REAGAN & REAGAN (STAY)

[2013] FamCA 437

FAMILY COURT OF AUSTRALIA

REAGAN & REAGAN (STAY) [2013] FamCA 437

FAMILY LAW – ORDERS – Stay – Where the applicant has sought leave to appeal an interlocutory order – Where the applicant’s case on the proposed appeal is not strong – Whether failure to grant a stay would render the appeal nugatory.

Family Law Act 1975 (Cth) s 94AA
Family Law Regulations 1984 (Cth) r 15A

Aarons v Knowles (1995) FLC 92-627
Aldridge and Keaton (Stay Appeal) [2009] FamCAFC 106
Alfasi and The Alfasi Group (2006) FLC 93-271
Rutherford and Rutherford (1991) FLC 92-255

APPLICANT: Mr Reagan

RESPONDENT: Ms Reagan

FILE NUMBER: BRC 728 of 2010

DATE DELIVERED: 11 June 2013

PLACE DELIVERED: Brisbane

PLACE HEARD: Brisbane

JUDGMENT OF: Forrest J

HEARING DATE: 4 June 2013

REPRESENTATION

COUNSEL FOR THE APPLICANT: The Honourable Mr Foley

SOLICITOR FOR THE APPLICANT: North Coast Law

COUNSEL FOR THE RESPONDENT: Mr Shoebridge

SOLICITOR FOR THE RESPONDENT: Schultz Toomey O'Brien

Orders

1. The husband’s application, filed 2 May 2013, for a stay of the delivery of judgment in the substantive proceedings in this matter pending the determination of his Application for Leave to Appeal filed 8 April 2013 is dismissed.

2. The further hearing of the substantive proceedings is adjourned to 10.00 am on Friday, 13 September 2013 for cross-examination of the wife on her affidavits filed 1 March 2013 and 15 March 2013; and cross-examination of the husband on any affidavit evidence he relies on in respect of the same issue; and further submissions by each party.

3. Any further affidavit of the husband on this issue shall be filed and served on or before Friday, 26 July 2013.

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

FAMILY COURT OF AUSTRALIA AT BRISBANE

FILE NUMBER: BRC 728 of 2010

Mr Reagan

Applicant

And

Ms Reagan

Respondent

REASONS FOR JUDGMENT

1. On 18 March 2013, whilst judgment in substantive property division proceedings between the parties in this matter remained reserved, I made orders on the application of the wife to re-open the case and to admit into evidence further affidavits of the wife filed on 1 and 15 March 2013.

1. By Notice of Appeal filed in the Full Court of this Court on 8 April, 2013, the husband has made an application for leave to appeal against those orders. Leave to appeal is required pursuant to s 94AA of the Family Law Act 1975 (Cth) and Regulation 15A of the Family Law Regulations 1984 (Cth) as the “decree” sought to be appealed against is an “interlocutory” one.

1. By Application in a Case filed 2 May, 2103, the husband seeks an order staying the orders that I made on 18 March 2013 pending the determination of his application for leave to appeal against those orders. During the hearing of that Application in a Case, counsel for the husband conceded that the order that the husband actually seeks is that the delivery of my judgment in the substantive proceedings be stayed pending the outcome of his application for leave to appeal against the orders I made on 18 March 2013. The reality is that the husband does not want my judgment in the substantive proceedings delivered before the determination of his application for leave to appeal and any consequent appeal against my orders that allowed the wife to re-open her case and put in further evidence in respect of a liability of the parties.

1. The wife opposes the husband’s application for a stay on the delivery of my judgment.

1. The granting of a stay pending the determination of an appeal is discretionary. The principles that are relevant to the determination of such a stay pending appeal are well established. See Aldridge and Keaton (Stay Appeal) [2009] FamCAFC 106.They are as follows:

(1)The onus to establish a proper basis for the stay is on the applicant for the stay.  It is not necessary for the applicant to demonstrate any “special” or “exceptional” circumstances;

(2)A person who has obtained a judgment, such as that obtained by the wife in this case, is entitled to the benefit of that judgment;

(3)A person who has obtained a judgment, such as that obtained by the wife in this case, is entitled to presume the judgment is correct;

(4)The mere filing of an appeal against that judgment is not sufficient grounds for the granting of a stay;

(5)The bona fides or otherwise of the applicant;

(6)A stay may be granted on terms that are fair to all parties - this may involve a court weighing the balance of convenience and the competing rights of the parties;

(7)A weighing of the risk that an appeal may be rendered nugatory if a stay is not granted – this is indeed a substantial factor in determining whether it will be appropriate to grant a stay;

(8)Some preliminary assessment of the strength of the proposed appeal – that is, whether the appellant has an arguable case and in particular whether he has demonstrated that he has an arguable case;

(9)The period of time in which the appeal can be heard and whether existing satisfactory arrangements may support the granting of the stay for a short period of time.

