Starling & Darby

[2009] FamCA 224

FAMILY COURT OF AUSTRALIA

STARLING & DARBY [2009] FamCA 224

FAMILY LAW – PROPERTY – whether an application for an injunction under s 114(3) of the Family Law Act 1975 (Cth) requires proceedings to be currently before the Court – whether enforcement under Rule 20.05 of the Family Law Rules 2004 requires proceedings to only of the sort stipulated in the Rules – whether the general power of the Court under s 34 of the Family Law Act 1975 (Cth) enables the Court to make any order which is “just and equitable” in circumstances after final consent orders have been made – whether subsequent judicial review and determination of final consent orders would alter substantive rights of the parties – whether subsequent judicial review and determination of final consent orders would be just and equitable in the circumstances – difference considered between the words “declaration” and “determination”

FAMILY LAW – COSTS – wholly unsuccessful application a factor to be taken into account under s 117(2A) of the Family Law Act 1975 (Cth) – significant delay in identification of an application a factor to be taken into account under s 117(2A) of the Family Law Act 1975 (Cth)

Family Law Act 1975 (Cth)
Family Law Rules 2004

Guinness & Guinness (No.2) [2008] FamCAFC 100
Kaljo & Kaljo (1978) FLC 90-445
Molier & Van Wyk (1980) FLC 90-911
McDonald & McDonald (1976) FLC 90-674
Ravasini & Ravasini (1983) FLC 91-312

APPLICANT: Mr Starling

RESPONDENT: Ms Darby

FILE NUMBER: CAF 4 of 2005

DATE DELIVERED: 30 March 2009

PLACE DELIVERED: Canberra

PLACE HEARD: Canberra

JUDGMENT OF: Faulks DCJ

HEARING DATE:

14 September 2007
9 November 2007

4 December 2007

REPRESENTATION

COUNSEL FOR THE APPLICANT: Mr Bartfeld QC

SOLICITOR FOR THE APPLICANT: Mr Farrar

FOR THE RESPONDENT: Ms Proctor

Orders

1. The application is dismissed.

2. The applicant will pay the costs of and incidental to the respondent in relation to these proceedings, other than the costs of the first hearing day, 14 September 2007, to which an order for costs has already been made.

3. The matter is removed from the pending cases list.

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

FAMILY COURT OF AUSTRALIA AT CANBERRA

FILE NUMBER: CAF 4 of 2005

MR STARLING

Applicant

And

MS DARBY

Respondent

REASONS FOR JUDGMENT

Introduction

1. These proceedings are regrettable.  They are regrettable primarily because of the totally unacceptable delay on my part in delivering my Reasons for Judgment or, perhaps more accurately, my reasons for the orders that I made on 4 December 2007 summarily dismissing the application. 

2. However, the proceedings are regrettable at another level.  As will transpire from my recitation of the history of this matter, the dispute was essentially over the interpretation of orders that the parties drafted themselves (in a comprehensive way) about complex transactions.  On my calculations, the differences of opinion between the parties (as reflected in their last filed amended application and response) amounts to some $131,941.71.  That figure at least is the amount less the amount the applicant would receive as a consequence of my order dismissing his application.  It seems likely that the parties have spent that much in legal fees in the course of the dispute to date.  Amongst other things, there had been eleven sessions before a Registrar of this Court and several appearances before me.  A list of the dates of appearances before Registrar Routh appears at Endnote 1 to these Reasons for Judgment.[1] 

3. The parties began their proceedings in this Court on 6 January 2005 when the father filed an application for final orders.  The matter then proceeded somewhat torturously for the rest of that year until 16 December 2005 when, by consent, I made orders which have been the subject of the dispute ever since. 

“Calm before the storm” – Nature of the orders made on 16 December 2005

1. For the purposes of this Judgment, it is necessary to examine the nature of the orders that were made.  The affairs of the parties were complicated.  Each of the parties conducted various activities through different corporate entities via different trusts.  The orders made by consent incorporated a process for joining each of the corporate entities as a party to the proceedings.  It was, however, a matter of agreement that for all practical purposes each of the corporate entities should be treated as the alter ego of one or the other of the parties.  The respondent, whom I shall refer to as the wife,[1] carried on a business in B, New South Wales which involved a hospitality business known as “C Centre.”  In fact, the business was owned by a company as trustee for the T Darby Family Trust.  A further company, L Pty Limited, had as its directors the husband and his daughter and the share holding was as to one to the husband and one to the wife.  It was also the Trustee of a trust known as the R Trust.  Another company, of which the wife was the sole director and shareholder, was the registered proprietor of the land on which the C Centre was operated from. 

