Salah and Solh (No.4)
[2018] FCCA 2843
•5 October 2018
FEDERAL CIRCUIT COURT OF AUSTRALIA
| SALAH & SOLH (No.4) | [2018] FCCA 2843 |
| Catchwords: FAMILY LAW – s.79A Application to set aside previous orders – consideration of rr.3.05(1) and 16.05(2) of the Federal Circuit Court Rules2001 – exercise of judicial discretion. |
| Legislation: Evidence Act1995 (Cth), ss.75, 140 Federal Circuit Court Rules 2001 (Cth), rr.3.05(1), 16.05(2) |
| Re F: Litigants in Person Guidelines (2001) FLC 93-072 |
| Applicant: | MS SALAH |
| Respondent: | MR SOLH |
| File Number: | DGC 1777 of 2012 |
| Judgment of: | Judge Williams |
| Hearing dates: | 4 September 2017, 5 – 6 February 2018, 23 - 24 July 2018 |
| Date of Last Submission: | 27 July 2018 |
| Delivered at: | Melbourne |
| Delivered on: | 5 October 2018 |
REPRESENTATION
| Counsel for the Applicant: | Mr Indovino |
| Solicitors for the Applicant: | Randles Cooper |
| Counsel for the Respondent: | Mr Grant of Counsel (4 September 2017) |
| Solicitors for the Respondent: Respondent in person | Merhi & Associates (4 September 2017) *Mr Solh otherwise appeared in person |
ORDERS
The Orders made by Her Honour Judge Jones on 11 September 2014 be set aside.
The proceedings be otherwise be adjourned in the Duty List on a date to be advised.
The wife’s costs of 6 February 2018 be fixed in the sum of $4,000.
The husband’s payment of the wife’s costs of 6 February 2018 be offset against the order of 17 August 2018 for the wife to pay the husband’s costs of $4,000.
IT IS NOTED that publication of this judgment under the pseudonym Salah & Solh (No.4) is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT MELBOURNE |
DGC 1777 of 2012
| MS SALAH |
Applicant
And
| MR SOLH |
Respondent
REASONS FOR JUDGMENT
Introduction
This matter is a dispute arising from final property orders which were made by Her Honour Judge Jones on 11 September 2014. The orders were made after a trial. The wife was legally represented at the trial. The husband acted on his own behalf.
The current dispute has arisen because:
a)The wife claims the husband should be required to transfer to her the former matrimonial home, being the property situated at Property A (“ the Property A property”);
b)The husband claims that he should be entitled to retain the Property A property.
Issues in dispute
The following issues were in dispute between the parties:
a)whether the time prescribed by order 1 of the orders of 11 September 2014 should be extended, to enable the wife to pay the husband the sum of $8,5000 and acquire the husband’s interest in the Property A property;
b)whether order 6 of the orders of 11 September 2014 should be enforced, to enable the husband to pay the wife the sum of $16,5000 and retain the Property A property, noting that such sum is in the trust account of the wife’s solicitors;
c)Whether the orders of 11 September 2014 should be set aside pursuant to sub-ss.79A(1)(a)-(d) of the Family Law Act 1975 (Cth) (“the Act”).
Synopsis
I have determined that:
a)the time for the wife’s compliance with order 1 of the orders of 11 September 2014, should not be extended;
b)order 6 of the orders of 11 September 2014, should not be enforced;
c)the orders of 11 September 2014 should be set aside;
d)the respective property claims of the parties should be determined by another Judge.
The reasons for my determination follow.
Background and Procedural history
The parties to the dispute have a long and bitterly contested history.
The husband was born in (country omitted) on 1976 and the wife was born in (country omitted) on 1982. In 1999 the husband immigrated to Australia and was granted permanent residence on 2002. The parties were married in (country omitted) on 2003. The wife arrived in Australia in 2004 whereupon they commenced cohabitation. The parties separated on 21 November 2011 and were divorced on 6 January 2013.
There are three children of the marriage [X] born 2005, [Y] born 2006 and [Z] born 2009.
The husband has since remarried and has two young children with his current wife.
The trial of the parties’ respective applications for property adjustment was heard by her Honour Judge Jones on 11 June 2014. On 11 September 2014, her Honour made final property orders (“the final property orders”) and delivered her reasons.
On 23 October 2014, the wife filed a Contravention Application alleging that the husband had contravened order 4 of the final property orders by denying the wife access to the former matrimonial home for the purposes of a valuer inspecting the premises, to assist the wife refinancing the mortgage.
On 8 December 2014, the wife’s Contravention Application was heard by her Honour Judge Jones. Orders were made on that date which amended the final property orders, including providing the wife with an extension of time to elect to retain the property and adjourned the contravention application to the duty list on 13 April 2015. The husband did not appear on that day.
The orders of 8 December 2014 provided for any tenant or resident of the Property A property to provide reasonable access to any valuer appointed by the wife, her finance lender or agents, to enable her to comply with her election to retain the property.
On 13 April 2015, the contravention application was again listed before Her Honour Judge Jones. On that day, orders were made providing that all extant applications be fixed for final hearing on 3 August 2015.
On 29 July 2015, the husband filed an application for leave to appeal seeking an extension of time in which to appeal the orders made 8 December 2014. The application for leave to appeal was listed on 24 September 2015.
The basis of the husband’s application for leave to appeal was:
a)that he had not been served with the wife’s Contravention Application;
b)he had not been accorded procedural fairness;
c)His rights pursuant to the 11 September 2014 orders had been unfairly interfered with and delayed.
On 3 August 2015, orders were made by her Honour Judge Jones as follows:
a)adjourning the final hearing of the Contravention Application to 17 August 2016;
b)upon the wife advising the Court that the husband’s appeal has been heard and determined, the trial date of the 17 August 2016 be brought forward to the next available date;
c)costs of both parties reserved.
On 24 September 2015, the husband’s application for leave to appeal was listed before his Honour Justice Strickland. On that day, the husband states that his Honour suggested to his Counsel that an application pursuant to r.16.05(2) of the Federal Circuit Court Rules 2001 (Cth) (“the FCC Rules”) should have been pursued, rather than an application for leave to appeal.
On 8 December 2015, the husband filed an application in a case seeking to set aside the orders of 8 December 2014, pursuant to r.16.05 (2) of the FCC Rules.
The husband’s application in a case was listed before me on 4 April 2016, when orders were made as follows:
a)the orders made on a December 2014 be set aside;
b)the wife file and serve any amended contravention application, and any affidavit in support no later than 3 June 2016;
c)the husband file and serve any material in response no later than 3 July 2016;
d)the matter be adjourned for final hearing on 17 August 2016;
e)the parties’ costs be reserved.
On 17 August 2016 the matter was again listed before me and orders were made as follows:
a)all extant applications adjourned to 2 December 2016 at 10.00am;
b)the husband’s costs of that day be fixed in the sum of $4,000, and reserved on the adjourned date.
On 8 December 2016, the wife filed an Application in a Case, seeking inter alia, the following orders:
a)in the alternative to paragraphs 1, 2, 3 and 4 hereof, the orders made by this Court on 11 September 2014 be set aside pursuant to s.79A of the Act on the following grounds:
i)that circumstances have arisen since the order was made as to make it impracticable for the said orders to be carried out, namely the respondent’s refusal to provide access to the real property for it to be valued by the applicant’s bank for loan approval and that no application was served on the parties having registered caveats over the real property in relation to such caveats being withdrawn;
ii)that the respondent has defaulted in carrying out an implied obligation to provide access to the real property for the purposes of the applicant obtaining a bank loan approval valuation and in the circumstances, as a result of the default it is just and equitable to vary the order or to set aside and make another order in substitution thereof;
iii)that circumstances have arisen since the making of the order whereby the applicant would suffer hardship if the court does not vary the order or set it aside in circumstances where the applicant has the care and responsibility of the children of the marriage.