1. In evidence on this application for a stay is a copy of the husband’s Notice of Appeal filed 2 May, 2013. Under the heading Grounds of Appeal are listed 3 specific grounds. They are:

(1)The learned trial Judge erred in ordering a re-opening of the trial based on “the Application before (His Honour) to re-open the Wife’s case at trial” (Paragraph 4 of Judgment) when no such application was filed before the Court.

(2)The learned trial Judge erred in failing to consider whether the allegedly fresh evidence was available at the time of the trial and could not be discovered despite the exercise of due diligence in circumstances where default judgment had been entered against the Respondent Wife on 19 July 2012, 2 months before the Family Court trial concluded.

(3)The learned trial Judge’s order to re-open the trial was a breach of procedural fairness having regard to:

(a)The lack of opportunity for the Appellant Husband to cross-examine the Respondent Wife on the “fresh evidence”;

(b)The lack of opportunity for the Appellant Husband to file material in response to the Respondent Wife’s allegedly “fresh evidence” in the trial proper and the lack of directions therefore;

(c)The Court’s failure to consider whether the Respondent Wife needed leave to withdraw her admission regarding the Appellant Husband’s partial liability for the … plantation debt;

(d)The Court’s failure to consider the basis of agreed joint liability for the … plantation debt as set out in paragraph 8 of the written submissions on behalf of the husband for the Respondent Wife’s Interim Application heard 18 March 2013;

(e)The Court’s failure to have proper regard for the desirability of an end to the protracted litigation in this case.

1. Before I turn to the preliminary assessment of the strength of the proposed appeal, I consider in this application I must also make some preliminary assessment of the strength of the application for leave to appeal.

1. An applicant seeking leave to appeal from an interlocutory order must demonstrate that there has been an error of principle and/or a substantial injustice to one of the parties or that the issue is one of general importance.  See Rutherford and Rutherford (1991) FLC 92-255; Aarons v Knowles (1995) FLC 92 -627 and Alfasi and The Alfasi Group (2006) FLC 93-271.

1. No submissions addressed directly to this issue were made by counsel at the hearing of this stay application.  However, I accept that counsel for the husband pressed the submission that I had made an error of principle in the judgment appealed against and that there had been a lack of procedural fairness to the husband in respect of that judgment. Counsel for the husband effectively submitted that the husband’s position on that is clear from the grounds of appeal listed in his Notice of Appeal filed.

1. In any event, having regard to the views I hold at this point as to the strength of the proposed appeal after a preliminary assessment of the merits of the three grounds listed in the Notice of Appeal, I am not satisfied that the application for leave to appeal has very much merit at all. I will now address each of the listed grounds of appeal in this respect.

1. I am not satisfied that Ground 1 of the appeal as asserted has any prospect of success. At the hearing of the wife’s application on 18 March, 2013, I expressed the view that the wife’s application was more properly one for a re-opening of her case on the trial and counsel for the wife accepted and adopted that proposition and took up that course.

1. Having taken that course, the solicitor who appeared for the husband was invited by me, repeatedly, to address the Court in response to that position.  He made no submissions that the wife could not or should not be allowed to amend her application in such a way.  He made no application for the matter to be adjourned to allow the husband to give greater consideration to his response or to put on other evidence. The written submissions he handed to the Court on the day showed that the issue of a re-opening by the wife was not a matter to which he had not turned his mind at all.

1. I do not consider that the husband has an arguable case on this aspect of his appeal.

1. As to Ground 2 of the appeal, it is that I failed to consider whether the “allegedly fresh evidence” was available at the time of the trial and could not be discovered despite the exercise of due diligence in circumstances where default judgment had been entered against the wife in July 2012, two months before the Family Court trial concluded.

1. The submission put to me by counsel for the husband on the hearing of this stay application, at [14] of his written outline of submissions, was not so much that I failed to consider the issue but rather that I accepted the wife’s evidence on the re-opening application that she learned after the trial in the substantive proceedings had concluded that judgment had been entered against her in the debt proceedings in the court in Western Australia without the husband having had the opportunity to cross examine or file material in response. Counsel goes on to submit that evidence, along with the evidence that was also before me that the wife had been served with the Writ in May 2012 and the evidence that default judgment had been entered against the wife in July 2012, is inconsistent with reasonable diligence on the wife’s part; a point of relevance to the discretionary determination, as I pointed out in [3] of my reasons.

