Stone and Stone (No 2)
[2013] FamCA 479
•19 June 2013
FAMILY COURT OF AUSTRALIA
| STONE & STONE (NO. 2) | [2013] FamCA 479 |
| FAMILY LAW – PROPERTY – COSTS – Where the primary proceedings were between the husband and wife to a marriage seeking orders for property settlement under s 79 of the Family Law Act 1975 (Cth) – Where the wife now seeks an order that the husband pay her costs of and incidental to the primary proceedings on an indemnity basis or on a party and party basis – Consideration of factors set out in s 117(2A) of the Family Law Act 1975 (Cth). FAMILY LAW – PRACTICE AND PROCEDURE – ADJOURNMENT – Where the husband has lodged an appeal against the Orders and judgment made in the primary proceedings – Where the husband seeks an adjournment of the wife’s application for costs until his appeal has been determined by the Full Court. FAMILY LAW – STAY OF PROCEEDINGS – Where the husband seeks a stay of the Orders made in the primary proceedings – Whether to grant a stay – Whether the wife should be entitled to the fruits of the judgment in the primary proceedings – Whether the failure to grant a stay would render the husband’s appeal nugatory – Whether the parties would face hardship were the Court to decline to grant a stay – Consideration of the merits of the husband’s appeal. |
| Family Law Act 1975 (Cth) Family Law Rules 2004 |
| Gould v Gould (2007) FLC 93-333 Harris and Harris (1991) FLC 92-254 Hitch & Hitch [2012] FamCAFC 124 House v The King (1936) 55 CLR 499 Forster & Forster [2013] FamCA 51 Fraser & Moedt (Unreported, Family Court of Australia, Nicholson CJ, Lindermayer and May JJ, 30 October 1997) Pennisi and Pennisi (1997) FLC 92-744 |
| APPLICANT: | Ms Stone |
| RESPONDENT: | Mr Stone |
| FILE NUMBER: | SYC | 6953 | of | 2009 |
| DATE DELIVERED: | 19 June 2013 |
| PLACE DELIVERED: | Sydney |
| PLACE HEARD: | Sydney |
| JUDGMENT OF: | Justice Fowler |
| HEARING DATE: | 29 May 2013 |
REPRESENTATION
| COUNSEL FOR THE APPLICANT: | Mr Schonell, SC |
| SOLICITOR FOR THE APPLICANT: | Diana Perla & Associates |
| COUNSEL FOR THE RESPONDENT: | Mr Todd |
| SOLICITOR FOR THE RESPONDENT: | McDonell Milne Toltz Family Lawyers |
Orders
The application of the husband for the adjournment of the wife’s application for costs is dismissed.
The husband is to pay the wife’s costs of and incidental to the proceedings from 10 September 2010 to the day before the commencement of the hearing on
21 February 2013 as agreed or assessed.
The husband is to pay the wife’s costs of and incidental to the hearing of the matter on an indemnity basis as agreed or assessed.
The Court certifies for Senior Counsel.
The application of the husband for a stay of proceedings on the Orders of this Court made on 18 April 2013 is dismissed.
IT IS NOTED that publication of this judgment by this Court under the pseudonym Stone and Stone has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
| FAMILY COURT OF AUSTRALIA AT SYDNEY |
FILE NUMBER: SYC 6953 of 2009
| Ms Stone |
Applicant
And
| Mr Stone |
Respondent
REASONS FOR JUDGMENT
The proceedings before the Court arise out of a judgment and Orders of this Court made on 18 April 2013 (“the primary proceedings”) in relation to the hearing and determination of issues between the parties, Ms Stone (“the wife”) and Mr Stone (“the husband”), concerning their rights under section 79 of the Family Law Act 1975 (Cth) (“the Act”).
The judgment in the primary proceedings should be read in conjunction with this judgment.
In the proximate proceedings there are three applications before the Court.
The first application is one in which the wife seeks orders for the payment of her costs by the husband on an indemnity basis or, alternatively, on a party-party basis. The Court is asked to certify for Senior Counsel. The husband opposes there being an order for costs on any basis.
