Setna and Advani and Ors

[2019] FamCA 736

FAMILY COURT OF AUSTRALIA

SETNA & ADVANI AND ORS [2019] FamCA 736

FAMILY LAW – PRACTICE AND PROCEDURE – Transfer of Family Court proceedings to the Supreme Court – Cross-Vesting legislation.

Family Law Act 1975 (Cth) s 75(2), 79
Jurisdiction of Courts (Cross Vesting) Act 1987 (Cth) s, 5(4)

Acton Engineering Proprietary Ltd v Campbell & Ors [1991] FCA 610
BHP Billiton Ltd v Schultz (2004) 221 CLR 400
Bankinvest AG v Seabrook (1998) 14 NSWLR 711
Chapman & Jansen (1990) FLC-92-139
James Hardie & Co Pty Ltd v Barry (2000) NSWSC 353
Kenda & Johnson (1992) 107 FLR 19
Valceskiv Valceski [2007] NSWSC 440

APPLICANT: Mr Setna

RESPONDENT: Ms Advani

INTERVENOR: Mr B Setna

FILE NUMBER: SYC 2854 of 2019

DATE DELIVERED: 17 October 2019

PLACE DELIVERED: Sydney

PLACE HEARD: Sydney

JUDGMENT OF: Henderson J

HEARING DATE: 9 October 2019

REPRESENTATION

COUNSEL FOR THE APPLICANT: Mr Kearney SC

SOLICITOR FOR THE APPLICANT: Broun Abrahams Burreket

COUNSEL FOR THE FIRST RESPONDENT: Mr Cummings SC

SOLICITOR FOR THE FIRST RESPONDENT: Barkus Doolan

COUNSEL FOR THE SECOND RESPONDENT: Mr Campton SC

SOLICITOR FOR THE SECOND RESPONDENT: ALP Lawyers

COUNSEL FOR THE THIRD RESPONDENT: Mr Weinberger

SOLICITOR FOR THE THIRD RESPONDENT: York Law

COUNSEL FOR THE FOURTH RESPONDENT: Mr Pritchard SC

Orders

1. These proceedings be transferred to the Supreme Court to be heard as that court may direct with the Supreme Court proceedings number 2019/….

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

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

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

FAMILY COURT OF AUSTRALIA AT SYDNEY

FILE NUMBER: SYC 2854 of 2019

Mr Setna

Applicant

And

Ms Advani

First Respondent

And

Mr B Setna

Second Respondent

And

Mr C Setna

Third Respondent

And

Mr Advani

Fourth Respondent

REASONS FOR JUDGMENT

1. This is an application by the husband to transfer the entirety of the family law proceedings commenced by his former wife in the Sydney Registry of the Family Court of Australia to the Supreme Court of New South Wales.

2. In the event the Court does not grant this application the husband seeks that the proceedings in the Family Court be stayed until proceedings in the Supreme Court have concluded.

3. Mr Kearney SC represented the applicant husband known as Mr Setna.

4. Mr Cummings SC represented the respondent wife known as Ms Advani.

5. Mr Campton SC represented the husband’s brother, Mr B Setna known as Mr B.

6. Mr Prichard SC represented the wife’s father, Mr Advani.

7. Mr Weinberger of Counsel represented husband’s father, Mr C Setna known as Mr C.

8. The application to transfer is consented to by Mr B and Mr C and is objected to by the respondent wife and Mr Advani, her father.

9. It is common ground that if the proceedings are not transferred to the Supreme Court there be a stay of the family law proceedings pending the determination of the Supreme Court proceedings. There is some dispute in relation to the terms, if any, of a stay.

