Rosington and Rosington - [2018] FamCA 172

FAMILY COURT OF AUSTRALIA

ROSINGTON & ROSINGTON

[2018] FamCA 172

FAMILY LAW – CONTEMPT – Where orders were previously made restraining the parties from selling, mortgaging, assigning or alienating any real property including drawing further funds against any existing security without the consent of the other party – Where the wife admits to drawing funds from a mortgage account – Where the wife was aware of the orders made – Where the wife knew that her actions were in breach of Court orders – Consideration of the meaning of ‘flagrant disregard’ – The wife was found to be in contempt of Court by the conduct described in each allegation.

Family Law Act 1975 (Cth) s 112AA, 112AP
Family Law Rules 2004 (Cth) r 21.08

Abduramanoski & Abduramanoska (2005) FLC 93-215 Bande v Cade (2011) 45 Fam LR 376 Kendling and Anor & Kendling (2008) FLC 93-384 Myers & Myers (2006) FLC 93-291 Tate & Tate (2002) FLC 93-107 Tate & Tate (No. 3)(2003) FLC 93-138
APPLICANT:	Mr Rosington

RESPONDENT:

Ms Rosington

FILE NUMBER:

SYC

6654

2015

DATE DELIVERED:

22 March 2018

PLACE DELIVERED:

Sydney

PLACE HEARD:

Sydney

JUDGMENT OF:

Loughnan J

HEARING DATE:

2 February 2018

REPRESENTATION

COUNSEL FOR THE APPLICANT:	Mr Cummings SC
SOLICITOR FOR THE APPLICANT:	Barkus Doolan Family Lawyers

COUNSEL FOR THE RESPONDENT:

Mr Byrne

SOLICITOR FOR THE RESPONDENT:

Panetta & Associates

Orders

The Court found that the wife was in contempt of Court by contravening orders made on 25 November 2015 as alleged in that she withdrew from her account with the T Bank being account number …00 BSB …, $222,521 on 1 September 2016 and $30,000 on each of 27 October 2016, 31 October 2016, 1 November 2016, 3 November 2016, 4 November 2016 and 7 November 2016.
The proceedings are adjourned to a date to be fixed in respect of any consequential orders arising from those findings.

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 Rosington & Rosington has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).

Note: This copy of the Court’s Reasons for Judgment may be subject to review to remedy minor typographical or grammatical errors (r 17.02A(b) of the Family Law Rules 2004 (Cth)), or to record a variation to the order pursuant to r 17.02 Family Law Rules 2004 (Cth).

FAMILY COURT OF AUSTRALIA AT SYDNEY

FILE NUMBER: SYC6654 of 2015

Mr Rosington

Applicant

And

Ms Rosington

Respondent

REASONS FOR JUDGMENT

Introduction

Mr Rosington (“the husband”) alleges that on seven occasions Ms Rosington (“the wife”) was in contempt of Court by contravening Court orders. The main dispute in the trial related to whether the contraventions by the wife constituted a flagrant challenge to the authority of the Court and therefore amounted to contempt.

application

The application before the Court was the husband’s Amended Application – Contempt filed 12 October 2017. The application contained seven allegations. The first identified the alleged contempt as the wife withdrawing $222,521 from her account with the T Bank, being account number …00 BSB … on 1 September 2016, in deliberate breach of an injunction made on 25 November 2015. The remaining allegations related to withdrawals by the wife from that same account, each in the sum of $30,000, respectively made on 27 October 2016, 31 October 2016, 1 November 2016, 3 November 2016, 4 November 2016 and 7 November 2016.
The application was supported by the husband’s affidavits filed 21 September 2017 and 12 October 2017. The wife opposed the application but was not required to file any evidence prior to the hearing.

