Shamon & Shamon (No 11)

Case [2023] FedCFamC1F 882

FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA

(DIVISION 1)

Shamon & Shamon (No 11) [2023] FedCFamC1F 882

File number(s): SYC 2375 of 2021
Judgment of: CURRAN J
Date of judgment: 18 October 2023
Date of Corrigendum 24 October 2023
Catchwords: FAMILY LAW – PROPERTY – where the parties seek declarations that property is held by the husband on trust for his father – where the proceedings had been bifurcated – where the parties submitted a minute of consent orders to settle the bifurcated issue – whether the court has accrued jurisdiction to make the declarations and consequential orders sought – whether the court can make the declarations by consent – the court has jurisdiction to make the orders – declarations and orders made by consent  
Legislation:

Family Law Act 1975 (Cth) ss 78 and 79

Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) r 3.05

Cases cited:

Church of the Foursquare Gospel (Australia) Ltd v New Hope Church Swansea Inc [2019] NSWSC 519

Estate of Judith Ann Watson [2017] NSWSC 596

George Zoltan Ajkay v Hickey & Co Pty Limited [2011] NSWSC 822

Selen & Selen & Anor (2013) 49 Fam LR 164

Starr v George [2019] NSWSC 60

Valceski v Valceski [2007] 36 Fam LR 630

Zetting v Muller [2017] NSWSC 659

Division: Division 1 First Instance
Number of paragraphs: 36
Date of hearing: 17 October 2023
Place: Sydney
Solicitor for the Applicant: Mr Jacobs of Lawbridge Lawyers & Consultants
Solicitor for the First Respondent: Ms Brochut of Barkus Doolan Winning
Solicitor for the Second Respondent: Litigant in person (did not appear)
Solicitor for the Third Respondent: Litigant in person
Counsel for the Fourth Respondent: Mr Hollo
Solicitor for the Fourth Respondent: York Law Family Law Specialists
Solicitor for the Fifth Respondent: Litigant in person (did not appear)
Table of Corrections
27 October 2023 On page 4, paragraph 12 of the Reasons for Judgment deleted the words “As stated by the Full Court in the decision of Selen & Selen & Anor (2013) 49 Fam LR 164 at paragraph 14” and insert “As adopted by the Full Court from the submissions of the third party in the decision of Selen & Selen & Anor (2013) 49 Fam LR 164 at paragraph 14:”

ORDERS

SYC 2375 of 2021

FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)
BETWEEN:

MS SHAMON

Applicant
AND:

MR SHAMON

First Respondent

MR B SHAMON

Second Respondent

MS C SHAMON (and others named in the Schedule)

Third Respondent

ORDER MADE BY:

CURRAN J

DATE OF ORDER:

18 OCTOBER 2023

BY CONSENT THE COURT ORDERS THAT:

RECITALS

A.The bifurcation proceedings are listed for final hearing listed on 18 October 2023 to 24 October 2023 before Justice Curran.

B.The purpose of the hearing is to determine:

(a)Whether the Husband holds the property known as and situated at 1 M Street, Suburb P NSW on trust for Mr R Shamon (''Suburb P Property'');

(b)Whether S Pty Ltd holds its 50% interest as a registered tenant…

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AGLC
Shamon & Shamon (No 11) [2023] FedCFamC1F 882
Case
[2023] FedCFamC1F 882
Decision Date

CaseChat Overview and Summary

The case of Shamon & Shamon (No 11) before Justice Curran in the Federal Circuit and Family Court of Australia involved a dispute concerning the ownership of certain properties. The wife sought declarations that certain properties were held by the husband on trust for his father, while the husband and his father sought to confirm this arrangement and make consequential orders. The legal issues before the court were whether the court had jurisdiction to make the declarations and consequential orders sought and whether the court could make the declarations by consent. The court found that it had jurisdiction to make the orders and that it was appropriate to do so by consent, given the persuasive and uncontroverted evidence and the consent of all parties. The court made the declarations sought and the consequential orders, resolving an aspect of the bifurcated s 79 application concerning the identification of the parties' assets. The orders included declarations that certain properties were held on trust for the husband's father and that the husband had no beneficial interest in these properties. The court also ordered the removal of certain respondents from the proceedings upon compliance with the orders.

The court's reasoning was based on the evidence presented, which was comprehensive, persuasive, and not contested. The court found that the evidence supported the declarations sought and that it was appropriate to make the declarations and orders by consent, considering the consent of all parties and the appropriate exercise of discretion. The court noted that the declarations and orders were confined to the private rights of the parties involved and did not impact any other parties. The court also considered the consent position of all parties and the appropriateness of making the declarations and orders by consent, finding it appropriate in the circumstances of the case. The final orders included declarations concerning the ownership of certain properties, orders for the transfer of interests in these properties, and orders for the removal of certain respondents from the proceedings.

