLC 92-614 Hickey & Hickey&Attorney-General for the Commonwealth of Australia (Intervener) (2003) FLC 93-143 House v The King (1936) 55 CLR 499 Re Wakim; Ex parte McNally and Another (1999) 198 CLR 511; (1999) 163 ALR 270 Worsnop & Worsnop [2007] FamCA 244 |
| APPELLANT: | Mr Puddy |
| FIRST RESPONDENT: | Ms Grossvard |
| SECOND RESPONDENT: | Mr B |
| FILE NUMBER: | PTW | 4131 | of | 2003 |
| APPEAL NUMBER: | WA | 26 | of | 2008 |
| DATE DELIVERED: | 19 March 2010 |
| PLACE DELIVERED: | Dubbo |
| PLACE HEARD: | Perth |
| JUDGMENT OF: | Coleman, Warnick & Boland JJ |
| HEARING DATE: | 19 October 2009 |
| LOWER COURT JURISDICTION: | Family Court of Western Australia |
| LOWER COURT JUDGMENT DATE: | 3 September 2008 |
| LOWER COURT MNC: | [2008] FCWA 98 |
REPRESENTATION
| COUNSEL FOR THE APPELLANT: | Ms Bateman |
| SOLICITOR FOR THE APPELLANT: | Eapon Carlose |
| COUNSEL FOR THE FIRST RESPONDENT: | No Appearances |
| SOLICITOR FOR THE FIRST RESPONDENT: | Sucy Varughese |
| COUNSEL FOR THE SECOND RESPONDENT: | Mr Hooper |
| SOLICITOR FOR THE SECOND RESPONDENT: | Marks & Sands |
Orders
That the appeal be dismissed.
That the application for leave to adduce further evidence be dismissed.
That the appellant husband pay the second respondent liquidator’s costs of the appeal as agreed or failing agreement as assessed on a party and party basis.
IT IS NOTED that publication of this judgment under the pseudonym Puddy & Grossvard and Anor is approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth)
| THE FULL COURT OF THE FAMILY COURT OF AUSTRALIA AT PERTH |
Appeal Number: WA 26 of 2008
File Number: PTW 4131 OF 2003
| MR PUDDY |
Appellant
And
| MS GROSSVARD |
First Respondent
And
| MR B |
Second Respondent
REASONS FOR JUDGMENT
COLEMAN J
By Notice of Appeal filed 1 October 2008, Mr Puddy (“the husband”) appealed against orders made by Crisford J on 3 September 2008 in proceedings for settlement of property between the husband, Ms Grossvard (“the wife”) and Mr B (“the liquidator”).
The orders of the trial judge relevantly provided that, from the net proceeds of sale of a property jointly owned by the husband and wife at O in the State of Western Australia there be paid to the liquidator the sum of $250,000.00 to be applied in the liquidation of K Pty Ltd (“K”), a corporation in which the shares were held by the husband. Any “surplus” after completion of the liquidation of K was ordered to be repayable to the husband as to 75 per cent and to the wife as 25 per cent.
The husband sought that the trial judge’s order be set aside. The wife has taken no part in the appeal before this Court. The liquidator resisted the husband’s appeal and sought to maintain the trial judge’s order.
On 5 June 2009 the liquidator filed an application for leave to adduce further evidence in the appeal in support of the trial judge’s decision. Whilst that application was never formally abandoned by Counsel for the liquidator, for reasons which will become apparent, for practical purposes it can be regarded as having been abandoned.
Background
The husband was aged 49 and the wife was aged 54 at the date of the trial judge’s judgment.
The parties married and commenced cohabitation in 1990. There were no children of the marriage. The parties finally separated in September 2004. Their marriage was dissolved by decree pronounced in early 2007.
In January 1989 the husband registered K and operated his business, P Security, through it. The husband was then the sole director and shareholder of K.
In 1997 the husband sold his security business to C Security for $746,000.00. The proceeds of such sale, together with the proceeds of sale of the parties’ former matrimonial home at P were substantially utilised to acquire land at O and to construct a home on that land. There the parties cohabited from December 1999 until their separation under the same roof in 2004.
K continued to operate until 6 December 2002 when it was put into member’s voluntary liquidation. On 18 December 2003 K was put into creditor’s voluntary liquidation.
The wife commenced proceedings for settlement of property in March 2005.
The liquidator intervened in the proceedings for settlement of property between the husband and wife on 29 January 2007. The liquidator asserted that the husband owed K $508,947.00 as a result of “loans and advances” made to him either by K directly (as to $365,631.00) or through another corporation controlled by the husband, R Pty Limited ($143,316.00) (“R”).
The trial judge accepted that the husband owed K the sum asserted by the liquidator but, as earlier referred to, concluded that only the sum of $250,000.00 should be paid to the liquidator. This her Honour concluded by reference to the likely quantum of K’s debts to its creditors. As also seen, her Honour also ordered that any monies not absorbed in the course of the liquidation of K be reimbursed to the parties in shares of 75 per cent to the husband and 25 per cent to the wife.
The trial judge’s Judgment
Given that, albeit not without complexity, the appeal relates only to the trial judge’s order with respect to the payment of $250,000.00 to the liquidator, reference to only limited portions of the trial judge’s Reasons for Judgment is instructive.
Under the headings “Brief History” and “Observations of the parties”, the trial judge provided a background to the dispute before her. The matters of background which I have recounted find expression in those parts of her Honour’s Reasons for Judgment.
The trial judge recorded that in June 2002 $332,000.00 was transferred from a bank account of K to an account in the name of R, both of which corporations the husband controlled at all material times.
On 2 August 2004, after K had been in voluntary members’ liquidation and then creditors’ voluntary liquidation, the husband withdrew $377,241.00 from R’s bank account.
On 4 March 2005 those funds were deposited into a cash management account in the husband’s name.
The trial judge recorded that on 28 October 2005 the husband withdrew $340,000.00 from his cash investment account.
The trial judge further recorded that:
21.Under cross-examination when asking about the movement of cash between various accounts [the husband] indicated that he had been told that XXX, a contingent creditor, had one year to make a claim (from December 2002) and he was “not wanting to lose money to the city slickers” a term he used in a pejorative sense to describe the liquidator. Further when asked why the monies were finally withdrawn on 28 October 2005 he indicated that “I realised (the wife’s solicitor) was so militant that I risked losing the asset so I withdrew it and put it in my safe”.
