Scott & Munayallan

Case [2021] FamCA 79

FAMILY COURT OF AUSTRALIA

Scott & Munayallan [2021] FamCA 79

File number(s): SYC59/2010
Judgment of: HENDERSON J
Date of judgment: 26 February 2021
Catchwords: FAMILY LAW – PRACTICE AND PROCEDURE – Abuse of process – Where the applicants seek to set aside orders of Justice Berman alleging them to have been obtained by fraud pursuant to rule 17.02 of the Family Law Rules 2004 (Cth) – Where the counts of fraud alleged by the applicants are not made out – Where the Court found the application was brought by the applicants for an ulterior purpose namely an attempt to re-litigate proceedings determined to finality in the Supreme Court of New South Wales inter alia – Finding of abuse of process – Applications dismissed.
Legislation:

Family Law Act 1975 (Cth) s 45A

Family Law Rules 2004 (Cth) r 17.02, r 19.26, r 19.30(1)(b)

Cases cited:

Cleary v Jeans [2006] NSWCA 9

D’Orta-Ekenaike v Victoria Legal Aid (2005) 223 CLR 1

Ebner v Official Trustee In Bankruptcy (2000) 176 ALR 644

Munayallan & Scott [2019] FamCA 549

Patch v Ward LR 8 Ch App 203

Secretary of State of Trade and Industry v Bairstow [2004] 4 All ER 325

Wan Ze Property Development (Aust) Pty Ltd (in liquidation) [2013] NSWSC 189

Wentworth v Rogers(No 5) (1986) 6 NSWLR 534 at 539
Number of paragraphs: 106
Date of hearing: 19 February 2021
Place: Sydney
Counsel for the First Applicant: Self-Represented Litigant
Counsel for the Second Applicant:  No appearance
Counsel for the Respondent: Self-Represented Litigant

ORDERS

SYC59/2010
BETWEEN:

MR SCOTT
First Applicant

I PTY LTD

Second Applicant
AND:

MR PHONG
Respondent

ORDER MADE BY:

HENDERSON J

DATE OF ORDER:

26 FEBRUARY 2021

THE COURT ORDERS THAT:

1.The Application in a Case filed by I Pty Ltd on 25 August 2020 is dismissed.

2.The Application in a Case filed by Mr Scott on 21 September 2020 is dismissed.

3.The question of costs of this application and the application for costs by Mr Phong is reserved.

Note:   The form of the order is subject to the entry in the Court’s records.

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 17.02 Family Law Rules 2004 (Cth).

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

REASONS FOR JUDGMENT

  1. This is a judgment in relation to two interim applications heard on 19 February 2021.

  2. Mr Scott represented himself. I refused a person who purported to represent I Pty Ltd to participate in the proceedings given she was not a lawyer on the Roll of Solicitors in New South Wales, was not a director or otherwise a company executive of the company and had been, to use her words, "sent…

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AGLC
Scott & Munayallan [2021] FamCA 79
Case
[2021] FamCA 79
Decision Date

CaseChat Overview and Summary

In the Family Court of Australia, Henderson J considered applications by Mr Scott and I Pty Ltd to set aside orders made by Justice Berman, alleging those orders were obtained by fraud pursuant to rule 17.02 of the Family Law Rules 2004 (Cth). The applicants sought declarations regarding an equitable and charge interest in a property, the setting aside of a transfer of that property, and various other orders including a substantial monetary judgment. The core of the dispute revolved around whether Justice Berman's previous findings were vitiated by fraud.

The legal issues before Henderson J were whether the applicants had established the alleged fraud, and if not, whether the applications constituted an abuse of process. The applicants contended that Justice Berman's decisions of 2 August 2019 and 23 October 2019 were obtained by fraud. This involved an analysis of the relief sought in the Family Court application by I Pty Ltd, which bore significant similarities to relief previously sought in a cross-claim filed in the Supreme Court of New South Wales.

Henderson J found that the counts of fraud alleged by the applicants were not made out. His Honour concluded that the applications were brought for an ulterior purpose, specifically as an attempt to re-litigate proceedings that had already been determined to finality in the Supreme Court of New South Wales. Consequently, the Court found the applications to be an abuse of process.

The applications filed by I Pty Ltd and Mr Scott were dismissed. The question of costs for these applications, and Mr Phong's application for costs, was reserved.

Orders

Orders of the court

SYC59/2010

BETWEEN:

MR SCOTT

First Applicant

I PTY LTD

Second Applicant

AND:

MR PHONG

Respondent

ORDER MADE BY:

HENDERSON J

DATE OF ORDER:

26 FEBRUARY 2021

THE COURT ORDERS THAT:

1. The Application in a Case filed by I Pty Ltd on 25 August 2020 is dismissed.

2. The Application in a Case filed by Mr Scott on 21 September 2020 is dismissed.

3. The question of costs of this application and the application for costs by Mr Phong is reserved.

Note: The form of the order is subject to the entry in the Court’s records.