The second application before the Court is one in which the husband seeks a stay on or an adjournment of the wife’s application for costs pending the determination of an appeal which he lodged on 16 May 2013 against the Orders made in the primary proceedings. The wife opposes the husband’s application for an adjournment.
The third application before the Court is the husband’s application for a conditional stay of the Orders made in respect of the primary proceedings pending the outcome of his appeal. The wife opposes the husband’s application for a stay.
Adjournment Application
In relation to the husband’s application for an adjournment of the wife’s costs application, the Court is of the view that it should determine the issue of costs now so that all relevant issues can be before the Full Court in due course and so that the parties are not then faced with a multiplicity of appeals, should any party wish to appeal the costs decision.
In addition, on present hearing times it is unlikely that the trial judge, by reason of retirement from office, would be available to determine such issues post the determination of the husband’s appeal in the primary proceedings.
For these reasons the application of the husband for an adjournment of the wife’s application for costs is dismissed.
Costs Application
In relation to the issue of costs, it is clear that section 117(1) of the Act provides that, subject to section 117(2), each party to proceedings shall bear his or her own costs.
Section 117(2) of the Act, however, reposes a wide discretion in the Court to make such orders for costs as the Court considers just.
Section 117(2A) of the Act sets out the matters which the Court must take into account in determining whether or not to depart from the rule in section 117(1) and make an order pursuant to section 117(2).
In its consideration of the operation of section 117(2A) and the authorities which guide this Court in the application of that section, the Court notes that the Full Court in Hitch & Hitch [2012] FamCAFC 124 stated as follows:
53.In Penfold and Penfold (1980) 144 CLR 311, the High Court described the application and purpose of this section. It was said at 315:
Sub-section (2) requires a finding of justifying circumstances as an essential preliminary to the making of an order. Beyond this there is nothing in the subject matter or in the interrelationship of the two provisions which imposes any additional or special onus on an applicant for an order for costs. Consequently, with respect to their Honours in the Family Court, we do not agree with the suggestion made in the judgment under appeal that an order can only be made under s. 117 (2) in "a clear case".
54.As a discretionary decision, the weight to be given to a particular consideration under s 117(2A) is a matter for the judge. However, in I and I (No 2) (1995) FLC 92-625 it was held that the relevant matters in s 117(2A) “must all be taken into account and all balanced in order to determine whether the overall circumstances justify the making of an order for costs”.
55.That is not to say that one single matter may not ultimately be determinative, as was confirmed in Fitzgerald (as child representative for A (Legal Aid Commission of Tasmania)) v Fish and Another (2005) 33 FamLR 123 at paragraph 41…
56.It is as well to recall previous decisions of this Court that a disparity in financial resources between the parties may justify an order for costs in favour of the party with fewer financial resources (Marinko v Marinko (1983) FLC 91-307, Mallet v Mallet (1984) 156 CLR 605). Also relevantly, the apparent inability of a party to pay costs is not a bar to a costs order being made in circumstances where that party’s conduct is determined to warrant an order (Cross v Beaumont (2008) 39 Fam LR 389).
Having considered the above principles, the Court now turns to the matters which it must consider under section 117(2A), which are as follows.
a) The financial circumstances of each of the parties to the proceedings
In this matter the financial circumstances of the parties to the proceedings are such as would enable either of them to meet an order for costs.
The husband has a greater earning capacity than the wife. He also has experience in investing in property.
There is no evidence that the parties’ financial positions have significantly changed from what they were at the time of the hearing, but for the intervention of the Orders made by the Court. Even so, the Court finds that the financial position of the husband is not a bar to the making of an order for costs against him, and the comparative financial position of the wife is not such as might disentitle her to an order.
b) Whether either party to the proceedings is legally aided
Neither party is or was legally aided.
c) The conduct of the parties to the proceedings in relation to the various matters set out in section 117(2A)(c)
As to the husband’s conduct in the proceedings, the judgment refers at paragraphs 64–71 of its text to various matters related to the non-disclosure and inadequate disclosure of the husband found by the Court. The husband was in addition obstructive to the proper preparation of the case for hearing.
The husband acknowledged in cross-examination that he had been obstructive in relation to the preparation of a report by a single expert accountant, and findings were made by the Court of the husband’s untruthfulness in contending that he could not afford to meet his share of the single expert’s fees.