Her Honour referred to an affidavit the husband swore on 26 October 2006 in which the husband “deposed to having withdrawn $335,000 from the Bank and spending approximately $1,000 a week for himself and his dog. He said the fact the money earned no interest was a better option than losing the entire amount to ‘the downtown slickers’”.
Her Honour ultimately concluded that, although the evidence was “at times difficult to understand” she was “satisfied the movement of monies and the final withdrawal was an attempt by [the husband] to not only avoid the liquidators but to remove matrimonial assets from view”.
Consistent with authority, the trial judge identified the property of the parties to the marriage. No part of her Honour’s determination of the parties’ assets assumes significance for present purposes. Her Honour’s conclusions with respect to the husband’s indebtedness to K do however. Her Honour recorded, accurately there is no doubt that the only contentious liability of the parties related to the liquidator’s claim.
The trial judge summarised the claim of the liquidator in the following terms:
35.The liquidator seeks ‘the husband and/or the wife repay to [K] Pty Ltd (in liquidation)’ two separate amounts. Firstly, $365,631 with accrued interest, legal fees and liquidator costs and secondly the sum of $143,316 with accrued interest, legal fees and liquidator costs. Additionally he seeks ‘legal costs and other liquidator’s fees of [K] Pty Ltd on an indemnity basis relating to their intervention in these proceedings’. None of this last amount is quantified. It is unclear whether there is duplication in the claims for liquidator fees and legal costs.
Having identified the two amounts sought to be recovered by the liquidator in the terms we have earlier recorded, the trial judge referred to the evidence before her in relation to such claims. As is not in doubt, the liquidator’s claim was, at least at the time of trial, based upon representations made by the husband over a period of years.
The trial judge recorded that:
39.[The husband] had signed a declaration of solvency on 20 November 2002 indicating that $508,947 was outstanding to [K] Pty Ltd as ‘loans and advances’. The declaration of solvency was to the effect that outstanding debts owed by [K] Pty Ltd would be paid within 12 months.
The trial judge articulated her reasons for accepting that the husband was indebted to K in the sum of $508,947.00 in the following terms:
43. …
· The husband acknowledged as much in the declaration of solvency he made on 20 November 2002 and he has never suggested anyone other than he or Ms [Grossvard] are liable for it;
· The husband has not denied owing the money to [K] Pty Ltd or that it was used to construct the house on the property purchased in [O];
· An inference can be drawn from his evidence that he wished to keep money he retained out of the reach of the liquidator;
· In his amended response to an application for final orders filed 1 March 2006 the husband seeks the parties be jointly liable for the repayment of the money;
· Various affidavits filed by the husband refer to money being owed.
For reasons which she provided, and which do not assume significance for present purposes, the trial judge concluded that any sum owed by the husband to K should be treated as a joint liability of the parties and deducted when calculating the net asset pool.
The trial judge recorded her intention to “discount” the sum of $508,947.00 which she accepted that the husband owed K. For reasons which will become apparent, discounting the sum of $508,947.00 to the sum of $250,000.00, and the adequacy of her Honour’s reasons for doing so, do not assume significance in this appeal.
The Grounds of Appeal
The husband’s Notice of Appeal articulated four grounds, none of which raised any challenge to the jurisdiction of the trial judge to determine the liquidator’s claim. Although not formally styled as such, an undated document containing “SUBSTITUTED GROUNDS OF APPEAL” articulated the challenges which Counsel for the husband agitated in her Summary of Argument. Counsel for the liquidator responded to these documents and took no issue as to whether or not the matters therein raised fell within the ambit of the husband’s pleaded Grounds of Appeal. In her oral submissions, Counsel for the husband identified by reference to three groups, the challenges agitated on behalf of the husband in the “SUBSTITUTED GROUNDS OF APPEAL”. Each of the three groups contained two complaints.
With respect to Counsel for the husband, whilst the grounds appearing in the two documents containing them, and the six specific grounds articulated in her Summary of Argument overlap to some extent, they are not entirely consistent. The course of oral submissions suggests that the appeal ultimately raises two issues of substance with respect to jurisdiction. The first issue is whether the trial judge lacked the jurisdiction to make any order in favour of the liquidator. The second is whether her Honour erred in deciding to exercise the jurisdiction if it existed. Although these issues are conceptually discrete, with respect to her, the submissions of Counsel for the husband leave the real focus of these complaints less than entirely clear. In fairness to Counsel for the husband, both issues shall be addressed.
The other issue of substance raised in the appeal is whether, on the evidence before her, the trial judge erred in making any order in favour of the liquidator if, contrary to the submissions on behalf of the husband, the trial judge did not err in concluding that she had jurisdiction to make such orders, and her decision to exercise jurisdiction was not erroneous.
Although the Grounds of Appeal and/or Summary of Argument relied upon on behalf of the husband complained that the trial judge erred in finding that the husband was indebted to K in the sum of $508,947.00, and had further erred in discounting that sum to $250,000.00, Counsel for the husband, ultimately did not pursue the second of those complaints. Clearly, if the assertion of the husband that the trial judge could not find that the husband was indebted to K, either in the sum of $508,947.00 or any lesser sum is accepted, no question of discounting the liability could arise.
The husband’s indebtedness to K was potentially either $508,947.00 or $365,631.00. If the figure of $508,947.00 or the lesser sum of $365,000.00 survives appellate challenge, whatever the correctness of the trial judge’s discounting of that sum to $250,000.00, or the adequacy of her reasons for doing so, the husband could not successfully challenge the trial judge’s order. Discounting a figure of $508,947.00, or of $365,631.00 clearly could not be to the detriment of the husband and wife, and could be to their considerable advantage if the debts to K, and costs of its liquidation could be proved to exceed the sum of $250,000.00.
The jurisdiction to make orders in favour of the liquidator
The following passages from Counsel for the husband’s Summary of Argument revealed the parameters of the jurisdictional challenge raised in Counsel for the husband’s “SUBSTITUTED GROUNDS OF APPEAL” and assert that her Honour:
4.32 …
(a)erred in that Justice Crisford did not consider the relevant indicia, criteria, factors and considerations which the Court was required to consider to determine if the accrued jurisdiction was invoked,
(b)erred by failing to give reasons for determining that the accrued jurisdiction was invoked.
