Rigby & Kingston
[2020] FamCA 415
•26 May 2020
FAMILY COURT OF AUSTRALIA
| RIGBY & KINGSTON AND ORS | [2020] FamCA 415 |
| FAMILY LAW – PRACTICE AND PROCEDURE – Joinder – Where various third party respondents, joined to the proceedings by the husband pursuant to r 6.03 of the Family Law Rules 2004 (Cth), make an application to be removed as parties to the proceedings – Where they contend that the husband has failed to establish the essential requirements to justify the joinder of a party - Where the husband was ordered to file an Amended Initiating Application and a Points of Claim document particularising the precise orders sought against each of the third party respondents as well as pleading the fact and law relied upon for the relief sought – Where the husband has failed to comply with that order – Where the husband contends that he has been prevented from properly particularising his claim by a lack of disclosure from the third party respondents – Where it is improper to join a party for the sole purpose of obtaining disclosure – Where the Court finds that the identified third party respondents were joined for an improper purpose and those respondents will be removed as parties to the proceedings – Where the obligations of the remaining third party respondents will be stayed pending the husband’s compliance with the order to particularise his case. FAMILY LAW – COSTS – Circumstances justifying order – Where the third party respondents seek indemnity, or alternatively, party to party costs against the husband for costs incurred in relation to a hearing in December 2019 – Where the circumstances justify the making of a costs order but are not so exceptional as to warrant an award of costs on an indemnity basis – Where the husband is ordered to pay costs fixed in the sum of $25,000 to the third party respondents, payable within 7 days of the conclusion of the substantive proceedings. FAMILY LAW – EVIDENCE – Application to strike out – Where the wife seeks to strike out particular paragraphs of the husband’s affidavit on the ground that they are not relevant to the issues listed for the first series of trial dates – Where the husband resists the application – Where the paragraphs objected to are struck out. FAMILY LAW – LITIGATION FUNDING – COSTS - Where the husband seeks further litigation funding from the wife in relation to the husband’s legal costs of responding to the application brought by the third party respondents – Where the circumstances do not justify an order for the wife to pay the husband’s costs of pursuing a claim against third parties, particularly where the basis for that claim is yet to be particularised – Where the application is dismissed. |
| Family Law Act 1975 (Cth), Pt VIIIAA, s 117 Family Law Rules 2004 (Cth), r 6.02, r 6.03, r 10.12(d), r 19.08(3), r 19.18 |
| Adsteam Building Industries Pty Ltd v Old Cement and Lime Co (Unreported, Supreme Court of Queensland, McPherson J, 16 July 1984) B Pty Ltd v Ors & K and Anor (2008) FLC 93-380 Burstall & Beyfus (1884) 26 ChD 35 Cassidy v Murray (1995) FLC 92-633 Colgate-Palmolive Co v Cussons Pty Ltd (1993) 46 FCR 225 Dare v Pulham (1982) 148 CLR 658 Fitzgerald (as child representative for A (Legal Aid Commission of Tasmania)) v Fish and Anor (2005) 33 Fam LR 123 In the Marriage of Gould; Swire Investments Ltd (1993) FLC 92-434 In the marriage of McAlpin (1993) FLC 92-411 In the marriage of Pagliarella (No. 3) (1994) FLC 92-460 Kohan and Kohan (1993) FLC 92-340 Lenova & Lenova (Costs) [2011] FamCAFC 141 Pelerman v Pelerman (2000) FLC 93-037 Prantage v Prantage (2013) 49 Fam LR 197 Re Webster (1975) 132 CLR 270 Re Wilcox, Ex parte Venture Industries Pty Ltd (1996) 72 FCR 151 Southern & Southern [2017] FamCA 128. Stopford Malloy & Malloy (Costs) [2018] FamCAFC 6 Wayne & Dillon [2008] FamCAFC 204 Weise & Wardle (1874) L. U. Eq 171 Wilson v Church (1878) 9 ChD 552 |
| APPLICANT: | Mr Rigby |
| RESPONDENT: | Ms Kingston |
| THIRD PARTY RESPONDENTS: | Mr F Kingston (2nd) Mr G Kingston (3rd) |
| FILE NUMBER: | BRC | 12882 | of | 2016 |
| DATE DELIVERED: | 26 May 2020 |
| PLACE DELIVERED: | Brisbane |
| PLACE HEARD: | Brisbane |
| JUDGMENT OF: | Carew J |
| HEARING DATE: | 15 May 2020 |
REPRESENTATION
| COUNSEL FOR THE APPLICANT: | Dr Ingleby |
| SOLICITOR FOR THE APPLICANT: | HopgoodGanim Lawyers |
| COUNSEL FOR THE FIRST RESPONDENT: | Mr Kirk QC |
| SOLICITOR FOR THE FIRST RESPONDENT: | Hartley Healy |
| COUNSEL FOR THE THIRD PARTY RESPONDENTS: | Mr Sullivan QC with Ms Minnery |
| SOLICITOR FOR THE THIRD PARTY RESPONDENTS: | Hede Byrne & Hall |
Order
The 4th - 7th, 10th, 11th, 13th – 19th, 21st, 22nd, 24th – 26th, 27th, 28th and 31st respondents are removed as parties to the proceedings.
The obligations of the 2nd, 3rd, 8th, 9th, 12th, 20th, 23rd, 29th and 30th respondents are stayed unless and until the applicant husband complies with his obligations pursuant to paragraph 3 of the Order dated 13 December 2019.
The applicant husband is to pay the costs thrown away by the 2nd to 31st respondents in relation to the hearing on 13 December 2019 and fixed in the sum of $25,000 payable within 7 days of the completion or settlement of the substantive s 79 proceedings between the husband and wife.
Paragraphs 2(g) and 2(h) of the Further Amended Initiating Application filed 28 February 2020 are dismissed.
The following paragraphs of the husband’s affidavit filed 5 May 2020 are struck out: 23 – 27, 140 – 142, 144 – 153, 154 – 156, 214 – 224, 225 – 229, 230 – 233, 237 – 240, and 244 – 258.
The husband’s Application in a Case filed 14 May 2020 for further litigation funding is dismissed.
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 Rigby & Kingston 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 BRISBANE |
FILE NUMBER: BRC 12882 of 2016
| Mr Rigby |
Applicant
And
| Ms Kingston |
Respondent
And
Mr F Kingston & Ors
Third Party Respondents
REASONS FOR JUDGMENT
There are three interlocutory applications before the Court for determination.
