R v Dovey; ex parte Ross

[1979] HCA 14

HIGH COURT OF AUSTRALIA

Barwick C.J., Gibbs and Mason JJ.

THE QUEEN v. DOVEY; Ex parte ROSS

(1979) 141 CLR 526

3 April 1979

Matrimonial Causes

Matrimonial Causes—Family Court of Australia—Powers—Injunction—Matrimonial home owned by family company and leased to husband and wife—Injunction to restrain husband as director and shareholder from exercising voting rights for sale of home—Whether matrimonial cause—Whether proceedings with respect to the maintenance of the wife—Whether proceedings for an injunction in circumstances arising out of the marital relationship—Family Law Act 1975 (Cth), ss. 4 (1) "matrimonial cause" (c), (e), 31 (1) (a), 114 (1), (3).

Decisions

April 3. The following written judgments were delivered:-
BARWICK C.J. In this application, I have had the advantage of reading the reasons for judgment prepared by my brother Gibbs. I agree that the application for a writ of prohibition should be dismissed. (at p528)

2. In my opinion, the Family Court had jurisdiction to make the order the subject of these proceedings. Like my brother Gibbs, I say nothing as to whether or not it ought properly to have been made in point of discretion. (at p529)

3. The relevant jurisdiction of the Family Court was that given by a combination of the definition of "matrimonial cause" in s. 4 (c) and ss. 31 (1) (a) and 114 (3) of the Family Law Act, 1975 (Cth), for here there was an application for maintenance. The grant of an interlocutory injunction to maintain an existing situation pending the determination of the maintenance proceedings was clearly enough in aid of the jurisdiction to grant maintenance. (at p529)

4. If par. (e) of the definition of "matrimonial cause" in s. 4 is read so as to do no more than make an application for an injunction a matter of principal relief in situations in which some circumstance, otherwise attracting jurisdiction, is seen to exist, the Family Court's jurisdiction in relation to the present case might, in my opinion, be placed upon par. (e) of the definition. However, for my own part, I am content to find the jurisdiction in the instant case in par. (c) of the definition. I find no need to attempt an exposition of the nature and limits of the jurisdiction which par. (e) of the definition purports to give. Its language is lacking in precision and its ambit a matter of some doubt in my mind. (at p529)

5. Save for the comments I have made, I agree with the reasons my brother Gibbs gives for discharging the order nisi. The reasoning in Sanders v. Sanders (1967) 116 CLR 366 is sufficient, I think, to dispose of the argument that the order under attack goes beyond jurisdiction because of its indirect effects upon others than the husband. (at p529)

GIBBS J. This is an application for a writ of prohibition directed to a judge of the Family Court. (at p529)

2. The prosecutor and the second respondent are husband and wife. There are two children of the marriage, aged nine and seven. The parties for some time lived together in a house at 14 Burrawong Avenue, Clifton Gardens, which was the matrimonial home. On 19th July 1978 the husband left the matrimonial home, but the wife and children have since continued to reside there. The house at Clifton Gardens is owned by a private company, Regent Dental Supplies Pty. Ltd. ("the company"). The property is subject to two registered mortgages. On 5th January 1977 the company granted a lease of the house to the husband and wife (who in the lease are together described as "the lessee") for a term of twelve months commencing on 5th January 1977. It was a term of the lease that if the lessee continued in occupation after the expiration of the term the tenancy should continue as a montly tenancy. In the events that have happened the husband and the wife are monthly tenants of the house. (at p530)

3. The original subscribers to the company were the husband, who was issued with one "A" Class share, and the wife, who was issued with one "B" Class share. It is alleged by the husband that one Michael Melov, an accountant, was on 7th February 1979 issued with one redeemable preference share, but the wife was not attended, or received notice of, any meeting at which it was resolved to issue any such share. In the circumstances at present existing, the "A" Class share confers on the husband the right to vote at a general meeting, but the "B" Class share does not confer on the wife any right to vote. It would appear that the redeemable preference share would carry such voting rights, if any, as the directors assigned to it. The husband and the wife are the only directors of the company. If there arose a deadlock between them it could only be resolved by action taken at a general meeting. (at p530)