10. The material read:

    a)For the applicant husband:

    i)Application in a Case and Affidavit filed 27 September 2019;

    ii)Written submissions and case outline of his Counsel; and

    iii)Respondent wife’s Points of Claim filed in the Family Court on 12 July 2019.

    b)For the respondent wife:

    i)Further Amended Initiating Application filed 26 June 2019;

    ii)Response to the husband’s Application in a Case filed 4 October 2019;

    iii)Affidavits of 20 May 2019 and 4 October 2019;

    iv)Affidavit of Dr D affirmed 17 May 2019; and

    v)Case outline of her Counsel.

    c)For Mr B:

    i)Response filed 26 September 2019; and

    ii)Affidavit filed 26 September 2019.

    d)For Mr C:

    i)Response filed 8 October 2019;

    ii)Affidavit filed 8 October 2019; and

    iii)Written submissions.

    e)For Mr Advani:

    i)Outline of submissions tendered at the interim hearing together with a document headed List of Characters.

11. I heard submissions from all parties’ Counsel.

Relevant chronology

1. The husband and wife are aged 32 and 31 respectively.

2. 2009, the parties commenced cohabitation.

3. 2009, the parties marry.

4. In 2010, the property at Suburb E was purchased in the name of the husband and his brother Mr B for $3.3 million.

5. The husband’s case is that the funds to purchase the property came from a loan from his father of $1.82 million and it is agreed a CBA mortgage of $1.8 million.

6. The wife asserts the home was bought as a gift for she and her husband by her husband’s family.

7. The parties live in the home until separation.

8. The home is renovated during cohabitation.

9. 2013, the husband purchases a property at Suburb F for $450,000 with a loan from the National Australia Bank advanced over the Suburb E property.

10. 2015, Mr C lodges a caveat on the title of the Suburb E property subsequent to the refinancing an extension of the mortgage.

11. 19 May 2018, an incident occurs between the husband and wife resulting in ADVO proceedings in which the wife is named as the protected person.

12. Mid-July 2018 the parties separated under the one roof and husband moves into a guest bedroom in the property.

13. 27 September 2018, husband pleads guilty to slapping the wife across the face and is granted a section 9 conditional release.

14. 1 October 2018, husband vacates the former matrimonial home.

15. 15 March 2019, Mr B’s solicitors write to the wife solicitors providing her with notice to vacate the Suburb E property. Husband asserts he is unaware of this.

16. 27 March 2019, interim ADVO made against the wife listing the husband as the protected person and matter is listed for hearing on 8 July 2019.

17. 3 March 2019, Statement of Claim filed in the New South Wales Supreme Court by a company owned by the husband’s father claiming monies owed to him from the wife’s father in the sum of $771,000.

18. 6 May 2019, wife vacates the Suburb E property.

19. 7 May 2019, wife commenced proceedings in the Family Court seeking multiple orders including joining the husband’s father Mr C and brother Mr B as respondents.

20. 9 May 2019, interim orders made by DCJ McClelland restraining the husband dealing with the Suburb E and Suburb F properties, filing by the husband of material in response, orders directed to the second respondents and listing the matter on 22 May 2019 for further directions.

21. 27 September 2019, husband files current interim proceedings.

22. At the outset Mr Campton SC on behalf of Mr B reasserted his client’s position that he objects to being involved in the family law proceedings but has participated in this matter given his joint ownership of the former matrimonial home with his brother. I accept his position.

23. It is the husband, his brother Mr B and father, Mr C’s position that the pending New South Wales Supreme Court proceedings involve the same subject matter as the proceedings in the Family Court.

24. In the family law proceedings the wife has joined her brother-in-law and father-in-law and seeks property orders and declarations in respect of what she asserts is a 100% beneficial ownership of the former matrimonial home at Suburb E between she and husband.

25. The wife seeks orders in respect of the Suburb F property and the property known as the Suburb G property being they are transferred to her absolutely unencumbered.

26. The wife seeks the husband’s superannuation be payable to her and the sum of $13,000 per week by way of spousal maintenance.

27. The husband’s application is that he retain his interest in the Suburb E and Suburb F property and all other assets in his name. The wife retain her savings, jewellery, cash investments and her application be otherwise dismissed.

28. It is agreed that the initiating Summons filed by Mr C in the Supreme Court on 3 May 2019 is a strict money claim between one of Mr C’s companies and the wife’s father Mr Advani, being a claim for monies advanced. From my reading of the statement of claim this was not a matter which involved the same subject matter as the family law proceedings per se.