The first application[1] has been brought by the 2nd to 31st respondents (“the third party respondents”) in the substantive proceedings. The second application[2] has been brought by the wife, and the third application[3] by the husband.
[1] Application in a Case filed 30 April 2020.
[2] Application in a Case filed 12 May 2020.
[3] Application in a Case filed 14 May 2020.
For reasons explained below, the application by the third party respondents to have various respondents removed as parties will be granted and the orders sought against the 27th and 28th respondents will be dismissed and they too will be removed as parties. The obligations of the remaining respondents will be stayed pending compliance by the husband with his obligation to particularise his claim against them. The third party respondents will be awarded costs in relation to the costs thrown away on 13 December 2019 fixed in the sum of $25,000. The wife’s application to strike out particular paragraphs of the husband’s affidavit of evidence in chief for the trial to commence on 1 June will be granted. Lastly, the husband’s application for further litigation funding will be dismissed.
Background
The background to this case was set out in reasons for judgment in earlier interlocutory proceedings between the husband and wife in 2017[4] as follows:
[4]Rigby & Kingston [2017] FamCA 877.
3.The parties were married in 1991 and separated on 26 October 2015 when the husband moved out of the family home and he now lives in rental accommodation. The parties disagree about whether or not they cohabited prior to the date of marriage. They have two children aged 22 and 16 respectively who live with the wife. Both parties are 52 years of age.
4.The wife is a woman of considerable wealth having been the recipient of a significant inheritance and gifts during the marriage. She was also employed full time throughout the marriage. She estimates her personal wealth at about $11,000,000. The wife is the managing director of her family business referred to in the proceedings as the Kingston Group. The Kingston Group was established by the wife’s father in 1939 and built up over his lifetime to the date of his death in 2008. He made it clear to his children that he did not want any of the wealth he created to be shared with any spouse of his children. His three children are all involved in the varied operations of the businesses and investments conducted by the Kingston Group. The wife received significant gifts from the Kingston Group over the years and has an interest with her two brothers in a testamentary trust established after her father’s death which will vest in 2040. The Kingston Group is estimated to be worth in the vicinity of $150,000,000.
5.The husband’s assets comprise savings of about $60,000, a motor cycle and superannuation of about $200,000. He contends that he owes his mother $100,000 and has outstanding legal fees of $15,000 plus unbilled legal fees of about $46,000. The husband commenced proceedings for property settlement in December 2016 in which he seeks a distribution to him of thirty-five percent of the net property of the parties or either of them.
6.The husband is a qualified professional but is unemployed other than in his own consultancy from which he earns a modest income.
7.The parties entered into a pre-nuptial agreement prior to their marriage in 1991 although it is not suggested that the terms of that agreement oust the jurisdiction of the court to make a property order if it is found to be just and equitable to do so. The agreement was intended to protect from claim by the other party any property owned at the time of the agreement; any inheritances and any property solely acquired by one party.
8.The wife argues that the parties thereafter kept their financial affairs entirely separate and maintained ledgers recording their day to day living expenses which they reconciled each month including dividing expenses for the children. On occasions when the husband was unable to meet all of his expenses the wife advanced money to him pursuant to loan agreements which the husband subsequently repaid. While the husband does not dispute the keeping of ledgers as alleged he contends that he was overborne by the wife to do so.
9.The parties have never had a joint bank account or credit card. They have never acquired property in joint names. They have never guaranteed the liabilities of the other. They were each free to spend their money and make investments as they wished.
10.The husband contends that he made substantial contributions to the improvement and conservation of property in the wife’s sole name over the years for which he was not recompensed. The wife disputes this claim and contends that any work undertaken by the husband was paid for at commercial rates.
11.At times during the marriage the husband was employed as a contractor for the Kingston Group but he contends he was underpaid. He received distributions as a discretionary beneficiary of the Kingston Group in order to minimise taxation for the Group and contends that he gave any such distributions to the wife save for the last distribution of $55,000 in 2015. The wife contends the distributions were made as a tax effective means of the husband repaying loans she had advanced to him.
12.The wife contends that while she always lived to a budget and was generally quite frugal the husband spent money as he earned it and made no savings or provision for his future. This did not concern her at the time given the agreement which they had reached prior to their marriage and to which she contends they both adhered.
13.In 2007 the husband commenced his own consultancy business in which he worked part time so that he could attend to the needs of the children and the household enabling the wife to pursue her career within the Kingston Group. The wife rejects this contention. She contends that despite the husband working part time she continued to undertake the majority of household tasks until a cleaner and gardener were employed and she also contends that they shared the parenting responsibilities. She describes the husband as having a “lazy work ethic”.
14.The husband contends that he is unable to support himself adequately and that he has been actively seeking employment since May 2016.
15.Since separation the husband has received $150,000 from the wife in three tranches (early 2016, 23 August 2016 and 11 November 2016). The husband expended $50,000 on a trip to Denmark in early 2016, $30,000 on legal fees and the balance on his own support.
16.The husband has sought disclosure from the wife in relation to her interests in the Kingston Group. The wife resists that disclosure on the basis that she has not been granted permission to disclose the information which is not hers to provide. She has invited the husband to subpoena the various entities to obtain the documents and submits that if the documents are considered relevant they can be obtained from those entities.
As a result of the earlier interlocutory proceedings, the wife was ordered to pay the husband a sum of $135,000 for his future legal costs (pursuant to the costs power in s 117 of the Family Law Act 1975 (Cth) (“the Act”)). The husband’s application for interim spouse maintenance was dismissed. The husband and wife were granted leave to inspect and copy documents produced pursuant to a subpoena issued at the husband’s request to various entities making up the Kingston Group, who later became the third party respondents.
On 3 May 2019, the husband filed an Application in a Case seeking leave to join the third party respondents. The joinder was opposed by the third party respondents who had informed the husband, prior to him filing his application, that should he wish to join them he should deliver a pleading (Points of Claim) setting out the basis for the joinder. Prior to the hearing of that Application, the husband simply amended his Initiating Application on 3 December 2019 and added the third party respondents as respondents to the proceedings purportedly pursuant to r 6.03 of the Family Law Rules 2004 (Cth) (“the Rules”).
In further interlocutory proceedings[5] heard late last year, the parties consented to an order on 13 December 2019 which included the following:
[5]Rigby & Kingston [2020] FamCA 8 (“Rigby”).
2.That paragraphs 7 and 8 of the applicant’s Amended Application in a Case[6] in so far as it applies to respondents 2 to 5, 7 to 9 and 11 – 31 (“the third party respondents”) be adjourned.