The husband is a successful financial professional. He was in large measure being cross-examined about his own business affairs and the Court formed the view that the husband had been guilty not only of persistent and continuing inadequate disclosure but of false and misleading disclosure as well.
The judgment in the primary proceedings at [71] states:
71.It is not as though the matters which the husband falsely asserted or deliberately failed to disclose (or indeed failed to disclose in the exercise of a spirit of insouciance) do not go directly to issues which are relevant in this case. The husband has been obstructive of attempts to procure light on the parties’ financial history in a marriage where the administration of his affairs was peculiarly within his ken and not that of the wife. The imbalance of knowledge made his obligation in these circumstances all the more significant and its breach likewise significant with consequential results.
It is the wife’s contention that this conduct alone would be sufficient to warrant the making of an order for costs, however, the Court notes it is but one of a number of matters required to be taken into account. Having said that, it is a matter to which this Court gives great weight.
Interdependent relationships in the nature of marriage often are ones in which there is an imbalance of power and knowledge. This marriage was one such. The obligation of disclosure is an obligation which the administration of justice in this jurisdiction requires to be discharged without reserve in a full and frank way, particularly for that reason. Anything less undermines the capacity of the Court to do justice between the parties to such relationships.
Apparently in an attempt to mitigate the consequence of his failure to disclose, the husband asserts that such failure was by reason of incompetent advice given to him by his advisors. The Court is unable to determine whether that is so and, even if it were, that would be a matter between the husband and those advising him and perhaps constitute grounds for an action in another Court.
So far as this Court is concerned, the wife is entitled to have the conduct of the husband taken into account notwithstanding its asserted aetiology.
d) Whether the proceedings were necessitated by the failure of a party to the proceedings to comply with previous orders of the court
It is not the case that the primary proceedings were necessitated for the above reason, however much of the Court’s time at interlocutory stages of the proceedings was applied to seeking disclosure from the husband, which disclosure was not forthcoming in a timely manner. The Court also notes that the husband’s compliance with orders relating to disclosure was wanting.
e) Whether any party to the proceedings has been wholly unsuccessful in the proceedings
Neither party to the proceedings has been wholly unsuccessful in the proceedings. The wife did not attain the amount which she sought and neither did the husband.
It would be true to say perhaps that the wife was more successful than the husband but that is not the matter which is required to be taken into account.
f) Whether either party to the proceedings has made an offer in writing to the other party to the proceedings to settle the proceedings and the terms of any such offer
The wife did make an offer in writing to the husband to settle the proceedings.
On 8 September 2010, after the parties attended a conciliation conference, the wife made an offer of settlement in writing which would have required the husband to pay to her an amount of $1,500,000. The wife would have retained her assets. On the basis of the then known asset pool specified in the balance sheet produced at the conciliation conference, the wife would have received a total of 39 per centum of the pool.
That offer was made at a time when the husband knew the quantum of the pool of assets and issues as to contribution were known. The offer was in dollar terms approximately $167,000 less than what was ordered to be paid by the husband to the wife pursuant to the Court’s final orders.
It is submitted by the wife that litigation in the Family Court of Australia is expensive and costly in both a financial and an emotional sense.
Parties are encouraged by the Family Law Rules 2004 (“the Rules”) to agree to compromise proceedings and are directed to do so where possible. The wife in this case made an offer to do so that was well within the reasonable range of expectations.
The husband throughout this case has adopted an unreasonable stance both in the quantum of his response to the wife’s offer and his refusal to make an offer greater than his response. His proposal was that he should pay to the wife an amount of $150,000 by way of property settlement.
The wife notes that, in the offer made in writing by the husband in a letter dated 27 August 2010, there had been no change to his proposed offer save for a suggestion that it was now a sum which should be applied “for the benefit of [J Stone]”. The husband was forewarned that the unreasonable nature of his response forced the wife to litigate. He was also put on notice that, should the Court determine that the wife was entitled to the amount sought in her offer or an amount higher, she would seek an order for indemnity costs from the date of the offer.