4. On 6th September 1978 the wife made application to the Family Court for an order that the husband pay maintenance to herself and her children and for further orders that the husband be restrained from disturbing the wife's "exclusive occupation" of the premises at Clifton Gardens, and that the husband be ordered to pay all mortgage instalments, municipal and water rates and household insurance in respect of those premises. The application was contested by the husband and was placed in the defended list of the Family Court. On 12th January 1979 the wife received a notice that an annual general meeting of shareholders of the company would be held on 5th February 1979. The business of the meeting, as stated in the notice, included "To sell the freehold land and buildings owned by the Company", and "To appoint additional Director and Secretary". The wife claims that she is the secretary of the company, but she did not sign the notice. After she received the notice, the wife consulted her solicitor and on 2nd February 1979 made an application to the Family Court for, inter alia, the following orders:

"1. That the respondent be restrained from exercising his voting rights as a shareholder and/or as a director of Regent Dental Supplies Pty. Limited in favour of any proposed resolution at a General or Directors Meeting of the said company whereby the matrimonial home situate at and known as 14 Burrawong Avenue, Clifton Gardens in the State of New South Wales may be listed for sale or sold or encumbered until further order. 2. That the respondent cause to be paid all and any arrears of mortgage instalments and further mortgage instalments council and water rates, taxes, electricity and telephone expenses in respect of the said matrimonial home until further order. 3. That the respondent pay to the applicant maintenance for the two children of the marriage in the sum of $20.00 per week for each child until further order. 4. That the respondent pay to the applicant for her maintenance the sum of $120.00 per week until further order."

On the same day Dovey J. made an interim order, ex parte, in terms of par. 1 of this application, and ordered that the application be returnable on notice on 9th February 1979. On that day the solicitor for the husband appeared and objected that the Court had no jurisdiction to make the order sought by par. 1. The learned judge held that he had jurisdiction and continued the injunction until further order. The injunction was designed to keep matters in statu quo until the merits of the case, which have not yet been considered, could be determined. We are not now concerned with the question whether it was a proper exercise of the Court's discretion to grant the injunction, assuming that there was jurisdiction to grant it. The sole question for our decision is whether the Family Court has jurisdiction to grant an injunction in a case such as the present. (at p531)

5. The Family Court has jurisdiction in (amongst other things) matrimonial causes instituted or continued under the Family Law Act 1975 (Cth), as amended ("the Act") (s. 31 (1) (a)). The submission on behalf of the wife is that the proceeding in the present case was a matrimonial cause within par. (c) or within par. (e) of the definition of "matrimonial cause" contained in s. 4 of the Act. That definition, so far as is material, is as follows:

"Matrimonial cause' means - . . . (c) proceedings between the parties to a marriage with respect to - (i) the maintenance of one of the parties to the marriage; or (ii) the custody, guardianship or maintenance of, or access to, a child of the marriage; . . . (e) proceedings between the parties to a marriage for an order or injunction in circumstances arising out of the marital relationship."

It is not submitted that the proceeding is a matrimonial cause within par. (ca) of the definition, because the present proceeding is not one in relation to concurrent, pending or completed proceedings for principal relief between the parties. In fact it appears that proceedings for dissolution of the marriage, assuming they were contemplated, could not have been brought because the parties have not separated and lived separately and apart for a continuous period of not less than twelve months: see s. 48 (2). (at p532)

6. The Family Court is given power to grant injunctions in cases within its jurisdiction. The nature of the power depends on the source of the jurisdiction. If the "matrimonial cause" is of the kind referred to in par. (e) of the definition, the power to grant an injunction is conferred by s. 114 (1) which reads as follows:

"In proceedings of the kind referred to in paragraph (e) of the definition of 'matrimonial cause' in sub-section 4 (1), the court may make such order or grant such injunction as it thinks proper with respect to the matter to which the proceedings relate, including an injunction for the person protection of a party to the marriage or of a child of the marriage or for the protection of the marital relationship or in relation to the property of a party to the marriage or relating to the use or occupancy of the matrimonial home."

In matrimonial causes of other kinds, the Court's power to grant injunctions is given by s. 114 (3) in the following terms: "A court exercising jurisdiction under this Act in proceedings other than proceedings to which sub-section (1) applies may grant an injunction, by interlocutory order or otherwise (including an injunction in aid of the enforcement of a decree), in any case in which it appears to the court to be just or convenient to do so and either unconditionally or upon such terms and conditions as the court thinks appropriate." (at p532)