   [1] I make such reference for the purposes of convenience only without intending in anyway to generate any offence.  Similarly, I shall refer to the applicant as the husband.

2. Among other entities were a succession of companies associated with mining, which were essentially the husband’s trading vehicles at some point.

3. The scheme outlined in the course of the orders was, in essence, to ensure that each of the entities finished up in the sole control of the husband or the wife.  One of the companies owned some properties in E Street in B.  These properties were secured in a way that enabled the husband to have them in due course, but for the wife to retain an interest in them until such time as she was paid any amount that was due to her.  The orders comprehensively incorporated indemnities in respect of various other entities and assigned responsibility for debts in relation to each of them.  Unfortunately, this was not done in the long run as comprehensively as it transpires it should have been done. 

4. The orders provided that the husband and the wife and the relevant corporate entities would do such things as are necessary to sell the E Street properties and the C Centre.[2]  Provisions were set out about how the sale was to be conducted and restrictions that were imposed upon either party in being involved directly in the purchase in respect of such sale.  The parties provided restrictions on anyone signing contracts without the knowledge and consent of the other and required the parties to cooperate about the sales including keeping the properties in good repair and allowing inspections. 

   [2] Orders made by consent on 16 December 2005 O10(a) & O10(b).

5. It is noteworthy that the parties themselves noted that they:[3]

   … do not intend that the provisions of this Order shall affect in any way their right to seek further machinery orders from the Court in the event that they are unable to agree in relation to the implementation of Order 10.

   [3] Orders made by consent on 16 December 2005 O11.

6. Notwithstanding that the parties themselves were responsible for seeding this particular rain cloud it appears they failed to forecast the thunderstorm which was to follow. 

7. A number of the disputes between the parties that are the subject of these proceedings arose from the sale of the C Centre.  Order 13 entered into by the parties prescribed that the proceeds of the sale of the C Centre would be first used to discharge the debt owed to the National Australia Bank.[4]  That debt was capped at a figure of $1,960,000.00 as between the parties, but not of course as between the parties and the National Australia Bank. 

   [4] Orders made by consent on 16 December 2005 O13(a).

8. This came about because the wife was operating the business and it was a way of ensuring that neither party could benefit from changes perhaps brought about by one or the other.  Again this should have sounded warning bells in the mind of the parties but clearly did not. 

9. As one would expect, from the sale of the C Centre were to be deducted the agent’s commission and other expenses relating to the sale and each of the parties were to receive by way of reimbursement any fees that had been paid or other expenses incurred by them in relation to the sale.  The wife’s motor vehicle lease was then to be paid out (with qualifications about her having to make payments after the date of the orders until the date of settlement).  Order 13(b)(iii) provided again, perhaps presciently but not presciently enough, that there may be a difference between a sale that was conducted as a “going concern” and one conducted not as a “going concern.”  In the latter event (which was in fact what transpired) any amounts due to trade creditors, any amount due from trade creditors and any other business related assets and liabilities “… [would] be brought to account in determining the net proceeds of sale, before division between the parties pursuant to Order 15 hereof.”

10. The orders then provided the wife would not draw more than $4,000 in a calendar month until the sale of the C Centre was achieved.[5] 

    [5] Orders made by consent on 16 December 2005 O13(c)(iii).

11. Again exhibiting caution, the parties foresaw that it was possible that that figure might be exceeded and provided that any surplus above that figure would be adjusted at the time of the sale so that 57.5 per cent would come out of the wife’s share of the sale of proceeds and be paid to the husband.[6] 

    [6] Ibid. 

12. Moreover, the parties provided that the husband could, at his own expense, audit the financial records of the relevant company to check compliance.[7] 

    [7] Orders made by consent on 16 December 2005 O13(c)(iv).

13. The orders then provided that the difference should be divided, in essence, between the parties in the ratio of 57.5 per cent to the husband and 42.5 per cent to the wife.[8]  Similar arrangements were put in place in relation to the E Street properties.  The overall effect was designed as the orders prescribed to ensure that the assets of the parties would be divided between the parties in the ratio set out above.  Provision was made in respect of one of the other properties which appeared to be likely to be retained by the husband to cap the value or at least to make it certain for the purposes of calculations. 

    [8] Orders made by consent on 16 December 2005 O13(e).