On 8 December 2016, the wife sought and was granted leave to withdraw her Contravention Application.
The wife’s Application in a Case was listed for hearing on 9 December 2016. Procedural orders were made on that day, and the matter was otherwise adjourned for hearing on 26 May 2017.
On 17 May 2017, the husband filed a Response to the wife’s Application in a Case, seeking that the Application in a Case be dismissed, and other orders ancillary to enforcement of the orders of 11 September 2014.
On 26 May 2017, Counsel for the husband raised objections to hearsay contained in the wife’s affidavits in support of her application.
Counsel for the wife submitted that as the s.79A proceedings were interlocutory, s.75 of the Evidence Act1995 (Cth) (“the Evidence Act”) permits hearsay evidence to be adduced in interlocutory proceedings.
On 26 May 2017, the following orders were made by me:
a)the matter be adjourned to 4 September 2017 at 10 AM for final hearing;
b)both parties file and serve within 45 days submissions as to whether the proceedings are interlocutory or a final hearing for the purposes of admissibility of hearsay evidence of the parties.
On 22 July 2017, the wife filed her submissions. On 29 August 2017, the husband filed submissions, which did not comply with the timeframe provided in my orders. The late filing was ostensibly due to “changes that have occurred in the office of his solicitor” and/or the husband’s difficulties in funding the current proceedings. Neither explanation is particularly satisfactory.
On 4 September 2017, I made an order as follows:
a)the Court declares that the wife’s Application in a Case filed on 8 December 2016, so far as it relates to an application pursuant to s.79A of the Act, is in interlocutory application.
I also published my reasons.
The matter was listed for hearing on 5 & 6 February 2018. On those days, the wife was represented by Counsel and the husband was unrepresented. The husband sought an adjournment of the hearing to enable him to save sufficient funds to obtain legal representation.
On 6 February 2018, the husband’s application was granted, and the matter was listed for hearing on 23 July 2018. On that day, the wife was represented, however the husband was not.
I advised the husband that he may wish to consult a duty lawyer to obtain advice, however he declined to do so. I also advised the husband of the requisite matters, in accordance with the guidelines referred to in Re F: Litigants in Person Guidelines (2001) FLC 93-072.
I note that the husband had previously represented himself in the proceedings before her Honour Judge Jones. The husband was both confident and competent in the presentation of his case before me.
Proposals of the parties
The wife’s proposal
The wife’s initial proposals are set out in her Application in a Case filed on 8 December 2016.
Counsel for the wife, in addition to his Final Written Submissions, provided a Minute of Orders sought by the wife.
The orders sought were expressed as two alternatives, namely:
a)I exercise my discretion pursuant to s.79A of the Act and make orders in substitution for the orders set aside;
b)I set aside the orders and make procedural orders for a further determination of adjustment of the respective property claims.
Particulars of the orders sought by the wife are set out at paragraphs 133- 134 hereof.
The husband’s proposal
The husband’s proposals are set out in his Response to an Application in a Case filed on 17 May 2017.
They are as follows:
a)the wife’s Application in a Case filed on 8 December 2016 be dismissed;
b)pursuant to the orders of 11 September 2014, the funds in trust with the lawyers for the wife, being payment in accordance with order 5 of the orders of 8 December 2014, be paid to the wife (less any costs payable by the wife to the husband) (“the payment”);
c)contemporaneously with the payment in order to hereof, at her expense the wife do all acts and things necessary to remove all caveats lodged by her and/or Victoria Legal Aid with respect to any grant of legal assistance against the said property;
d)the wife pay the husband’s costs of an incidental to and in relation to these proceedings.
The husband did not provide a minute of final orders sought.
Documents relied upon by the parties
The wife
The wife relied upon the following documents:
a)Application in a Case filed on 8 December 2016;
b)her affidavits sworn on 22 October 2014, 31 March 2016, 8 December 2016, 25 May 2017 and 29 August 2017;
c)Affidavit of Luke Peter Randles sworn on 25 May 2017.
The husband
The husband relied upon the following documents:
a)Response to an Application in a Case filed on 17 May 2017;
b)His affidavits sworn on 12 February 2015, 30 November 2015, 17 May 2017 and 20 July 2018.
Evidence
The standard of proof in this case is the balance of probabilities (s.140 of the Evidence Act).
Section 140 of the Evidence Act provides:
(1) In a civil proceeding, the court must find the case of a party proved if it is satisfied that the case has been proved on the balance of probabilities.
(2) Without limiting the matters that the court may take into account in deciding whether it is so satisfied, it is to take into account:
(a) the nature of the cause of action or defence; and
(b) the nature of the subject‑matter of the proceeding; and
(c) the gravity of the matters alleged.
The wife and the husband relied upon their respective affidavits. The affidavits were numerous, and recounted the history of the parties’ dispute following the determination of the property proceedings.
I do not intend to recite the evidence of all parties at trial. However, all of that evidence, together with the affidavits of the parties relied upon, the exhibits tendered and submissions made by Counsel for the wife and the husband, has been considered and taken into account.
In Bell & Nahos [2016] FamCAFC 244, Strickland J addressed the obligations of a trial judge in that regard as follows (at [28]-[29]):
28. Plainly that is the case, but it is not necessary in reaching a decision for a trial judge to refer to every piece of evidence or argument that is presented during a trial. That principle is well established in a number of authorities; I will mention two:
a) In Whisprun Pty Ltd v Dixon (2003) 200 ALR 447 at [62], Gleeson CJ, McHugh and Gummow JJ said this:
…A judge’s reasons are not required to mention every fact or argument relied on by the losing party as relevant to an issue. Judgments of trial judges would soon become longer than they already are if a judge’s failure to mention such facts and arguments would be evidence that he or she had not properly considered the losing party’s case.
b) In Housing Commission of New South Wales v Tatmar Pastoral Co Pty Ltd and Penrith Pastoral Co Pty Ltd [1983] 3 NSWLR 378 at 385 – 386, Mahoney JA said this:
It is not the duty of the judge to decide every matter which is raised in argument.
…
Nor is it necessary for a judge who is exercising a discretionary judgment to detail each factor which he has found to be relevant or irrelevant, or to itemize, for example, in the assessment of damages for tort, each of the factual matters to which he has had regard … Nor is a judge required to make an explicit finding on each disputed piece of evidence. It will be sufficient, if the inference as to what is found is appropriately clear…
29. I can see no error here in her Honour’s failure to refer to all of the evidence of the mother in relation to this issue. Her Honour plainly considered the evidence that she needed to in order to reach her decision.
Both the wife and her solicitor Luke Peter Randles gave evidence and were cross-examined. The wife was cross-examined by Counsel for the husband, and by the husband personally. Mr Randles was cross-examined by the husband. The husband gave evidence and was cross-examined.
I therefore had the immeasurable benefit of observing both parties in the witness box for a considerable period of time, and observing their demeanour in Court throughout the proceedings.
The wife gave evidence and was cross-examined with the assistance of an interpreter. She generally gave direct evidence and responded to questions appropriately. She was not evasive, and was prepared to make some concessions. She was consistent in her evidence.
Mr Randles, the wife’s solicitor, gave evidence in a direct and straightforward manner. He answered all questions put to him in cross-examination and impressed me as a witness of truth.
The husband gave evidence and was cross-examined without the assistance of an interpreter. He was very competent in English. His evidence was problematic. He was, at times, evasive, and pretended not to understand some questions. His initial response to many questions was “possibly”. When pressed further, he sometimes answered the question asked, and sometimes did not. He professed to be unable to recall events, when it suited his purposes. His explanation about his financial relationship with Mr S and the arrangements for renting the Property A property, were evasive and not credible.