Short history

There is no general background material in the evidence before me. I gather that the parties were married and that they have had property settlement and parenting proceedings before the Court. I was told that final orders for settlement of property were made on 16 January 2018 in terms agreed between the parties. I gather that the wife is a CEO and Managing Director of D Pty Limited which is a service company. That company has had a significant turnover in the range of $5 million to $8 million per annum. The parties have eight year old twin sons and, as I say, there are parenting proceedings in relation to them.
On 25 November 2015 interim orders were made by Justice Stevenson including relevantly, order 16(e) whereby the parties are restrained by injunction from selling, mortgaging, assigning or alienating any real property of which either of the parties is a registered proprietor including but not limited to drawing further funds against any existing security without the consent of the other party. As I understand it the parties owned three properties. One of those properties was at L Street, Suburb M (“the Suburb M property”) which was the former matrimonial home of the parties. It was held in the name of the wife. The parties had borrowed on the security of that property from the T Bank and the relevant account was in the nature of a line of credit or an off-set account secured against that property (“the account”).
The wife made withdrawals from the account on the dates identified in the allegations. Those funds were transferred to another account and were ultimately used to reimburse the company for payments it made to the solicitors then acting for the wife in these proceedings.

The Law

The legislation

The relevant legislation in contempt proceedings is found in s 112AP of the Family Law Act 1975 Cth (“the Act”) as follows:
(1)Subject to subsection (1A), this section applies to a contempt of a court that:
(a)does not constitute a contravention of an order under this Act; or
(b)constitutes a contravention of an order under this Act and involves a flagrant challenge to the authority of the court.
(1A)This section does not apply to a contempt that constitutes a contravention of a maintenance order if the order has been complied with before the matter of the contravention comes before the court.
(2)In spite of any other law, a court having jurisdiction under this Act may punish a person for contempt of that court.
(3)The applicable Rules of Court may provide for practice and procedure as to charging with contempt and the hearing of the charge.
(4)Where a natural person is in contempt, the court may punish the contempt by committal to prison or fine or both.
(5)Where a corporation is in contempt, the court may punish the contempt by sequestration or fine or both.
(6)The court may make an order for:
(a)punishment on terms;
(b)suspension of punishment; or
(c)the giving of security for good behaviour.
(7)Where a person is committed to prison for a term for contempt, the court may order the person’s discharge before the expiry of that term.
(8)To avoid doubt, the serving by a person of a period of imprisonment as a result of a contempt of a court arising out of a failure by the person to make a payment in respect of the maintenance of another person does not affect the first‑mentioned person’s liability to make the payment.
…
Section 112AA of the Act defines an “order under this Act” as, in part,
An order (however described) made by the court under this Act (other than a parenting order)
Rule 21.08 of the Family Law Rules 2004 (“the rules”) sets out the procedure to be followed in contempt proceedings:
Procedure at hearing
At the hearing of an application mentioned in item 1A, 2, 3, 4 or 5 in Table 21.1, the court must:
(a)inform the respondent of the allegation;
(b)ask the respondent whether the respondent wishes to admit or deny the allegation;
(c)hear any evidence supporting the allegation;
(d)ask the respondent to state the response to the allegation;
(e)hear any evidence for the respondent; and
(f)determine the case.

The standard of proof

In Tate & Tate (2002) FLC 93-107 the Full Court affirmed that the standard of proof in contempt proceedings under s 112AP of the Act is beyond reasonable doubt. The Full Court stated at 89,016:
75. Having regard to the language of s 112AP of the Act, including the possibility of committal to prison and/or the imposition of a fine if a natural person is found to be in contempt and to the Rules of Court made pursuant to s 112AP(3), in our view, properly characterised, the application before Murray J seeking that the husband be dealt with for contempt of court was a proceeding for an offence. Whilst the acts constituting the alleged contempts in the instant case are not offences against any law of the Commonwealth…in our view, those acts, if established, constitute offences arising under an Australian law. Accordingly, the proceedings are criminal proceedings as defined in the Evidence Act and thus the standard of proof to be applied is as set out in s 141(1) of that Act, namely proof beyond reasonable doubt.
76. It follows, in our view, that the standard of proof to be applied in proceedings in the Family Court seeking that a respondent be dealt with for contempt of court is proof beyond reasonable doubt.
This position was affirmed by the Full Court in Abduramanoski & Abduramanoska (2005) FLC 93-215 (“Abduramanoski”) at 79,582 and in Bande v Cade (2011) 45 Fam LR 376 (“Bande”) at 393.
The Full Court also stated in Abduramanoski that s 112AP should be considered as a complete and self-contained code. They stated at 79,582:
47. In Rutherford v Marshal of the Family Court of Australia (1999) FLC 92-866 at 86,241, the Full Court described s 112AP, then Part of Division 3 of Part XIIIA after the 1988 amendments, “a complete code for dealing with contempts of the Court”. The Full Court affirmed the decision in Schwarzkopff (supra), noting that contempt under the Act does not constitute “an offence against any laws of the Commonwealth”. The Court accepted a submission that s 112AP, as it then was, constituted a self contained code, and general sentencing legislation, whether State or Federal, had no application.

