Sanders and Sanders & Ors - [2014] FamCA 176

FAMILY COURT OF AUSTRALIA

SANDERS & SANDERS AND ORS

[2014] FamCA 176

FAMILY LAW – PROPERTY – Settlement in relation to marriage – Re-hearing following appeal to Full Court – Where neither party has capacity to satisfy order for property division – Not just and equitable to make any order – Application of the husband and application of the wife dismissed
FAMILY LAW – PRACTICE AND PROCEDURE – Application for Leave to Amend during a re-hearing following appeal in the Full Court – Where wife in re-hearing sought to amend application – Consideration of matters relevant to power to permit amendment – Where matters included substantial delay, wasted costs, prejudice and concerns of case management – Where order for costs would not compensate the other parties for prejudice caused by further delay – Where wife should have made Application at early stage in proceedings – Where Leave to Amend denied
FAMILY LAW – PRACTICE AND PROCEDURE – Application for Adjournment pursuant to s 57 of Legal Aid Commission Act 1979 (NSW) – Consideration of “special circumstances” – Application for Adjournment dismissed
FAMILY LAW – EQUITY – Where husband and respondents had signed personal guarantee – Where guarantee secured against matrimonial home – Where matrimonial home sold pursuant to guarantee – Where wife sought orders against the respondents on the basis of equitable contribution – Where right to seek contribution not determined
FAMILY LAW – THIRD PARTIES – Jurisdiction of Court to make orders affecting the property of third parties – Where respondents were third parties– Where property of respondents is not sufficiently connected to the division of matrimonial property
FAMILY LAW – COSTS – Indemnity costs – Where husband and wife sought indemnity costs against each other – Where wife wholly unsuccessful in proceedings – Where wife’s conduct in proceedings would justify order for costs against her – Where wife does not have ability to satisfy order for costs – Where wife made no submissions regarding s 117(2A) – Where husband and respondents do not have ability to satisfy order for costs – All applications for costs dismissed

Family Law Act 1975 (Cth) ss 79; s 85A; s 90AA; s 90AE; s 90AK; s 117(2A)

Legal Aid Commission Act 1979 (NSW) s 57

AC and Ors & VC and Anor [2013] FamCAFC 60
Aon Risk Services Australia Ltd v Australian National University (2009) 239 CLR 175
B Pty Ltd and Ors & K and Anor [2008] FamCAFC 113
Rowell & Keogh [2011] FamCAFC 74
Sanders & Sanders and Ors [2012] FamCAFC 136
Sexton & Sexton [2012] FamCAFC 218

J O’Donovan and J Phillips, The Modern Contract of Guarantee (Thomson Reuters, 2^nd ed., 2010)

APPLICANT WIFE:

Ms Sanders

1^ST RESPONDENT HUSBAND:

Mr Sanders

2^ND RESPONDENT:

U Pty Limited

3^RD RESPONDENT:

CG Pty Limited

4^TH RESPONDENT:

S Pty Limited

5^TH RESPONDENT:

K Pty Limited

6^TH RESPONDENT:

Y Pty Limited

7^TH RESPONDENT:

N Holdings Pty Limited

8^TH RESPONDENT:

Mr EB

9^TH RESPONDENT:

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2014] FamCA 176
Decision Date: 25 March 2014

CaseChat Overview and Summary

In the matter of *Sanders and Sanders & Ors*, Rees J considered applications by both the husband and wife concerning the division of matrimonial property, following an appeal to the Full Court. The proceedings also involved third-party respondents against whom the wife sought equitable contribution orders. The core dispute revolved around the division of property under section 79 of the *Family Law Act 1975* (Cth), with significant procedural applications also before the court.

The court was required to determine whether it was just and equitable to make any order for property division, given that neither party possessed the capacity to satisfy such an order. Additionally, the court had to consider the wife's application for leave to amend her application during the re-hearing, assessing factors such as delay, wasted costs, prejudice, and case management. The wife also sought an adjournment under section 57 of the *Legal Aid Commission Act 1979* (NSW), requiring consideration of whether "special circumstances" existed. The court also had to address the wife's claims for equitable contribution against third-party respondents and the jurisdiction to make orders affecting their property, as well as various applications for costs, including indemnity costs.

Rees J dismissed the wife's application for leave to amend, finding that the substantial delay, wasted costs, and prejudice to other parties meant that an order for costs would not adequately compensate for the harm caused by further delay, and that the application should have been made earlier. The application for adjournment under section 57 of the *Legal Aid Commission Act 1979* (NSW) was also dismissed, as no special circumstances were established. Crucially, the court found that it was not just and equitable to make any property division orders under section 79 of the *Family Law Act 1975* (Cth) because neither party had the capacity to satisfy such orders. The court also determined that it lacked jurisdiction to make orders affecting the property of the third-party respondents, as their property was not sufficiently connected to the division of the matrimonial property. All applications for costs were dismissed, including the wife's unsuccessful applications against the husband and respondents, and the husband's unsuccessful application against the wife, noting that while the wife's conduct might justify costs against her, she lacked the ability to satisfy such an order.

Consequently, the wife's applications for leave to amend, adjournment, spousal maintenance, property division orders, and costs were all dismissed. The husband's application for property division orders and his application for costs against the wife were also dismissed.

Orders

Orders of the court

IT IS ORDERED

That the wife’s application for leave to amend her application filed 29 April 2013 is dismissed.

That the wife’s application for an adjournment pursuant to section 57 of the Legal Aid Commission Act 1979 (NSW) is dismissed.

That the wife’s application for spousal maintenance is dismissed.

That the wife’s application for orders pursuant to section 79 of the Family Law Act 1975 (Cth) (“the Act”) is dismissed.

That the husband’s application for orders pursuant to section 79 of the Act is dismissed.

That the wife’s application for costs against the husband and the 4th, 10th and 11th Respondents is dismissed.

That the husband’s application for costs against the wife is dismissed.

Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

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