Where the evidence of the wife and the husband differs, I prefer the evidence of the wife and Mr Randles.
The Evidence
Paragraph 2 of the orders made on 11 September 2014 provided for the wife to give the husband notice of her intention to acquire the husband’s interest in the Property A property. Such notice was to be provided within 30 days of the date of the orders and in writing (“the election”).
Both parties agree that the wife provided notice of her election to acquire the property to the husband in September 2014.[1] The wife’s evidence was that an email was sent to the husband’s Hotmail address on 26 September 2014. The husband’s evidence is that the wife advised him of her election by text message between mid to late-September 2014.
[1] Conceded by the husband at paragraph 13 of his affidavit filed 29 July 2015.
The factual disagreement between the parties arises from:
a)the subsequent events; and
b)the disagreement about whether each party fulfilled her/his respective obligations pursuant to orders 1 and 6 of the 11 September 2014 orders.
Wife’s evidence
The wife’s evidence was:
a)On 26 September 2014, she sent an email to the husband at his Hotmail address, advising of her election to seek a transfer of the property to her;[2]
[2] Paragraph 6 and annexure one of the wife's affidavit sworn 25 May 2017.
b)She did not receive any reply advising her that the Hotmail address was incorrect, or that the email failed to transmit;
c)Around 26 September 2014, her personal lending manager from the Bank 1, Mr V, arranged for a valuer to attend the property to complete a valuation to enable her to refinance the mortgage encumbering the property;
d)On 30 September 2014, the wife received an email from Mr V advising that the husband had again refused to provide access to the property to enable a valuation to be conducted;[3]
[3] paragraphs 9 and annexure four of the wife's affidavit sworn 8 December 2016
e)The email of 30 September 2014 from Mr V to the wife states as follows:
Dear Ms Salah
I have tried calling you today that your line was busy. Please refer to the comments from Valuer:
Notes: Delay: Cancellation Request
Comments:
I spoke with the requester who advised that we can now speak with the borrower access. I spoke with the customer, Mr Solh, who advised that there is water damage to the house at the moment and he has lodged a claim with his insurance and is waiting for them to process so it can be fixed. As he doesn’t know when this will be completed, please cancel this request and reorder once or damage has been repaired. Thank you.
So I need to cancel a valuation request.
Regards
f)Her former solicitor forwarded an email to the husband on 3 October 2014, advising the husband of the need to have the property available for valuation inspection.[4] The email was forwarded to the husband at an email address: (“the Hotmail address”);
[4] paragraph 6 of the wife's affidavit filed 23 October 2014 and annexure "S3"
g)The email of 3 October 2014 to the husband refers to:
i)the solicitor contacting the husband on 12 September 2014, requesting a copy of the most recent bank statement and that the wife had contacted him on 24 September 2014 advising via both SMS and email that she was able to take over the loan;
ii)the allegation by the husband to the bank that there was a burst water pipe at the premises, and requesting a copy of the husband’s insurance claim;
iii)the husband had contacted the wife that day relating to the children, however the husband had failed and refused to respond to the solicitors’ SMS and phone calls to him;
h)On 15 October 2014, a further letter was sent to the husband by the wife’s new solicitor, Mr Randles, advising the husband that a valuer would attend the premises on 20 October 2014 at 12.30pm to complete the valuation. The letter sought a response from the husband confirming the valuer’s attendance, by 3.00pm on 17 October 2014, and failing such confirmation the valuation would be cancelled and a contravention application issued;
i)The husband did not respond to the letter of 15 October 2014 and a contravention application was filed on 22 October 2014 and returnable on 8 December 2014;
j)On 19 November 2014, she forwarded a text message to the husband on his mobile phone as follows:[5]
[5] paragraph 8 of the wife's affidavit sworn 29 August 2017
Mr. Solh,
as per final children court order you are suppose to give all your updated contact details to me. You are not following property and children both final order until now. You are not response my current lawyers (Randles Cooper lawyers) correspondence with you. My lawyer is unsuccessful in serving the contravention application and affidavit to you. Please let me know your current residential address and contact number how and when you are available, so my lawyer can serve all the documents to you.
Honourable family court allocated the time of the hearing on 8 December 2014 at 9 AM. Today is 19th of November 2014, I’m informing you the hearing date by SMS. Email and Viber.
Any information please contact my lawyer (you already have my lawyer’s details).
Thank you,
Ms Salah
k)She did not recall receiving a text message from the husband advising her that he was overseas;
l)On 8 December 2014, Judge Jones made orders providing the wife to have access to the property for the purposes of obtaining a valuation and otherwise dispensing with the requirement for personal service;[6]
m)On 25 February 2015, the wife’s new solicitor forwarded to the husband via email at the Hotmail address and via post to a post office box in Suburb A, a copy of the orders of Judge Jones dated 8 December 2016;[7]
n)On 2 March 2015, the wife’s solicitor forwarded a letter to the tenants of Property A advising that a further valuation had been scheduled for 10 AM on Monday, 9 March 2015, in accordance with the orders of Judge Jones of 8 December 2014;[8]
o)On 4 March 2015, the wife’s solicitor forwarded a further letter to the tenants of Property A advising a further valuation time of 10 AM on Monday, 16 March 2015;[9]
p)On 16 March 2015, the wife was advised by, Mr T, valuer that he attended the Property A premises, however nobody was home, there was no car in the driveway and all the shutters had been pulled closed.
[6] Paragraph 16 and annexure 7 of the wife's affidavit sworn 8 December 2016.
[7] Paragraph 17 and annexure 8 of the wife's affidavit sworn 8 December 2016.
[8] Paragraph 18 and annexure 9 to the wife's affidavit sworn 8 December 2016.
[9] Paragraph 19 and annexure 10 to the wife's affidavit sworn 8 December 2016.
Evidence of Mr Randles
Mr Randles’ evidence was:
a)On 15 October 2014, a letter was forwarded to the husband via email to the Hotmail address, advising him of the need for the wife’s valuer to attend the Property A property for valuation purposes, and that such valuation would take place on 20 October 2014 at 12:30pm;[10]
b)On 29 October 2014, a letter was forwarded to the husband at the address: Property B, which enclosed the Application – Contravention and the wife’s Affidavit in support;
c)He engaged a process server to attempt to personally serve the husband with a copy of the Application – Contravention and Affidavit in support at his address, Property B. The process server attempted service on two occasions; namely on 10 November 2014 at 6:15pm on Thursday, 13 November 2014 at 8:15pm, however there was no one home;[11]
d)On 18 November 2014 an email was forwarded to the husband at the Hotmail address enclosing a copy of the wife’s Contravention Application listed on 8 December 2014 and her affidavit in support sworn 22 October 2014, however the email was not able to be delivered. He was of the opinion that between 15 October 2014 and 18 November 2014, the husband made the Hotmail address inactive.