As the oral submissions of Counsel for the husband confirm, the thrust of the first of these challenges was that the trial judge erroneously concluded that she had jurisdiction to entertain the liquidator’s claim, whether pursuant to the Court’s accrued jurisdiction or on any other basis. Ancillary to these challenges are the complaints on behalf of the husband that if, contrary to the contentions of his Counsel, the trial judge had jurisdiction to entertain the liquidator’s claim, her Honour erred by exercising that jurisdiction. Albeit only by reference to the Court’s accrued jurisdiction, these complaints were agitated in the following passages of Counsel for the husband’s Summary of Argument which assert that her Honour:
4.32…
(c)erred by failing to consider the balancing of relevant interests in exercise of the discretion to exercise the accrued jurisdiction in the Proceedings;
(d)erred by failing to give reasons for determining that, in the exercise of the Court’s discretion, the Court ought to accept the invitation to exercise the accrued jurisdiction in the Proceedings.
Before considering the discretionary challenges agitated on the husband’s behalf, it is appropriate to consider the contention of Counsel for the husband that her Honour lacked jurisdiction to entertain the liquidator’s claim. In support of that challenge, Counsel for the husband submitted that:
4.5The relevant indicia, criteria, factors and considerations which Justice Crisford was required to consider, to determine if the accrued jurisdiction was invoked, were:
(a)what the parties had done,
(b)the relationships between or among them,
(c)the laws which attached rights or liabilities to their conduct and relationships,
(d)whether the claims were part of a single justiciable controversy and in determining that question whether the claims were ‘attached’ and not ‘severable’ or ‘disparate’,
(e)whether the claims were non-severable from a matrimonial cause and arose out of a common sub-stratum of facts, and
(f)whether the Court had the power to grant appropriate remedies in respect of the ‘attached’ claims. [footnote omitted]
By reference to the judgment of McHugh J in Re Wakim; Ex parte McNally and Another (1999) 198 CLR 511; (1999) 163 ALR 270 Counsel for the husband complained that the trial judge had failed to identify “what the parties had done”, and the “relationships between or among them”.
It was further complained that:
4.10The laws which attach rights or liabilities to the parties conduct and relationships were not identified; except for the laws provided for in the Family Law Act 1975 (Cth) as between the Husband and the Wife.
Counsel for the husband asserted that the trial judge erred in failing to identify and consider whether the claims of the liquidator “were part of a single justiciable controversy”, and submitted:
4.12The determination of this issue depends upon whether the Third Party’s non-Family Law Claims are part of a single justiciable controversy which includes the claim of the Husband and Wife against each other in the s79 proceedings. In order for the Third Party’s non-Family Law Claims to be seen as part of a single justiciable controversy which includes the s79 claims, the Court must be satisfied that the Third Party’s non-Family Law Claims are ‘attached’ to and not ‘severable’ or ‘disparate’ from the section 79 claims. The justiciable controversy was not identified by the trial judge. [Footnotes omitted].
It was further complained that the trial judge could not reasonably have concluded that the liquidator’s claim was “non-severable and arose out of [sic] common sub-stratum of facts”.
Ultimately, it was submitted that:
4.15As the attached claim was not adequately particularised or identified, it cannot be determined if the Court had power to grant remedies in respect of the Third Party’s non-Family Law Claims.
That submission was amplified in the following terms:
4.18The Third Party’s non-Family Law Claims and the section 79 of the Family Law Act 1975 (Cth) claims do not form part of a single justiciable controversy and the Third Party’s non-Family Law Claims are not attached to and are severable from the section 79 of the Family Law Act 1975 (Cth) claims and the two sets of claims do not arise from a common substratum of facts.
4.19This is not a case where the Husband and Wife are claiming an interest in an item of property in which the third party also claims an interest. It is also not a case where the financial affairs of the parties to the family law claims are and were intimately interwoven into the financial affairs of the third parties and it is impossible to determine the issues as to the parties’ financial affairs without unravelling them.
…
4.21The Third Party’s non-Family Law Claims are quite severable and disparate from the section 79 proceedings. The section 79 proceedings can, and should, conveniently be determined separately from the Third Party’s non-Family Law Claims. The mere fact that one aspect of the factual history of the financial relationships between these parties (the alleged borrowing of funds) may be relevant in both sets of proceedings does not serve to make the two sets of proceedings part of an indivisible matter. The nature and basis of the claims in the two proceedings are quite different, are entirely separate from each other and therefore do not fall within any accrued jurisdiction of the Court. [Footnotes omitted].
On behalf of the liquidator, it was submitted that the jurisdiction to entertain the liquidator’s claim was supportable on a number of bases.
The crux of the submissions on behalf of the liquidator was that:
29.Whilst the determination of the actual claims of the creditors may not have fallen within the ambit of ‘single justiciable controversy’, it is obvious that the claim by the intervener as against the parties for moneys they owed the company is part of such a single justiciable controversy with the Family Court matters as between husband and wife.
30.The intervener’s claim involves the assessment of the liability owed by one or both of the parties. In the Family Court proceedings the Court was bound to determine what the appropriate assets of the parties were. As commented by the appellant in affidavit and by Her Honour Justice Penny, it would not be possible to determine the parties’ asset pool without also determining how much the parties should pay to the liquidator on account of their borrowings from the company.
31.No application was made by any party to stay the proceedings in the Family Court whilst the liquidation was finalised.
Counsel appearing for the liquidator in this Court adopted the submissions of Counsel for the liquidator at trial, who said to the trial judge in opening:
…we are running a Biltoft- type argument here. We’re relying on the accrued jurisdiction of this court. We simply say we don’t care where it comes from; we want our $500,000-odd and then we want to go…
Whilst Counsel then appearing for the liquidator subsequently raised aspects of the “Corporations Code” before the trial judge, the jurisdiction to make orders in favour of the liquidator in reliance upon the Corporations Act 2001 (Cth) was not agitated before this Court.
This Court has not been referred to any assertion by Counsel then appearing for the husband that the trial judge lacked jurisdiction to entertain the liquidator’s claim. Nor has it been referred to any submission that if jurisdiction to do so was available, her Honour should not have exercised such jurisdiction. In those circumstances, it is unsurprising that this Court has not been referred to any submission by Counsel then appearing for the liquidator to the trial judge in relation to the availability of jurisdiction to make orders in favour of the liquidator, or with respect to the discretion to exercise such jurisdiction. These matters were not in issue at trial.