1. I have already observed that at no time on the hearing of the wife’s application on 18 March 2013 was an application for an adjournment asked for as a consequence of my determining that I was hearing a re-opening application of the wife. Similarly, at no time was an application made by the solicitor for the husband to cross-examine the wife on her evidence nor was any application made for the husband to have the leave to file further affidavit material in response to the evidence of the wife.

1. Although the husband and his legal representatives were clearly alert to the relevance of the issue of the “freshness” of the evidence that was sought to be put before the Court by the wife on a re-opening application[1], after having pointed out to the solicitor for the husband what I considered, on the authorities, were relevant matters, including the question as to whether the further evidence could not by reasonable diligence have been discovered earlier, no further oral submission on that point was made by him.

[1]          See [6] of the written submissions made on behalf of the husband on 18 March 2013.

1. Indeed, all of the evidence about the existence of the alleged debt prior to the commencement of the trial of the substantive proceedings, the service of the Writ on the wife, the communication between the wife’s solicitors and the husband’s solicitors about a potential Defence and the wife’s subsequent position at the trial of the substantive proceedings that the matter could not be defended, was clearly considered by me as part of the discretionary determination to re-open.   It was considered, along with the evidence that the wife had only learned in December 2012 that judgment debt at been entered against her in July 2012, in the light of no further submission having been made on behalf of the husband as to its relevance or as to the weight that should be given to it.

1. In these circumstances, I am not satisfied that the husband has much in the way of prospects of success on appeal in respect of Ground 2 of the appeal.

1. As to all of the grounds set out in Ground 3 of the appeal, I find myself again very quickly satisfied that the husband has no real prospects of success on the points included.

1. I have already repeatedly observed that absolutely no application or submission was made on behalf of the husband at the hearing in March 2013 for cross-examination of the wife on the “fresh evidence”, or for the filing of any material in response or as to the need for leave to be sought by the wife to be able to withdraw or resile from the position represented in final schedules presented to the Court in respect of assets and liabilities. As counsel for the wife pointed out, no such application has been made since the re-opening order was made either.

1. In any event, counsel for the husband now submits (and counsel for the wife agrees) that a course open to the Court, if a stay is not granted, is to make further directions that facilitate cross-examination of the wife on the evidence that was allowed in and allow the husband to adduce further evidence himself. Counsel for the husband informed the Court that his instructions are to seek directions with respect to such a course in the event that the stay is not granted.

1. As to the 4^th of the grounds set out in Ground 3 of the appeal, I must say I do not understand the reference to paragraph 8 of the husband’s written submissions of 18 March, 2013. I am, however, quite satisfied that I considered relevant matters about the joint liability in determining to re-open the hearing of the substantive proceedings and to allow the wife’s affidavits into evidence. I do not consider there is merit on the appeal in this point.

1. As to the final ground set out in Ground 3 of the appeal, I consider it nonsense to assert that I failed to have proper regard for the desirability of an end to the protracted litigation in this case. I may not have expressly referred to that desirability but it is never far from the forefront of my mind any time I am determining proceedings before me; just as it is on the consideration of this application.

1. As can be seen, I do not consider, on my preliminary assessment, that the application for leave to appeal has much merit. That is, therefore, I consider, a weighty matter in the discretionary determination of this stay application.

1. I am indeed conscious of the fact that if I do not grant the stay and I go on and pronounce judgment in the substantive proceedings before the husband’s application for leave to appeal is heard that it will be rendered nugatory. However, as counsel for the husband himself submitted, much of what the husband submits was wrong with my judgment against which he appeals can be remedied alternatively by means of allowing cross-examination of the wife on her new evidence and allowing the husband to adduce further evidence relevant to the matter himself and for the parties to make further submissions. Counsel went so far as submitting that if that was allowed the husband’s application for leave to appeal might never even be pressed.

1. In making my decision on this matter, I am also acutely mindful of the fact that it is already around nine months since the trial of the substantive proceedings concluded and that it would be likely to be another period of nine to twelve months before the husband’s application for leave to appeal will be heard by the Full Court of this Court, with a further period of time likely to elapse after the hearing of the application before judgment in that matter is delivered.

1. I am also mindful, as I already observed, of the need for timely resolution of litigation for litigants, particularly in this Court.

1. Ultimately, consideration of the matters set out above, causes me to determine to refuse the husband’s application for a stay but to make further directions that facilitate cross-examination of the wife on the evidence I allowed in previously, that allow the husband to adduce further evidence on the point himself and each of the parties the right to make further submissions relevant to the point.

1. I make the orders set out at the commencement of these reasons.

I certify that the preceding thirty (30) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Forrest delivered on 13 June 2013.

Associate: 

Date:  13 June 2013