In his application for a stay of proceedings upon the Orders made in the primary proceedings, the husband asserts that the stay should be made conditional on the payment by him to the wife of the sum of $480,000, which sum he says is the amount which should be ordered to be paid to the wife by the Full Court on appeal. The husband thus acknowledges that, certainly as at the present time, the proposal contained in his response to the wife’s offer was an insufficient sum and the Court notes more than fifty per centum less than the amount now proposed to be paid.
The Court is informed (and it is not denied) that the husband did not during the proceedings make any offer to settle greater than his response to the wife’s offer. The wife contends that he also failed to comply with the requirement in the Rules that a party must make a genuine offer to settle. To this end the wife submitted that an offer of settlement involves a compromise and, given that the husband’s “offer to settle” was the same as his position at trial, it cannot be said that what he offered to the wife was genuinely an offer of compromise.
By reason of the husband’s failure in that regard, it is submitted that he forced and compelled the wife to run her case to a final hearing. It is also submitted that it is not as though the husband is not commercially savvy and astute. He is a financial professional who understands financial matters and the basis of determinations of value.
In Pennisi and Pennisi (1997) FLC 92-744 the Court said:
We do however, consider the closer the offer is to the award when the offer is under the amount awarded by the Court, the more weight that should be given to this factor in considering the question of costs. The principle must not, however, be rigidly applied. Offers must be seen in the context of the case and the extent of the offeree’s knowledge of the parties’ financial circumstances while the offer is live. In the family law jurisdiction, it is not uncommon to find relationships where one party, often the wife, has significantly less grasp of the parties’ financial arrangements, or the financial circumstances are so complex that it would be premature to accept an offer.
This was not a case where the husband proceeded in ignorance of those financial matters which would enable him to assess the wife’s offer.
In Harris and Harris (1991) FLC 92-254, where at trial the Court awarded the wife exactly the amount she had offered to settle for, the Full Court on hearing an appeal in the matter agreed that the trial judge was within the limits of the proper exercise of his jurisdiction to order costs.
It is submitted by the wife that it is both appropriate and justified for the Court to make an order for costs against the husband on the basis of the wife’s offer. Had it been accepted, the litigation between these parties would have ended some two and a half years ago and the emotional and financial trauma of a trial would have been avoided.
g) Such other matters as the Court considers relevant
It is argued by the husband that the balance of prejudice to him if the costs sought by the wife were enforced prior to the hearing of his appeal would be significant, whereas no such prejudice would be occasioned to the wife by refusing to make an order for costs now that could not be overcome by a later order for costs or interest.
It is asserted by the husband that his failure to disclose was seriously hampered by his failure to retain a competent solicitor to prepare appropriate financial and other documentation and to otherwise guide the husband. There is not in this case, however, evidence before the Court from which it can conclude that the husband could not afford to take competent advice or that such advice was not available to him.
It is submitted by the husband that he did not retain a solicitor on the final hearing and to that extent conducted the case as a self-represented litigant, although with direct access to Counsel. That Counsel, it is suggested, could not undertake the work of a solicitor and, consequently, the guidance and proper management of those financial disclosure matters appears not to have been properly undertaken.
It is the Court’s view that a failure to disclose is a failure to disclose and, if the husband failed to do so by reason of incompetent advice, then he has such remedies as are available to him in other jurisdictions. Presumably, the quantum of his loss could well match the quantum of the orders of the costs now sought against him.
It is suggested that whilst the husband may be a financial professional he is not a solicitor. It is also argued that being personally involved in the proceedings adds an emotional element that should have been addressed at a far earlier stage of the proceedings. The Court is left in no doubt that all of that is true, however, the remedy for those problems lay with the husband and the result of those facts should not now be visited upon the wife at her cost.
It is submitted by the husband that:
This is not a Black -v- Kelner type case in which the Court was left in a quandary as to whether there were other likely assets of substance in the name of the husband or his entities.
In response to that submission, it is the Court’s view that the failure to disclose by the husband, as adumbrated in the judgment in the primary proceedings, does not permit of the Court to say that such assets as were disclosed by him constituted the whole of the asset pool. The husband placed himself in a situation where the failure to disclose left the Court in real doubt as to the accuracy of any portrayal by the husband of his financial position.