[6] Relating to the appointment of a single expert to value the wife’s interests in various property.
3. That by 28 February 2020 the applicant:
(a)File and serve an Amended Initiating Application setting out with precision the precise orders sought on a final basis against each of the proposed third party respondents; and
(b)File and serve a Points of Claim document, pleading the contentions of fact and law, with specific reference to the particular provisions of the Family Law Act 1975 (Cth) relied upon as grounds for the relief sought by the applicant against each of the third party respondents in the Amended Initiating Application to be filed pursuant to subsection (a) and identifying, with reference to filed affidavits (including paragraph numbers in those affidavits), the contentions of fact to support each particular ground of relief.
4.That any obligation of the third party respondents as a party to these proceedings including any obligation as to disclosure be stayed until the later of:
(a) 30 April 2020; or
(b)In the event an application for summary dismissal, disjoinder or for a further stay is filed by any of the third party respondents prior to 30 April 2020, the determination of that application.
Additionally, on the husband’s application for further litigation funding, a ‘dollar for dollar’ order was made on 14 January 2020 which required the wife to pay to the husband’s solicitors an equivalent sum to any paid by her to her own lawyers. The order did not extend to proceedings involving the husband and the third party respondents other than for a sum of $10,000 which the wife consented to pay. The reasons for limiting the litigation funding order to proceedings involving the husband and wife were explained in my reasons (14 January 2020)[7] and included the following:
14. … I am not at this stage persuaded that the circumstances justify an order for the wife to pay the husband’s costs of pursuing a claim against third parties, particularly where the basis for that claim is yet to be particularised.
[7]Rigby (n. 5).
My reasons also updated the background to the case including the following:
7.Since the matter was last before me in 2017, the wife has revised the estimated worth of her personal assets to $7.3 million and the husband has obtained employment with a taxable income for the 2019 financial year of $113,144.
…
11..... The initial trial dates[8] have been allocated for the hearing of evidence relevant to the question of ten issues identified with the assistance of the husband and wife and will not involve the third parties. It is anticipated that the ability to cross-examine each party and any witnesses relied upon will enhance the prospect of the matter being able to proceed to resolution, but of course that cannot be guaranteed.
[8] Pursuant to r 16.04(c) of the Family Law Rules 2004 (Cth) the matter was listed for a series of dates for trial commencing 1 June 2020 for 4 days and pursuant to r 11.01 the initial dates for trial are for the hearing of evidence and cross-examination of witnesses in relation to the factual issues identified with the assistance of the parties in Notation A to the order made 13 December 2019.
The ten issues identified with the assistance of the husband and wife are as follows:
(1)Did the parties conduct their financial arrangements during the marriage in accordance with the pre-nuptial agreement of 1991 and/or the financial agreement between them that they keep their finances totally separate, with all expenses being referred to in 1 shared equally?
(2)If the parties did conduct their financial arrangements in accordance with the agreement was the husband overborne by the wife to do so?
(3)Did the husband make substantial contributions of any nature recognised by the Family Law Act 1975 (Cth) to the improvement and conservation of property in the wife’s sole name over the years for which he was not recompensed?
(4)Was the husband underpaid for the work he did when employed as a contractor for the Kingston Group?
(5)Were the distributions made to the husband as a discretionary beneficiary of the Ms Kingston Trust made in order to minimise tax for the wife or the family constituted by the husband, the wife and their children or were the distributions made as a tax effective means of the husband repaying loans the wife had made to him?
a.Were the “loans” described in (5) in truth made and did the husband agree to borrow?
(6)Did the husband commence part time employment and then later his own consultancy which afforded him the opportunity to work less than full time hours in 2007 in order to enable him to meet the needs of the children?
(7)Did the contributions of the husband as homemaker and parent exceed those of the wife as homemaker and parent and were there periods he fulfilled a role of primary homemaker and/or parent and thereby indirectly contributed to the financial contributions being made by the wife?
(8)What were the contributions by the wife to the Kingston Group and how was she recompensed for her employment?
(9)What were the financial contributions of the husband during the relationship?
(10)What were the financial contributions of the wife during the relationship?
On 28 February 2020, the husband filed a Further Amended Initiating Application and Points of Claim.
Applications by the third party respondents
Removal of certain third party respondents as parties
The third party respondents submit that the 4th - 7th, 10th, 11th, 13th – 19th, 21st, 22nd, 24th – 26th and 31st respondents (“the identified respondents”) should be removed as parties to the proceedings as “no arguable case exists against these entities for Part VIIIAA relief” and that these respondents have been joined for the “impermissible purpose of making them subject to interparty discovery”.
A person, including an entity, “whose rights may be directly affected by an issue in a case, and whose participation as a party is necessary for the court to determine all issues in dispute in the case, must be included as a party to the case”.[9] An example is given in the legislation immediately after this rule in the following terms:
If a party seeks an order of a kind mentioned in section 90AE or 90AF of the Act, a third party who will be bound by the order must be joined as a respondent to the case.
[9] Family Law Rules 2004 (Cth), r 6.02(1).
While no submissions were directly made on the effect of this ‘example’, the substance of the argument by the third party respondents is that the husband has failed to establish the essential requirements to justify the joinder of a party, namely, how the identified respondents’ rights may be directly affected and that their participation is necessary.
In Wayne & Dillon,[10] Warnick J (sitting in the appellate division) said:[11]
17. … any person joined to a proceeding ought, at that point, be able to take advice on whether the facts pleaded (if established) would lead to a successful claim. Joinder to litigation is a serious step with often significant financial consequences.
[10] [2008] FamCAFC 204.
[11] Ibid at [17].
In B Pty Ltd v Ors & K and Anor,[12] the Full Court (Faulk DCJ, Coleman and Warnick JJ) allowed an appeal by third parties concerned with relief sought under Part VIIIAA of the Act and said:
52. We do not accept that it is proper to allow joinder of third parties merely upon the formulation of a paragraph in, or to be added to, an application, on the basis that at trial facts to support the application may be asserted and proved. Sufficient facts must be asserted to demonstrate that, if proved, the law arguably provides the relief sought.
[12] (2008) FLC 93-380; see also In the Marriage of Gould: Swire Investments Ltd (1993) FLC 92-434; Southern & Southern [2017] FamCA 128.
In the context of the applications currently before the Court, it is useful to note that the object of Part VIIIAA of the Act is to allow the Court, in relation to the property of a party to a marriage, to:
a)make an order under ss 79 or 114; or
b)grant an injunction under s 114;
that is directed to, or alters the rights, liabilities or property interests of a third party (s 90AA).