14. The parties (wisely one would have thought) also made provision that if there were to be a sale of the properties producing more than their calculations had been based upon, then that additional sum would be divided between the parties equally.[9]  Order 16, which dealt with the husband’s assertion that he had “carried forward capital loses which would offset any capital gains realised from the sale of the [E Street] properties”, provided that if this were not so, then that liability would be divided between the parties in the ratio set out above.[10] 

    [9] Orders made by consent on 16 December 2005 O13(f).

    [10] Orders made by consent on 16 December 2005 O16(a) & O16(b).

15. The balance of orders made by consent included indemnities, transfers and declarations which were intended to ensure that each of the parties finished up with the properties that they were agreed to receive.  In particular, Order 22 provided that:[11]

    … the Wife is declared to be the sole owner of:

    (a)Any goods, chattels and personal property in her possession, excluding the furniture, fixtures and fittings belonging to [the C Centre].  IT IS NOTED THAT the Wife has a number of items of antique furniture and other antique items located in [the C Centre] premises, including the Bar, and they remain her property.  IT IS NOTED THAT the Wife is free to sell some or all of her antique furniture to any purchases of [the C Centre] and the proceeds of such sale shall be the Wife’s property.

    [11] Orders made by consent on 16 December 2005 O22(a).

16. One would have thought in those circumstances that that would have resolved any ambiguity in any of the situations so far as the parties were concerned. 

“The storm cometh” – Aftermath of the orders of 16 December 2005

1. Regrettably such optimism was unwarranted.  Sales of properties occurred and at figures which were greater than those that had originally been expected.  This was not the cause of concern.  A buyer was eventually found for the C Centre and the property was sold not as a “going concern.”  Again, the sale did not in itself present any problems so far as the parties were concerned.

2. Troubles did arise and these resulted in an application presented as an application in a case on 6 November 2006 by the husband accompanied by an affidavit seeking that there be certain payments made to the husband and wife ($816,671.14 to the wife and $427,260.96 to the husband.)[12] Further, the motor vehicle lease was to be paid out and that the sum of $450,000 be retained in an interest bearing deposit “pending reconciliation of [the C Centre’s] accounts and agreement between the parties or order of the Court.”[13] 

   [12] Application in a case of the husband filed 6 November 2006.

   [13] Ibid. 

3. The affidavit outlined the nature of some of the disagreements between the parties. 

4. On 29 May 2007, a further application in a case was filed by the husband seeking that, pursuant to Rule 15.51 of the Family Law Rules2004, the husband have leave to adduce evidence from an expert who is not a single expert witness.  This proposed expert witness was Mr H, an accountant who had been retained by the husband during the course of the dispute before the orders made by consent.  This application was accompanied by an affidavit from the husband’s lawyer asserting a need for what amounted to an adversary expert witness.  The affidavit also asserted that there were a number of issues in dispute and that they required “expert forensic accounting evidence” for each of them.[14] 

   [14] Affidavit of Mr Farrar filed 29 May 2007 [para 3(c)].

5. These issues were identified in the affidavit as follows (summarised rather than quoted):[15]

   i)The antiques, referred to above, and their value for sale;

   ii)Whether a loan from Mr O was a business debt which should be paid from the proceeds or whether it should be regarded as a personal debt of the wife;

   iii)Whether credit card payments which the wife asserted should be deducted from the total for distribution should be regarded as business debts, as the wife asserted, or personal debts of the wife as the husband asserted, (in whole or in part);

   iv)Whether there were drawings by the wife in excess of the $4,000 referred to above and if so the adjustment that should be made in respect thereof; and 

   v)Whether the wife had made drawings after the sale of the property (as had been foreshadowed by the orders) which required adjustment. 

   [15] Affidavit of Mr Farrar filed 29 May 2007 [para 3(c)(i) to 3(c)(v)].

Subsequent proceedings before the Court

1. While this process had been occurring the parties had been appearing relatively regularly before Registrar Routh.  He saw his task (at least altruistically and mercifully) as assisting the parties to finalise and reconcile their accounts.  He may or may not have turned his mind to whether or not there was jurisdiction to entertain the application in its somewhat strange form as filed on 6 November 2006.  In its terms (as then drafted), it seemed to be perhaps the implementation of the cautionary provisions of the orders enabling some re‑listing for directions.  In any event, no blame is attributable to Registrar Routh as he did everything he could to assist the parties towards some negotiated conclusion.  But up to and including 5 July 2007, the parties had been involved with Registrar Routh on eight occasions.  These orders brought the matter before me in September 2007 when the matter was adjourned yet again to the Registrar on 25 October 2007 and then back before me on 9 November 2007 and finally on 4 December 2007. 