Orders

Orders of the court

SYC 2375 of 2021

FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)

BETWEEN:

MS SHAMON

Applicant

AND:

MR SHAMON

First Respondent

MR B SHAMON

Second Respondent

MS C SHAMON (and others named in the Schedule)

Third Respondent

ORDER MADE BY:

CURRAN J

DATE OF ORDER:

18 OCTOBER 2023

BY CONSENT THE COURT ORDERS THAT:

RECITALS

A. The bifurcation proceedings are listed for final hearing listed on 18 October 2023 to 24 October 2023 before Justice Curran.

B. The purpose of the hearing is to determine:

(a) Whether the Husband holds the property known as and situated at 1 M Street, Suburb P NSW on trust for Mr R Shamon (''Suburb P Property'');

(b) Whether S Pty Ltd holds its 50% interest as a registered tenant in common in the property situated and known as H Street, Suburb J NSW on trust for Mr R Shamon (''Suburb J Property'').

C. The Husband is the sole director of S Pty Ltd. Since 14 July 2020, the Third Respondent, Ms C Shamon has held the sole ordinary share in the company (being 100% interest). This company is registered on title as to 50% in the Suburb J property (tenants in common).

D. At the direction of the Husband as sole director of S Pty Ltd, the Husband caused S Pty Ltd to act as the corporate trustee of the Shamon Fixed Trust as well as to receive trailing commission income in respect of a business operated by the Husband for a period of time in the past. By these orders the Fourth Respondent acknowledges that the estate of the late Mr R Shamon has no right, title, interest or any liability in respect of any assets and expenses that are attributable to the activities of the Husband as aforementioned and that these orders are intended to bring about the termination of S Pty Ltd as trustee of the Shamon Fixed Trust to a new corporate entity to be established by the Husband, and for the transfer of the shareholding in S Pty Ltd by the third respondent to the Husband, with the effect that the trailing commission trailing commissions will continue to be received by S Pty Ltd.

BY CONSENT IT IS ORDERED:

The Suburb P Property

1. The Court declares as against the Wife, the Husband, and the 4th Respondent, that at all times the Husband:

(a) holds and has held on trust for the sole benefit of Mr R Shamon, and since his death, the estate of the late Mr R Shamon, the property situated at and known as 1 M Street, Suburb P being the whole of the land in folio identifier … (the Suburb P Property); and

(b) the Husband has never held any beneficial interest directly or indirectly in the Suburb P Property.

2. That within 30 days of the making of these Orders, the Husband do all acts and things and sign all documents to transfer to the estate of the late Mr R Shamon, all of the Husband's right, title and interest in the Suburb P property free of encumbrance (it being noted that the mortgage registered on title to the Commonwealth Bank has been paid off).

S Pty Ltd (The Suburb J Property)

3. The Court declares that as against the Wife, the Husband, the 3rd Respondent and the 4th Respondent, that at all times:

(a) The Third Respondent, Ms C Shamon, has never had and does not have any beneficial interest, directly or indirectly, in the Suburb J property.

(b) The Husband, has never held any beneficial interest indirectly or directly in the Suburb J property.

(c) S Pty Ltd has held and holds on trust for the sole benefit of Mr R Shamon and since his death, the estate of the late Mr R Shamon, a half share (50% interest) in the property situated and known as H Street, Suburb J NSW being the whole of the land in folio identifier … ("the Suburb J property").

4. That within 90 days of the making of these Orders, and simultaneously:

4.1 The Husband, as director of S Pty Ltd, do all acts and things and sign all documents to transfer to the estate of the late Mr R Shamon, it's half share (50% interest) in the Suburb J property subject to the encumbrance thereon;

4.2 The Fourth Respondents as legal personal representatives of the estate of the late Mr R Shamon do all acts and things and refinance the mortgage secured over the Suburb J property (noting the same will also be undertaken by the other 50% registered proprietor Mr Q), and

4.3 Ms C Shamon do all acts and things and sign all documents to transfer to the Husband, all of her right, title and interest in the shareholdings in S Pty Ltd.

5. The COURT NOTES that the Parties agree that the effect of the Orders and Notations herein is to ensure that the estate of late Mr R Shamon holds, legally and beneficially, a half share interest in the Suburb J property as registered proprietor together with Mr Q (as to the other half interest) as tenants in common.