The allegations

The wife was informed of seven allegations. The first was:
[Ms Rosington] it is alleged that in contempt of Court you contravened orders made on 25 November 2015 in that on 1 September 2016 you withdrew $222,521 from your account with the [T Bank] being account number …00 BSB …11.
The remaining allegations related to withdrawals from that same account, each in the sum of $30,000, respectively made on 27 October 2016, 31 October 2016, 1 November 2016, 3 November 2016, 4 November 2016 and 7 November 2016.
The wife made identical responses in respect of each allegation, indicating that she did not admit the charge.
I asked the wife’s counsel to concede the elements of the case that the husband has to make out. The following concessions were made on behalf of the wife:
(a)that she had been properly served with the amended application and the two supporting affidavits of the husband which were filed on 21 September 2017 and 12 October 2017;
(b) that the wife knew of the orders made on 25 November 2015; and
(c)that as asserted in the seven allegations, the wife made the withdrawals in the stated sums on the days in question from the named T Bank account.
There was initially no concession that the orders made on 25 November 2015 prohibited the conduct alleged against the wife in the seven allegations.
There were two objections to the husband’s affidavit but he was not required for cross-examination. No further documents were tendered in the husband’s case.
At the close of the husband’s case it was submitted on behalf of the wife that the husband had failed to demonstrate that there was a contumacious or flagrant breach of the Court’s orders and therefore that the wife should not be required to respond to the husband’s application. I rejected that submission and the wife was required to present her case. She relied on an affidavit sworn on 2 February 2018.
The wife was cross-examined.
Submissions were made and judgment was reserved.