2. In the meantime, Mr H had filed an affidavit on 25 July 2007 in which he gave his opinion about the matters that were in dispute.  On 13 August 2007, the wife filed an affidavit in which she set out what she saw as the background to the dispute and made certain assertions about how money had been expended and about certain values.  An affidavit was also filed on 13 August 2007 by Mr O in which he made assertions essentially corroborative of the matters set forth by the wife.  On 13 August 2007, Mr S, the wife’s accountant, also filed his version of the accounts.

3. On 31 August 2007, Mr D, who was a director of the purchaser company of the C Centre, filed an affidavit in which he explained what he understood was the basis for the valuation of the antiques in the course of the sale. 

4. It was eminently predictable that there would be objections to some of the evidence that had been filed.  In fact, the written document to that effect was filed on 12 September 2007.  On 18 September 2007, the husband filed an affidavit responding to the wife’s affidavit and then on the same day he filed an amended application in a case seeking a fixed payout of sums from the money held by the solicitors who had undertaken the conveyancing.  The wife’s response thereto was filed on 7 November 2007, which in my opinion, correctly identified the most recent application or amended application of the husband as masking the fact that behind what appeared to be an application seeking simple procedural orders, there was an implied requirement that the disputes referred to previously needed to be resolved.  In her response, the wife sought the payment out of the alleged loan to Mr O, an adjustment in her favour for the antiques and for the credit card debt and for the distribution of other money. 

5. As I suggested above, I conducted an analysis of the difference between what was sought by each of the parties at this somewhat late stage in the proceedings and it appears that it meant that the husband should receive $131,941.71 more if his version were to be upheld. 

Proceedings before me on 14 September 2007

1. When the matter came before me on 14 September 2007 I noted at an early point that it was difficult to know precisely what the nature of the proceedings being brought actually were. I include the following excerpt from the transcript of the proceedings:[16]

   HIS HONOUR: What I am concerned about is this, what sort of an application is this before me?

   MR BARTFELD QC: The application is, or is intended to be one of interpretation and enforcement of an order.

   HIS HONOUR: On what basis?  What power do I have to interpret an order?

   MR BARTFELD QC: Well it is nothing else [perhaps if it is nothing else], an inherent failure of the Court to interpret the meaning of its own orders [I think this probably meant the inherent power of the Court to interpret its own orders.]

   [16] Transcript of proceedings 14 September 2007 1-2.

2. I suggested to Mr Bartfeld QC that perhaps what he was looking for might be contained in Rule 20.07(a) of the Family Court Rules 2004 which provides:

   The Court may make an order: (a) declaring the total amount owing under an obligation.

3. But the sort of orders that the Court could make under those Rules are quite confined in their form. 

4. I pointed out to Mr Bartfeld QC that I wanted him to be clear about what would be the nature of the issues that would be facing me when the matter came before the Court next on the Monday after the weekend following his appearance by telephone.  Mr Bartfeld QC responded:[17]

   And, your Honour, I think that the answer lies in section 114 subsection (3) [of the Family Law Act 1975 (Cth)] the injunctive power which can be invoked in order to enable execution.

   [17] Transcript of proceedings 14 September 2007 3.

1. Mr Bartfeld QC went on to explain that what his client was asking me to do was to make an order directing the payment of a certain sum to one party and another sum to another, possibly under s 114(3) of the Family Law Act 1975 (Cth).

2. He also drew my attention to s 34 of the Family Law Act 1975 (Cth), which provides:

   (1)The Court has power, in relation to matters in which it has jurisdiction, to make orders of such kinds, and to issue, or direct the issue of, writs of such kinds, as the Court considers appropriate.

3. I then pointed out to Mr Bartfeld QC that s 114(3) would not seem to be applicable because there were apparently no other proceedings pending in the Court, as the matter had been finalised by orders made by consent on 16 December 2005. I agreed with Mr Bartfeld QC that the form of the application (ie, an application in a case) which he felt had been mandated by the Rules was not a matter of concern to me.

4. Mr Bartfeld QC then said:[18]

   Well the proceedings are the enforcement of an order which each party interprets differently to the other. 

   [18] Transcript of proceedings 14 September 2007 4.

5. When I reiterated my concern that s 114(3) required some primary proceedings to enable it to be enlivened Mr Bartfeld QC replied:

   Well section 114(3) certainly contemplates an injunction in aid of enforcing of a decree so that section clearly contemplates the very proposition I am propounding.[19]

   [19] Ibid.

6. Mr Bartfeld QC then said that essentially the exercise was one of determining:

   what the order meant in the context of what happened subsequent to its making.[20]

   [20] Ibid.