29. However, the cross claim filed by Mr Advani on 25 July 2019 in answer to the summons clearly involves the former matrimonial home at Suburb E, the property at Suburb F and the Suburb G property all the subject matter of the wife’s application in the Family Court.

30. Mr Advani asserts he has an interest in the Suburb E property by way of his advancement of monies to his daughter as set out at paragraph 32.a of the Cross Claim for renovations carried out to the property.

31. Mr Advani asserts a monetary claim in respect of the Suburb F property and the Suburb G property by way of his advancement of monies in respect of the Suburb F property and verbal agreements between him and Mr C in respect of the Suburb G property.

32. Mr Advani asserts a monetary claim for damages from Mr C as a result of the asserted agreement them in respect to the ADVO order and associated proceedings.

33. The cross claim joins nine additional defendants being the husband and his brother Mr B and various entities of which Mr C, the husband’s father has control or an interest in.

34. In respect of the Suburb E claim Mr Advani seeks payment of $386,386 plus interest from Mr B and the husband or in the alternative a declaration that Mr Advani has a beneficial interest in the Suburb E property giving rise to an equitable charge over the property.

35. In light of these facts I accept entirely the position of husband, Mr B and Mr C that the proceedings in the Family Court involve the same parties absent issues of company entities as do the proceedings in the Supreme Court.

36. I do not accept the submission by Mr Cummings that the wife is not involved in the Supreme Court proceedings. At minimum she is involved as a witness and her involvement has come about by her father’s cross claim in which he asserts his beneficial interest in the Suburb E property comes about by significant payments to her for renovation of the Suburb E property. All such assertions will no doubt need to be tested.

37. Additionally, I accept the applicant’s joint submissions that the Supreme Court proceedings can be finalised earlier than those before this court and that the Supreme Court proceedings upon transfer may be dealt with to finality within nine months. This is a benefit parties in the Sydney Registry of the Family Court do not have access to and an estimate to final hearing of this matter in this court is three years from today’s date.

38. I find from the facts that there is a commonality of a substantial number of issues and parties between both proceedings.

39. I find both courts are seized of jurisdiction to entertain the totality of the proceedings however a request has only been made to transfer the family law proceedings to the Supreme Court to be heard concurrently.

40. Going now to the law relevant principles and section 5(4) of the Jurisdiction of Courts (Cross Vesting) Act 1987 (Cth):

    (4) Where:

    (a) a proceeding (in this subsection referred to as the relevant proceeding ) is pending in the Federal Court or the Family Court (in this subsection referred to as the first court ); and

    (b) it appears to the first court that:

    (i) the relevant proceeding arises out of, or is related to, another proceeding pending in the Supreme Court of a State or Territory and it is more appropriate that the relevant proceeding be determined by that Supreme Court;

    (ii) having regard to:

    (A) whether, in the opinion of the first court, the relevant proceeding or a substantial part of it would have been incapable of being instituted in that court, apart from this Act and any law of the Australian Capital Territory or the Northern Territory relating to cross-vesting of jurisdiction; and

    (B) whether, in the opinion of the first court, the relevant proceeding or a substantial part of it would have been capable of being instituted in the Supreme Court of a State or Territory, apart from this Act and any law of a State or Territory relating to cross-vesting of jurisdiction; and

    (C) the extent to which, in the opinion of the first court, the matters for determination in the relevant proceeding are matters arising under or involving questions as to the application, interpretation or validity of a law of the State or Territory referred to in sub-subparagraph (B) and not within the jurisdiction of the first court apart from this Act and any law of the Australian Capital Territory or the Northern Territory relating to cross-vesting of jurisdiction; and

    (D) the interests of justice;

    it is more appropriate that the relevant proceeding be determined by that Supreme Court; or

    (iii) it is otherwise in the interests of justice that the relevant proceeding be determined by the Supreme Court of a State or Territory;

    the first court shall transfer the relevant proceeding to that Supreme Court.

