Rahman and Rahman (No 2)

[2020] FamCA 477

FAMILY COURT OF AUSTRALIA

RAHMAN & RAHMAN (NO. 2) [2020] FamCA 477

FAMILY LAW – PROPERTY – INTERIM – Where Orders were made in 2012 for the husband to pay the wife $377,000 – Where the husband is restrained from leaving the country until the payment is made in full – Where the wife seeks the husband be restrained from disposing his assets until a hearing to determine jurisdiction – Orders made

Family Law Act 1975 (Cth) ss 79, 114(3)
Bankruptcy Act 1966 (Cth) s 59A

APPLICANT: Ms Rahman

RESPONDENT: Mr Rahman

FILE NUMBER: SYC 7852 of 2007

DATE DELIVERED: 5 June 2020

PLACE DELIVERED: Sydney

PLACE HEARD: Sydney

JUDGMENT OF: Stevenson J

HEARING DATE: 29 May 2020

ORDERS MADE: 29 May 2020

REPRESENTATION

COUNSEL FOR THE APPLICANT: Mr McDonald

SOLICITOR FOR THE APPLICANT: Jordan Djundju Lawyers

COUNSEL FOR THE RESPONDENT: Mr Johnson

SOLICITOR FOR THE RESPONDENT: MCW Lawyers

Orders

1. Pending further Order the husband is restrained by injunction from disposing of, transferring or withdrawing any monies held by him in Commonwealth Bank account number …01 and Commonwealth Bank account number…82.

2. The proceedings are adjourned to a date to be fixed after the determination of the husband's appeal against the Orders of Rees J made on 13 March 2020.

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 Rahman & Rahman 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 SYDNEY

FILE NUMBER: SYC 7852 of 2007

Ms Rahman

Applicant

And

Mr Rahman

Respondent

REASONS FOR JUDGMENT

The proceedings

1. Ms Rahman and Mr Rahman are parties to long-standing litigation in relation to property settlement. Following a trial, Orders were made pursuant to section 79 of the Family Law Act 1975 (Cth) (“Family Law Act”) on 10 February 2012. These Orders provided inter alia that the husband pay to the wife a sum of $377,000 and that he be restrained from leaving the Commonwealth of Australia until such payment is made in full.

2. The husband appealed unsuccessfully against these Orders.  On 9 October 2013 his appeal was dismissed and he was ordered to pay the wife's costs.  The husband has paid no part of the sum of $377,000, nor the wife's costs of the appeal.

3. On … October 2013 the husband presented a Debtors Petition to the Official Receiver and was declared bankrupt.  The husband's statement of affairs referred to unsecured creditors totalling $378,011.52, of which a sum of $377,000 was the amount which he was ordered to pay to the wife on 10 February 2012.

4. The husband was discharged from bankruptcy on or about 30 October 2016.  On 30 May 2017 he filed an application for a discharge of the Orders which prevented him from leaving Australia until he made payment to the wife of the sum of $377,000.  This application was dismissed on 13 March 2020.  The husband's appeal against the dismissal of this application has yet to be allocated a hearing date.

5. On 17 April 2020 the wife filed an Initiating Application, by which she sought splitting orders in relation to the husband's superannuation funds on a final basis.  The wife also sought interim orders to restrain the husband from dealing with a sum of approximately $115,000 held in two Commonwealth Bank accounts.  Further, she sought an order for payment to her of these funds in partial satisfaction of the Orders of 10 February 2012.

6. The husband had disclosed the existence of three superannuation benefits and two Commonwealth Bank accounts in a Financial Statement which he swore on 10 January 2020 and upon which he relied in support of his application for a discharge of the Orders which restrained him from leaving Australia.  The husband raised a jurisdictional issue when the wife's interim application came before me on 30 April 2020.  I directed the preparation of written submissions and adjourned the wife's application to 29 May 2020.

Background

1. The husband and the wife, who are aged 53 and 46 respectively, married in 1992 and separated on 4 August 2006.  They have three children who are now adults.