7. The exchange continued for some time and eventually I suggested to Mr Bartfeld QC:[21]

   … it seems to me that possibly what the parties are seeking is in fact an order under section 79A.[22]

   [21] Transcript of proceedings 14 September 2007 5.

   [22] Ibid.

8. To this Mr Bartfeld QC replied[23] and maintained his position all through the proceedings:

   I don’t believe either party is seeking that.

   [23] Ibid.

9. Ms Rees (then counsel for the wife) contributed:[24]

   Certainly not from the wife’s point of view, your Honour.

   [24] Ibid.

10. Ms Rees’s position was that she had not filed a response because there was no valid application to respond to.  In a subsequent exchange with Mr Bartfeld QC I queried why there had not been some clarification of the orders that were being sought at an earlier point given that there had been some nine months elapsed since the filing of the application and when the matter had come before the Court. 

11. In the circumstances, it was agreed by counsel that the matter would not proceed on the following Monday and an order was made about costs. 

12. The matter came back before me on 9 November 2007.  Mr Bartfeld QC had provided to the Court some extensive written submissions on the question of jurisdiction which was the issue he said he was there to address upon on behalf of the husband.  Mr Bartfeld QC resisted the suggestion that what the parties were seeking was re-litigation of the previous proceedings.  He asserted that:[25]

    … that is really a matter of dealing with the machinery provisions…

    [25] Transcript of proceedings 9 November 2007 4. 

13. He referred me to the matter of Molier & Van Wyk.[26]  He identified the difference between the parties as being about $50,000 at that point. 

    [26] Molier & Van Wyk (1980) FLC 90-911.

14. The proceedings before the Court involved a consideration still of what power the Court might have to determine the matters that were in dispute.  I said to Mr Bartfeld QC:[27]

    It comes back to the proposition that I advanced to you on the last occasion we were before the Court: that the difficulty that arises is not one that is rectifiable by enforcement or by declaration; it is one rectifiable by setting aside the orders and a re-determination.  Now, that’s not a course of action anyone wants to undertake and I can understand that entirely; but it is not capable of resolution.  There is no jurisdiction to resolve a commercial default on the part of two parties, full stop.

    [27] Transcript of proceedings 9 November 2007 10.

15. The discussion at this point had centred on the antiques and the difficulty resolving around what value, if any, ought to have been ascribed to them as between the parties, rather than as between the purchaser and the wife.  The issue then turned to the question of various business loans.  The ensuing debate with counsel related to how the Court was to categorise business loans in default of there being new evidence which would then need to be tested.  The credit card expenses were a subject of debate which Mr Bartfeld QC submitted again:[28]

    Once again your Honour will hear evidence and determine it. 

    [28] Transcript of proceedings 9 November 2007 13.

16. When I questioned Mr Bartfeld QC about the number of items that would have to be the subject of determination he suggested:[29]

    … a small number of transactions about which evidence is given, cross‑examination, and your Honour will determine them.  It’s not a matter where your Honour will need to examine every little item of expenditure. 

    [29] Transcript of proceedings 9 November 2007 14.

17. Mr Bartfeld QC then went on to say he could not nominate which items were in dispute because the accountants had not yet finished conferring or at least had not yet provided their joint report. 

18. There then ensued a further discussion about whether or not the wife had circumvented or breached the orders of the Court by using credit cards for the purposes of drawing more money then she had previously been entitled to do.  This appeared to involve some add-back to the pool of property.

19. Subsequently, Mr Bartfeld QC acknowledged[30] that the current application was not to be his client’s final application which he said would need to be adjusted as to the amount:

    … slightly depending on what the outcome of the conference [between the experts] is…

    [30] Transcript of proceedings 9 November 2007 16-17.

20. When further queried about this Mr Bartfeld QC said:[31]

    Your Honour, as at today we stand by the application that’s before you.  That’s the application. 

    [31] Transcript of proceedings 9 November 2007 17.

21. I then queried him as to what evidence he was going to rely upon to support the application, on the basis that as he was standing by the application, he should know what the evidence is and therefore be in a position to tell me.  He responded that his difficulty was he did not have an affidavit from his expert as yet.

22. I suggested again that possibly the right way to resolve the matters in dispute between the parties was to make an application under s 79A of the Family Law Act 1975 (Cth).

23. I put to Mr Bartfeld QC:[32]

    What you’re suggesting seems to me to be very, very clearly related to what was the pool of property between the parties, not a question of interpretation, even assuming that was a valid exercise of this Court’s role in enforcement. 