DISCUSSION

All of the allegations of contempt relate to contraventions of order 16(e) made on 25 November 2015. That order is as follows:
PENDING FURTHER ORDER:
(16) The parties are restrained by injunction from:
….
(e)selling, mortgaging, assigning or alienating any real property of which either of the parties is the registered proprietor, including but not limited to drawing further funds against any existing security without the consent of the other party.
The injunction in question was addressed by Justice Stevenson at paragraph 48 and 49 of her reasons for judgment delivered on 25 November 2015. Her Honour said:
48.The husband sought orders which would restrain each of the parties from dealing with their assets other than in the ordinary course of business. The wife proposed that the parties enter into undertakings that they each refrain from dealing with their assets without first giving 14 days’ notice.
49.The wife’s proposal must be intended to provide an opportunity for the other party to approach the Court for injunctive relief, if he or she has a basis for doing so. Experience indicates that this scheme is impracticable, in terms of gaining quick access to a court with stretched resources. I will accede to the husband’s application in relation to injunctive orders.
There was nothing in the cases presented by either party to suggest that the issues are different in relation to any of the individual allegations.
As to the necessary elements of the case.
It is conceded that the application and the husband’s affidavits in support were served on the wife. It is conceded that the wife had knowledge of the orders. It is conceded that the wife made the withdrawals alleged in each of the seven allegations.
It was not initially conceded by the wife or on her behalf that order 16(e) made on 25 November 2015 restrained her from making any of the withdrawals that were the subject of the allegations in these proceedings.
In her affidavit the wife relevantly deposed:
…
9. I deducted the funds from the Account because I have used it as a store of excess savings. This is because interest paid by me on the loan over the [Suburb M] Property is reduced by reference to those savings. The effect of this is that, rather than earning a low interest rate in a standard savings account, the savings reduce the amount of the principal upon which the interest (at the higher home loan rate) on the [Suburb M] loan is calculated. Were those interests benefits not available I would simply have deposited the excess savings when they became available into an ordinary stand-alone savings account.
10. I have never regarded the excess savings deposited in the Account as repayments of the [Suburb M] loan, since they are freely deductable like a savings account and, for instance, they do not require an application to be approved for drawing of extra funds. I can simply deduct them either on-line or by form which does not require a credit approval process.
The wife’s affidavit goes on at paragraph 15:
At the time of making the Deductions and paying the legal fees:
a.as a consequence of my understanding described above, I did not at the time of the Transfers consider that making the Deductions from the Account constituted “drawing further funds against any existing security” as described by Order 16(e) dated 25 November 2015 (“Order”);
b.I was also of the understanding that parties in family law proceedings bore their own costs and that, to achieve that, the amount of legal fees paid by them was “added back” to the asset pool for the purposes of working out how much of the pool was to be retained by (or paid to) the other side. In that regard:
i.annexed hereto and marked “C” is a copy of an email from my then solicitor from as early as March 2016 advising me that legal fees might be added back; and
[the attached annexed form of balance sheet was excluded on objection].
c.accordingly, I certainly did not think that, by making the Deductions to fund payment of my legal fees I was doing anything that would cause damage to [Mr Rosington] and I did not want to do any such thing:
d.I also believed that the asset pool available to [Mr Rosington] and I included the [Suburb M] property, which was worth well over $5,000,000 (it in fact sold recently for $6,570,000) as well as business assets and I had no reason to believe that the Deductions would cause any risk that I would become bankrupt and unable to make any payment to [Mr Rosington] under these proceedings;
e.I had absolutely no intention of breaching the Court’s orders. If I have inadvertently done so I feel mortified and ashamed and apologise without reservation.
However, the wife conceded in cross-examination that any drawings on the account referred to in the allegations was a drawing on a facility secured by the Suburb M property. As to the state of her knowledge at the time of the drawings, there was later the following passage of evidence:
Question:And there can be absolutely no question can there, [Ms Rosington], that every time you took funds from that account you knew that it was drawing on a facility that was secured against the home at [Suburb M].
Wife:At the time, no but from today, yes I now believe that is correct.
….
Question:What I want to put to you as squarely as I possibly can, [Ms Rosington] is that a person of your intelligence, sophistication and experience knew full well that when you take further funds out of a home loan account you were drawing on a facility secured by the property. Isn’t that right?
Wife:Yes.
In summary, the husband and the wife asked this Court to make orders, among others, to place limits on their dealings with real property in the interim. The wife proposed that the parties be required to give 14 days prior written notice to the other party before such a dealing and the husband proposed the order that was ultimately made. For the reasons given on 25 November 2015, Justice Stevenson favoured the approach suggested on behalf of the husband. The order in question is clear in its terms. It restrains the parties from selling, mortgaging, assigning or alienating any real property of which either of the parties is the registered proprietor including but not limited to drawing further funds against any existing security without the consent of the other party. The order was drawn so as to clearly identify the account from which the wife drew the funds, as an account to which the injunction applied. The wife conceded in cross-examination that she knew that by drawing further funds against the Suburb M mortgage account she was drawing further funds against an existing security. She did not seek the husband’s consent. She did not ask the Court for permission. She simply made the drawings. She made one drawing of approximately $220,000 and then six subsequent drawings of $30,000. It was ultimately conceded by the wife that she contravened the orders of 25 November 2015 in the way described in the allegations.
There is no dispute in these proceedings that s 112AP of the Act can apply, among other circumstances to a deliberate contravention of a court order. That is what has occurred here.
The only remaining disputed issue before the Court is whether the breach of orders in this instance represents a flagrant challenge to the Court’s authority. It is clear on the authorities that the husband does not have to demonstrate that the wife set out to make a flagrant challenge to the Court’s authority. The question is whether her conduct represents such a challenge.
It is submitted on behalf of the applicant that there could not be a clearer example of a contravention that represents a flagrant challenge to the Court’s authority and that there are many similar fact circumstances that have resulted in a finding of contempt in other cases. It is submitted in the applicant’s case that it would be an error of law to find that the circumstances of the wife’s conduct in this case fell short of a flagrant challenge to the Court’s authority. It is conceded in the wife’s case that her conduct in these proceedings could be found to represent a flagrant challenge to the Court’s authority. However, it was also submitted in the wife’s case that a review of the similar fact cases referred to in the submissions on behalf of the applicant will reveal that there is a feature of the cases where there has been a contempt found in a contravention of a financial injunction that goes beyond the nature of the conduct in this case. It was submitted that in the cases where the breach was found to be contumacious there was conduct intended for example, to destroy or put beyond the reach of the Court or the other party the property of the parties which was the subject of the proceedings or there was an attempt to deny the other party access to the funds that would meet the proper claims of that party.