6. THE COURT NOTES that the Husband and Wife agree for the purposes of these proceedings and property settlement, whether by consent or by order of this court, neither the Suburb P Property nor the half share of the Suburb J property will be considered and/or included as property of the Husband or the Wife or either of them.

7. That Orders 3 and 4 of the Orders made 20 May 2021be discharged;

8. That Order 2(a), 3(b) and 3(d) of the Orders of 9 April 2021 be discharged.

9. That paragraphs 5 to 8 of the Wife's Amended Initiating Application filed 5 May 2021 (seeking relief pursuant to section 106B of the Family Law Act 1975 in respect of the shareholding in the company S Pty Ltd) be dismissed.

10. That the 4th Respondent's Response to Initiating Application filed on 8 September 2021 (seeking relief pursuant to section 106B of the Family Law Act 1975 in respect of Suburb P property and Suburb J property) be otherwise dismissed.

Removal of parties and costs

11. The COURT NOTES that upon the parties' compliance with these orders the Third and Fourth Respondents will pursuant to Rule 3.05 of the Rules make application for each of:

(a) the Third Respondent, Ms C Shamon; and

(b) the Fourth Respondent, either as the estate of the late Mr R Shamon or as Y, Ms C Shamon and Ms G Shamon each as the legal personal representative of the late Mr R Shamon,

to be removed as parties from these proceedings and the Third Respondent and Fourth Respondent each have liberty to file that application at that time which, unless the Court otherwise directs, will be determined in chambers.

12. That as between the Fourth Respondent (either as the estate of the late Mr R Shamon, or as Y, Ms C Shamon and Ms G Shamon each as the legal personal representative of the late Mr R Shamon), the Wife, the Husband and Ms C Shamon, there be no order as to costs in respect of the Fourth Respondent's equitable claims and the Wife's s.106B claim in these proceedings such that each of the parties is to be responsible for their respective costs and disbursements in the proceedings.

13. That the final hearing listed from 18 October 2023 to 24 October 2023 be vacated.

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 10.14(b) Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 10.13 Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth).

Section 121 of the Family Law Act 1975 (Cth) makes it an offence, except in very limited circumstances, to publish proceedings that identify persons, associated persons, or witnesses involved in family law proceedings.

Background

Background to the litigation

Full text does not contain this section.

Evidence

Evidence Before The Court

It is also significant that from the wife’s case it was now no longer in contest that the properties were at all times held on trust. Without canvassing all of the evidence factors such the deceased having provided the purchase funds, paying the mortgage, paying the stamp duty and all outgoings, and evidence of conversations of intention and the health issues of the deceased were all persuasive factors.The Suburb J Evidence The evidence in respect of the Suburb J property was also significant. In addition to the evidence from the husband’s father and the husband, there was also independent evidence from the nephew Mr Q and his parents as to the circumstances of the financial arrangements, and from the accountant who provided advice, which all supports a finding that the property was at all times held on trust. The factual basis for the findings which supported the granting of both declarations sought was not in dispute by any other party.The Wife’s case The wife was a contradictor to the claims. The parties’ respective applications and responses the points of claim and defence identified the justiciable issues between the parties. The wife was aware of the particulars of the claim and evidence in support of the declarations sought as it had been provided in the evidence filed in these proceedings. There is no doubt that the issues raised were adequately joined and did not fall to be determined in an “evidentiary vacuum”. The evidence was comprehensive and persuasive and, importantly, ultimately not in contest. The wife, had until this time, advanced a case and filed evidence and a defence to points of claim entirely inconsistent with the making of the declarations, and she had until this time sought orders including the 106B orders. I have confidence in making the declarations sought as the issues were entirely responded to. The confidence in making the orders of course is only on being satisfied that there is a proper basis for the making of such declarations, which as referred to above, I am so satisfied. The fact that the wife has joined in seeking the declarations also supports the making of the orders. The declarations have been made after hearing from the parties as to the merits of the application. The wife made no submissions other than to confirm her consent to the orders. Significantly no issue was taken with the evidence relied upon or the appropriateness of the exercise of discretion to make the declarations sought.CONCLUSION I am satisfied as to jurisdiction to make the orders sought. I am satisfied that it is both appropriate and justified on the evidence presented to make the declarations sought together with the consequential orders to give effect to the declarations and finally determine the issues between these parties. It is significant that the declarations sought, being a judicial act determining and pronouncing legal rights in this case, have been undertaken in the following circumstances. First, the evidence relied upon in support of such declarations was persuasive and corroborative, including from independent third-party sources and was not contested. Secondly, the declarations are confined only to the parties to these proceedings, that is they do not extend beyond the interests of the husband, the wife and the Fourth Respondent, being the private rights of these parties in this case. There was no evidence of any other party whose interests may be impacted by the declarations sought. Finally, the consent orders and declarations finally determine an aspect of the s 79 application, which has been bifurcated, which resolves the matters as between the parties and the Second to Fourth Respondents and resolves an aspect in dispute that was the identification of the assets of the parties to the marriage.

