RICE & RICE (No.2)
[2019] FCCA 1877
•11 April 2019
FEDERAL CIRCUIT COURT OF AUSTRALIA
| RICE & RICE (No.2) | [2019] FCCA 1877 |
| Catchwords: FAMILY LAW – Property – Stay application pending appeal – costs. |
| Legislation: Federal Circuit Court Rules 2001 (Cth), r.25B.16 |
| Cases cited: Aldridge & Keaton [2009] FamCAFC 106 Macris & Galanis [2015] FCCA 2623 |
| Applicant: | MR RICE |
| Respondent: | MS RICE |
| File Number: | PAC 6086 of 2014 |
| Judgment of: | Judge Obradovic |
| Hearing date: | 11 April 2019 |
| Date of Last Submission: | 11 April 2019 |
| Delivered at: | Parramatta |
| Delivered on: | 11 April 2019 |
REPRESENTATION
| Appearing for the Applicant: | In person |
| Appearing for the Respondent: | Ms Hogg |
| Solicitors for the Respondent: | Hogg & Associates |
ORDERS
The Application in a Case filed by the husband on 15 March 2019 is dismissed.
The husband is to pay the wife’s costs in the amount of $2,987 within 42 days of today’s date.
The Application in a Case filed by the wife on 28 March 2019 is referred to a Registrar pursuant to Rule 25B.16(2) of the Federal Circuit Court Rules 2001.
IT IS NOTED that publication of this judgment under the pseudonym Rice & Rice (No.2) is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT PARRAMATTA |
PAC 6086 of 2014
| MR RICE |
Applicant
And
| MS RICE |
Respondent
REASONS FOR JUDGMENT
On 31 January 2019, the Court made orders in proceedings in respect of parenting and property adjustment orders between the parties. The proceedings were heard on 31 July 2017, 1 and 2 August 2017 and 8 November 2017, with the last submissions received by the Court on 8 January 2018.
By way of a Notice of Appeal filed on 28 February 2019, Mr Rice, who was the respondent in the substantive proceedings, seeks to appeal Orders 17 and 31 of the Orders made on 31 January 2019. Indeed, he seeks for those orders to be discharged.
Order 17 relates to three bank accounts, being Westpac Youth Reward Saver accounts held in each of the children’s names, which the Court essentially directed to be closed and payment to be made to the wife in respect of all of the funds held in those accounts. At the time of the making of the Orders on 31 January 2019, and indeed at the time of hearing, the eldest child of the parties was an adult, while the two younger children remained below the age of 18 years.
Order 31, which the husband also seeks by way of his Notice of Appeal to be discharged, is an order for the husband to pay to the wife spousal maintenance for a period of two years in the amount of $450 each week. The husband sets out his grounds of appeal at pages 3 and 4 of that Notice of Appeal which has been filed on 28 February 2019.
On 15 March 2019, the husband filed an Application in a Case seeking a stay of Orders 17 and 31, pending the outcome of the appeal which he filed on 28 February 2019. The Court today heard that application in a Case. In support of the Application in a Case, the husband relied on his Affidavit which was also filed on 15 March 2019, and Exhibit ‘1’ in his Application is the Notice of Appeal filed on 28 February 2019.
In response to that Application in a Case, the wife filed a Response document on 10 April 2019 seeking orders for the Application in a Case to be dismissed and an order for the husband to pay the costs of these proceedings. She sought to rely on an Affidavit also filed on 10 April 2019 which the husband did not object to.
Both parties made submissions in respect of the stay application. The husband a number of times during his submissions alluded to the fact that he was not legally represented and that the Court should take that matter into account in determining his application and the way that the arguments were raised.
The seminal decision in respect of the relevant principles in respect of stay applications, albeit it was an application for stay of children’s orders, is the Full Court decision of Aldridge & Keaton[1], which has been referred to as a helpful guide for trial judges dealing with applications for a stay pending the determination of an appeal[2].
[1] [2009] FamCAFC 106
[2] Macris & Galanis [2015] FCCA 2623
The Court understands that the relevant principles may be summarised as follows. The onus to establish a proper basis for a stay is on the applicant for the stay and it is not necessary to demonstrate any special or exceptional circumstances. The person who has obtained a judgment is entitled to the benefit of that judgment and to presume that the judgment is correct.
The Court also needs to take into consideration the bona fides of the applicant on the appeal and in the stay application and look at the possibility that the appeal may be rendered nugatory if the stay is not granted. The Court also needs to undertake a preliminary assessment of the strength of the proposed appeal, that is, whether the appellant has an arguable case.
One of the other relevant considerations is 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.
Unfortunately, the submissions by the husband, to a large extent, did not address any of the relevant principles that the Court has to take into consideration. The evidence in support of the stay was really a regurgitation of the grounds of appeal.