Counsel for the husband fairly conceded that the jurisdictional issues now sought to be agitated on behalf of the husband had not been agitated before the trial judge, but submitted that, if there was no jurisdiction to entertain the liquidator’s claim, the failure to raise that issue could not enliven jurisdiction to do so. It is ultimately less than certain that the existence of jurisdiction was challenged before this Court. In paragraph 4.2 of the written Summary of Argument for the husband, it was acknowledged:
4.2The Family Court of Western Australia is not restricted to the determination of a family law claim or proceedings; it may exercise accrued jurisdiction to determine non-family law claims. [Footnote omitted]
However, for more abundant caution, the question of jurisdiction shall be considered.
The contention on behalf of the husband was that the Court should not have exercised accrued jurisdiction in relation to the particular claim of the liquidator. To determine that question, as the submissions for the husband make clear, involved a factual enquiry. Thus, in contrast to many other assertions on appeal about a lack of jurisdiction in the Court below, the capacity of an appellant to argue that accrued jurisdiction should not have been exercised in respect of a particular claim, may well be circumscribed or negated by the conduct of the case below. As will become apparent later in these reasons, the trial judge determined the liquidator’s claim, within the confined parameters set by the conduct of the husband’s case.
There is a distinction between a situation in which a judge hearing Family Court property settlement proceedings is asked to determine the existence and extent of a claim by a third party against a party to the marriage, and the situation in which a third party merely asks for an order in respect of its entitlement, or that some attention be paid to recovery of its entitlement, about which there is no issue joined as to its existence or quantum, though the husband and/or wife may resist any order in the creditor’s favour. In the instant case, as presented by the husband below, it was not always easy to determine into which category the husband’s position fell.
Not surprisingly in the circumstances as outlined, the trial judge did not provide specific reasons for concluding that she had jurisdiction to entertain the liquidator’s claim. However, the trial judge’s reasons reveal that her Honour directed her mind to the basis upon which the liquidator’s claim fell within the jurisdictional competence of the Court.
Her Honour said in that regard:
56.The Full Court in Biltoft and Biltoft (1995) FLC 92-614 reviewed the relevant authorities regarding the approach to be taken to the interests of third party creditors.
57.In regard to liabilities generally, it was said (at 82,127):
‘Notwithstanding the general practice which has developed, the Court has indicated that it may properly determine not to take into account or to discount the value of an unsecured liability in certain circumstances. Such liabilities would include but are not limited to a liability which is vague or uncertain, if it is unlikely to be enforced or if it was unreasonably incurred.’
58.The Full Court concluded its discussion in Biltoft by saying (at 82,128 – 82,129):
‘…There is no requirement that the rights of an unsecured creditor or a claim by a third party must be considered and dealt with prior to the Court making an order under s 79, nor is there a rule of priority as between a creditor claimant and a spouse…
There is an obligation on both parties to disclose any significant creditors or any significant claim against either of them by a third party. If, as a result of the order of the Court in the property [proceedings], the ability of a creditor or claimant to recover his or her debt or claim is likely to be affected, notice of the Family Court proceedings must [be] given to that creditor or claimant. He/she may then intervene in the Family Court proceedings and either seek a stay [of] those proceedings or some appropriate order which recognises his/her rights’.
At trial, jurisdiction to entertain the liquidator’s claim was potentially sought to be enlivened by section 90AE of the Act. Section 90AE(2)(b) empowers the Court, in proceedings under s79 of the Act, to make orders altering the “rights, liabilities or property interests of a third party in relation to the marriage”. It is tempting to think that, implicit in exercising that power is the jurisdiction to determine the rights which are potentially thus affected in reliance upon the section. The Explanatory Memorandum to the legislation enacting the section suggests that, notwithstanding the terms of s90AE, the legislative intention was however more limited. Given that, at trial, Counsel for the liquidator sought to rely upon s90AE to only a limited extent, and that her Honour’s jurisdiction has not been sought to be defended in reliance upon it before this Court, and for other reasons which will be provided, it is unnecessary to consider the section in detail.
Not uncommonly, ordering the extinguishment of a liability, in preference to ordering one party to indemnify the other party with respect to it, will be necessary to secure a just and equitable determination of parties’ property rights. As was submitted on behalf of the liquidator, in the passage earlier referred to, fundamental to a determination of the “property” of the parties to the marriage in the circumstances of this case was a determination of the indebtedness of the parties or either of them to the liquidator of K. It is logically difficult to suggest why, having made that determination the trial judge could not have made the order which she did for payment of such indebtedness. Whether that is sufficient to enliven jurisdiction to entertain disputed claims by third parties is another question.
Nothing to which the Court has been referred persuades me that there is necessarily any prohibition upon the Court ordering parties to a marriage to make payments to a third party creditor out of their property, whether that be in reliance upon the provisions of the Act and/or the court’s accrued jurisdiction at the time Biltoft was decided, or subsequent to the enactment of s90AE in 2003, or the amendments to s79 which were enacted in 2005. The issue remains whether the jurisdiction to make orders with respect to “debts” in reliance upon s90AE and/or s79 extends to determining the existence and quantum of debts asserted by a creditor which are disputed by the alleged debtor or debtors in circumstances where the issue has not been resolved by the judgment of a court of competent jurisdiction.
The terms of s90AE appear sufficiently broad to encompass determining the existence of disputed debts. Read in their entirety however, the terms of the section appear to contemplate that the relationship of debtor and creditor is not controversial, and that “re-arranging” established liabilities is the focus of the section. Some support for such a narrow interpretation can be gained from the judgment of the High Court in Ascot Investments v Harper (1981) 148 CLR 337. Although, for reasons which are later suggested, it is not necessary to express a concluded view about the matter, such a limited interpretation of s90AE would not be likely to defeat the interests of either the party/parties asserting a debt, or the party/parties denying such claims. The disputed indebtedness of the party/parties to a marriage to a third party will almost always be relevant to determining the property of the parties to the marriage and, if controversial, thus be able to be determined by the Court in the exercise of its accrued jurisdiction, without needing to rely upon s90AE. Absent specific legislative provision enabling the rights between creditors and debtors to be varied in the way in which s90AE provides, the accrued jurisdiction of the Court may be insufficient to enable outcomes of the kind articulated in the section to be achieved. Conversely, s90AE alone may be insufficient to enable the Court to determine disputed debts. However, these are matters best left for determination in an appropriate case.