Part VIIIAA has potentially far reaching scope and can override other laws, trust deeds, or other instruments (s 90AC).
The substantive application in this case, between the husband and wife, involves proceedings under s 79 of the Act, and in appropriate circumstances a court may make a variety of orders including:
a)An order directed to a director of a company or to a company to register a transfer of shares from one party to the marriage to the other party (s 90AE (1)(d));
b)An order that directs a third party to do a thing in relation to the property of a party to the marriage (s 90AE(2)(a)); or
c)An order that alters the rights, liabilities or property interests of a third party in relation to the marriage (s 90AE(2)(b)).
There are significant pre-conditions and limitations to the exercise of the powers (s 90AE(3)) including that the Court may only make an order under s 90AE(1) or (2) if:
a)The making of the order is reasonably necessary, or reasonably appropriate and adapted, to effect a division of property between the parties to the marriage;
b)If the order concerns a debt of a party to the marriage it is not foreseeable at the time that the order is made that to make the order would result in the debt not being paid in full;
c)The third party has been accorded procedural fairness in relation to the making of the order;
d)The Court is satisfied that, in all the circumstances, it is just and equitable to make the order; and
e)The Court is satisfied that the order takes into account the matters mentioned in subsection (4).
The matters in s 90AE(4) are as follows:
a)The taxation effect (if any) of the order on the parties to the marriage;
b)The taxation effect (if any) of the order on the third party;
c)The social security effect (if any) of the order on the parties to the marriage;
d)The third party's administrative costs in relation to the order;
e)If the order concerns a debt of a party to the marriage, the capacity of a party to the marriage to repay the debt after the order is made;
f)The economic, legal or other capacity of the third party to comply with the order;
g)If, as a result of the third party being accorded procedural fairness in relation to the making of the order, the third party raises any other matters, those matters;
h)Any other matter that the Court considers relevant.
Similarly, in proceedings under s 114 of the Act (injunctive relief), the Court may make a variety of orders or grant injunctions including:
a)Directing a third party to do a thing in relation to the property of a party to the marriage (90AF(2)(a)); or
b)Altering the rights, liabilities or property interests of a third party in relation to the marriage (90AF(2)(b)).
There are significant pre-conditions and limitations to the exercise of the powers (s 90AF(3)) including that a court may only make an order under s 90AF(1) or (2) if:
a)The making of the order is reasonably necessary, or reasonably appropriate and adapted, to effect a division of property between the parties to the marriage;
b)If the order or injunction concerns a debt of a party to the marriage--it is not foreseeable at the time that the order is made, or the injunction granted, that to make the order or grant the injunction would result in the debt not being paid in full;
c)The third party has been accorded procedural fairness in relation to the making of the order or injunction;
d)For an injunction or order under subsection 114(1) – the Court is satisfied that, in all the circumstances, it is proper to make the order or grant the injunction;
e)For an injunction or order under subsection 114(3) – the Court is satisfied that, in all the circumstances, it is just and convenient to make the order or grant the injunction;
f)For an injunction under subsection 114(3) – the Court is satisfied that, in all the circumstances it is just or convenient to grant the injunction; and
g)The Court is satisfied that the order takes into account the matters mentioned in subsection (4).
The matters in s 90AF(4) are as follows:
a)The taxation effect (if any) of the order or injunction on the parties to the marriage;
b)The taxation effect (if any) of the order or injunction on the third party;
c)The social security effect (if any) of the order or injunction on the parties to the marriage;
d)The third party's administrative costs in relation to the order or injunction;
e)If the order or injunction concerns a debt of a party to the marriage, the capacity of a party to the marriage to repay the debt after the order is made;
f)The economic, legal or other capacity of the third party to comply with the order or injunction;
g)If, as a result of the third party being accorded procedural fairness in relation to the making of the order or injunction, the third party raises any other matters, those matters;
h)Any other matter that the Court considers relevant.
The third party respondents were added as parties to the proceedings by the husband filing an Amended Initiating Application on 3 December 2019 relying upon r 6.03 of the Rules. No orders were sought in that Amended Initiating Application against the identified respondents.
The husband filed a Further Amended Initiating Application on 28 February 2020 and included two additional paragraphs to the final orders sought, purportedly to overcome the failure, up to that point, of seeking any relief against the identified respondents. The relief sought against the identified respondents is expressed as follows:
[In circumstances where the Court accedes to the husband’s application for an acceleration of the vesting date of the trusts of the Kingston Group as sought by paragraphs 1 – 4 of the application and in circumstances where the identified respondents are not mentioned in paragraphs 1 – 4]
5. That to give effect to paragraph 4 and in accordance with sections 90AE and 90AF of the Family Law Act 1975, the 2nd to 31st Respondents do all acts and things to effect a payment to the husband of 35% of the net property of the Applicant and Respondent Wife including but not limited to:
a) Distribution of capital and/or income;
b) transfer, sell, encumber or otherwise deal with property;
As identified by the Honourable Court.
In the alternative to the orders sought in paragraphs 1 – 5 of that Application, if the vesting date of the trusts is not accelerated, the husband seeks to set aside the ‘umbrella deed’[13] pursuant to s 106B of the Act and to adjourn the property proceedings pending the vesting of the Kingston Testamentary Trust. Upon an account being taken of the property, liabilities, and financial resources of the parties the husband seeks an order that he receive 35%. There follows an identical provision to paragraph 5 in the Application.
[13] The ‘umbrella deed’ refers to a deed entered into the wife and her two brothers, Mr F Kingston (2nd respondent) and Mr G Kingston (3rd respondent) on 13 February 2014 which among other things amended the ‘cessation date’ or what is referred to in these proceedings as the ‘vesting date’ from 2026 to 2040.
The third party respondents submit that the relief sought by the husband “amounts to a nebulous assertion of engagement of power with no particularity beyond the seeking of orders to vest certain trusts” and it does not set out with precision the order sought against each identified respondent.
The third party respondents further submit the husband’s pleading, i.e. the Points of Claim document, fails to set out any “proper factual basis” for the joinder of the identified respondents under Part VIIIAA. For example:
a)The identified respondents are not trustees (so as to be arguably affected by the vesting order sought by the husband in relation to trusts);
b)It is not pleaded that the wife has any equitable interest in the assets of the entities;
c)Shares in the identified respondents are sometimes, but not in every case, pleaded to be held by the wife; and
d)Some shares are pleaded to be held by trust entities in other entities.