[10] annexure 1 to the affidavit of Luke Randles sworn 26 May 2017
[11] annexure 5 to the affidavit of Luke Randles sworn 26 May 2017
The husband’s evidence
The husband’s evidence was:
a)In mid to late-September 2014, the wife advised the husband by text message that she intended to seek a transfer of the property;
b)The wife did not pay to him the sum of $8,500 in accordance with order 1 of the September 2015 orders, nor would she pay any mortgage instalments, rates taxes and like apportionable outgoings;
c)On 19 November 2014, he paid to the wife the sum of $16,500 in accordance with order 6 and sent a letter to the Court registry on 19 November 2014, confirming his payment;[12]
[12] Paragraph 15 and annexure four of the husband's affidavit sworn 28 July 2015 in support of his notice of appeal.
d)That sum was paid into the wife’s bank account, and thereafter, transferred into her solicitor’s trust account in June 2015;
e)He did not receive a text message from the wife dated 19 November 2014 advising him of her Contravention Application which was listed on 8 December 2014;
f)As at 7 December 2014, he was not aware of the wife’s Contravention Application which was listed for 8 December 2014, despite contacting the Court via email on 7 December 2014 and referring to an Application;
g)He was overseas from 5 to 13 November 2014, and 23 November 2014 to 16 December 2014. He advised the wife via text message on 5 November 2014 that he was travelling overseas to visit his ailing parents;
h)He was unaware that the wife would need to arrange for the property to be valued, prior to obtaining finance, to discharge the mortgage encumbering the Property A property;
i)He had not been contacted by anyone to make arrangements to value the property in order for the wife to refinance the mortgage;
j)He had not used his Hotmail email address since September 2013.[13] In his oral evidence, he subsequently corrected that date to May 2014, but did not provide any explanation for the change of dates;
k)The emails annexed to the wife’s affidavits forwarded to and allegedly received from that Hotmail address were emails which the wife fraudulently sent to herself, as she had access to the account and passwords whilst they were married;
l)His correct email address at the relevant time was (omitted);
m)His address for service was and remains a Post Office Box in Suburb A;
n)At the relevant time he did not live at Property A, and moved back into the property in January 2018;
o)His residential address was Property B;
p)Although his residential address was a short distance from Property A, he did not attend the Property A property, nor drive past it, as the wife lived opposite at Property C, and he was fearful of her.
[13] Paragraph 11 of the husband's affidavit sworn 29 July 2015.
Discussion of evidence and findings of fact
The findings of fact in this matter are significantly dependent upon the credibility of each of the witnesses.
The evidence of the husband under cross-examination was unimpressive, disingenuous, duplicitous and evasive.
He was unequivocally evasive about :
a)The terms of a loan between himself and his friend, Mr S. Mr S filed an affidavit on 5 February 2014 in the original proceedings between the parties which were determined by Her Honour Judge Jones annexed to that affidavit is a loan agreement between the husband and Mr S for the sum of $100,000. The agreement provided that the sum advanced was to be repaid by 11 June 2016. The husband’s evidence under cross-examination was that the repayment date of the loan had been extended sometime in 2016, although he was unable to recall the exact date. The extension of the loan agreement was not annexed to any affidavit filed by the husband in this proceeding;
b)The circumstances giving rise to Mr S lodging a caveat against the title to the Property A property;
c)His reasons for not informing Mr S of the order of Judge Jones made on 11 September 2014, requiring Mr S to remove the caveat encumbering the property;
d)The location of his home Property B from mid-2014. He would not directly answer questions about the configuration of the units, and whether or not his home was one of the front buildings of the unit block after much cross-examination and eventual intervention by me he admitted that he lived in unit one, which was one of the front units on the street at Property B. The evidence of Mr Randall’s as to attempted service of a contravention proceedings on the husband at that address, was entirely consistent with the husband’s eventual concession of where he was living at that time;
e)The reason why he had not driven past the Property A premises, at the time he was living in Property B, as the two premises are a few kilometres from each other. His evidence was that he was afraid of the wife at that time;
f)Despite the husband being the registered proprietor of the property, Mr S was ostensibly in control of leasing the property to tenants and for payment of the mortgage; and that he and Mr S did not have any discussions about the tenancy of Property A, including payment of rent;
g)When and how Mr S allegedly approached him to advise him that the tenants had vacated the property so that he and his family could move into the property;
h)His income from both his employment and social security benefits;
i)His lack of conversation with Mr S about the extent of his alleged indebtedness;
j)His inability to recall when he had travelled overseas in 2014;
k)The lack of explanation why he changed his evidence about the date on which he ceased using the Hotmail email address from September 2013 to May 2014;
l)His evidence that he did not receive the wife’s text message on 19 November 2014, advising him of the contravention proceedings, despite acknowledging that the phone number to which the wife said she sent the text was his ;
m)His evidence of the circumstances of him becoming aware of the listing of the wife’s Application – Contravention on 8 December 2014. He was ostensibly advised of the listing either by email or telephone, he was unable to recall which, by a registry staff member when he telephoned the enquiry centre;
n)Why he did not advise the court of his payment of funds to the wife until 7 December 2014, when he was in (country omitted), when he actually paid the funds in November 2014;
o)His statement that he had no knowledge about banking practice and that it was likely that the bank would require a valuation of the property prior to advancing a mortgage to the wife, to enable her to purchase the property from him
p)His acceptance of the order made by Judge Jones on 8 December 2014, enabling the wife to engage a valuer for a bank refinance;
As a result of the husband’s evidence under cross examination, his generally evasive, non-responsive and contradictory answers, I have formed the view that the husband blatantly manipulated the wife’s capacity to comply with the orders to enable her to purchase his interest in the Property A for the property.
I find that:
a)The husband deliberately denied the wife’s valuer access to the Property A property, to enable a valuation to take place;
b)Emails forwarded to the Hotmail address were received by the husband, and that email address was his address at all relevant times;
c)The husband was aware of the contravention proceedings as a result of the text message from the wife dated 19 November 2014;
d)The wife acted to the best of her ability to enable compliance with the orders;
e)The husband deliberately and wilfully sought to frustrate the wife’s capacity to comply with the orders of 14 September 2014, to enable her to acquire his interest in the Property A property.
Relevant Law
Machinery or substantive provisions
The wife contends that the Court has the power to vary the timeframe for payment, as prescribed by order 1 of the 11 September 2014 orders.
She relies on her submissions of 12 May 2017, and asserts that the orders she seeks to modify are machinery provisions of the orders, and do not affect the substantive rights of the parties.
The submissions refer to a number of authorities: Davis and Davis [2012] FMCAfam 1244, In the Marriage of Ravasini [1983] FLC 91-312 (“Ravasini”), In the Marriage of McDonald [1976] FLC 90-047 and In the Marriage of Slapp [1989] FLC 92-022 (“Slapp”).
The husband submits that:
a)the orders of 11 September 2014 should be enforced;
b)the extension of the time prescribed in paragraph 1 of the 11 September 2014 orders is not a machinery provision, and affects the substantive rights of the parties.
Whether a variation of orders is a machinery provision or a substantive variation has been the subject of much judicial attention.
In Ravasini (supra) at paragraphs 905- 907, the Full Court said:
… Counsel for the appellant referred to McDonald and McDonald (1976) 1 Fam LR 11,391; [1976] FLC 90-047 ; Kaljo and Kaljo (1978) 4 Fam LR 190 ; [1978] FLC 90-445 and Molier and Van Wyk (1980) 7 Fam LR 18 ; [1980] FLC 90-911 as authority for the power of the court to make what is termed a machinery order. There is no question of the power of the court to make what we would with respect suggest is more properly called a consequential order. The real questions are what is the proper definition of a consequential or machinery order and where is the dividing line between a consequential order which may be varied or modified and a substantive order which the Act gives no power to the court to modify or vary. Counsel for the appellant was unable to refer the court to any authority on this point…
…
It is appropriate then to look at what a consequential order is. The Shorter Oxford Dictionary defines “consequential” as meaning “following esp as an effect, immediate or eventual, or as a logical inference”.
The Universal English Dictionary defines the word as “following as a consequence, on what has gone before, resultant: consequential alteration in wording of a document, those made necessary by others already made”. The same dictionary defines “consequence” as “event which follows upon something else which is, or appears to be, the cause; a result, outcome of what has gone before”.
A consequential order then, in a property matter, would include an order following logically or of necessity from a prior substantive order.
What a consequential order is not is an order the effect of which is to vary the prior order for property settlement. It is not possible to suggest that even the slightest variation of the original order is a consequence of it. What is being submitted in this appeal is that the original order should be amended not as a consequence of that order itself, not as a necessary follow up of that original order but rather as a consequence of events which have happened in the market place since that order was made rendering the facts on which it was based no longer accurate.