The 2005 amendments to the Family Law Act 1975 (Cth) (“the Act”) introduced section 79(10) relevantly provided:
The following are entitled to become a party to proceedings in which an application is made for an order under this section:
(a) a creditor of a party to the proceedings if the creditor may not be able to recover his or her debt if the order were made;
(b) any other person whose interests would be affected by the making of the order.
It would be surprising, and illogical, if, notwithstanding the rights conferred upon creditors and other interested third parties by those provisions, the Court could not make orders in their favour with respect to such debts or interests. Some support for that proposition can be gained from the decision of the Court in Worsnop & Worsnop [2007] FamCA 244. Whether the Court would make such orders in a particular case is another question. Accepting the submission now made on behalf of the husband would at least limit the practical utility of intervention by a creditor or interested person. These matters however would not of themselves necessarily enliven the Court’s jurisdiction to entertain disputed third party claims asserting a debt in reliance upon s79 of the Act.
The potential availability of jurisdiction to entertain the liquidator’s claim appears to be further supported by the terms of s75(2)(ha) which was enacted in 2005, and requires courts exercising powers under s 79 to consider:
the effect of any proposed order on the ability of a creditor of a party to recover the creditor's debt, so far as that effect is relevant; and
It would be surprising if, notwithstanding that provision, the Court could not make an order as between the parties to the marriage which avoided a creditor’s entitlement to recover its debt being defeated, if so doing was considered just and equitable. Section 79(10)(a) and s75(2)(ha) both appear to refer to a debt which is not controversial. Section 79(10)(b) appears to refer to interests which are not controversial.
However, I am not convinced that the combination of these sections provides a jurisdictional basis for entertaining the liquidator’s claim. These provisions enable a creditor to intervene in proceedings in the circumstances referred to in s79(10)(a), and oblige the court in such circumstances to have regard to the matter identified in s75(2)(ha). There is a material distinction between being a “creditor” and asserting an indebtedness which is disputed. A jurisdictional basis other than s79 thus needs to be enlivened in order for the court to entertain disputed debt claims.
There has never been any real doubt that the Court could order one party to a marriage to indemnify the other party to the marriage with respect to a liability to a third party. Subsequent to the 2003 amendments, and subject to compliance with the relevant provisions of the Act, the Court may be able to order that a creditor be limited to its rights against one party to the marriage, notwithstanding that both parties to the marriage were indebted to it. As has been earlier noted it is less than clear that s90AE provides an independent jurisdictional basis for the court to entertain a claim such as that of the liquidator in this case.
To the extent that, at least inferentially, the trial judge relied upon the Court’s accrued jurisdiction as the basis upon which the liquidator’s claim could be entertained, nothing to which this Court has been referred persuades me that so doing was erroneous. As earlier noted, the “first step” in determining the property settlement proceedings before her required the trial judge to determine the property of the parties to the marriage. So doing involved identifying and quantifying the parties’ assets and liabilities. It could not be successfully asserted that the liquidator’s claim lacked the requisite justiciable connection with the proceedings before the trial judge. Indeed, so far as the determination of the property of the parties was concerned, that was the most significant issue, and was not severable or disparate from the property settlement proceedings between the husband and wife.
I am persuaded that the trial judge had jurisdiction to determine the liquidator’s claim in the exercise of accrued jurisdiction. Given the matters to which reference has been made with respect to the course the trial took before her, the trial judge’s reasons were adequate. There was never any suggestion before the trial judge, on behalf of the husband, that she lacked the jurisdiction to entertain the liquidator’s claim. To provide reasons for not accepting arguments which were never put is not a requirement recognised by the authorities relating to the adequacy of reasons for judicial decisions.
I am thus not persuaded by anything to which we have been referred that the trial judge lacked the jurisdiction to hear and determine the liquidator’s claim, or that her Honour failed to give adequate reasons for concluding that she had such jurisdiction. In reliance upon the Court’s accrued jurisdiction, her Honour was able to entertain the liquidator’s claim on the basis she indicated in the passages of her judgment which have earlier been chronicled.
The exercise of jurisdiction to make orders in favour of the liquidator
In support of the assertion that the trial judge erred in exercising the jurisdiction to determine the liquidator’s claim, it was submitted:
4.28In making the Orders pursuant to Accrued Jurisdiction, Justice Crisford exercised accrued jurisdiction to determine the Third Party’s non-Family Law Claims.
4.29Justice Crisford erred in that Justice Crisford did not identify the action or actions upon which Justice Crisford made the Orders pursuant to Accrued Jurisdiction. Similarly, Justice Crisford did not identify the elements of such unidentified action or actions. Justice Crisford did not identify how the Third Party had established the unidentified elements of the unidentified action or actions on the basis of the evidence before the Court.
4.30Justice Crisford’s failure to identify the action or actions, elements of such unidentified action or actions and evidence upon which the unidentified action or actions are established are errors. Further, Justice Crisford’s failure to give reasons which identified the action or actions, elements of the action or actions and evidence which established the elements of the action or actions is an error in itself. In general, the appellate Court should be able to discern either expressly or by implication the path by which the result has been reached. The reasons of the trial judge fail this test. [Footnotes omitted].
The trial judge did not in her judgment expressly record that she was entertaining the liquidator’s claim in purported exercise of the Court’s accrued jurisdiction. Beyond reiterating that, nothing to which this Court has been referred establishes that the trial judge could not have entertained the liquidator’s claim in reliance upon the Court’s accrued jurisdiction, no more needs to be said about that matter. It remains to consider whether the trial judge erred in exercising the Court’s jurisdiction to determine the liquidator’s claim.
Given that there was no challenge to the jurisdiction to determine the liquidator’s claim before her, it is not surprising that the trial judge’s reasons did not traverse in any detail whether such jurisdiction should be exercised. Notwithstanding the absence of any suggestion at trial that her Honour should decline to entertain the liquidator’s claim, her reasons reveal the basis upon which her Honour concluded that it was appropriate to exercise the jurisdiction to determine the liquidator’s claim. So doing involved the exercise of discretion. Challenges to such exercise are determined by reference to the principles emerging from the decision of the High Court in House v The King (1936) 55 CLR 499, and later authorities consistently following that decision.