7. The proceeding in the present case was clearly within the jurisdiction of the Family Court. In the first place, it was a proceeding between a husband and a wife with respect to the maintenance of the wife and the maintenance of the children of the marriage. The injunction was sought in aid of the exercise of jurisdiction in that proceeding. Secondly, it was a proceeding between a husband and a wife for an injunction "in circumstances arising out of the marital relationship". It does not seem to matter whether those words where they appear in par. (e) govern "proceedings" or "order or injunction" (although grammatically they appear to govern the former expression) because by s. 114 (1) it is made clear that the order or injunction may only be made with respect to the matter to which the proceedings relate, that is, with respect to the circumstances arising out of the marital relationship. The words "circumstances arising out of the marital relationship" appear to be wide, but it is not necessary in the present case to attempt to give a comprehensive statement of their meaning. It is, I think, true to say, as Demack J. said in In the Marriage of Mills (1976) 25 FLR 433, at p 435 , that "the mere fact that something happens between a husband and wife does not mean that it involves 'circumstances arising out of the marital relationship'" and that "events which raise issues of criminal law, industrial law or fiscal law cannot be brought within the 'marital relationship' simply because the circumstances involve a husband and wife and their children". However, the occupation by a wife of the matrimonial home is clearly a consequence of the act of marriage between the parties, and can be regarded as an exercise of the rights and a performance of the duties to which the marriage has given rise. Moreover, the circumstances described in par. (e) must include circumstances in which it would be appropriate to make an injunction of the nature indicated in s. 114 (1), which expressly mentions an injunction "relating to the use or occupancy of the matrimonial home". Indeed, proceedings brought by a wife to protect her right to continue to occupy the matrimonial home, when that right is threatened by some action of the husband, appear to lie at the very heart of the matters described in par. (e). (at p533)

8. Although counsel for the husband did not contest that the Court would have had jurisdiction if the matrimonial home had been owned by the husband, it was submitted that the circumstance that the home was owned by the company meant that the Court lacked jurisdiction. It was said that there is no jurisdiction in the Family Court to restrain a third party (even a family company) from dealing with its own property, and no jurisdiction to achieve that object by restraining a husband, in his capacity as a director or shareholder, from exercising his voting power as such in a particular way. However, it is not right to say that the order sought by the wife and made by the learned judge in the present case prevents the company from dealing with its own property. The order is not directed to the company and does not bind it. It is true that the practical effect of the injunction will be that there will be no sale, but that will be because the husband, who controls the company, is prevented from exercising his control in such a way as to bring about a sale, and not because the company is forbidden to do anything which those who control it have resolved to do. Even if the injunction did indirectly affect the rights of the company, that would not mean that it was beyond power: see Sanders v. Sanders (1967) 116 CLR 366 and Antonarkis v. Delly (1976) 51 ALJR 21, at pp 23-24 which, although decisions on the Matrimonial Causes Act 1959 (Cth), provide a guide to the meaning of the present Act. (at p533)

9. The alternative argument on behalf of the husband was that there is no jurisdiction to make an injunction which would circumscribe the performance by the husband of his fiduciary duties as a director of the company - which, it was said, include a duty to take account of the interests of the creditors of the company: see Walker v. Wimborne (1976) 137 CLR, at pp 6-7 . There is no justification in the words of the Act, or in principle, for limiting the jurisdiction of the Family Court in the manner suggested. Once the proceedings are found to be of the kind referred to in par. (c) or par. (e) of the definition, the Court has jurisdiction, and the fact that the husband may be affected in the performance of other duties which do not arise out of the matrimonial relationship, although relevant to the question how the jurisdiction should be exercised, is no ground for holding that jurisdiction does not exist. In a case such as the present the argument has an air of unreality. It is impossible to suppose that the Parliament intended that a husband might place the matrimonial home beyond the jurisdiction of the Family Court simply by vesting it in a private company which he himself controls: such a result would make it impossible for the Family Court properly to perform its functions in many cases. (at p534)

10. In the present case the facts that the matrimonial home is mortgaged, and that the company has other creditors, are matters relevant to be considered by the Family Court. The husband's case, which is that the home should be sold, and the proceeds used to pay off creditors and buy a more modest home which would be within his means to maintain, requires careful consideration - but, of course, it may be expected to receive that consideration when the Family Court turns to the merits of the case. (at p534)

11. The Family Court had jurisdiction in the present case and the order made by the learned judge was within his jurisdiction. The application should be dismissed. (at p534)

MASON J. I would dismiss this application for the reasons given by Gibbs J. (at p534)

Orders

Application for writ of prohibition dismissed.

Prosecutor to pay the respondent's costs, including the costs of the chamber application.