With hindsight it would have been of greater assistance if I was taken to the examples that learned counsel for the wife had in mind. My research may have been inadequate to the task I was set but I did not find a trend that was of assistance in supporting the proposition made in the wife’s case. In any event, as I will discuss below, the Full Court considered and rejected the thrust of that submission in Kendling and Anor & Kendling (2008) FLC 93-384 (“Kendling”)

Flagrant challenge

The concept of “flagrant challenge” as stated in s 112AP of the Act was discussed by the Full Court Bande at 393:
[119] The concept of a “flagrant challenge” involves conduct of an exceptional, striking or repeated nature. In In the Marriage of Ibbotson and Wincen (1994) 18 Fam LR 164; (1994) FLC 92-496 the Full Court held… “The use of the term ‘flagrant challenge’…is intended to underline the exceptional or striking nature of the contravention in question and thus to differentiate it from what might be described as the general run of breaches which are intended to be dealt with under s 112AD…it is a question of fact and degree whether the stringent terms of the section are satisfied”.
[120] The breach in question must be wilful (that is deliberate, as distinct from inadvertent) but not necessarily contumacious. In In the Marriage of English (1986) FLC 91-729 the Full Court held (at 75,294): “In our opinion the line of authorities…demonstrate that in proceedings for civil contempt it must be established that the respondent knew of the undertaking or order and that his act or omission in breach of that order or undertaking was a wilful, that is, a deliberate act by him as distinct from accidental or inadvertent. It is not necessary in addition to establish that the conduct was contumacious; that is, it is unnecessary to show that the act or omission was done with a deliberate intention to break or disregard the undertaking or order”.
In Kendling the Full Court also considered the concept of what constituted a flagrant challenge to the authority of the court within the meaning of s 112AP. In that matter there was no controversy that the husband breached the orders and that he knew of the making of the injunctive orders when he breached them. It was also not controversial that the husband had subsequently remedied the breaches of the injunctive orders that gave rise to the counts of contempt. At page 82,890, the Full Court considered the meaning of the word ‘flagrant” as follows:
183. It is instructive to consider the meaning of “flagrant” in s112AP.
184.The Oxford Dictionary defines “flagrant” as “conspicuously or obviously offensive”. The Macquarie Dictionary defines flagrant as “glaring, notorious or scandalous”.
185.In Ibbotson & Wincen (supra) the Full Court suggested that s 112AP involves circumstances:
…where the contravention involves a “flagrant challenge to the authority of the Court”. Repeated breaches are not a prerequisite, although that may more readily attract this provision. The use of the term “flagrant challenge” to the authority of the Court is intended to underline the exceptional or striking nature of the contravention in question and thus to differentiate it from what might be described as the general run of breaches which are intended to be dealt with under s 112AD.
In the ultimate, it is a question of fact and degree whether the stringent terms of the section are satisfied, bearing in mind…that it is usually more appropriate to use s 112AD.
186.The Full Court declined to “consider in a definitive way what was intended to be encompassed by s 112AP” on the facts of Ibbotson’s case. We have not been referred to any more helpful statement of principle in the practical sense than this passage from the decision of the Full Court in Ibbotson (supra). We infer from this passage that determining whether the facts as found beyond reasonable doubt in a given s 112AP application will constitute a flagrant challenge to the authority of the Court involves neither solely finding of fact nor solely the exercise of discretion.
187.As any contempt of necessity constitutes a challenge to the authority of the Court, seeking to define when the challenge to the authority of the Court becomes flagrant will not always be a simple or clear decision. It is to be remembered that in this Court the husband bears the onus of establishing appealable error. It is not for the respondent to re-prove the case beyond reasonable doubt in this Court.
188.In Rutherford v Marshal of the Family Court of Australia (1999) FLC 92–866; 25 Fam LR 383, the Full Court noted Counsel for the husband’s submission that “a deliberate intention to break the Court’s order is a necessary component of such a challenge” [original emphasis] as it was contended that “[without such an intention... there can be no ‘challenge’ because there must be an object of the challenge to which it is specifically directed, in this case the Court.” The Full Court rejected Counsel for the husband’s submission as follows:
We do not accept that submission. An alternative definition of “challenge” found in the Macquarie Dictionary is “a calling to account or into question”. For a breach to come within the section it must be “a flagrant challenge to the authority of the Court” (emphasis added). It does not need to be a challenge directed to the Court, in the sense proposed by Mr Broun. Any act which may properly be described as “flagrant” (which only means “glaring, notorious or scandalous”) and which calls into question the authority of the Court, expressed through its relevant order, may constitute a contempt, within the meaning of the section.
189.This statement of principle is in line with Hay (1998) FLC 92-819; [1998] 23 Fam LR 247, where the Full Court held that the introduction of the concept of “a flagrant challenge to the authority of the court” in s 112AP did not change the previously existing law, as stated in the following passage from English (1986) FLC 91-729 (at 75-294):