Whether what is to be done is termed a consequential order or a machinery order the result is the same. The Court has no power to vary the original order. It has power to enforce the order and to modify the machinery provisions of the order to effect enforcement provided that by so doing it does not affect the substantive rights of the parties. That power can also be used to spell out the effect of the order where that is not clear.
An examination of the cases referred to bears out what we have already stated. In Kaljo’s case the Court did not vary the substantive order namely that the husband provide up to $70,000 for the purchase of a home; what the Court did do was to examine that order, discover its true meaning and then make further orders of a machinery, consequential or operative nature to enable the substantive order to be put into effect. The substantive order itself was not varied. That order could only be varied pursuant to the provisions of sec. 79A or an appeal or under the slip rule.
The same situation applies in the cases of Molier and Van Wyk and McDonald. In Molier and Van Wyk the Court again interpreted the substantive order and then made the necessary further orders to give it operation and effect. In McDonald and McDonald the order could be divided into two parts, the substantive order that the husband pay the purchase price to the wife and then the machinery or consequential orders which set out how that payment was to be made. Again the substantive order was not varied.
…
The true position then was summed up with precision by the Full Court in Molier and Van Wyk at p. 75,768 where it was said:
“It has been decided that while this Court has no power to vary an order for property settlement, it has power to enforce the order and to modify the machinery provisions of the order to effect enforcement...”
Thus, as we have set out above, the substantive order cannot be varied but the enforcement provisions, the secondary orders made as a consequence of the substantive order, to give it operation and effect, can be varied. It is therefore the construction of the order itself that is to be examined and not the basis of fact on which it was made. The test is not whether the unchangeable or substantive order is a just or proper order — that is a matter for appeal or for an application under sec. 79A — but whether the part or parts of the order sought to be changed are part or parts of the substantive order or whether they are orders made to give efficacy to that substantive order.
Whether variation to orders is a machinery provision or affects substantive rights of the parties was again considered by the Full Court in In the Marriage of Bray (1988) 93 FLR 183 and in Slapp (supra).
In Bray (supra) at 185, Lindenmayer J said:
In my opinion, what is of most significance in relation to the orders of 13 August [in the case of Bray] is that, by par 3 of those orders, it was specifically provided that in the event that the wife should fail, refuse or neglect to pay the husband the sum of $51,680 referred to in order number I within the time specified in order number I, then the property should be sold forthwith and the net proceeds of sale should be divided between the parties in certain proportions. Order number 3 made specific provision for what should occur in the event that the wife failed to pay the money within the time specified in order number I. In my opinion, order number 3 did create a substantive right in the husband, and, for that matter, in the wife, to receive, in that event, in the husband’s case not a fixed sum of money but a fixed percentage of the proceeds of sale of the matrimonial home. In my view, that is an entirely different right from that provided by order number I, and it cannot be said, in my opinion, that the requirement for the payment within a period of three months was merely a machinery provision.
…
In my opinion, in order to succeed with his submission in relation to par 1, it is necessary to conclude that order number 3 is entirely a machinery provision only, and in my opinion, it is not.
Mr Rybak referred to a number of authorities in support of his submissions. He referred first to the case of In the Marriage of McDonald (1976) 1 Fam LR 11,391, and he submitted that that case is authority for the proposition that an order for the payment of money within a fixed period of time is merely a machinery order.
I do not regard that case as authority for that proposition in every case. In any event, the case of McDonald was a case decided in 1976, prior to the enactment of s 79A of the Act, and in my opinion if it were authority for a proposition as broad as Mr Rybak suggested, then, in my opinion, it would no longer have any force or validity.
At 187 of Bray, Nygh J said:
The test, as I have said earlier, is the one laid down in Ravasini, and in McDonald, an inquiry as to whether the order vests a right in a party, and for the reasons I have explained earlier this must be done within the context of those orders. Obviously each set of orders in each case must be analysed on its own in its own right. In the context of the orders of this case, I am satisfied that the time provision was an integral part of the substantive provisions of the orders which his Honour made.
At 187 of Bray, (supra) Graham J said:
The wife’s application sought to vary a prior order for property settlement. She sought to have the original order amended, not as a consequence of the order itself, but because something had occurred which required the order to be modified in this case. That something was the fact that the wife could not raise the money that she had been ordered to pay the husband.
The order of the learned trial judge was couched clearly and precisely. I have concluded that order was not a consequential order, and I am of the view that the payment of the amount of money within three months was a substantive part of the order. I, too, would dismiss the appeal.
In Slapp (supra) the Full Court followed Bray (supra), and at paragraph 160 to 161 said:
As Mr Moss has pointed out, this court In the Marriage of Bray (1988) 12 Fam LR 563, held in an almost identical situation that an order which substitutes an alternative order if certain preconditions are not fulfilled by a certain time, confers upon the beneficiary of that order a substantive right. In other words, the orders as originally framed by his Honour on 11 March 1988 provided that if the money was not paid by 11 July 1988, or such further time as the parties might by agreement extend, there would be vested in the wife a substantive right of quite a different kind to that provided for in the first alternative.
…
In my view that situation falls fairly and squarely within the scope of the earlier decision in In the Marriage of Bray, supra. It cannot be described as merely a change of machinery but it had the effect of depriving the wife of a right of substance which the earlier orders of the court, as amended, had vested in her.
Discussion
The authorities identify that the test whether the order/s sought to be changed are mechanical or substantive requires close scrutiny of the orders in the context of each case.
In this matter, the relevant orders are paragraphs 1, 2, 3, 5 and 6 which provide:
a)within 60 days of the date of this order (“the date”) the applicant pay to the respondent sum of $8,500 (“the first payment”);
b)within 30 days of the date hereof the applicant advised the respondent in writing (“election”) whether she proposes to make the first payment and accept the transfer to her of all the respondent’s right, title and interest in the former matrimonial home, situated at and known as Property A in the state of Victoria (“the real property”);
c)subject order 2 and contemporaneously with the first payment to the respondent into the parties do all such acts and things and sign all such documents as may be necessary to transfer to the applicant and at the expense of the applicant all of the respondents right, title and interest in the real property;
d)upon the applicant advising the respondent of the election pursuant to order two, the applicant pay all instalments pursuant to the mortgage and all rates, taxes and the like apportioning outgoings of or with respect of the real property;
e)in the event the respondent has not made a second payment to the applicant pursuant to order 1, the respondent pay to the applicant within 90 days of the date sum of $16,500 (“the second payment”).
The orders provide a process for the wife to have the opportunity to acquire the husband’s interest in the property, provided she:
a)firstly, makes an election of her intention to acquire the property;
b)secondly, pays the sum of $8,000 to the husband;
c)thirdly, refinances the mortgage encumbering the property.
If she fails to do so, then the husband is entitled to exercise his right to acquire the wife’s interest in the property, provided he pays to her $16,500.
In default of either party electing to retain the property, the property is to be sold and the proceeds of sale divided in the specified proportion.
The orders are precise and unambiguous. It is obvious that because of the wife’s alleged default in paying the $8,500 to him, the husband seeks to retain the property.
Having regard to the authorities and in particular, the statements in Bray (supra) and Slapp (supra), it is clear to me that the husband’s right to acquire the wife’s interest in the property, if she does not follow the prescribed steps to acquire his interest, is a substantive right. It is entirely different from the husband receiving a payment of $8,500 for his interest in the property, or receiving a share of the proceeds of sale, if neither party sought to retain the property.
For these reasons, I conclude that an extension of time for the wife to comply with paragraph 1 of the 11 September 2014 orders is not a machinery or consequential provision.
Rule 3.05(1) of the Federal Circuit Court Rules 2001
Neither party made submissions about the Court’s power pursuant to r.3.05(1) of the FCC Rules.