It is submitted on behalf of the husband that the offer made by the wife was predicated on a different set of figures than those found by the Court on the hearing. The submission of the husband in this regard is not found by the Court as being a reasonable basis on which the Court should ignore the wife’s offer for settlement. Ultimately, it is a matter of the quantification of the offer of settlement in dollar terms.
The husband was the financial manager of the parties’ assets. He was peculiarly in a position of determining whether or not the offer fell within a reasonable range of results. Any change in the nature of the asset pool from the date of the offer to the date of the hearing, it is suggested, should relieve the husband from the consequences of the offer, notwithstanding that the percentage figures asserted in the offer and the monetary cost of the offer to the husband were less than those calculated by the Court.
The Court agrees with the submissions made by the wife and does not conclude that the husband is able to resist a claim for costs by reason of the matters raised. The offer was within a reasonable range and should have been accepted.
As to the question of indemnity costs, they are rarely given but Counsel for the wife contends that an award for costs on that basis should be ordered in this case. It was submitted that the Full Court decision of Fraser & Moedt (Unreported, Family Court of Australia, Nicholson CJ, Lindermayer and May JJ, 30 October 1997) supports the wife’s position for an indemnity costs order, which she contends is warranted due to the husband’s “false and misleading disclosure designed purely to disentitle the wife.”
It is the Court’s view that some portion of the costs of this case, having regard to the conduct of the husband referred to in the judgment, should in the Court’s view justly be upon that basis.
Accordingly, the Court proposes to order that the husband pay the wife’s costs of and incidental to the hearing from the date on which the hearing commenced until the date on which the hearing concluded, namely for the two days of trial, on an indemnity basis.
The husband should pay the wife’s costs otherwise as agreed or assessed from the date of the wife’s offer on 8 September 2010 to the date of the commencement of the hearing.
Certification for Senior Counsel
This case is one which warranted Senior Counsel being briefed particularly because of the obstructive behaviour of the husband, the non-disclosure of the husband and his false and misleading disclosure.
There was a reasonable requirement for the skill and experience of
Senior Counsel, particularly in cross-examination and in the analysis of material relevant to the non-disclosure and false disclosure.
The Court will certify for Senior Counsel.
The Court for the above reasons will make the Orders set out above and finds that, in the circumstances of this case, such orders are just.
Stay Application
A stay is sought by the husband in relation to the Orders made on 18 April 2013 in the primary proceedings. The husband lodged an appeal against those Orders in the Full Court on 16 May 2013.
A stay may be granted in the exercise of the discretion of the trial judge. The authorities make clear what needs to be taken into account by the Court in relation to a stay of proceedings and a stay is not granted as a matter of course.
In Forster & Forster [2013] FamCA 51, Strickland J considered an application for a stay pending determination of an appeal and summarised the principles to be applied when considering whether to grant a stay as follows:
13.In terms of the principles to be applied in stay applications, they are well settled and I refer to the Full Court decision in Aldridge & Keaton (Stay Appeal) [2009] FamCAFC 106. In paragraph 18 of that decision the Full Court reiterated and summarised the relevant principles as follows:
18.The principles to be applied in determining an application for a stay of orders both in the general law and in respect of parenting proceedings are also well known (see The Commissioner of Taxation of the Commonwealth of Australia v Myer Emporium Limited [No.1] (1986) 160 CLR 220 at 222; Alexander v Cambridge Credit Corporation (1985) 2 NSW LR 685; Jennings Construction Limited v Burgundy Royale Investments Pty Limited (1986) 161 CLR 681; Clemett & Clemett (1981) FLC 91-013; JRN & KEN v IEG & BLG (1998) 72 ALJR 1329 at 1332). The authorities stress the discretionary nature of the application which should be determined on its merits. Principles relevant to this matter include the following:
· the onus to establish a proper basis for the stay is on the applicant for the stay. However it is not necessary for the applicant to demonstrate any “special” or “exceptional” circumstances;
· a person who has obtained a judgment is entitled to the benefit of that judgment;
· a person who has obtained a judgment is entitled to presume the judgment is correct;
· the mere filing of an appeal is insufficient to grant a stay;
· the bona fides of the applicant;
· a stay may be granted on terms that are fair to all parties - this may involve a court weighing the balance of convenience and the competing rights of the parties;
· a weighing of the risk that an appeal may be rendered nugatory if a stay is not granted – this will be a substantial factor in determining whether it will be appropriate to grant a stay;
· some preliminary assessment of the strength of the proposed appeal – whether the appellant has an arguable case;
· the desirability of limiting the frequency of any change in a child’s living arrangements;
· the period of time in which the appeal can be heard and whether existing satisfactory arrangements may support the granting of the stay for a short period of time; and
· the best interests of the child the subject of the proceedings are a significant consideration.