In any event, doing the best that it can and considering the grounds of appeal as pleaded in the Notice of Appeal, the Court understands in respect of Order 17 that the husband asserts that the Court did not have the power to make the order that it did, that insufficient reasons were provided for the order that was made, and that the order was contrary to the evidence in the proceedings.
In respect of the appeal regarding Order 31, which is the spousal maintenance order, the Court understands, that the appeal is sought on the basis that the Court’s discretion was miscarried, and that there were insufficient reasons provided for the orders which were granted.
That is the Court’s understanding of what the grounds of appeal allude to, and this understanding is simply made on the basis of the reading of the husband’s Affidavit as well as Exhibit ‘1’. No submissions were made in respect of the strength of the appeal, nor was there any submissions made as to the grounds of appeal and how they may be made out.
The husband in his submissions, if the Court understood him correctly, essentially said that staying the orders would not make any difference because the wife does not have the benefit of those Orders to date, that is, the husband has not paid any spousal maintenance to date, and she has not had the benefit of the money in the children’s account in any event.
There were some confusing submissions which were to the effect of that the appeal would be rendered nugatory because the wife’s financial position was so dire that if the order was not stayed and the monies were paid to the wife, both in terms of the amounts in the children’s bank accounts and also the amounts which the husband has to pay the wife in spousal maintenance, the wife would not have the capacity to repay those amounts.
The husband has an obligation to comply with the Orders. The Orders were made by the Court on 31 January 2019. He has not complied with the order to pay spousal maintenance. He says to the Court that he is not seeking an order in any event for that money to be repaid if the appeal is successful. Rather, he is simply asking for a discharge of that order.
To date, the husband, by virtue of the fact that he has not made any spousal maintenance payments to the wife, is already in arrears to the tune of $4,500 in respect of the spousal maintenance order.
At the time of final hearing, the Court understands that the monies in the children’s bank accounts or in the accounts held in the children’s names were in the approximate amount of about $30,000. The husband says to the Court today that there is, in fact, about $43,000 in those accounts and that he has been maintaining payments into the children’s accounts since final hearing, those payments being $150 in total per month, being $50 to each account per month[3].
[3] The husband also says that the current value of the shares which are in the wife’s name, being the Shares [A] shares, at present are about $190,000. At time of hearing, the court made a finding that those shares were then valued at about $128,000.
In respect of the Court’s reasoning for the spousal maintenance order, that reasoning is disclosed at least in paragraphs 90 and 91, of the Reasons for Judgment published on 31 January 2019.
In respect of the reasons for orders to the transfer to the wife the monies held in the accounts in the children’s names, those matters seem to have been referred to in paragraphs 79, 80, 85, 89 of the Reasons for Judgment. While it may be that the Full Court finds that those reasons are not sufficient to explain why an order was made to transfer the funds held in the children’s accounts to the wife, there are to the mind of this Judge, reasons provided in the Reasons for Judgment as to why that order was made.
One of the findings that the Court made in paragraph 78 was that the respondent had not been fully open and frank in respect of his obligations for financial disclosure and that it was difficult for financial information to be obtained from the respondent. Despite lengthy evidence and detailed submission, the Court was not able to make precise findings about the asset pool and, indeed, found that there was no agreed asset pool. In those circumstances, the Court held that it should not be unduly cautious about making findings in favour of the innocent party, who in the circumstances of this matter, was the applicant wife.
The making of a stay order is, of course, a discretionary remedy which the Court is being asked to grant and it is up to the applicant husband to convince the Court that the Court should exercise its discretion in the manner that he seeks.
There is no evidence in respect of the period of time in which the appeal can be heard and the status of that appeal, except by way of submissions that the first listing of the appeal is on 24 April 2019. The draft index was filed by the husband on 28 March 2019, the Court notes, which is the last date for the filing of that draft index. After this date the appeal would have been rendered abandoned had that draft index not been filed.
I have, in considering the stay application, conducted a preliminary assessment of the strength of the proposed appeal and whether the appellant has an arguable case. To my mind, the appellant’s appeal has more strength in the argument that there are insufficient reasons in respect of the children’s accounts than the argument which is raised by the husband in respect of the lack of reasons for the order for spousal maintenance.
The Court is not satisfied that there is an arguable case in relation to the grounds that the Court did not have the power to make the orders that it did in paragraph 17 and that it was an order that was contrary to the evidence in the proceedings. The Court is also not satisfied that the appellant has an arguable case that the discretion of the Court was miscarried in making the spousal maintenance order in the manner that it was made and on the basis of the evidence and the basis of the findings that were made by the Court in its Reasons for Judgment, published on 31 January 2018.