Rule 3.05(1) of the FCC Rules provides as follows:
3.05 Extension or shortening of time fixed
(1) The Court may extend or shorten a time fixed by these Rules or by a judgment, decree or order.
(2) A Registrar may extend or shorten a time fixed by these Rules.
(3) The time fixed may be extended even if the time fixed has passed.
(4) A time fixed by these Rules or by a judgment, decree or order for service, filing or amendment of a document may be extended by consent without an order.
In Slapp (supra) at paragraph 161, Nygh J referred to an extension of time under the rules of court. In doing so, he referred to the High Court authority of FAI General Insurance Co-Ltd v Southern Cross Exploration N. L. (1988) 165CLR 268:
In [FAI] the Honours were dealing with an appeal from the Supreme Court of New South Wales and held that the provisions of Pt II, r3 of the rules of that court which allow the Supreme Court by order to extend or abridge any time fixed by the rules or by any judgment of (sic) order, allowed the Supreme Court of New South Wales to extend the time fixed under certain procedural directions to the doing of certain things, even though it was a part of a self-executing order which had the effect of terminating the proceedings if those steps were not being taken within the time prescribed.
Discussion
The issue of extension of time pursuant to r.3.05 of the rules was raised by me in court, when both parties were represented by counsel.
Both at that time, and in the final written submissions, neither party made submissions about the court’s power pursuant to r.3.05(1) of the Rules.
Whether the court has power to extend time pursuant to an order, which would afford an opportunity to the wife to investigate her prospects of refinancing, is a different matter from whether or not such discretion should be exercised.
In the present circumstances, I am of the view that this court has power to extend a timeframe fixed by a judgement, however the discretion should to do so should not be exercised in the current case.
The reasons I decline to exercise my discretion are as follows:
i)The time which has elapsed since the making of the orders in September 2014; and
ii)The changed circumstances of both the husband and the wife.
Section 79A setting aside of orders altering property interests
Section 79A of the Family Law Act 1975 (“the act”) provides :
Section 79A(1) Where, on application by a person affected by an order made by a court under section 79 in property settlement proceedings, the court is satisfied that:
(a) there has been a miscarriage of justice by reason of fraud, duress, suppression of evidence (including failure to disclose relevant information), the giving of false evidence or any other circumstance; or
(b) in the circumstances that have arisen since the order was made it is impracticable for the order to be carried out or impracticable for a part of the order to be carried out; or
(c) a person has defaulted in carrying out an obligation imposed on the person by the order and, in the circumstances that have arisen as a result of that default, it is just and equitable to vary the order or to set the order aside and make another order in substitution for the order; or
(d) in the circumstances that have arisen since the making of the order, being circumstances of an exceptional nature relating to the care, welfare and development of a child of the marriage, the child or, where the applicant has caring responsibility for the child (as defined in subsection (1AA), the applicant, will suffer hardship if the court does not vary the order or set the order aside and make another order in substitution for the order; or
(e) a proceeds of crime order has been made covering property of the parties to the marriage or either of them, or a proceeds of crime order has been made against a party to the marriage;
the court may, in its discretion, vary the order or set the order aside and, if it considers appropriate, make another order under section 79 in substitution for the order so set aside.
Section 79A of the Act is a remedial section intended to address miscarriages of justice and other specific difficulties and should be construed liberally to affect the intended purpose: Re Gilbert and the Estate of Gilbert (dec’d) (1989) 13 Fam LR 632. However, s.79A cannot be used to circumvent the basic principle that there can only be one property settlement between parties to a marriage: In the marriage of Kowalski (1992) 16 Fam LR 235.
The applicant bears the onus of proof of satisfying the court that it is appropriate to exercise the jurisdiction to vary or set aside a previous final property order: Official Trustee in Bankruptcy v Donovan (1996) 20 Fam LR 802.
In her final written submissions the wife relies upon s.79A(1)(a)(b) and (d). I consider s.79A(1)(c) to also be relevant. I will address each provision.
Section 79A(1)(a) Miscarriage of justice by reason of fraud, duress, suppression of evidence, false evidence or any other circumstance
According to the authorities, the provisions of this section only apply to circumstances in existence at the time or before the original orders were made. It does not refer to circumstances occurring subsequent to the making of the orders. In the Marriage of Molier and Van Wyk (supra).
The wife does not submit that there were circumstances at the time of or before the original orders were made, which would warrant the setting aside of the orders, pursuant to the matters referred to in that subsection.
Section 79A(1) (b) Impracticable for the order to be carried out
Section 79A(1)(b) was considered by the Full Court in Cawthorn & Cawthorn [1998] FamCA 37.
In that case the husband, who had defaulted in complying with some final property orders made by consent, sought to set aside the orders. His application was precipitated by a severe deterioration in his financial circumstances since the making of the orders, which he asserted made it impracticable for him to comply with the orders
The Full Court adopted the approach of Kay J in In the Marriage of La Rocca (1991) 14 Fam LR 715, who stated that the concept of impracticability, for the purposes of this section, was similar to the doctrine of frustration in contractual matters.
At page 85,059 of Cawthorn the Full Court quoted Kay J as follows:
My own view is that the concept of impracticability, as referred to in this section, is akin to the application of the doctrine of frustration in contractual matters. What the Parliament is concerned with and what ought to be concerning the Court is the happening of events which cannot be reasonably foreseen, which will have the effect of causing an injustice to one of the parties if the happening of such events is not given effect to.
In standard contractual doctrine, I think that is as comfortably as anywhere described by Russell J. in Re Badische Co. Ltd. (1921) 2 Ch. 331 at 379 , where his Honour said:
The doctrine of dissolution of a contract by the frustration of its commercial object rests on an implication arising from the presumed common intention of the parties. If the supervening events or circumstances are such that it is impossible to hold that reasonable men could have contemplated that event or those circumstances and yet have entered into the bargain expressed in the document, a term should be implied dissolving the contract upon the happening of the event or circumstances.
Now, in my view, what the appropriate application of s. 79A(1)(b) ought to be is that circumstances that have arisen in which it becomes impracticable to carry out the orders are circumstances that could not reasonably have been contemplated and that in such circumstances, whilst impossibility is not the test and impracticability is, it may then become just and equitable to change the orders.
In Cawthorn (supra) Full Court did not accept that the husband’s insolvency, which resulted from:
a)the sale of a property realising substantially less than had been anticipated; and
b)an embezzlement of money by one of the husband’s business partners
was a ground to set aside the orders pursuant to the particular provision.
In this matter the wife alleges that her default or inability to comply with the orders was caused by the husband’s failure to allow a bank valuer access to the premises, to enable her to refinance the existing mortgage encumbering the property. In the absence of a bank valuation she was simply unable to proceed with an application to refinance the mortgage and thereby implement a transfer the property to her.
The wife’s evidence in relation to the arrangements made for a valuer to inspect the property referred to at paragraph 58. The husband, under cross-examination gave evidence that he was unaware that the wife would require a valuation of the premises to enable her to refinance the existing mortgage. As referred to, I do not accept that evidence of the husband.
The husband also alleged that he was unaware of any attempts by the wife or her lawyers to contact him to arrange a valuation of the property. That was because correspondence and emails had been sent to the wrong postal address and email address. No correspondence had been sent to his address for service on the court file nor to what he asserted was his correct email address. I refer to my findings in this regard at paragraph 64 hereof.
Section 79A(1)(c) default in carrying out an obligation imposed by original order
In Cawthorn, the Full Court also considered this provision. The husband had made one initial payment of $5000 to the wife, however he had defaulted in his obligation to make further payment to the wife, and had made virtually no attempt to comply with the balance of the orders.
The facts of Cawthorn were distinguished from Monticone & Monticone [1998] FamCA 92. In Monticone, the applicant had made considerable effort to comply with the orders, although not within the time specified.