41. No one party bears an onus in respect of an application for transfer as was held in the decision of Bankinvest AG v Seabrook (1998) 14 NSWLR 711 (“Bankinvest AG v Seabrook”) at 727B. The decision of Chapman & Jansen (1990) FLC-92-139 (“Chapman & Jansen”) is authority that a decision to transfer or not is an administrative decision, not appealable and the court ought take a broad approach to the matter and to the meaning of the words, “in the interests of justice”, which words appear at section 5(4)(b)(ii)(D) of the Jurisdiction of Courts (Cross Vesting) Act 1987 (Cth).

42. Quoting from decision of Spiegelman J in James Hardie & Co Pty Ltd v Barry (2000) NSWSC 353 (“James Hardie”):

    The Court makes a judgment as to what the interests of justice require and, having made the judgment the proceedings ought to be determined in another Court the Court is obliged to transfer the proceedings.

43. In relation to the words in the interests of justice, Justice Brereton in Valceskiv Valceski [2007] NSWSC 440 (“Valceski”) summarised the decision of the High Court in BHP Billiton Ltd v Schultz (2004) 221 CLR 400 (“BHP Billiton”) on this issue and how the Courts might make that determination:

    As BHP Billiton makes clear the interests of justice concern those of both parties (in this matter all 5 parties) rather than the selection of the most advantageous or least disadvantageous forum for one of them, the interests of justice are to be judged by more objective factors such as facilitate identification of the “natural forum” in which objectively judged it might be expected that the dispute would fall to be resolved with its concomitant juridical advantages and disadvantages for each party whatever they may be.

44. The matter of Valceski concerned the transfer ultimately of proceedings commenced in the Supreme Court for a declaration of 3rd party’s equitable interest in matrimonial property to the Family Court to be determined with the parties’ matrimonial dispute.

45. From a reading of his Honour’s erudite judgment an appropriate question for a judge in the determination of such a case is what relief is being sought in each court? His Honour found that the relief sought in each court was an interest in a particular piece of property.

46. Secondly, his Honour enquired, did the equity suit form part of the justiciable controversy in respect of the matrimonial proceedings? His Honour found that it did.

47. Thirdly, His Honour found that justice would be best served by the controversy being dealt with in one court.

48. Fourthly, that the equity proceedings formed a smaller part of the larger controversy being the family law dispute between the parties.

49. Justice Davis in a Full Court decision of the Federal Court of Acton Engineering Proprietary Ltd v Campbell & Ors [1991] FCA 610 (“Acton Engineering”) said:

    The term, interests of justice, is a broad term which enables all relevant factors to be taken into account. Those factors include matters relating to the efficiency, including the economy and expedition of litigation in matters of convenience having regard to the location of witnesses and records and would also encompass matters of policy relating to the administration of justice of the Federal Court the State and Territory Supreme Courts.

50. Courts have been clear that there should be little fettering of the term, “in the interests of justice” and that it is a broad approach that must be taken, see Kenda & Johnson (1992) 107 FLR 19 (“Kenda & Johnson”).

51. Thus, what are all the relevant factors in this broad brush approach?

52. The wife’s first order in her amended application is a declaration that she and her husband own 100% of a property currently owned by her former husband and his brother.

53. Mr Advani’s cross-claim seeks as an alternative to a sum of money owed to him, a declaration that he, too, has an interest in the former matrimonial property owned by the husband and his brother.

54. The first task for the Court in a family law property proceedings under section 79 of the Family Law Act 1975 (Cth) is to identify the value, nature and species of matrimonial assets.

55. The second task is to determine the entitlement of each to the property that has been identified and valued expressed as a percentage. Both the Supreme Court and Family Court have a long history of determining whether a party by way of contribution, advancement, energy, effort, agreement or otherwise has an equitable interest in a property to which they have no legal title.

56. I reject Mr Cummings’ submissions that in some way the Family Court has the specialist nuanced capacity over and above that of the Supreme Court to determine the contribution and, therefore, entitlement of a party to a property to which they have no entitlement at law be they in a marriage or otherwise.