Although, in the circumstances as outlined not necessarily provided for that specific purpose, the trial judge’s reasons reveal that she considered the nexus between the liquidator’s claim and the property of the parties to the marriage. That consideration commenced with a reference to the transfer of $332,000.00 from a K bank account to an account in the name of R, such transaction having occurred at the direction of the husband. Her Honour then referred to the husband’s withdrawal of $377.241.00 from R’s account on 2 August 2004 and its placement on 4 March 2005 into a cash investment account in the husband’s own name. The trial judge then referred to the husband’s withdrawal of $340,000.00 from his cash investment account on 28 October 2005, and his explanation in cross-examination that he did so in order to avoid losing the funds to the liquidator of K or, at least inferentially, to the wife. The trial judge concluded:
23.The evidence was at time difficult to understand but I am satisfied the movement of monies and the final withdrawal was an attempt by [the husband] to not only avoid the liquidators but to remove matrimonial assets from view.
Her Honour had earlier, and correctly, under the heading “The law” referred to the “four step process” which emerged from the decision in Hickey & Hickey& Attorney-General for the Commonwealth of Australia (Intervener) (2003) FLC 93-143, the first of which step she described as being:
· to make findings as to the identity and value of the assets and liabilities of the parties.
The trial judge identified as the “only liability in contention” the claim by the liquidator, which her Honour accurately discerned to be “not without substantial difficulty”. In a series of subsequent paragraphs (36-43) the trial judge considered the evidence before her in relation to the liquidator’s claim. Her Honour concluded that “the amount as claimed by the liquidator is owing to [K] Pty Ltd”, and set out why she was thus satisfied.
For reasons which she articulated (paragraphs 44-50), and which are not controversial for present purposes, her Honour concluded that any liability to K should be treated as “a joint liability” of the husband and wife and then proceeded to determine “how this debt is to be dealt with”.
Having referred (paragraphs 56, 57 & 58) to the decision in Biltoft, the trial judge recorded:
60.In all the circumstances I intend to make some provision for the payment of the debts that can be identified such that at least these creditors are repaid and some costs met. However, a number of the claims are simply vague and uncertain and I am of the view, they are unlikely to be enforced. For this reason I intend to discount the amount of $508,947.00 I also take into consideration:
· previously, the liquidator had taken some steps to identify creditors and they are much the same as at the present;
· the time since the liquidation commenced is some 5 years.
· the liquidator’s evidence suggests any other creditors are largely based on speculation and may have lost interest in any event.
Whatever this Court might conclude with respect to the challenges on behalf of the husband to the findings with respect to the husband’s debt to K, the passages of the trial judge’s reasons to which reference has been made demonstrate that her Honour clearly considered the appropriateness of exercising the discretion to determine the liquidator’s claim and, permissibly in my view, concluded that she should do so. The trial judge’s exercise of discretion to entertain the liquidator’s claim has not been shown to have been erroneous.
The finding that the husband was indebted to K.
Counsel for the husband submitted that the evidence before the trial judge precluded her from making any finding that the husband was indebted to K, either in the sum of $508,947.00, or any other sum. We perceive that these challenges are expressed in paragraph 4.32(e) and (f) of the Summary of Argument which asserted that as her Honour:
(e) erred by failing to identify:
(i) the action or actions,
(ii) the elements of such unidentified action or actions, and
(iii) the evidence upon which the unidentified action or actions are established, and
(f) erred by failing to give reasons which identified:
(i) the action or actions,
(ii) the elements of the action or actions, and
(iii)the evidence which established the elements of the action or actions,
there are grounds for the appeal to be allowed and the Orders made by the Honourable Justice Crisford on 3 September to be set aside (insofar as they relate to payment of the sum of $250 000.00 to the Third Party and in default the sale of the property at O in the State of Western Australia).
In oral submissions to this Court, Counsel for the husband submitted that, the husband having put in issue his alleged indebtedness to K, the liquidator was obliged to prove such indebtedness according to the civil standard. It was submitted that the liquidator had failed to discharge that onus of proof either by cross examining the husband to establish the claim made by the liquidator or adducing evidence capable of doing so.
It was further submitted on behalf of the husband that Counsel then appearing on his behalf had made clear to the trial judge that the husband disputed the liquidator’s claim that the husband owed $508,947.00. Counsel then appearing for the husband did submit during the course of opening addresses to the trial judge that “the husband doesn’t admit a debt of $508,000.00”. Counsel proceeded to say: “[h]e says that he’s written it down as a contingent debt, but he’s not saying that it was an actual debt”.
Counsel for the husband placed significant reliance upon the following evidence emerging during cross-examination of the liquidator:
In relation to any money owing to the company, you haven’t really conducted an investigation into that, have you?---Well, in relation to that, the only information that I’ve had up until last Friday was the draft financial statements of 31 October which disclosed loans due to the company of $508,000.00 and I accept that this evidence may not be admissible for the purposes of my liquidation, but during the course of these proceedings I’ve received the financial statements at 2002 which are a slightly different amount but amount to $499,000.00 of loan receivables.
But you haven’t done a full investigation, have you. I mean you picked up some information only this week. What I mean is you haven’t completed an investigation as to whether there in fact are loans and/or if there are loans who owes the money?---I haven’t completed the investigation, no.
No. So it’s not by any means certain that in fact loans are owed to the company?---It’s not.
Until your investigation is complete and you’ve formed a conclusion as to that matter?---The one thing that I could add to that though is that the financial statements are prima facie evidence of the debt, but we just don’t know according to the narration next to the entry in the balance sheet – we don’t know who that debt is due from. It says shareholders, but we don’t know precisely who that is.
Counsel for the liquidator submitted that there was ample evidentiary foundation for the trial judge’s finding that the husband was indebted to K in the sum of $508,947.00. The evidence of the liquidator upon which Counsel for the husband relied was asserted to be not inconsistent with the trial judge’s finding, which were based upon evidence of the husband.
By reference to the husband’s trial affidavit, sworn 18 March 2008, Counsel for the liquidator submitted that the husband’s evidence at trial had been “primarily” a complaint about the process by which K was re-registered and the liquidation re-activated. The evidence relied upon by Counsel for the liquidator in support of his submission recorded in some detail the events leading up to the liquidation of K.