In our opinion the line of authorities, aside from the cases of Stirling and Kitchener, demonstrate that in proceedings for civil contempt it must be established that the respondent knew of the undertaking or order and that his act or omission in breach of that order or undertaking was a wilful, that is, a deliberate act by him as distinct from accidental or inadvertent. It is not necessary in addition to establish that the conduct was contumacious; that is, it is unnecessary to show that the act or omission was done with a deliberate intention to break or disregard the undertaking or order.
190.The husband was clearly aware of the orders by which he was bound. To the extent that he asserted any absence of understanding of their terms, the trial Judge rejected such assertions. It has not been established that the trial Judge erred in so doing. The husband is a person with considerable commercial experience and success. In the absence of clear evidence that the terms of the orders permitted any uncertainty or doubt as to their nature and effect, the terms of the orders would not support an inference in those terms.
191.Whilst learned Counsel for the husband sought to advance the husband’s case in reliance upon the evidence that the husband had sought to have his solicitors clarify the effect of the injunctive orders by which he was bound prior to breaching them, the fact that the husband proceeded to breach the orders in circumstances where he did not receive such clarification, or if he did, said he did not recall or remember what the clarification was, in our view is more conducive to a finding of flagrancy than its absence.
192.The trial Judge clearly stated, in reliance upon findings of fact which are either unchallenged, or incapable of being successfully challenged, that the husband, who was at all material times represented, knew of the Court’s orders, and either understood their nature and effect, or chose to breach them without clarifying their nature and effect, made a conscious decision to breach the orders.
193.The fact that the breaches of the Court’s orders in this case do not represent the most extreme or flagrant challenges to the authority of the Court is not the test. What was required was that the trial Judge be satisfied that these breaches were exceptional or striking. Nothing to which we have been referred persuades us that it was not reasonably open to the trial Judge to so conclude.
Apropos the submission made on behalf of the wife before me, the Full Court in Kendling rejected the submission raised by the respondent that contempt requires significant or enduring adverse consequences for the applicant. From 82,892 the Full Court said:
194.So far as the submissions on behalf of the husband in relation to the absence of significant or enduring adverse consequences for the wife of the husband’s breaches of the Court’s orders are concerned, we record that in our view those submissions are misconceived in at least two material respects.
195.It is to be remembered that s 112AP concerns challenges to the authority of the Court. The fact that such challenges may have significant or enduring adverse consequences for the other party to the matrimonial cause may well be part of the circumstances enlivening the provisions of s 112AP, but in our view their absence does not preclude the section being successfully enlivened in a case where the findings of fact were as they were in this case.
196.There are at least two reasons why that is so. First, if this proposition were accepted, the consequences of the most flagrant challenges to the authority of the Court could be avoided by the rectification of the breaches of the orders at any time prior to the imposition of sentence. There would be a clear incentive in those circumstances for parties to flagrantly challenge the authority of the Court in the hope that the other party would not incur the expense of bringing the application pursuant to s 112AP, safe in the knowledge that if and when that was successfully undertaken, remedying the breaches of the orders would obviate the imposition of sanctions pursuant to the section.
197.Secondly, although not so expressed, implicit in the husband’s submission, at least in cases where rectification of breaches of court orders can be achieved by financial transactions or payments, is that it has the potential to elevate the wealthy to a level of impunity not enjoyed by those less affluent. Senior Counsel for the wife voiced this contention in oral submissions:
So for a very wealthy man this is just pulling the cheque book out at the last minute, and what [Counsel B]’s submission, and the effect of it would encourage is for, in any case in this Court where there is a huge disparity in wealth, a wealthy husband would feel quite confident to say, "Well, the Court can make whatever orders it likes. I will do what I want. If and when I am caught, and if and when someone goes through the massive hurdles of embarking upon a successful prosecution of me, then I will get the cheque book out and repay it and I will feel strongly confident that that Court is unlikely to do anything to me that would involve depriving me of liberty and if [Counsel B]’s argument would have it, and so far as any judge who made a contrary decision ought be seen as erring in the exercise of their discretion. [Transcript of proceedings, 4 June 2008, page 50].
198.In this case, as learned Counsel for the husband candidly expressed it in the submission which we have earlier recorded, the husband’s case is that the “pie” being so large, nothing done by him in breach of the Court orders could ultimately enure to the financial detriment of the wife and thus could not be considered flagrant.
199.We not only disagree with that proposition, but regard the submission itself as indicative of flagrancy, the husband, through his learned Counsel, candidly suggesting to the Court that because his means are as large as he admits them to be, he can do with impunity what others perhaps could not because he asserts it would not affect the wife’s ultimate entitlements.

