Richardson and Richardson - [2012] FamCAFC 58

FAMILY COURT OF AUSTRALIA

RICHARDSON & RICHARDSON

[2012] FamCAFC 58

FAMILY LAW ─ APPEAL ─ Leave to appeal against an interlocutory mandatory injunction ─ Substantial injustice to husband if leave to appeal refused demonstrated in that potential to retain rural property occupied by husband would be lost if leave refused ─ Leave to appeal granted and the appeal allowed.

Family Law Act 1975 (Cth) Part VIII

Adam P Brown Male Fashions Pty Ltd v Philip Morris Inc (1981) 148 CLR 170
Rutherford & Rutherford (1991) FLC 92-255

APPELLANT:

Mr Richardson

RESPONDENT:

Ms Richardson

FILE NUMBER:

DUC

2010

APPEAL NUMBER:

EAA

133

2011

DATE DELIVERED:

24 April 2012

PLACE DELIVERED:

Sydney

PLACE HEARD:

Sydney

JUDGMENT OF:

Coleman J

HEARING DATE:

24 April 2012

LOWER COURT JURISDICTION:

Federal Magistrates Court

LOWER COURT JUDGMENT DATE:

28 October 2011

LOWER COURT MNC:

[2011] FMCAfam 1256

REPRESENTATION

COUNSEL FOR THE APPELLANT:

Mr Battley

SOLICITOR FOR THE APPELLANT:

Mark Ireland Lawyers

COUNSEL FOR THE RESPONDENT:

Mr Givney

SOLICITOR FOR THE RESPONDENT:

Campbell Paton & Taylor

Orders:

That leave to appeal is granted, and the appeal is allowed.
That orders 3 and 4 of the orders made by Dunkley FM on 28 October 2011 are set aside.
That the respondent wife’s costs of and incidental to the application for leave to appeal and the notice of appeal are reserved.
That there be no orders made in substitution for those of the learned Federal Magistrate.

further orders made in the exercise of original jurisdiction:

That the substantive matter is set down for a 3 day final hearing at 10am on 23, 24 and 25 May 2012 at Dubbo before Coleman J.

That all primary evidence is to be exchanged by 13 May 2012.

That by not later than 23 May 2012, all experts or asserted experts who have sworn affidavits in the proceedings, are to confer with each other with respect to any controversial issues remaining from such expert opinion evidence and produce counter signed memoranda in relation to all matters in dispute and the basis of dispute with respect of each of such matters.

That the parties be granted liberty to restore the matter for further directions on 48 hours notice, by telephone.

That mutual discovery and inspection of documents be conducted by not later than 15 May 2012.

That leave be granted for any expert witness to give evidence by telephone.