Nowhere in the relevant paragraphs (87-101) of his affidavit sworn 18 March 2008 did the husband dispute his indebtedness to K. The absence of such assertion was submitted to have been the more significant as the husband had shown “an ability to understand and analyse complex court processes”. The affidavit evidence of the husband (paragraphs 108 and 109) was asserted to support that conclusion. The husband’s failure to dispute his indebtedness to K was in my view more significant because of a series of affidavits sworn by the wife earlier in the proceedings.
In her affidavit, sworn 29 July 2003, the wife deposed to the husband having a balance in a business account in the sum of $427,630.58. Annexed to her affidavit was a bank statement confirming the wife’s allegation. In her affidavit sworn 28 January 2005, the wife referred to the husband’s alleged indebtedness to K in the sum of $508,947.00. The wife reiterated her allegations in considerably more detail in her affidavit sworn 1 December 2005.
Whilst it was conceded, accurately, that the husband did not refer to his alleged loans from K Pty Ltd in his trial affidavit, Counsel for the liquidator asserted that the husband had acknowledged such liability in two Financial Statements sworn by him, and read in the proceedings before the trial judge.
In the first such Financial Statement sworn by the husband on 8 October 2003 (Note: the financial statement was filed on 9 October 2003), the husband referred to “loan accounts” owed to K and R as “$NK”. As is apparent from the document, the husband there made no attempt to quantify the loans which he thus admitted as “other personal liabilities”.
In his subsequent Financial Statement, sworn on 4 April 2005, and apparently prepared by the husband himself, the husband revealed a liability to K estimated to be $75,000.00. The husband also disclosed a personal liability to K of $365,613.00 and “personal business liabilities” to R of $143,947.00. In the same document, the husband disclosed as “additional information” a “contingent liability ([K] Pty Ltd)” estimated $1,100,000.00.
In his affidavit sworn on 28 February 2006, the husband said:
17.At the time of the liquidation the liquidators were aware of the debt to the company of $508,974.00 which were jointly borrowed by both my wife and myself and were in the loan accounts of the company. (See Annexure PG9 (b) of the wife’s affidavit).
18.The amount of $508,974.00 owed to [K] Pty Ltd ($143,316.00 and $365,631.00) by the wife and myself was declared in my Financial Statement filed 4 April 2005.
In addition to the evidence which Counsel for the liquidator identified and relied upon in his written summary of argument, reliance was also placed upon the affidavit of the husband, sworn 28 February 2006, in which (paragraph 27) the husband deposed to liabilities for loan accounts in K, with debit balances of $508,947.00, $150,000.00, $34,295.00 and $63,742.00.
Counsel for the liquidator also relied upon the third Financial Statement of the husband, sworn 15 March 2006, in which, the husband quantified his loan to K in the sum of $365,613.00 and asserted the sum of $143,947.00 to be the debit balance of his “[K] loan account”.
Counsel for the liquidator further relied upon the husband’s assertion at trial that the wife be equally liable for any claims by the intervener. In the orders sought by the husband at trial an order was sought that “in the event that any sum is owing by the Husband to the Intervener an order that the Wife be equally liable for such debt” be made. As Counsel for the liquidator reminded this Court, at trial, Counsel then appearing for the liquidator sought the repayment by the husband of his indebtedness to K in the two sums totalling $508,947.00 (plus accrued interest, fees and costs).
Before this Court, Counsel for the liquidator relied upon the submissions of Counsel for the husband at the conclusion of the trial, during which the following was said:
MR BUTCHER: Now, it is said that the husband, in the same vein perhaps, it’s said that the husband was at fault for withdrawing funds of $355,000.00 and then keeping them in a safe for a period of some eight months or so. Now, that was a reaction to the wife’s activities in reviving the liquidation. I’m not suggesting that it makes good commercial sense to deposit moneys in a safe where they don’t earn interest, but perhaps it was a natural reaction in the circumstances, bearing in mind that we’re dealing here with a person under severe stress, suffering from depression and concerned about his life savings.
HER HONOUR: I think he said he wanted to avoid the downtown slickers.
MR BUTCHER: Yes, that was his way of putting it.
HER HONOUR: Meaning the liquidators.
It was later submitted on behalf of the husband:
MR BUTCHER: Basically it’s a case of the evidence being totally inadequate on all fronts and there’s no adequate evidence of the debts, there’s no adequate evidence even as to what the loan is and who owes the money. The accounts for [K] Pty Ltd for the year ending 30 June 2002 show shareholders loans of $340,708.00 So where does the figure of $508,000.00 come from? I think originally it came from the wife, but we’ve heard that she didn’t know what was going on because she didn’t really involve herself in the company affairs.
It’s true that the husband has shown quite a few different figures in his papers as well, and his position I would have to say is somewhat inconsistent because he shows [K] as a debt and then a contingent debt. So he’s got a foot in both camps as well, but that’s not surprising in my submission because there’s acute difficulty in working out whether any money is owing to the company and if so by whom and whether the company has any legitimate creditors.
Now, in those circumstances, we say that the court ought not to entertain the claim by the intervener. What should happen is that the intervener should go about his business and do what liquidators do and investigate all these matters and then, if thought appropriate, commence proceedings in the proper way at the proper time for the proper amounts.
Your Honour, that completes my summary. Unless you have any further matters which you want me to address.
It was ultimately submitted by Counsel for the liquidator that, to the extent that any uncertainty surrounded the husband’s alleged indebtedness to K, that was because the husband, who better than anyone knew the truth about those matters, had comprehensively failed to place evidence of those matters before the Court. The husband’s evidence to which the trial judge referred in her reasons was submitted to have left little scope for doubt as to why the husband had failed to do so.
The trial judge appreciated that, by the commencement of the trial before her, the husband disputed that he was indebted to K. In the passages which have earlier been referred to (paragraphs 19-23), the trial judge recorded the husband’s movement of funds from K’s bank account. No finding of fact there referred to has been the subject of challenge in this appeal. The effect of those findings of fact is that the husband obtained funds of not less than $377,241.00, $332,000.00 of which was obtained from a bank account of K. In the absence of any evidence that the husband was entitled to those monies, and this Court having been referred to none, those monies were repayable to K.
It is to be remembered that, as Counsel for the husband sensibly acknowledged, a finding of indebtedness of or in excess of $250,000.00 denies the husband’s challenge to the trial judge’s findings with respect to his indebtedness to K, any prospect of success. As is obvious, $332,000.00 considerably exceeds that amount. The trial judge then detailed, in the passages to which we have earlier referred (39-43) the husband’s own representations with respect to his indebtedness to K. The basis upon which the trial judge concluded as she did that the husband owed K $508,947.00 was thus clearly explained.