In Cawthorn the Full Court said, in the context of an application by the defaulting party, as follows:
… in our view a party cannot successfully seek an order pursuant to s 79A(1) as a result of that party's own default unless such default was due to circumstances quite beyond that party's control. This rests firstly upon the well established principle of law that no one should profit by their own wrong doing. This principle clearly embraces the obligation to carry out the provisions of a court order. Secondly, it would normally not be just and equitable to grant relief under s 79A(1) in those circumstances …
The Full Court further stated:
To obtain the relief that he seeks, the husband must establish to the court that his cause is one which is just and equitable. One of the principal maxims of equity is “he who comes into equity must come with clean hands”. The husband's hands are, in our view in the circumstances of this case, very far from clean. We would accordingly decline to grant relief pursuant to s 79A(1)(c).
In this matter there is no dispute that the wife has :
a)complied with paragraph 2 of the orders, namely, that she advised the husband within the prescribed time of her election for the property to be transferred to her;
b)failed to comply with paragraph 1 of the orders , namely she has not paid to the husband the sum of $8,500;
c)failed to comply with paragraph 5 of the orders, namely she has not paid all instalments pursuant to the mortgage and all rates, taxes and the like apportionable outgoings preferable to the property.
There is also no dispute that the husband has complied with paragraph 6 of the orders, namely he paid to the wife $16,500 within the 90 day specified period.
From the wife’s perspective, the husband has deliberately frustrated her capacity to comply with paragraphs 1 and 3 of the orders, to enable her to discharge the existing mortgage encumbering the property.
Although there is no specific order requiring discharge of the mortgage, paragraph 3 requires each of the parties to do all acts and things and sign all such documents as may be necessary to transfer to the applicant (wife) at her expense, all of the respondent’s (husband) right title and interest in the real property.
As the husband is the sole registered proprietor of the property and mortgagor, it would not be possible to transfer the husband’s interest in the property to the wife, absent the wife making arrangements to discharge the existing mortgage encumbering the property.
As a result of my findings about the husband’s deliberate avoidance of the wife’s attempts to arrange a valuation of the property, both parties do not come to the court with “clean hands”.
As I am satisfied that both parties have defaulted in their obligations, the next question to address is whether or not it is just and equitable to vary the order or set it aside or make another order in substitution for the order.
According to the wife, she advised the husband of her election to seek a transfer of the property to her email to the Hotmail address on 26 September 2014. The husband asserts that the election took place between mid and late September 2014 and was via SMS.
Between late September 2014 and March 2015 the wife personally, and through her two sets of solicitors made many attempts to arrange for a valuer to attend the Property A property, to enable her to refinance the mortgage and thereby a transfer of the property to her.
As referred to at paragraph 63 and 64 hereof, I have found that:
i)the husband was aware of the wife’s attempts to have the property valued as a precursor to complying with the orders.
ii)The husband intentionally frustrated the valuation of the property, to thwart the wife obtaining finance to discharge the mortgage
iii)absent a valuation of the property, it would not have been possible for the wife to obtain finance from the Bank 1 to enable her to transfer the property.
The orders of Judge Jones made in September 2014 enabled the wife to retain the property, should she choose to do so. At the time the orders were made, the wife was and remains the primary carer of the parties’ three children, and she bears the financial responsibility for the children with little child support paid by the husband. However the husband’s actions deprived the wife of the option to retain the property.
Whilst the wife did not comply with paragraphs 1 and 5 of the September 2014 orders, it is difficult to contemplate how she could have reasonably done so in the absence of any certainty of her capacity to refinance the mortgage and have the property transferred to her.
The wife attempted to have the property valued by the bank as early as 26 September 2014, which according to the wife’s evidence was either the day on which she made the election or a couple of days after. Further attempts to value the property were made on 30 September 2014, including an alleged conversation between the husband and the valuer who attended the premises, relating to a supposed water leak.
Emails and letters were subsequently forwarded to the husband on 3 and 15 October 2014 seeking confirmation of further valuation times. On 22 October 2014 a contravention application was filed by the wife.
The wife’s requests to value the property were made in a timely manner. If the husband had complied and cooperated with the wife’s request for valuation of the property, she would have been able to make an informed decision within the 60 day period referred to in order 1, about whether she wished to retain the property and make the payment to the husband. The actions of the husband did not enable her to do so.
In my view, as a result of the husband’s conduct for the reasons referred to herein:
i)It is impracticable for the order to be carried out; and
ii)In the circumstances that have arisen as a result of the default, it is just and equitable to vary, set aside or make another order in substitution for the order.
Not to do so, would condone the husband’s conduct and deprive the wife of any possibility of retaining the property, as contemplated by the orders of 11 September 2014.
Section 79A(1)(d) circumstances of an exceptional nature relating to the care, welfare and development of the child
This provision of the act refers to the circumstances of the child of a marriage. The court must be satisfied that the child or the applicant who has caring responsibility for the child will suffer hardship if the court does not vary or set aside the order or make another order. It enables the court to intervene where there has been a change of circumstances, which are of an exceptional nature and relate to the care welfare and development of a child of the marriage.
This issue was considered in In the Marriage of Simpson and Hamlin (1984) 9 Fam LR 1040; FLC-91-576.
In this matter there was no evidence of any circumstances which had arisen of an exceptional nature resulting in hardship to the wife or the children. The only hardship which could be contemplated would be depriving the children of the right to live in a home of which their mother was the registered proprietor. Such hardship could not, on any view, be considered of an exceptional nature, and so serious that the only method of addressing the hardship would be to set aside or vary an existing order of the court.
Husband’s application to enforce the orders of 11 September 2014
As a result of my findings, determination and conclusion of relief pursuant to s.79A(1)(b) and (c) of the act, I do not intend to enforce the orders of 11 September 2014, as sought by the husband.
Should the orders be varied or set aside, or another made in substitution
In her final written submissions, the wife submitted to alternative positions. Firstly that the orders of 11 September 2014 should be varied and secondly that the orders should be set aside.
Her submissions relating to variation of the orders may be summarised as follows:
i)The property should be independently valued
ii)The wife pay to the husband 35% of the equity in the property and effective discharge of the mortgage to the Bank 1 encumbering the property
iii)The $16,500 in the wife’s solicitor’s trust account be retained, pending the determination of a costs application.
Her submissions relating to setting aside of the orders may be summarised as follows:
i)The orders of 11 September 2014 should be set aside
ii)Procedural orders for filing amended applications/responses and affidavits in support
iii)Leave to the wife to join Mr S as a second respondent to the proceedings
iv)The $16,500 in the wife’s solicitor’s trust account be retained, pending the determination of a costs application.
In his final written submissions, the husband did not address varying or setting aside the orders as his position was that the orders of 11 September 2014 should be enforced.
The distinction between setting aside and varying an order, where it has either been considered or determined that relief should be granted pursuant to s.79A(1)(b), (c), or (d), has been considered in a number of authorities.
In Pendleton & Pendleton [2017] FamCAFC 108, the Full Court referred to the authorities of Parker and Parker (1983)FLC 91-364, Simpson and Hamlin (supra), and Trustee for the Bankrupt Estate of N Lasic & Lasic (2009) FLC 93-402 where s79A(1)(b) (d)and (a) had been respectively engaged.