The purpose of contempt proceedings

I note that the contempt proceedings have been prosecuted notwithstanding that the substantive property settlement proceedings out of which they arose, have been concluded. That raises the question of the purpose of contempt proceedings. In Myers & Myers (2006) FLC 93-291 and Abduramanoski the Full Court affirmed the position established in Tate & Tate (No. 3)(2003) FLC 93-138 where it was discussed at 78,299:
57. Normally, the purpose of contempt proceedings against a person for breach of such an order is to coerce them to comply with it. However, It is quite clear that another purpose of bringing proceedings for contempt against a person who has breached a non-monetary order of the court may be that of punishment. The purposes of imposing punishment would appear to reflect the need for individual and general deterrence and retribution for the party’s failure to comply with the order. Retribution is called for because it is essential to the proper working of the court system that court orders are obeyed. If they are defied or ignored, the whole system of dispute resolution by litigation breaks down. While there are other means of dispute resolution available, in the final analysis a citizen has the right to approach a court to determine a dispute and the court has a duty to do so.
In Abduramanoski the Full Court considered that the primary aim of contempt proceedings can be punitive at 79,583:
64. In this case, the primary aim of the proceedings is clearly punitive and it is clear from the authorities that this is an appropriate aim, at least in circumstances where there has been a flagrant defiance of court orders…
The Full Court in Kendling also considered further public policy implications of contempt proceedings. This was within the context of a case where the husband and wife had reached an agreement and the wife no longer pressed the contempt proceedings. It was stated at page 82,872:
In Louis Vuitton Malletier SA v Design Elegance Pty Ltd and Another (2006) 225 ALR 541, Merkel J….referred to the case of Attorney-General v Times Newspapers Ltd [1974] AC 273 at 307 in which Lord Diplock said there was “an element of public policy in punishing civil contempt, since the administration of justice would be undermined if the order of any court of law could be disregarded with impunity…” …
We perceive that avoiding the undermining of the administration of justice by condoning breaches of court’s orders, and the limit to the public interest which thus arises by virtue of the inter parties nature of the breaches needs to be balanced in the circumstances of the present appeal.
It was further stated at page 82,876:
We perceive that the public policy issues to which we have referred preclude us from concluding that determining the present appeal does not lack “utility” or involve this Court in providing “advisory opinions”.

Conclusion

Ultimately the wife conceded that she knew that her conduct in drawing on the account was in breach of Court orders. That was a necessary concession. She is a person of obvious intelligence and experience. She runs a business turning over between $5 million and $8 million each year and employs a substantial staff. She is ‘savvy’ in business and commerciality as she conceded in cross-examination. The husband and the wife had specifically asked the Court to address restrictions on the access that she and the husband had among other accounts, to the account in question. The wife knew the terms of the order that was made and by seven deliberate acts, she breached that order. In my view the breaches were a flagrant challenge to the authority of the Court.
I find the wife to be in contempt of Court by contravening orders made on 25 November 2015 in that she withdrew from her account with the T Bank being account number …00 BSB …, $222,521 on 1 September 2016 and $30,000 on each of 27 October 2016, 31 October 2016, 1 November 2016, 3 November 2016, 4 November 2016 and 7 November 2016.
A further date will be fixed by arrangement with the parties in order to deal with any orders to be made a consequence of those findings.

I certify that the preceding forty-five (45) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Loughnan delivered on 22 March 2018.

Associate:

Date: 22 March 2018