The third party respondents are correct to submit, and it is not in contention, that “a shareholder does not by its shareholding have a legal or equitable interest in the assets of the corporate entity. The property interest it has is in the shares”. As Barwick J in Re Webster[14] said:
… under the general law it is well established that a shareholder does not have any legal or equitable interest in the assets… of the company. Even where a shareholder owned almost all the shares of a company, he had no legal or equitable right or interest in the company’s assets.
(citations omitted)
[14] (1975) 132 CLR 270 at 287.
The very point of pleadings is to enlighten a party as to the case they will meet at trial. As the High Court said in Dare v Pulham[15] (Murphy, Wilson, Brennan, Deane and Dawson JJs writing jointly):
Pleadings and particulars have a number of functions: they furnish a statement of the case sufficiently clear to allow the other party a fair opportunity to meet it …; they define the issues for decision in the litigation and thereby enable the relevance and admissibility of evidence to be determined at the trial …; and they give a defendant an understanding of a plaintiff's claim in aid of the defendant's right to make a payment into court. Apart from cases where the parties choose to disregard the pleadings and to fight the case on issues chosen at the trial, the relief which may be granted to a party must be founded on the pleadings…
(citations omitted)
[15](1982) 148 CLR 658 at 664.
Consistent with the requirements of ss 90AE and/or 90AF the husband must identify:
a)What it is that the husband seeks of each third party; or
b)What rights, liabilities or property interests of each third party the husband seeks to alter; and
c)Why is the order or injunction reasonably necessary; or
d)In what way is the order or injunction sought by the husband against each third party reasonably appropriate and adapted to effect a division of property between the parties to the marriage; and
e)How is the order or injunction proposed by the husband just and equitable or proper or just and convenient.
It is only when those matters are apparent the third party respondents will be able to provide evidence of such matters as are required by ss 90AE and/or 90AF, for example:
a)The taxation effect (if any) of the order or injunction on each third party;
b)The third party’s administrative costs in relation to the order or injunction;
c)The economic, legal or other capacity of each third party to comply with the order or injunction; and
d)Any other matter raised.
The Further Amended Initiating Application filed by the husband on 28 February 2020 does not set out with precision the order sought against each identified respondent nor do the Points of Claim plead the material facts upon which any relief sought against them is dependent.
The Points of Claim includes the following paragraphs:
…
51. By reason of the absence of disclosure, the Husband is:
a. …;
b. unable to limit the range of entities in the Kingston Group who are required to be Respondents to his claim.
…
84. If the Husband were able to isolate a particular entity which owned sufficient monies to realise the amount required to satisfy his order pursuant to section 79 of the Act, then he would be better-placed to confine the relief sought pursuant to sections 90AE and/ (sic) 90AF could be confined to a particular entity – or limited number of entities.
85. The absence of disclosure prevents the Husband from confining the scope of relief sought.
86. Accordingly, the relief sought in the Further Amended Initiating Application filed 28 February 2020 is unable to be further particularised as required by the order dated 13 December 2019 until disclosure from the 2nd to 31st Respondents is received.
It is difficult to interpret the above paragraphs as anything other than a concession by the husband that he has not fulfilled his obligations (including under the order consented to by him on 13 December 2019) to state precisely the orders sought and set out in a pleading the proper basis for joinder. While he offers a reason for that, i.e. the absence of disclosure, I accept the third party respondents’ submission that the proper time for making that argument was prior to the order being made. In oral submissions the husband conceded that “no specific particularised relief is sought” but then took issue with the submission by the third party respondents that “no arguable case exists for Part VIIIAA relief”. Rather unconvincingly, the husband submitted that “[o]rders may well be required. Orders may well be reasonably necessary or reasonably appropriate against those entities”.
In defending his failure to comply with the obligations he consented to on 13 December 2019, the husband argues that the third party respondents have been “so successful in resisting disclosure”. The third party respondents deny that allegation. The only evidence in relation to disclosure relates to a failed application by the husband against the wife who was found not to have possession or control of the documents sought to be disclosed. The husband, however, successfully subpoenaed the third party respondents (prior to them being joined as parties) to produce documents, which they did.
The husband also submitted:
… there needs to be a valuation of the wife’s one-third interest in the group, and there needs to be proper accounting evidence as to the implication of particular orders, and there needs to be the opportunity for the requirements of s 90AE to be fulfilled. There’s no alternative other than joinder that meets those aims. There’s certainly no alternative other than joinder that has been offered by the third parties … [w]hat’s required to happen for this case to proceed properly is joinder, then disclosure, then specificity …
…until we have disclosure, we will not know how to particularise our claim. … All I know is that there’s lots of trusts. There’s lots of corporate entities who own property … but I don’t know what are the arrangements between those corporate entities. … I don’t know how to formulate my claim
…[w]hen we have specific particularised discovery of what those respondents own, the value of it, the net value of it, we will be able to specify particularised final relief.
The third party respondents submit that joining a party for the sole purpose of discovery is an abuse of process and an “impermissible purpose”.
In support of this submission, the third party respondents refer to a number of authorities including Southern & Southern[16] where Hogan J said:
9. … the fact that disclosure may be more efficiently obtained does not of itself provide an appropriate basis for joinder as a party to proceedings.
[16] [2017] FamCA 128.
Additionally, reliance is placed upon Adsteam Building Industries Pty Ltd v Old Cement and Lime Co[17] where McPherson J said:
It was suggested that the applicant defendants may have been joined in the action with a view to enabling Adsteam to obtain discovery from them, and for no other purpose. In view of my preceding conclusion it is not necessary to determine whether or not that was the, or even a, purpose. There is authority for saying that in some circumstances an action may be brought simply for the purpose of obtaining discovery: see Norwich Pharmacal Co v Customs s Excise Commissioners [1974] AC 133. That was a case in which discovery was required in order to identify a potential defendant. In that regard no difficulty exists in the present case; but, in any event, it is not appropriate that the scope of that decision be explored here because, although the Norwich case was referred to in passing in the course of the submissions, no attempt was made to found any submission upon it. Generally, it is not possible to join a party as defendant to an action simply for the purpose of obtaining discovery or costs against him: see Weise v Wardie (1874) L. U. 19 Eq 171; Burstall v Beyfus (1884) 26 ChD 35, 40–41; Wilson v Church (1878) 9 ChD 552; and, as the latter decision shows, the proper course, where no relief is claimed in which a particular defendant is interested, is to strike out the defendant in question.