2. In 2012, the trial judge made the following findings, inter alia:

   [160]The undisputed fact is that the husband was responsible for moving virtually all of the parties' assets from Australia to Lebanon.  I do not accept the husband's version as to what happened to those assets.

   ...

   [164]  ...

   It follows from the findings that I have made that I am of the view that the husband has failed to explain what happened to the sum of $580,000 that left Australia in August 2005. It follows therefore that I am confident that the asset pool is at least of that amount. As discussed above, the parties agreed that whatever the asset pool was found to be, it should be divided 65 percent to the wife and 35 percent to the husband. In those circumstances, it follows that the wife should be successful in obtaining an order pursuant to s 79 FLA that the husband pay to her the sum of $377,000." [164]

3. In dismissing the husband's appeal, the Full Court observed inter alia as follows:

   [4]It was uncontentious that in August 2005 the husband transferred some $130,000 from a bank account in Australia to Lebanon.  On 26 August 2005 the husband drew down $450,000 on a mortgage facility and transferred that money to Lebanon.  The mortgage was over the marital home of the parties and the repayments eventually fell into arrears.  The house was eventually sold by the mortgagee, the proceeds falling short of the debt owed and there remained approximately $50,000 shortfall.

4. The husband deposed that he is employed as a tradesman, on a gross income of $99,112 per annum.  His Financial Statement of 10 January 2020 referred to two Commonwealth Bank accounts with a total balance of $115,733 and superannuation benefits of $58,102.

5. In 2015 the husband and his current wife married by proxy.  The husband deposed that his wife lives in Lebanon and that he supports her financially.

Consideration

1. In my view each of the parties raised an arguable case in relation to the jurisdictional issue. Essentially the husband contended that his discharge from bankruptcy released him from all provable debts, which included the sum of $377,000 payable to the wife by way of court order. On the other hand, the wife drew attention to the fact that section 59A of the Bankruptcy Act 1966 (Cth) provides that:

   Sections 58 and 59 have effect subject to an order under Part VIII or Part VIIIA of the Family Law Act.

2. The issue before me on 29 May 2020 was whether the husband should be restrained from dealing with funds held in bank accounts, including two specified Commonwealth Bank accounts, pending determination of the jurisdictional question.  I took the view that the interim orders sought by the wife was too widely framed, as the husband should not be prevented from all access to funds in bank accounts for any purpose.

3. It seemed to me to be reasonable that the husband be restrained, pending further order, from dealing with the funds held in the two specified Commonwealth Bank accounts.  Such an order would not prevent the husband from opening another account into which he could deposit his salary and withdraw funds from time to time to meet his living expenses.

4. Section 114(3) of the Family Law Act provides as follows:

   A court exercising jurisdiction under this Act in proceedings other than proceedings to which subsection (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 considers appropriate.

5. It seems to me to be abundantly clear that there is a danger that the wife's claim may be defeated if there is no restraint upon the husband dealing with the funds in these two bank accounts.  The husband elected not to make payment to the wife in accordance with an order of the court and then to enter into bankruptcy, apparently with the intent of depriving her of the benefits of the litigation.  Whether the husband has succeeded in this endeavour is a matter for argument and determination on a later occasion.

6. That being so, it seems to me clearly to be "just and convenient" that there be an order sought by the wife but as modified as I indicated above in these reasons.  There are proceedings before the court, as instituted by the wife in her Initiating Application and her Application in a Case dated 15 March 2020.  In my view, the relief sought by the wife may be construed as property and/or enforcement proceedings.

7. It seems to me that the proposed injunctive relief should be granted, upon a weighing of the benefit to the wife against the potential detriment to the husband.  Effectively, the husband will be deprived of access to a specified amount of money only while a proper opportunity is afforded to the wife to explore whether or not she is able to secure partial compliance with an order of the court.

I certify that the preceding eighteen (18) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Stevenson delivered on 5 June 2020.

Associate: 

Date:  5 June 2020