Counsel for the husband frankly acknowledged that the nearest to any evidentiary indication that the husband disputed the claim of the liquidator was his failure to include in his trial affidavit any reference to his alleged indebtedness to K. I am not convinced that the husband at any time prior to the trial put either the Court or the liquidator on notice that the liquidator’s claim on behalf of K was disputed. Accepting that during the course of the case at trial, Counsel for the husband made clear that the husband did not admit the liquidator’s claim, it has not been established that, although less than conclusive, as the trial judge clearly acknowledged, the evidence before her precluded her Honour from finding as she did with respect to the $508,947.00. If, although it has not been established, the funds which the husband was said to owe R ($143,316.00) form part of his indebtedness to K, the evidence still comfortably supported a finding that the husband was indebted to K in the sum of $365,631.00 which, as is self-evident, is significantly in excess of the sum of $250,000.00 which the trial judge ordered to be paid to the liquidator.
Whilst the evidence may have supported other findings, that is not the test as the authorities make clear. The husband has failed to establish that it was not open to the trial judge to find as she did on the evidence before her. As Counsel for the liquidator submitted, to the extent that there was confusion in relation to the husband’s indebtedness to K that was largely because of the way the husband chose to present his case.
Conclusion
None of the challenges to the trial judge’s decision having been made out, I would dismiss the husband’s appeal.
Costs
Counsel for the liquidator sought an order that the husband pay the liquidator’s costs of the appeal.
Whilst opposing any order for costs, counsel for the husband was sensibly constrained in relation to any matters within section 117(2A) which could militate against making an order for costs in favour of the liquidator. I am of the opinion that the circumstances justify ordering the husband to pay the liquidator’s costs of the appeal as agreed or assessed.
The primary reason for so concluding is that the husband’s appeal has been wholly unsuccessful. As my reasons, and those of the majority reveal, a significant part of the husband’s appeal to this Court involved matters were never raised before the trial judge. What may be referred to as the complaints relating to the husband’s indebtedness to K were to a large extent not raised before the trial judge, or not raised in the manner in which they were before this Court.
WARNICK AND BOLAND JJ:
We have had the advantage of reading in draft the reasons for judgment of his Honour the presiding judge. We agree that the appeal should be dismissed but, in relatively small part, express our reasons for that conclusion in ways which to some extent may differ from those of Coleman J.
We agree with Coleman J that there is power within the terms of the Family Law Act 1975 (Cth) (“the Act”) to make an order that a party to a marriage pay an amount to a creditor, whether that creditor is a party or not. However, we doubt that, leaving aside the accrued jurisdiction, there is power to bind a creditor, even if party to the property settlement proceedings, to accept, in satisfaction of a debt, less than the full amount, or to determine the merits and/or quantum of a creditor’s claim.
In short, in our view, the principles enunciated in Biltoft and Biltoft (1995) FLC 92-614 and the terms of s 79(10) and s 75(2)(ha) of the Act are directed to the questions of the right to, and the prospect of, recovery by creditors of their debts, not to the proof of those debts, against one or other or both of the parties to the marriage, where liability is in issue.
It follows that, if in this matter the husband’s case ought be seen as one which called into question liability of the husband and/or wife to the liquidator and that case was considered to be determined by the orders made by Crisford J, in our view those orders could only be supported as an exercise of the accrued jurisdiction (leaving aside any powers contained in Part VIIIAA of the Act).
However, on one view of the presentation of the husband’s case before Crisford J, he did not dispute the quantum of the liquidator’s claim, but only disputed that he should pay, because he argued that the debts of K had not been identified and established. We agree that, on that construction of the husband’s case, it was open to Crisford J to order that the husband pay a sum to K, that order, however, not having the effect that it extinguished K’s claim. On their part the husband and wife were protected against the prospect that the liabilities of K would be less than the sum that the husband was ordered to pay to K, by the provision that any surplus be repaid to the husband and wife, albeit, as between them, in specified proportions.
However, the conduct of the husband’s case before Crisford J waxed and waned about just what issue was joined with regard to the liquidator’s claim. But, as was identified in Coleman J’s reasons, at trial counsel for the liquidator stated that he relied on the accrued jurisdiction. As is also clear from Coleman J’s reasons, no issue was made of that. No submission was made that the liquidator should plead, in the form of a Statement of Claim and/or identify the law upon which his claim was based. No issue was raised about the nature of the enquiry as to whether the court should exercise accrued jurisdiction or not, or about the evidence relevant to that enquiry.
We do not regard the arguments of counsel for the husband on the appeal as challenging whether the Family Court of Western Australia may exercise accrued jurisdiction or not. But counsel does argue that her Honour should not have exercised the accrued jurisdiction. As whether the trial judge should have exercised that jurisdiction in this instance, a matter which was brought to the trial judge’s attention, was not put in issue, in our view, (in so far as the trial judge may have needed to rely on the accrued jurisdiction to determine the quantum of the liquidator’s claim), provided the trial judge could have exercised accrued jurisdiction, the judgment may be upheld, notwithstanding the reasons contain no discussion of the question.
We say this because we agree with what Coleman J has said in paragraph 49, in relation to determining any question of whether or not to exercise accrued jurisdiction:
49.…To determine that question, as the submissions for the husband make clear, involved a factual enquiry. Thus, in contrast to many other assertions on appeal about a lack of jurisdiction in the Court below, the capacity of an appellant to argue that accrued jurisdiction should not have been exercised in respect of a particular claim, may well be circumscribed or negated by the conduct of the case below. …
We are satisfied that, for the reasons the learned presiding judge has given in paragraphs 69-74, that it was open to Crisford J to find that she should exercise the jurisdiction to determine the liquidator’s claim.
Though counsel for the liquidator at trial referred to Part VIIIAA of the Act as a possible source of jurisdiction to make orders determining the quantum of a claim by the third party, the trial judge did not deal with that submission and nothing was said to us about it. We therefore see no need in disposing of this appeal to remark upon the provisions of Part VIIIAA of the Act.
We agree with the other orders proposed by the presiding judge, and with his reasons for those orders.
I certify that the preceding one hundred and eleven (111) paragraphs are a true copy of the reasons for judgment of the Honourable Full Court
Associate:
Date: 19 March 2010
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