Silve and Pardo (No 2)

[2010] FamCA 940

FAMILY COURT OF AUSTRALIA

SILVE & PARDO (NO. 2) [2010] FamCA 940

FAMILY LAW – PRACTICE AND PROCEDURE – Stay pending appeal

APPLICANT: Ms Silve

RESPONDENT: Mr Pardo

FILE NUMBER: SYC 973 of 2010

DATE DELIVERED: 15 October 2010

PLACE DELIVERED: Sydney

PLACE HEARD: Sydney

JUDGMENT OF: The Hon. Justice Cohen

HEARING DATE: 15 October 2010

REPRESENTATION

APPLICANT: Ms Silve in person

COUNSEL FOR THE RESPONDENT: Mr Campton

SOLICITOR FOR THE RESPONDENT: Gayle Meredith & Associates

Orders

1. That the application of the wife for a stay filed 12 October 2010 is hereby dismissed.

2. That in the event that the wife fails by 5pm today to execute or validly execute a contract for sale of the property at K to a purchaser agreed on by the parties or in default of agreement determined by the husband the husband is hereby empowered to execute a contract for sale of the said property prior to any appointed auction date for the property on behalf of both the husband and the wife for a price of not less than $1,600,000.

3. That the wife shall vacate the said property and remove all of her furniture and possessions therefrom and deliver up vacant possession of it to the estate agent Mr G (“the agent”) not less than fourteen (14) days prior to the date scheduled for completion of any sale referred to in order 2.

4. In the event that the wife fails to vacate the K property in accordance with order 3. herein, proof of which shall be by Affidavit sworn by the agent, a writ of possession shall be issued forthwith thereafter in the following form:

   “To the Marshall of the Court and to all officers of the Australian Federal Police: whereby Order of this Court made on the 15^th day of October 2010 it was ordered that the wife vacate the premises situated at and known as [K] (“[K] property”) and the Court being satisfied that the said wife has failed to comply with the said order YOU ARE HEREBY DIRECTED for the purpose of giving effect to the said order at such time and with such assistance as you may require and if necessary by force to enter upon the [K] property and cause the wife to vacate the [K] property.”

5. That, by consent, in the event that the purchaser referred to in order 2. agrees to the deposit payable on exchange of contracts being released on exchange that on behalf of the wife the husband shall authorise the agent to cause the deposit less such sum as is required to meet the agent’s commission and other costs relating to the sale to be paid to the husband and the wife in equal shares by way of interim property settlement.

6. That all costs are reserved.

IT IS NOTED that publication of this judgment under the pseudonym Silve & Pardo is approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth)

FAMILY COURT OF AUSTRALIA AT SYDNEY

FILE NUMBER: SYC 973 of 2010

MS SILVE

Applicant

And

MR PARDO

Respondent

REASONS FOR JUDGMENT

1. In these proceedings, the wife seeks a stay of orders I made on 10 September 2010.  In effect, the orders I have made were orders made on a rehearing from a decision by a Judicial Registrar in which he permitted the husband to sell the former matrimonial home.  I, too, permitted the husband to sell the former matrimonial home. The principles upon which the Court should decide whether or not to grant a stay are well known.  They are:  whether or not the refusal of a stay would render the appeal nugatory;  the extent of comparative hardship which really involves consideration of loss to the respondent created by the granting of a stay, together with the balance of convenience of any other nature. The prospects of success are another element that should be considered, and the extent of delay in the hearing of the appeal is another matter that should be considered where delay will affect, in financial matters, the financial situation of the parties.

2. In relation to all of those elements, I must weigh them.  In some cases, a finding in favour of the applicant for a stay of one of those matters might outweigh all of the other matters. In the case where the refusal of a stay would render the appeal nugatory, that is a very compelling matter for the grant of a stay, but it is not the sole determinant. 

3. I shall deal with the prospects of success first.  One must bear in mind that the wife has not appealed.  She has simply sought leave to appeal.  The grounds that she has provided are many and difficult to understand and, in particular, difficult to relate to the decision I made.  In my view, generally, her prospects of success are extremely weak, and equally as weak are her prospects of being granted leave to appeal.  In the aspect of prospects of success, one must look at the realities.  Although prospects of success relate to prospects of success in the appeal, one must also look at whether a successful appeal would benefit the wife in any way. 