In respect of weighing the risk that the appeal may be rendered nugatory if the stay is not granted, what the husband seeks, as the Court understands, is in respect of Order 17, is for that order to be discharged and for the moneys which are held in those bank accounts, for those moneys to be paid to the children rather than the wife. In that sense, the appeal would not be rendered nugatory if the stay was not granted. In any event, the Court can, in deciding the stay application, make an order injuncting the wife from spending those moneys until a particular time has passed, or perhaps even until the appeal has been heard.
Given that there is no evidence as to when the appeal is going to be heard and the significant financial strain which the wife finds herself in, the Court finds that the weighing of discretion falls in the wife’s favour in that she is entitled to the benefit of the judgment and that she is entitled to presume that the judgment is correct. The Court is not satisfied that the husband has established a proper basis for the stay based on his submissions and the evidence which he relies upon. For those reasons, the Application in a Case filed on 15 March 2019 is dismissed.
Costs
In her Response filed on 10 April 2019, the wife seeks an order that her costs of the proceedings be paid. That was clarified to be costs in accordance with Schedule 1 of the Federal Circuit Court Rules2001, in particular, item 3 and item 13 of that Schedule, which is a total amount of $2,987.
It was submitted on behalf of the wife that her financial circumstances are limited, that she has limited funds and that that is one of the reasons why the Court ought to make the costs order. It was also submitted on behalf of the wife that an adjournment was required initially when the stay application was brought before the Court because the application had not been served on her in sufficient time for her to be able to answer it before that first return date. It was also submitted on behalf of the wife that there was no correspondence received by her or on her behalf in respect of the stay application, that is, she was not put on notice before that stay application was made.
The husband, in response to the stay application, says that he is not in a financial position to make payment in accordance with the costs which are sought. He says that the wife has the benefit of a 70/30 split as a result of the orders made by this Court on 31 January 2019 and that he needed to make the stay application because he has lodged an appeal against those orders. He submitted that he is entitled to presume that the appeal might be upheld. I have already, in my brief Reasons for dismissing that Application in a Case, given my preliminary assessment of the strength of that appeal.
In any event, what the Court needs to be satisfied of is that there are justifying circumstances as to why the usual course, which is outlined in section 117 that each party shall bear its own costs, ought to be departed from. In the circumstances of this case, I am satisfied that there are circumstances justifying a costs order. The applicant husband, in the Application in a Case, has been entirely unsuccessful. It is an application that required the wife to answer it. She has been legally represented when appearing in response to that Application in a Case.
Her financial circumstances are indeed difficult, as is outlined in her Affidavit filed on 10 April 2019, and despite the orders which were made on 31 January 2019, there has been significant difficulties in the wife receiving the benefit of those orders. At the time that the orders were made, the wife was already in difficult financial circumstances, which is one of the reasons why the Court made the order for spousal maintenance that it did. Neither party is in receipt of Legal Aid and, therefore, that is not a relevant consideration.
The conduct of the parties to the proceedings is not in any way extraordinary and both parties have conducted themselves in these proceedings – and by these proceedings, I mean in the Application in a Case – in an appropriate manner. The proceedings were not necessitated by the failure of a party to comply with any previous order of the Court, that is, the stay application was not necessitated by any such failure. I have already referred to the fact that the husband has been wholly unsuccessful in the application for the stay.
I have not been taken to any offer in writing which has been made to settle the proceedings and the terms of any such offer. Indeed, it was submitted on behalf of the wife that there was no correspondence entered into by the parties and that the wife was not on notice until she received the application in a case as to the husband’s intention to seek the stay. I also note that the husband has been paying money into the children’s bank account in the amount of $150 per month, instead of making at least a partial payment towards the spousal maintenance which he has an obligation to pay pursuant to the Orders that I made on 31 January 2019.
There have been some difficulties in the wife having the benefit of the orders, as I have already indicated, resulting in part in the circumstances of financial need that she finds herself in at present. One of the other matters that the Court considers relevant is the conduct of the husband in the substantive proceedings, but only to a very limited extent. That is the findings that were made by the Court in respect of the husband’s failure to comply with his obligations for full and frank disclosure, making the asset pool impossible to ascertain and resulting in the orders which were made for the benefit of the innocent party in those proceedings.
The wife seeks a modest amount of costs, that is, costs in accordance with schedule of the Federal Circuit Court Rules. In all of the circumstances, I find that it is appropriate to make a costs order for the husband to pay the wife’s costs in the amount of $2,987 as a result of the unsuccessful application in a case seeking a stay of the orders made by the Court on a final basis on 31 January 2019.
I certify that the preceding thirty-eight (38) paragraphs are a true copy of the reasons for judgment of Judge Obradovic
Date: 11 April 2019
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