57. Other relevant matters in relation to a claim under section 79 of the Family Law Act 1975 (Cth) arise under section 75(2) of the Family Law Act 1975 (Cth), the 75(2) factors. The wife has argued these factors are in her favour. The factors set out in the Act are clear and unambiguous and again will be determined by a Judge on the evidence presented by the wife.

58. The wife claims domestic violence was perpetrated upon her during the marriage and that this is a relevant factor in her property claim as well. This argument will be accepted or rejected on the evidence the wife places before the Court.

59. The wife’s claim will be satisfied from the Suburb E property if she is successful in her application of a declaration of trust as it is the only substantial asset. The alternative claim by her father relates to the property at Suburb E as well.

60. The wife also seeks an order for spousal maintenance and the success or otherwise of this application will be dealt with upon the evidence she places before the Court. I do not see an application for spouse maintenance or assessing whether there has been domestic violence perpetrated upon the wife such as to impact upon her entitlement to property are so nuanced or specialised that these proceedings can only be dealt with in the interests of justice by remaining in the Family Court.

61. The wife is but one party in the totality of these proceedings. There are five parties in total, four are currently involved in litigation in each court, together with multiple companies in the Supreme Court which are effectively Mr C’s entities.

62. I accept neither the husband, wife nor his brother are involved in the initial proceedings commenced by Mr C. I accept they would they be involved in a money tracing exercise as is sought by Mr Advani in relation to monies alleged to be owed.

63. I accept that transferring the Family Court proceedings to the Supreme Court may involve wife being part of litigation namely the tracing exercise in which she has no involvement. I accept it is of the benefit to the wife that the proceedings are stayed in the Family Court whilst the Supreme Court proceedings are finalised as she has not been joined as a party in the Supreme Court proceedings.

1. Going to the interests of the other parties.

2. Mr Advani has joined the husband and his brother to the Supreme Court proceedings as they are the legal owners of a property he seeks an order in respect of and has involved his daughter in the facts needed to support his equitable claim in the Suburb E property.

3. Similarly, the wife has joined her father-in-law and former brother-in-law in the Family Court proceedings as she seeks an order against them in respect of property that they are either the legal owners of or assert an equitable claim in respect of.

4. When viewed in this light it is clear the proceedings are joined and that the Supreme Court is well able to deal with all matters in both courts given that the Family Court proceedings relate to property proceedings only.

5. I accept the submission of Mr Cummings that the wife may have fragile health at this time having made a suicide attempt in March 2019 and earlier. However, if the Family Court proceedings are stayed until the Supreme Court proceedings are finalised the wife will need to face the spectre of two court cases. The family law proceedings at some time in the future and in the Supreme Court as her father has involved her in his cross-claim albeit at this stage as a potential witness only.

6. If the Family Court proceedings remain here and are stayed until the conclusion of the Supreme Court proceedings the wife, husband his brother and father will all face the spectre of being involved in two court hearings the first in the Supreme Court the second in the Family Court. Only the wife’s father benefits from a stay as he is not involved in the Family Court proceedings.

7. Upon transfer of the Family Court proceedings to the Supreme Court all parties face one final hearing in one court. This is a relevant consideration in the interests of justice in a determination of whether to transfer the family law proceedings to the Supreme Court.

8. To use Justice Brereton’s words in Valceski the “natural fit” in this matter and after having had regard to all the factors is the Supreme Court given that the determination of all the parties’ interest in the property at Suburb E is at the heart of each proceeding in both courts. The Supreme Court is well able to determine the section 79 claim and the subsequent issues including the wife’s claim for spousal maintenance and if accepted as a fact the impact of domestic violence perpetrated upon the wife expressed as a percentage, upon her entitlement to the matrimonial property.

9. I find it is in the interests of justice that these proceedings be transferred to the Supreme Court to be heard as that Court may direct with Supreme Court proceedings number 2019/….

I certify that the preceding eighty-three (83) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Henderson delivered on 17 October 2019.

Associate:

Date: 17 October 2019