That is the course that I propose to follow here. For the reasons given, the names of the defendants Holderbank, Holfin and S G.I.O will be struck out of this action.
[17] (Unreported, Supreme Court of Queensland, McPherson J, 16 July 1984) at [10].
The three authorities cited by McPherson J above contain clear statements that joining a party for the sole purpose of obtaining discovery (or in one case, costs) is improper if not vexatious.[18] Lastly, reference is made to Wayne & Dillon[19] where Warnick J allowed an appeal against the joinder of a third party holding that joining a party to overcome difficulties with disclosure was an error.
[18] Weise & Wardle (1874) L. U. Eq 171 per Jessel MR; Burstall v Beyfus (1884) 26 ChD 35 at 41 per Earl of Selborne L.C. and Cotton LJ at 42; Wilson v Church (1878) 9 ChD 552 per Jessel M. R. at 557.
[19][2008] FamCAFC 204 at [39] – [41].
I accept the submissions made by the third party respondents and find that the identified respondents were joined for an improper purpose.
The identified respondents will be removed as parties. This does not exclude their rejoinder if the husband is able to establish a proper basis.
Summary dismissal of ‘claim’ against the 27th and 28th third party respondents and removal as parties
The 27th respondent is the corporate trustee of the Kingston Group of Companies Super Fund and the 28th respondent is the trustee of the Kingston Pty Ltd Super Fund. The third party respondents submit that the claim against the 27th and 28th respondents should be dismissed summarily as there is no reasonable prospect of success against them.[20] Further, or in the alternative, that they should be removed as parties in the litigation.
[20] Family Law Rules 2004 (Cth), r 10.12(d); see also Pelerman v Pelerman (2000) FLC 93-037 at 87,582 [46] as to the applicable principles.
The order sought against the 27th and 28th respondents is contained in the husband’s Further Amended Initiating Application filed 28 February 2020 as follows:
2. That the following trustees of the said trust each exercise its powers of the said trust to appoint the date which is 90 days from the date of this Order as the vesting date for the said trust:
a) …
…
g) T Pty Ltd ACN … (as Trustee of the Kingston Group Super Fund);
h) T Pty Ltd ACN … (as Trustee of the Kingston Pty Ltd Super Fund);
It is uncontentious that the wife’s member accounts within the superannuation funds “are property of the parties to the marriage”. The third party respondents submit that “[i]t is not necessary to vest the funds where a roll out of the Wife’s interests would be sufficient in all the circumstances”.
The husband concedes that the third party respondents have “a stronger argument in relation to the superannuation funds” but seeks to resist the application because he does not “know with precision what the relationship is between those superannuation funds and the rest of the group”.
Part VIIIB of the Act allows a member’s benefit in a superannuation fund to be “split” with the other party to the marriage (s 90XT). A superannuation interest is treated as property for the purposes of paragraph (ca) of the definition of matrimonial cause in s 4 of the Act (s 90XC). Where a splitting order is made, the trustee of the superannuation fund will be bound by the order subject to their being accorded procedural fairness (s 90XZD and r 14.06 of the Rules).
In my view, the husband has no reasonable prospect of success in relation to the order sought against the 27th and 28th respondents given the provisions of the Act which permit a roll out of the wife’s member benefits. Accordingly, paragraphs 2(g) and 2(h) of the husband’s Further Amended Initiating Application will be dismissed and the 27th and 28th respondents will be removed as parties.
Stay of obligations against remaining third party respondents
As to the remaining third party respondents (i.e. other than the ‘identified respondents’ and the 27th and 28th respondents), the third party respondents seek a continuation of the stay granted by consent on 13 December 2019 (see paragraph 4 of the order made 13 December 2019 set out in paragraph 7 above), until the husband complies with his obligations to state with precision the order sought against each of them and pleads a factual basis to support the orders ultimately sought.
Many of the matters discussed above in relation to the application to remove the identified respondents are relevant to this application as well and I will not repeat them.
It is argued by the third party respondents that the “sole basis the husband proffers to interfere with the property rights of 30 third parties is that he says the Wife has an interest in the group and the group must ‘distribute the trust fund and income’ equally between the wife and her two brothers”. The third party respondents submit that they “still do not know the case they face”.
The husband submits that if the Court ultimately finds that it is just and equitable to make a property adjustment order in favour of the husband, there will be insufficient property in the wife’s name to achieve that outcome. He gives by way of example the wife’s asserted value of property in her own name of about $7,500,000 whereas her interest in the Kingston Group may be in the vicinity of $50,000,000. If the husband were to succeed in his claim for 35% or even a lesser percentage, orders will be necessary against the third party respondents.
While the husband may ultimately be correct that the rights of each third party respondent may be directly affected by an issue in the case and that their participation is necessary for the Court to determine all issues in dispute in the case, he has not established that to be the case at this point.
The husband’s concession that he is unable to plead his case until he has obtained disclosure supports the third party respondents’ case that the husband has failed to comply with his obligations set out in the order made on 13 December 2019.
The third party respondents raise a further matter in support of their submission that the husband’s pleading is deficient, namely, that on 13 December 2019 it was made clear that depending upon the precise orders sought against the third party respondents, “constitutional law questions necessitating the participation of the Attorneys-General of the Commonwealth or of the States may be argued. This pleading was meant to provide the specificity to allow those considerations to be made. It hasn’t”. This further demonstrates the need for precision and particulars of the case the third party respondents have to meet.
With the consent of the third party respondents, the husband will nevertheless have a further opportunity to state with precision the order sought against each of the remaining third party respondents and to plead the factual basis to support the orders sought.
Costs of the third party respondents responding to the husband’s Amended Application in a Case filed 3 May 2019
The third party respondents seek an order that the husband pay their costs of responding to the husband’s Amended Application in a Case filed 3 May 2019 on an indemnity basis ($92,645.45) or, in the alternative, on a party and party basis ($67,934.07).
The order made on 13 December 2019 included the following:
20. The application by the third party respondents for the costs thrown away for today’s hearing be reserved to the first day of the initial trial dates on 1 June 2020, with liberty to argue the issue of costs if the matter comes before the Honourable Justice Carew at any time prior to 1 June 2020 and upon the delivery of a schedule of costs to the solicitors for the husband.
The affidavit of the third party respondents’ solicitor filed 13 May 2020 attaches the schedule of costs on an indemnity and standard basis. While the third party respondents and the husband each made oral submissions on 15 May 2020, the husband was accorded an opportunity to file further written submissions addressing the issue of quantum and he did so on 22 May 2020.