4. For reasons I shall come to, on the issue of comparative hardship or whether or not the refusal of a stay renders the appeal nugatory, I am of the view that any success on appeal by the wife is likely to undermine her situation, ultimately, on the property proceedings.  This, of course, goes to the issue of whether or not the grant of a stay will render the appeal nugatory as well. 

5. Essentially, the husband opposes the stay, because he is able to execute a contract for the sale of the home today and urges the Court to allow him to do so, because it is to the general benefit of the parties.  He has called evidence from an estate agent whose evidence I accept; a man who I felt should be believed and whose judgment, based upon his experiences as an estate agent, should be given substantial weight.  Mr G, the estate agent in question, said that the house has been advertised for sale and is due to be auctioned.  However, prior to the auction, he has had 10 offers.  The offers range between $1.4 million and $1.625 million.  Some of the offers are subject to conditions.  Two offers, one for $1.6 million and one for $1.61 million, would permit acceptance today, with payment of five per cent deposit on acceptance and settlement in 49 or 42 days respectively. 

6. Mr G’s evidence is that the house is really worth $1.4 to $1.5 million and that if those offers are not accepted those making the offer may not, because there could be less competition at an auction, need to bid so highly to obtain the home. One possibility is that prospective purchasers will buy something else in the meantime. Therefore, according to Mr G, the husband should not gamble but should accept one of the two offers that I have specified. This is particularly germane because, at the hearing when I permitted the sale, the wife claimed that the house was worth $1.1 million or thereabouts and disputed the husband’s claim that the house was worth $1.5 million. 

7. In the circumstances, the sale price is such that significant risk to the parties’ financial situation will be occasioned by a failure to accept one of the two substantial offers today.  The circumstances are very important.  They are that the parties have debts of approximately $1 million.  The most significant debt is for about $800,000.  Currently, that debt is costing $8000 per month in interest because it is already in default.  It is already in default and it is not being paid.  Altogether, the million dollars in debts are more likely to be subject to something like $10,000 a month in interest. 

8. In circumstances where the parties have no other significant assets, the wife is unemployed, although hopeful, and the husband’s outgoings are greater than his income, not including any debt repayment. The wife wants to keep the home.  The parties have been married for about 30 years.  The wife has various reasons for saying, although all of the reasons appear to me to be quite weak, that she should get a very high proportion of the parties’ net assets on division under section 79.  Even if, as is highly unlikely, she gets as much as 75 per cent of the parties’ assets, the parties’ net assets are still only likely to be approximately $400,000, so the husband would need to be paid at least $100,000. 

9. For the husband to be able to be paid $100,000 more than whatever level of debt he keeps, the wife would have to borrow an extra $100,000 on the $800,000 that is already owed on the house.  This is for somebody who, at best, has an income of $600 per week net, although now she claims that she can get a job which will give her $60 an hour, although one has no idea how many hours per week she will be able to work for, because she will be paid at an hourly rate.  In all of the circumstances, the future prospects are that this house will have to be sold, whether it is after a hearing under section 79 or after an appeal or as a result of my order. 

10. In that sense, an order for sale will not render the wife’s application for leave to appeal, and an appeal in a true and realistic sense, nugatory, although it will make the appeal itself of no value. 

11. On the issue of comparative hardship, I have already said enough to make the situation obvious.  It is that these parties are not able to pay their debts without selling the house and that interest is accruing at least at the rate of $8000 a month, and in those circumstances all that further delay in sale of the house is likely to do is to increase the level of debt, and there is the accompanying risk that the price now available for the house may not be achieved in future. 

12. In all of the circumstances, weighing all of the matters I have referred to, I am of the very clear view that a stay should be refused.  One should not lose sight of the fact that, prima facie, a litigant is entitled to his judgment.  That the situation is even stronger in that direction, where the appeal can only be preceded by leave, is obvious and strengthens my view that, in this case, the husband should be protected from continuing further loss imposed upon him by the wife if she is to obtain a stay and that the stay should be refused.  The husband, in that way, at least has the fruits of the judgment pending the application for leave to appeal which I think will fail in any event.  So I simply shall refuse the stay. 

I certify that the preceding twelve (12) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Cohen delivered on 15 October 2010.

Associate:     

Date:              22 October 2010