Decision

Reasons for decision

The wife made no submissions other than to confirm her consent to the orders. Significantly no issue was taken with the evidence relied upon or the appropriateness of the exercise of discretion to make the declarations sought.CONCLUSION I am satisfied as to jurisdiction to make the orders sought. I am satisfied that it is both appropriate and justified on the evidence presented to make the declarations sought together with the consequential orders to give effect to the declarations and finally determine the issues between these parties. It is significant that the declarations sought, being a judicial act determining and pronouncing legal rights in this case, have been undertaken in the following circumstances. First, the evidence relied upon in support of such declarations was persuasive and corroborative, including from independent third-party sources and was not contested. Secondly, the declarations are confined only to the parties to these proceedings, that is they do not extend beyond the interests of the husband, the wife and the Fourth Respondent, being the private rights of these parties in this case. There was no evidence of any other party whose interests may be impacted by the declarations sought. Finally, the consent orders and declarations finally determine an aspect of the s 79 application, which has been bifurcated, which resolves the matters as between the parties and the Second to Fourth Respondents and resolves an aspect in dispute that was the identification of the assets of the parties to the marriage. It was submitted on behalf of the Fourth Respondent that it is agreed that the estate will not form part of the matrimonial pool and that the husband is not a beneficiary under his late father’s will. Although the will was not in evidence before me I note that submission. It was also agreed that upon the parties complying with their obligations arising pursuant to the proposed orders that an order should be made for the removal of the Third and Fourth Respondents from the proceedings. To that end I note that upon compliance with these orders, the parties are to file an application in accordance with Rule 3.05 of the Federal Circuit and Family Court of Australia (Family Law) Rules 2021 and I note with the consent of the parties that application will be determined by me in chambers. I note that each party consented to such an order being made.

Ratio Decidendi

Legal Principle Established

Counsel for the Fourth Respondent in oral submissions identified the evidence of each of the witnesses relied upon that supported the making of the orders. After consideration of the evidence relied upon, and noting the consent position of all the parties, I am satisfied in the exercise of discretion that it is appropriate to make the orders sought to finalise the issues between the parties and that it is appropriate to make the consequential orders to give effect to the declarations.THE APPLICATION FOR DECLARATIONS AND CONSEQUENTIAL ORDERSShould declarations be made by consent? The parties all sought the orders and declarations be made by consent. The fact that orders are sought to be made by consent is a relevant, but not determinative factor in determination of the application. The authorities I was taken to confirm that the court has a wide discretion to make declaratory orders. Counsel for the Fourth Respondent identified a number of authorities which supported the exercise of discretion and the making of declarations (and consequential orders) by consent. Those cases in summary identify that it was previously accepted jurisprudence that declarations should not necessarily be made by consent, however in considering all relevant factors including the consent positions of all parties that it can be appropriate to make declarations by consent. I accept the submission that in the circumstances of this case, based on the evidence, it is appropriate to make the declarations and orders by consent for the reasons that follow. The evidence presented, that was not in dispute, in support of the claim for the declarations and orders in respect of the Suburb P property and Suburb J property was persuasive. The Suburb P Evidence The evidence in respect of the history of the Suburb P property was significant. Evidence was relied upon by the Fourth Respondent which included the uncontested evidence of the husband’s father, and the husband and his sister Ms G Shamon of the circumstances and intentions at the time of the purchase of the property. There were some differences in the recollections of the parties of matters and conversations that occurred, however given the time frame that has elapsed since, the evidence supports the findings sought that the properties were held on trust. It is also significant that from the wife’s case it was now no longer in contest that the properties were at all times held on trust. Without canvassing all of the evidence factors such the deceased having provided the purchase funds, paying the mortgage, paying the stamp duty and all outgoings, and evidence of conversations of intention and the health issues of the deceased were all persuasive factors.The Suburb J Evidence The evidence in respect of the Suburb J property was also significant. In addition to the evidence from the husband’s father and the husband, there was also independent evidence from the nephew Mr Q and his parents as to the circumstances of the financial arrangements, and from the accountant who provided advice, which all supports a finding that the property was at all times held on trust.