At paragraph 49 of Pendleton, the Full Court referred, with approval to the statement of Nygh J in Parker. At paragraph 50, the Full Court said:
[50] The issue arose again in Simpson and Hamlin [1984] FamCA 62; (1984) FLC 91-576 where the Full Court was considering a case where subparagraph (d) of s 79A(1) was engaged. The Full Court said at 79,659 (emphasis added):
The husband also complained that in making the variation, his Honour did not consider the present financial circumstances of the parties. Indeed, had his Honour set the consent order aside and proceeded to make a fresh order under sec. 79, he would have been obliged to consider all factors which must be considered under sec. 79(4) and, so far as they are relevant, under sec. 75(2). As Nygh J. explained in Parker and Parker (1983) FLC 91364 at pp. 78,444-78,446; [1983] FamCA 54; (1983) 9 Fam. L.R. 323 at pp. 328-329, the choice between setting aside and variation depends on the degree of intervention to be made. Where, as here, that intervention consists of a perceived realignment of the distribution of property of the parties from one-third to two-thirds respectively to an approximately equal division, it is in our view a matter which goes beyond mere variation and would require the formal setting aside of the order and the making of a new order with all the consequences of that under sec. 79. Only thus can the Court ensure that the new order will be just and equitable between the parties.
[51] Section 79A(1) was also considered in Trustee for the Bankrupt Estate of N Lasic & Lasic (2009) FLC 93-402 where the primary judge had “amended” orders after it was conceded that s 79(1)(a) was engaged. There the Full Court, when considering the distinction between setting aside and varying of an order, cited with evident approval the passage we have extracted above from Simpson and Hamlin (and their Honours also emphasised the words we have emphasised). Having done so, the Full Court went on to observe at [237] (emphasis added):
We accept in this case, having regard to the time which had elapsed since the making of the consent orders and changes in circumstances pertaining to the real estate, the orders proposed by the trustee presented obvious practical difficulties. Nevertheless, in our view, in light of the magnitude of the adjustment to the outcome contained in the consent orders, this was a case where the orders should have been set aside rather than merely being varied or, as his Honour said, “amended”.
In this case, four years have elapsed since the making of the orders, and the change in circumstances pertaining to the property in dispute is significant. I am of the view that because of the consequent ramifications and the change in circumstances of the parties, referred to by the husband in his affidavit filed 20 July 2018, the orders should be set aside. I am unable to make new orders which would satisfy a full and comprehensive consideration of the matters arising under s.79(4) and s75(2), without affording the parties the opportunity to place evidence before the court which would enable appropriate consideration.
I am cognisant that this will result in a further hearing of the competing property applications between the parties, however in my view regrettably there is no other alternative.
Costs
On 17 August 2016, I made an order reserving the husband’s costs of that day fixed at $4,000 as the wife was unable to proceed with the trial.
On 9 December 2016, the matter was again listed for trial, but did not proceed, due to the wife filing an Application in a Case on 8 December 2016.
Paragraphs 2 and 3 of the orders of 9 December 2016 provided for each of the parties to file brief written submissions in relation to costs incurred by the husband from 4 April 2016 to date.
On 26 May 2017, when the matter was listed for trial, there was a dispute about whether proceedings pursuant to s.79A of the act were interlocutory and the admissibility of hearsay evidence.
Paragraph 2 of the orders made on 26 May 2000 and provided for the parties to file, within 45 days, written submissions about whether the proceedings were interlocutory or final.
On 22 July 2017, the wife filed her written submissions, however the husband did not file his written submissions until 29 August 2017. The explanation for non-compliance with my orders provided by the husband’s solicitors were “changes that have occurred in the office of his solicitors” and/or the husband’s difficulties in funding the proceedings.
On 4 September 2017 I:
a)Made an order declaring that the s.79A application was an interlocutory application.
b)Delivered reasons relating to the interlocutory/final dispute and the admissibility of hearsay evidence.
The matter was again listed for a further trial on 5 February 2018. On that day the interpreter who had been booked mistakenly went to the Dandenong Registry of the court.
The matter was adjourned to the next day, 6 February 2018. The husband appeared on his own behalf on that day and the wife was represented by counsel.
The husband sought an adjournment of the proceedings to enable him to fund legal representation stop on that day in order was made that the husband pay the wife’s costs of the day thrown away, with the date of payment and quantum to be determined by final reasons.
During the final trial which took place in July 2018, there were no submissions about further issue of costs.
I am of the view that orders should be made for the wife to pay the husband’s costs of $4,000 ordered on 17 August 2016 and for the husband to pay the wife’s costs ordered on 6 February 2018. There were no specific submissions about the quantum of the wife’s costs incurred on 6 February 2018.
The quantum of the wife’s costs thrown away on 6 February 2018, should be the same as the quantum of the husband’s costs ordered on 17 August 2016. On both occasions the party in whose favour the cost order was made, was represented by Counsel when the other party sought an adjournment.
I intend to make a further order offsetting each of the costs orders.
In relation to the husband’s costs since 4 April 2016, the husband filed written submissions as to costs on 31 January 2017 and the wife filed written submissions as to costs on 21 February 2017.
I do not intend to repeat the submissions of each of the parties contained in the written submissions.
The husband, in his submissions sought costs incurred as a result of the proceedings commenced by him pursuant to r.16.05 of the Federal Circuit Court Rules and the costs arising from the contravention proceedings which were listed for determination on 17 August 2016.
As previously referred to, on 17 August 2016, an order was made that the wife pay the husband’s cost fixed at $4000. I have referred to that cost order in these reasons.
Both written submissions referred to the relevant factors in the s.117(1) of the Act.
Section 117(1) of the Family Law Act1975 (“the Act”) states, subject to the provisions of s.117(2), that the general rule in proceedings in this court, is that each party to proceedings, shall each bear his or her own costs.
Section 117 (2) of the Act provides as follows:
If, in proceedings under this act, the court is of the opinion that there are circumstances that justify it in doing so, the court may subject to sub-sections (2A), (4), (4A) and (5) and the applicable Rules of Court, make such order as to costs and security for costs, whether by way of interlocutory order or otherwise, as the court considers just.
Section 117(2A) of the Act provides, that in considering what order (if any) should be made for the payment of costs, the court shall have regard to the following matters:
(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.
In the Marriage of I (No.2) (1995) FLC 92-625, the Full Court said that the relevant matters in s.117(2A):
“…must all be taken into account and/or balanced in order to determine whether the overall circumstances justified the making of an order for costs”
I will address each of the relevant factors.
Financial circumstances of the parties
Neither of the parties filed an updated financial statement for the purposes of the s.79A proceeding.
The financial circumstances of the parties are referred to in the respective written submissions, and the husband was cross-examined about his current financial circumstances.
The husband is a part-time (occupation omitted) and has remarried with two young children who apparently have been recently diagnosed as autistic. He claims his income throughout the property proceedings of 2013/2014 was approximately $23,000 per annum. He is also in receipt of a social security payments.
The wife has nominal assets and in her written submissions stated that she earned $1260 per week, which includes receipt of family tax benefits. She is responsible for the support of the three children of the parties’ relationship, with the husband paying nominal child support to her. She has re-partnered but receives no financial assistance from her partner.
Whether either party is in receipt of legal aid
Neither party is in receipt of a grant of legal assistance.
Conduct of the parties
I refer to and discuss the prospective conduct of the parties and my relevant findings elsewhere in these reasons.
Whether the proceedings minuted necessitated by the failure of a party to comply with previous orders
I refer to and discuss compliance of the parties with previous orders and my relevant findings elsewhere in these reasons.
Whether a party has been wholly unsuccessful
I refer to and discuss the respective success of the parties and my relevant findings elsewhere in these reasons.
Whether either party has made an offer to settle the proceedings
There were no offers to settle the proceedings which were brought to my attention.
After having considered all the matters referred to in s.117(2A), I am not persuaded that there are any circumstances which would warrant a departure from the usual rule that each party pay his / her own respective costs.
I certify that the preceding one hundred and seventy four (174) paragraphs are a true copy of the reasons for judgment of Judge Williams
Date: 5 October 2017
Key Legal Topics
Areas of Law
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Family Law
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Civil Procedure
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Equity & Trusts
Legal Concepts
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Appeal
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Costs
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Remedies
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Procedural Fairness
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