    [32] Transcript of proceedings 9 November 2007 19.

24. After further exchanges, I put the following proposition to Mr Bartfeld QC:[33]

    Let me put this to you in the bluntest possible terms, Mr Bartfeld: my very clear inclination is to dismiss the matter summarily.  However, I am prepared to acknowledge that it is open to the Court to make a determination about – or a declaration, not a determination – about money that might be paid pursuant to an order.  I note that you tell me that the only evidence upon which you will base your case is that of [the husband] and also Mr [H], and I note that you tell me Mr [H] is yet to submit his evidence.  I am prepared to postpone making my decision until Mr [H’s] evidence is before me, so I can then see whether, in the light of that evidence, there is any further substance to the submissions that you’re making; but I have to say to you, at the moment I find no basis upon which I could see that this is a matter which deals with enforcement at all. 

    It is simply re-litigating the matter that was before the Court originally and which was resolved by consent; and moreover, the thing that troubles me most about that aspect of it, is that if I am to do it I do so in a vacuum, because I am not in a position to then make a determination about all the other matters that were in dispute between the parties and which no doubt bore upon their decision to reach a negotiated conclusion rather than anything else.  It’s not uncommon for people, in reaching a conclusion, to come to the final figure by reference to… a concluded figure based on perhaps different assessments on the part of each of them as to what the value of different items was, but which is simply a pragmatic resolution of their problem; and I fear that in this matter if we re-open – which is what I believe we are, in effect, doing – to deal with these items in dispute, that all we are really doing is creating the basis for further litigation based on the fact that at the end whichever party felt aggrieved by whatever determination I made would then simply say, “Well, that wasn’t the basis upon which I reached my conclusion, I now want to set the orders aside,” and so we then start all over again, again.  Now, how long do you require for Mr [H] to have his affidavit ready?

    [33] Transcript of proceedings 9 November 2007 22-23.

25. Mr Farrar subsequently intervened as solicitor for the husband[34] to say that there had been agreement about the antiques.  Before I proposed to adjourn the matter Ms Proctor for the wife sought to be heard and suggested there was no basis for the matter to proceed any further and that it should be dismissed summarily.  She reiterated a number of the arguments that had been the subject of debate between Mr Bartfeld QC and me.  She concluded that:[35]

    That’s where you’re going to be in December [2007], in my submission, the same as you are today, and the same as you were, I think, on 14 September [2007.] That is that the process – there is no process before the Court that is capable of being resolved by the Court. The parties need to do something other, and I think the only option in the Court is section 79A. Those are my submissions.

    [34] Transcript of proceedings 9 November 2007 23.

    [35] Transcript of proceedings 9 November 2007 26.

26. I responded that it seemed to me in fairness that I would need to allow the process of the joint accounting to be concluded and suggested that when it had been filed I would then be in a position to see if I would be in the same position as Ms Proctor suggested I would be.[36]  I then adjourned the matter to enable the joint report to be filed and reserved the question of costs.  The subsequent report of the meeting of the joint experts, Mssrs H and S, on 9 August 2007 (filed 3 December 2007) demonstrates that the financial matters in question would have required significant examination and cross-examination of evidence.

    [36] Ibid.

27. When the matter was back before me on 4 December 2007, I summarily dismissed the application before me. 

28. Prior to that occurring the experts in the matter had filed a joint report which identified quite a number of matters that are in dispute not the limited number that had been foreshadowed by Mr Bartfeld QC. 

29. I made reference to the definitions of the words “declare” and to “determination” in the Macquarie Dictionary.[37]  I concluded that what I was being asked to do was to make a determination rather than to declare an amount owing or some other factor capable of identification.  I did, however, point out that in the Concise Australian Legal Dictionary Third Edition a second meaning was given to the word “declare” as follows:[38]

    A formal imperative statement creating or preserving a right.  A declaration may be contained in a treaty.  Declaration includes a resolution or statement of claim such as a declaration of war or independence.

    [37] Transcript of proceedings 4 December 2007 2.

    [38] Transcript of proceedings 4 December 2007 3.

30. I conceded that if I were to accept that definition there was, contained within the word at least, the element of creating or preserving a right.  I then considered with Mr Bartfeld QC the decisions of Molier & Van Wyk[39] and of McDonald & McDonald.[40] I concluded that it was not a matter of simply ordering the parties to consult some authority which would provide an answer and would provide the interpretation necessary but to actually resolve property disputes between the parties.  I concluded:[41]

    It is the situation that there is a dispute, a justiciable dispute between the parties which requires not only evidence to be given and cross‑examination, I should say, but also a determination. 