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 17.02 Family Law Rules 2004 (Cth).

Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

In order to determine whether the applications of Mr Scott and I Pty Ltd that Justice Berman's decisions of 2 August 2019 and 23 October 2019 were obtained by fraud is made out I must analyse his Honour’s Reasons for Judgment.Justice Berman's Reasons for Judgment His Honour's decision of 2 August 2019 determined that a cross-claim filed by I Pty Ltd in the Supreme Court in July 2018 sought almost identical relief to that sought in an Application in a Case filed in the Family Court on 22 August 2018 by I Pty Ltd. Mr M gave evidence at the hearing before Justice Berman in his capacity as the manager of I Pty Ltd acting on instructions of Mr A Scott and Ms Scott, the husband's parents who are the directors of I Pty Ltd. Mr Scott, Mr Phong and the Applicant wife were also present at the hearing. I note from a reading of paragraph 48 of his Honour’s judgment it is clear Mr Scott was involved in the hearing as his Honour says:During the proceedings he [Mr M] deferred in all things to the husband and was prevented by the husband from making any submission inconsistent with the husband's case. The application before his Honour and filed by I Pty Ltd sought the following orders and declarations:1.A declaration that the applicant, I Pty Ltd has at all material times in and after September 2005 had equity and an charge interest in the land described in folio identifier … and known as J Street, Suburb E (“the Property”).2.A declaration that the said equity and charge interest operates in priority to any interest in the Property held by the respondents 1-4 (Mr Scott, Mr Phong, Ms Phong, Ms Munayallan).3.A declaration that the said the applicant, I Pty Ltd.’s equity and charge interest operates in priority to any interest in the Property held by the respondents 1-4 (Mr Scott, Mr Phong, Ms Phong, Ms Munayallan.4.A declaration that the respondent 2-3 (Mr Phong and Ms Phong) holds the property on trust for the first applicant I Pty Ltd in respect of, or to the extent of first applicant I Pty Ltd equitable interest in the property.5.Order that the transfer to the property from the respondents 2-3 (Mr Phong and Ms Phong) dated in May 2018 be set aside or rescinded.6.A declaration that the said the applicant, I Pty Ltd has subrogated the right of the Bank Mortgage in or about July 2015 and has a second secured sum of $504,709 (“the Second Loan”) in respect to priority over the interests of the respondents 1-4 (Mr Scott, Mr Phong, Ms Phong, Ms Munayallan).7.A declaration that the applicant, I Pty Ltd is, and at all material times has been, entitled pursuant to section 74F of the Real Property Act 1900 to lodge and maintain a caveat or mortgage in respect of the Property.8.Order that the second and third respondents be restrained from registering, or attempting to register, any interest in the Property unless and until the applicant, I Pty Ltd.’s security interest in the Property has been satisfied or otherwise released.9.The applicant I Pty Ltd has Possession of the whole of land in title folio identifier … situated at and know as J Street, Suburb E in the state of New South Wales (LAND);10.A declaration that the second and third respondents had knowledge of the first and applicant’s interest in the land in or before October 2014. 11.A declaration that the second and third respondents equitable interest in the property, defeasible for fraud within the meaning of sections 42 and 43 of the Real Property [Act] 1900.12.A declaration that the second and third respondents hold the property on trust for the applicant in respect of, or to the extent of applicant’s equitable interest in the property.13.Leave to issue a writ of possession;14.The applicant I Pty Ltd, judgement against the respondents 1-3 (Mr Scott, Mr Phong, Ms Phong) in the sum of $2,910,000,06 being the amount owning as of 9 January 2018;15.Interest in the sum referred to the preceding sub-paragraph in accordance with the provisions of the agreement from 9 January 2018;16.Charges and expenses in accordance with the agreement. Funds in Court Trust17.Order that if the applicant, I Pty Ltd.’s is not successful in the above orders 5, then applicant, I Pty Ltd.’s obtain full funds which were placed in the court trust on the 2 May 2018.18.Declaration that the proceeds of sale of J Street, Suburb E which occurred on the 2 May 2018 are the subject to equity and charge in favour of the applicant, I Pty Ltd. 19.Declaration that the said equity and charge operates in priority to any claim upon such proceeds of sale by the respondents 1-4 (Mr Scott, Mr Phong, Ms Phong, Ms Munayallan).20.Order that such proceeds of sale as are held in Court to be paid to the applicant I Pty Ltd.21.Such further or other orders as the Court considers appropriate.22.Costs.(As per the original)

Ratio Decidendi

Legal Principle Established

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