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

THE APPELLATE JURISDICTION OF THE FAMILY COURT OF AUSTRALIA AT SYDNEY

Appeal Number: EAA 133 of 2011

File Number: DUC 79 of 2010

Mr Richardson

Appellant

And

Ms Richardson

Respondent

EX TEMPORE

REASONS FOR JUDGMENT

This is an application for leave to appeal against interlocutory orders made by Dunkley FM in proceedings for settlement of property between the parties to the marriage, Mr Richardson (“the husband”) and Ms Richardson (“the wife”) pursuant to the provisions of Part VIII of the Family Law Act 1975 (Cth) (“the Act”). The substantive proceedings remain on foot.
On 28 October 2011, the learned Federal Magistrate made a series of orders, the order of particular significance for present purposes being order 3 which provides:
3.The parties shall sign all documents and give authority and all necessary consents to:
a)Within two (2) weeks list the “[R]” property for sale by auction.
b)The reserve price for the “[R]” property at auction will be $1,200,000.00.
c)Instruct the auctioneer:
d)If the property is “passed in” (ie does not reach reserve) to accept the highest offer of $1,100,000.00 of above.
It is from that order, in particular, that the husband has sought leave to appeal.
As his learned counsel made clear, and with respect, sensibly so, given the history of the proceedings as recorded by the learned Federal Magistrate in his Reasons for Judgment of 28 October 2011, and more extensively recorded in the affidavit of the wife, sworn 20 March 2012, the husband cannot oppose, and does not oppose the property, the subject of the dispute, a rural property known as “R”, situated in the Central West of New South Wales, being placed on, and remaining on the market for sale by private treaty.
That is to say, it is with respect to the auction provisions of order 3, made on 28 October 2011, that the husband seeks to enliven the discretion to grant leave to appeal, and to secure the discharge of.
Learned counsel for the husband conceded that his client’s desire to preserve the opportunity to retain R is both somewhat unheralded, particularly in a formal sense, and not entirely consistent, or perhaps even plainly inconsistent, with the stance the husband has from time to time taken, in relation to R over the past 12 months.
As the transcript would record, fortuitously, the final hearing of the proceedings is able to take place in Dubbo on 23, 24 and 25 May of this year, that is to say, a little over four weeks hence. That changes things, in terms of the present application. That arises in, essentially, the following way. The R property is subject to an encumbrance of about $430,000. That encumbrance is not being serviced by the husband, who is in possession of the property. The impost referable to the encumbrance is about $3,500 to $3,600 per month. Mr Givney of counsel, with his customary candour, concedes that the equity in R is unlikely to be less than $800,000, and that such a sum would accommodate his client’s claim, were she to be wholly successful, and would undoubtedly do so in one months time, at which time it can reasonably be expected that the encumbrance will have increased by a further $3,500 to $3,600.
Circumstances have clearly changed, and the change is a material change, whereby the proceedings can be finally heard and determined a little over one month hence. The question arises as to whether, whatever the ultimate success or otherwise of the husband’s request to retain R, that possibility should be defeated, or potentially defeated, by maintaining the orders for the auction sale.
It ought not to be forgotten that the auction sale orders may operate in a way which the evidence at present suggests could be somewhat unfortunate for the wife. It may be that, notwithstanding their apparent recent willingness to purchase R for $1.4 million, faced with an auction scenario, the potential purchasers, to whom Mr Givney of counsel referred, may, in fact, not bid at auction. The husband and/or interests favourable to him may bid, and it is possible that, notwithstanding that the property may sell, either to the husband or third parties for $1.4 million, the effect of the auction orders of 28 October 2011 could have the potentially perverse outcome that the husband or interests supportive of him acquired R for as little as $1.1 million. That is unlikely, it seems, but nevertheless it is a possibility that cannot be entirely rejected.
The critical factor in the Court’s thinking is that with a final hearing a little over one month away, and any prejudice to the wife arising out of interfering with the learned Federal Magistrate’s orders being able to be accommodated in the orders then made, both in terms of to whom R may be sold, or by whom it may be retained, and what entitlement the wife has, the Court is disposed to grant leave to appeal, and to uphold the appeal.
With respect to the submissions of the learned counsel for the husband in relation to denial of natural justice and the like, in the absence of more than the Court has been referred to, and notwithstanding the apparent concession made by the learned Federal Magistrate, and his Honour’s subsequent recusal from further hearing the proceedings, the Court would not, given the history of the matter as outlined by the learned Federal Magistrate to some extent, and more extensively by the wife in her affidavit, be persuaded that appellate intervention should be enlivened, having regard to the decision of the High Court in Adam P Brown Male Fashions Pty Ltd v Philip Morris Inc (1981) 148 CLR 170 and of the Full Court of this Court in Rutherford & Rutherford (1991) FLC 92-255.
The basis upon which leave to appeal will be granted is, in effect, the further evidence that there will be a final hearing a little over four weeks from now. The prejudice to the wife of a further four week delay can be accommodated. No orders made at this time would address whatever prejudice, or disadvantage, the wife may, when the evidence is tested, be able to demonstrate with respect to the period prior to this time. That is a matter of history. Whatever the wife can prove to have been the detriment incurred by her, as her learned counsel fairly and frankly conceded, that can be accommodated out of what emerges as the minimum equity in the R property.
The Court is satisfied in those circumstances that to decline to disturb order 3 would have the potential to visit a substantial injustice upon the husband. That is not to say, and the husband ought not for one minute so think that he will be able to retain the property. The history of his vacillation in that regard to date suggests that, as the transcript would record, unless at the trial in May this year the husband is able to put forward a clear and definite, and immediate proposal to retain the property, at and for what emerges as fair market value, the reality is that it will almost certainly be sold. Whether or not that will occur will depend upon the evidence, and its testing, the findings of fact the Court makes, and the exercise of discretion by reference to such findings of fact.
The Court is simply recording at this stage, however, that it ought not be thought that by securing a disturbance of order 3, that there is any express, or implied finding by the Court that either the husband should have first right of purchase, or that he will be granted it. That will be a significant issue for the trial.
The question which then arises is whether in the intervening period, that is to say until the trial, the property should be marketed for sale, or that its sale left in abeyance. Sensibly, in the Court’s view, learned counsel for the wife has adopted the position of not seeking that the parties be put to the potentially needless expense of marketing the property for the sake of four weeks.

I certify that the preceding fifteen (15) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Coleman delivered on 24 April 2012.

Associate:

Date: 30.04.2012