The basis for the claim for costs can be summarised as follows:
a)The third party respondents pointed out to the husband as early as 1 May 2019 that if he proposed to join them he would need to particularise the final orders sought against each of them and the legal and factual basis for the relief sought;
b)The husband was informed that a pleading would be necessary, consistent with Court practice in such circumstances;
c)That a pleading would be required was acknowledged by the husband as early as 2016 in his costs agreement with his solicitor;
d)The husband initially sought to join the third party respondents without seeking any final relief against them but for an improper purpose i.e. disclosure;
e)The husband’s initial Application in a Case seeking leave to join the third parties was replaced two days before the due date for submissions for the hearing on 13 December 2019 by an Amended Initiating Application naming the third party respondents, thereby “amplif[ying]” the costs incurred by the third party respondents;
f)The husband ultimately conceded the points made by the third party respondents and consented to the order made on 13 December 2019 requiring precise orders against each third party respondent and a pleading setting out the contentions of fact and law upon which the husband relies; and
g)Properly advised, the husband must have known he was required to properly articulate what final relief was sought and particularise his case. This circumstance and the late concessions ultimately made by the husband are said to justify a costs order on an indemnity basis.
In oral submissions, the third party respondents clarified the basis of the claim for costs stating – “Our submission at the time was that the whole day was thrown away and unnecessary because [the husband] didn’t do what we requested [him] to do on 1 May, and ultimately, that what [he] in part did, but agreed to do by those orders [on 13 December 2019]”.
In his oral submissions, the husband submitted - “If your Honour were to make a costs order in these circumstances, you would simply be making the husband pay for the non-disclosure of the wife. … The wife is a director of the companies. It simply beggars belief that she couldn’t simply ask her brothers for their consent to let valuers in and let me have access to documents. In due course they will answer to that, but until there has been a proper examination of the circumstances giving rise to the need for documents, your Honour should not entertain the application. It’s a premature application in circumstances where all the application sought was for disclosure to be given to valuers and experts…. [The] December application was part of a general course of litigation”.
The husband’s further written submission exceed the limited basis upon which he was given leave to file them, i.e. in relation to the quantum sought, but in any event, he submits that the question of costs as sought by the third party respondents should be reserved “until the role of the 2nd to 31st respondents has been confirmed by the Court”. If the costs are not reserved, the husband submits that costs should be assessed on scale and the payment “adjourned until after the final property settlement order is made in this matter”. As to the quantum claimed by the third party respondents, the following submissions are made:
a)The husband is impecunious and has no capacity to pay a costs order;
b)The costs claimed for junior counsel (in addition to Queen’s Counsel) should not be allowed because:
i)The complexity of the matter “at that time” does not justify two experienced counsel to be instructed particularly noting that the husband and wife each only have one counsel;
c)The schedule of costs includes work done that “is part of their general participation in the proceedings” and “do not properly form part of the alleged costs thrown away”; and
d)Lastly, the travelling charges for instructing solicitor to travel to Brisbane for the directions hearing in June 2019 was unnecessary where leave was provided to appear by telephone.
How costs applications are determined
Parties in this jurisdiction generally bear their own costs (s 117(1) of the Act) but the Court has a wide discretion to make such order as to costs as the Court considers just where there are circumstances that justify it in doing so (s 117(2)) It is not in contention that costs can be awarded against a non-party.[21]
[21] In the marriage of McAlpin (1993) FLC 92-411 at 80,215; see also Cassidy v Murray (1995) FLC 92-633 at 82,365, In the marriage of Pagliarella (No. 3) (1994) FLC 92-460 at 80,756 (citing the High Court in Knight v FP Special Assets Ltd (1992) 174 CLR 178 at 192 – 193).
In exercising the discretion to make a costs order the following factors must be taken into account, where relevant (s 117(2A)):
a)the financial circumstances of each of the parties to the proceedings;
b)whether any party to the proceedings is in receipt of assistance by way of legal aid and, if so, the terms of the grant of that assistance to that party;
c)the conduct of the parties to the proceedings in relation to the proceedings including, without limiting the generality of the foregoing, the conduct of the parties in relation to pleadings, particulars, discovery, inspection, directions to answer questions, admissions of facts, production of documents and similar matters;
d)whether the proceedings were necessitated by the failure of a party to the proceedings to comply with previous orders of the Court;
e)whether any party to the proceedings has been wholly unsuccessful in the proceedings;
f)whether either party to the proceedings has made an offer in writing to the other party to the proceedings to settle the proceedings and the terms of any such offer; and
g)such other matters as the Court considers relevant.
It is sufficient for one factor in s 117(2A) to be present.[22]
[22] Fitzgerald (as child representative for A (Legal Aid Commission of Tasmania)) v Fish and Anor (2005) 33 Fam LR 123.
A court will not lightly make an order for costs to be paid on an indemnity basis. There needs to be some circumstance of an exceptional kind to justify that course.[23]
[23] Kohan and Kohan (1993) FLC 92-340 at 79,614; Colgate-Palmolive Co v Cussons Pty Ltd (1993) 46 FCR 225 at 233 (“Colgate-Palmolive”).
Rule 19.08(3) requires the terms of any costs agreement to be disclosed when indemnity costs are sought.
In Re Wilcox, Ex parte Venture Industries Pty Ltd[24] the Full Court of the Federal Court per Cooper & Merkel JJ said:
[24] (1996) 72 FCR 151 at 156 – 157.
The issue whether costs should be ordered on a party and party basis or on an indemnity basis has acquired increasingly greater significance as the gap between the two bases appears to have grown.
The gap has highlighted the conflict between two seemingly irreconcilable objectives. The first is protecting access to justice by only exposing an unsuccessful litigant in the usual course to an order for scale costs on a party and party basis. The second is relieving a successful litigant from the burden of costs which that litigant should not have been required to incur. These and other policy factors have been considered by the courts over a very long period in order to arrive at the principles which govern the undoubted discretion of courts to depart from ordering costs on a party and party basis and ordering costs on an indemnity basis. The principles were stated by Sheppard J in Colgate-Palmolive Co v Cussons Pty Ltd [1993] FCA 536; (1993) 46 FCR 225.
The Full Court (per Cooper and Merkel JJ) went on to restate the principles from Colgate-Palmolive as follows: [25]
[25]Colgate-Palmolive (n 23) at 156 – 157.