    [39] Molier & Van Wyk (1980) FLC 90-911.

    [40] McDonald & McDonald (1976) FLC 90-674.

    [41] Transcript of proceedings 4 December 2007 6.

31. I went on to say, and I adopt for the purposes of my Reasons for Judgment that:[42]

    … what I’m being asked to determine as between the parties are substantive matters relating to their rights in relation to the pool of property to be divided.  It isn’t the case that I’m simply engaging in some machinery provision that will take account of things that were not quite capable of being foreseen at the time. 

    [42] Transcript of proceedings 4 December 2007 7.

The bases upon which the application might have been entertained

1. Leaving aside the form of the application, the dispute, as became abundantly clear during the course of the debate between counsel and myself during the proceedings, related to the resolution of a group of matters which had arisen subsequent to the consent orders essentially about how those orders should properly be interpreted.  The jurisdictional question was what power the Court had to resolve such a dispute between the parties.  The parties had turned their minds to many of the minutiae of the resolution of their dispute.  It is clear from the proceedings before this Court subsequently that they had not thought of all of them.  At least, if they had thought of them they had not thought that they were matters that required specification and agreement. 

2. There were essentially three ways in which it might be asserted that the matter could come before the Court.

Injunction under s 114(3) of the Family Law Act 1975 (Cth)

1. The first suggested way of resolution related to an injunction under s 114(3). This would, in essence, involve the making of a mandatory injunction requiring the payment of a certain amount of money. While I have some residual concern that s 114(3) could only properly be brought into effect if there were other proceedings before the Court, I accept that there is some force to the argument advanced by Mr Bartfeld QC that that section could be employed in aid of an order already in force.[43] 

   [43] Family Law Act 1975 (Cth) s 114(3).

2. Nevertheless this is not simply a question of enforcement; it is a matter of the determination of contested evidence between the parties about what was required by the orders that were finally made.  The issue about the antiques may have been resolved which would have precluded some additional evidence although not, in my opinion, in a way indicative of how the rest of the proceedings should be dealt with.  It appears that the dispute about the antiques was resolved pragmatically rather than by reference to any particular principle.  The determination of what expenses were business expenses and what loans were business loans was a matter upon which there would need to be further evidence, further cross‑examination and then determination.  Any such determination may well have called into question the basis upon which either of the parties or both of them in fact had reached agreement.  As I commented to counsel during the course of proceedings, it is not uncommon for parties to reach agreement based upon a pragmatic conclusion even if each of them has a different view about what the nature of the evidence may be or what value should be attributed to certain items of property.  If the basis of that mutual understanding (or perhaps misunderstanding) at the time of the agreement is to be set aside it is difficult to see how either or both parties might not have a ground for saying that the orders no longer represented the understanding upon which their agreement had been entered into. 

3. In summary, this is not about a mandatory injunction in support of the enforcement of an order, even if that order required some interpretation.  It was common ground that the matter could not proceed any further without additional evidence and without there being some determination of issues between the parties.  This, in my opinion, takes it outside the realm of a mandatory injunction. 

General enforcement order under Chapter 20 of the Family Law Rules 2004

1. The second suggested way of resolving the dispute was by way of a general enforcement order under Chapter 20 of the Family Law Rules 2004.   Under that chapter there are four suggested methods of enforcement: an order for seizure and sale of real or personal property, including under an Enforcement Warrant; an order for the attachment of earnings and debts, including under a Third Party Debt Notice; an order for sequestration of property; and an order appointing a receiver (or a receiver and manager).[44]  What I was being asked to do was none of those.  Again the issue was really one of determination of a dispute between the parties which could only be undertaken by evidence and a determination about evidence. 

   [44] Family Law Rules 2004 Rule 20.05.

2. Accordingly, I was faced both with an exclusion of the proceedings based upon their failure to fall within any of the nominated grounds and an impracticability in invoking this power because of the need to resolve the dispute between the parties. While it does not affect my decision in this matter, I accept Mr Bartfeld QC’s submission that the four methods of enforcement as outlined under Rule 20.05 are not exclusive or exclusionary of other means of enforcement.

General power under s 34 of the Family Law Act 1975 (Cth)

1. I turn now to the general powers of the Court under s 34 of the Family Law Act 1975 (Cth) (a suggestion made originally by Mr Bartfeld QC in the proceedings of 14 September 2007.) Mr Bartfeld QC seemed to contend that s 34 would enable the Court with the power to do whatever it thought was just and equitable in the circumstances.

2. I do not accept that s 34 confers upon the Court any power in addition to powers otherwise then specifically conferred. However, even if that were so, the question in this matter is on what basis could it be just and equitable for me to set aside an order, or more appropriately, to enforce what one party interpreted was the order without determining the issue in an ordinary trial process. Such a trial process would involve evidence, cross-examination and other matters which in turn would require perhaps a re-examination of the fundamental basis upon which the original agreement had been entered into. Presumably when the parties entered into consent orders they accepted that (at very least for pragmatic reasons) the orders were just and equitable. What I was now being asked to do by the husband was to excise some parts of the “agreement” and to conduct a hearing about them. When I concluded that hearing how could I (as a Judge) be satisfied that the result would be “just and equitable” without a consideration of all the property and evidence about contributions and factors under s 75(2) of the Family Law Act 1975 (Cth) in relation to all the property?

Altering substantive or machinery orders?

1. Finally, there is the question of whether what I was being asked to do constituted merely the alteration of a machinery provisions rather than substantive provisions.  The alteration of machinery provisions received at least some implicit imprimatur in the matter of Kaljo & Kaljo.[45] This aspect of the matter is re-enforced by the fact that the parties turned their minds in the orders that are sought to be “interpreted” and “enforced” by reserving liberty to apply about some aspects of the matter.  However, the aspects about which liberty to apply was reserved by the parties related genuinely to questions of machinery not to questions of substance.  Moreover, as I have reiterated at great length during the course of the proceedings before me and in this Judgment, in my opinion, there is no basis upon which I can simply make an interpretation of the orders or some procedural steps such as the appointment of a valuer or the determination of how a valuer might be appointed or how an auctioneer might be commissioned to resolve the issues between the parties. 

   [45]Kaljo & Kaljo (1978) FLC 90-445. I note the principles from Kaljo & Kaljo were subsequently considered by the Full Court in Ravasini & Ravasini [1983] FLC 91-312 and more recently by the Full Court in Guinness & Guinness (No.2) [2008] FamCAFC 100.

1. It is clear that there are still matters unresolved which would require the giving of evidence, the testing of evidence and a determination about the evidence which in its term would disrupt the balance or possibly the basis upon which the original settlement had been achieved.  In my opinion, what I am being asked to do in this matter is not to provide machinery to enable the orders between the parties to be implemented.  Rather, it is a request for the substantive setting aside of some of those orders and a re-consideration of the terms upon which the orders are to be carried out.  Accordingly, in my opinion, the Court cannot properly entertain the application currently before it.

Conclusion

1. If the parties, or either of them, had sought that the orders be set aside under s 79A of the Family Law Act 1975 (Cth) then the orders might have been set aside and other orders substituted for those that had previously been made. The difficulty I face is that, notwithstanding the enormous energy that has been expended by the parties in dispute about the matters that are currently before me, there is no reasonable basis upon which I can entertain that application in the context of the nature of the dispute itself. My determination summarily to dismiss the applicant’s application does not preclude the parties from not only appealing against this decision but also from seeking, should they wish to do so, the setting aside of those orders. Whether this is a sensible or commercial decision on their part is a decision I cannot make. Nevertheless it is the decision that they must make because I propose to dismiss the application.

Costs

1. The husband will pay the costs of and incidental to the wife in relation to these proceedings, other than the costs of the first day in relation to which an order for costs has already been made.  The issue about costs was debated before me on 4 December 2007 and I agreed that I would postpone making the order until I made the other orders to avoid any differential appeal period. 

2. In this matter the primary prescription under the Family Law Act 1975 (Cth) is that each party should pay his or her own costs.[46] The Court has the power to depart from such a consideration provided it takes account of matters set out under s 117(2A).

   [46] Family Law Act 1975 s 117(1).

3. The matters I consider to be relevant to that consideration are the fact that the husband has been wholly unsuccessful in his application and I further take note of the fact that there was a significant delay in the identification of the application that was in fact in the end relied upon. 

4. The other matters are not, in my opinion, significantly relevant to my determination. 

I certify that the preceding eighty (80) paragraphs are a true copy of the reasons for judgment of the Honourable Deputy Chief Justice Faulks.

Legal Associate:

Date:  30 March 2009

[1] The parties appeared before Registrar Routh over the following dates: 21 November 2006; 9 February 2007; 15 February 2007; 27 March 2007; 7 May 2007; 4 June 2007; 25 June 2007; 5 July 2007; 3 August 2007; 7 September 2007; and 25 October 2007.