(a)the Court ought not to depart from the rule that costs be ordered on a party and party basis unless the circumstances of the case warrant the Court in departing from the usual course;
(b)the circumstances which may warrant departure from the usual course arise as and when the justice of the case so requires or where there may be some special or unusual feature in the case to justify the Court in departing from the usual course;
(c)whilst the circumstances in cases in which indemnity costs have been ordered offer a guide, the question must always be whether the particular facts and circumstances of the case in question warrant the making of an order for costs other than on a party and party basis.
While the categories of cases in which an indemnity costs order may be awarded are not closed, indemnity costs may be ordered where a case was pursued with “wilful disregard of known facts or clearly established law”.[26]
[26] Ibid at 233.
The explanatory guide to the Rules provides a useful definition of costs on an “indemnity basis”, namely: [27]
[27]Prantage v Prantage (2013) 49 Fam LR 197 at 200.
[A]n entitlement to costs, including costs under a costs agreement, for all costs incurred, other than costs that are unreasonable in amount or that have been incurred unreasonably.
Rule 19.18 empowers the Court, when awarding costs, to make an order for costs:
a)of a specific amount;
b)as assessed on a particular basis (e.g. lawyer and client, party/party or indemnity);
c)to be calculated in accordance with the method stated in the order; or
d)for part of the case, or part of an amount assessed in accordance with Schedule 3.
In considering what specific order should be made, the same rule provides that the Court may consider any of the following factors:
a)the importance, complexity or difficulty of the issues;
b)the reasonableness of each party’s behaviour in the case;
c)the rates ordinarily payable to lawyers in comparable cases;
d)whether a lawyer’s conduct has been improper or unreasonable;
e)the time properly spent on the case, or in complying with pre-action procedures; and
f)expenses properly paid or payable.
Discussion – costs
I am not persuaded that the circumstances of this case are exceptional and warrant an award of costs on an indemnity basis. In any event, the costs agreements are not before me.
There is no doubt that the disparity of financial positions between the third party respondents and the husband are stark. The husband is employed as a company director/management consultant and deposes to earning an income of $93,600 per annum. His expenses almost exceed his income. It is submitted that the husband has no capacity to pay a costs order, but that alone is not a basis to refuse the application.[28]
[28]Lenova & Lenova (Costs) [2011] FamCAFC 141.
The most significant factor favouring a costs order is that the husband did not concede the point, raised by the third party respondents as early as 1 May 2019, until the hearing on 13 December 2019. On that date he consented to an order requiring him to particularise the orders sought against each of the third party respondents and to file a pleading. He further consented to adjourning those parts of his application which sought the appointment of a single expert. The third party respondents are in my view entitled to the costs thrown away including by having to respond to the husband’s initial application filed 3 May 2019 which sought, among other things, to join the third party respondents as parties; and preparing submissions in support of the orders ultimately agreed to by the husband; and retaining Queen’s Counsel for the attendance at court on 13 December 2019.
The Full Court has repeatedly encouraged the fixing of a lump sum costs order rather than causing the parties to incur further costs in assessment of costs.[29] I have the advantage in this case of a detailed schedule of costs prepared by the solicitor for the third party respondents. It is immediately apparent that the schedule extends beyond the claim for costs thrown away. In the circumstances of this case, I consider that an award of costs against the husband fixed in the sum of $25,000 is just and will so order. The husband will be required to pay those costs within 7 days of completion of the substantive s 79 proceedings between the husband and wife.
[29] See for example Stopford Malloy & Malloy (Costs) [2018] FamCAFC 6 per Thackray, Strickland & Murphy JJ at [10] – [13].
Application by the wife – strike out evidence
The wife seeks to strike out particular paragraphs of the husband’s affidavit filed 5 May 2020 on the ground that they are not relevant to any of the issues listed for the first series of trial dates commencing on 1 June 2020.
As noted above, on 13 December 2019 and pursuant to r 16.04(c) of the Rules this matter was listed for a series of dates for trial commencing 1 June 2020 for 4 days, and pursuant to r 11.01 the initial dates for trial are for the hearing of evidence and cross-examination of witnesses in relation to the factual issues identified with the assistance of the parties in Notation A to the order made 13 December 2019 (see [5] and [6] of the order). The said factual issues are set out in paragraph 10 above.
Each of the husband and wife were permitted to file one supplementary affidavit of evidence in chief by themselves and any witness upon which they intend to rely, incorporating within the affidavit a list of paragraphs and annexures to earlier affidavits filed and to be relied upon at trial commencing on 1 June 2020 (see [11] and [12] of the order). The husband was also permitted to file an affidavit strictly in reply (see [13] of the order).
The particular paragraphs objected to by the wife and the topics which the paragraphs address are as follows:
a)23 – 27 Cohabitation, general living arrangements and de facto checklist;
b)140 – 142, 144 - 153 Husband’s relationship with the children post October 2013;
c)154 – 156 Lifestyle;
d)214 – 224 Previous attempts to separate from the wife;
e)225 – 229 Umbrella Deed;
f)230 – 233 Post Separation s 75(2) factors;
g)237 – 240 Husband’s maintenance needs; and
h)244 – 258 Husband’s current financial circumstances.
The husband resists the striking out of any of the paragraphs on the basis that it is not possible to separate the matters to which objection is taken with the issues included in the notation, but in the event the wife’s submissions as to relevance is upheld it is submitted the wife should simply be relieved of any obligation to respond to them.
I propose to strike out paragraphs of the husband’s affidavit filed 5 May 2020 to which objection is taken. I accept the wife’s submissions that those paragraphs are not relevant to the issues listed for hearing commencing on 1 June 2020.
Application by the husband – litigation funding
The final application for determination is whether or not the wife should pay a further sum by way of litigation funding in relation to the husband’s legal costs of responding to the third party respondents’ Application in a Case filed 30 April 2020.[30] The sum sought is $17,332.50.
[30] The husband filed an Application in a Case on 14 May 2020. Only paragraph 1(a) was relevant in the circumstances.
It will be recalled from earlier in these reasons that on 14 January 2020 I made a ‘dollar for dollar’ order against the wife which requires her to pay an equivalent sum to the husband’s lawyers to that which she pays her own lawyers. I specifically declined to make an order that the wife meet the husband’s costs in proceedings involving the third party respondents and in particular:
14. … I am not at this stage persuaded that the circumstances justify an order for the wife to pay the husband’s costs of pursuing a claim against third parties, particularly where the basis for that claim is yet to be particularised.
Nothing has changed to persuade me otherwise. The husband’s application will be dismissed.
I certify that the preceding eighty-one (81) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Carew delivered on 26 May 2020.
Associate:
Date: 26.05.2020
6
12
2