As can be seen from the authorities cited above, the husband in this case has the onus of establishing a proper basis for a stay. He is not, however, required to demonstrate the existence of any “special” or “exceptional” circumstances.
In these proceedings the following matters are in the Court’s view material in relation to the consideration of whether the husband’s request for a stay should be granted.
The entitlement of the successful party to the fruits of the judgment and the question of hardship
Clearly the wife is entitled to the fruits of her judgment and she is entitled to assume that the judgment in the primary proceedings is correct.
The Court must consider the hardship or prejudice caused to either party in either the grant or refusal of a stay.
In this case the wife has significant and ongoing liabilities attracting interest payments which would be able to be discharged upon payment of the fruits of the judgment to her.
It is submitted by Counsel for the husband that there is no prejudice to the wife that cannot be cured by a subsequent order as to interests or costs; however, also on the submission of Counsel for the husband, the wife would be obliged to expend the capital which the husband proposes to pay to her as a condition of a stay for her support and for the payment of her fees.
The Court regards a requirement that the wife so utilise her capital pending the pursuit by the husband of his appeal far from being a matter of no prejudice to the wife. Rather, the Court views it as a matter of significant prejudice to the wife and, in any event, the husband does not offer such payment for a period of four months. The Court therefore does not agree with the submission of the husband.
The payment of interest on a liability with respect to the wife’s home is
non-deductible for tax purposes. Interest payable to the wife would, on the other hand, be taxable. There would not necessarily be no prejudice to the wife by reason of payment of interest. The Court is also informed that the wife’s mortgage liability on her present home is significant. She is indebted for an amount of $676,900 on the mortgage charged on her home and in the sum of $360,000 in relation to a debt owed on her business. She is also indebted on a motor vehicle lease in the sum of $32,703.
It is suggested that there may be some prejudice to the husband in the cost and time involved in recouping an amount should he be successful on his appeal.
There is nothing in the evidence before the Court which leads it to the conclusion that the wife is going to divest herself of assets so as to frustrate any such further adjustment should it be required.
The bona fides of the applicant
It is suggested by the wife that, having regard to the husband’s long history of delay and obstruction, the action of the husband in appealing the judgment in the primary proceedings and his current application for a stay is simply another example of that tendency on his part.
The Court notes the history as submitted by the wife and cannot but agree with her assessment of the husband’s habit of delay and obstruction; however, it cannot say in relation to the husband’s appeal, which is of right, that he has acted mala fides.
Whether a stay may be granted on terms that are fair to all parties
It is not considered by the Court that the proposal of the husband as to the conditional nature of the stay would be fair to the wife. The husband would be required to forthwith undertake a significantly greater obligation under the terms of a stay to provide the balance of fairness which the law requires to exist.
The husband has put forward that he is unable to presently pay the amount that he proposes to pay as a condition of a stay. The Court is concerned that it cannot be satisfied that even were it to order the amount proposed by the husband, that the amount ordered would be available at the due time of its payment. There might be a reasonable basis if the husband were to undertake a secured obligation to the wife to indemnify her for any loss including any taxation liability on interim payments and to actually pay the sum to her required to meet her obligations from time to time until the hearing with respect to her debts. However no such proposal is made.
Whether the refusal to grant a stay would render the appeal nugatory
Ordinarily this is a substantial factor in considering an application for a stay. In this case, however, the husband agrees (at page 11 paragraph 8) of his written submissions that the lack of a stay would not render his appeal nugatory. Further, on the hearing of the matter Counsel for the husband so confirmed orally.
The merits of the appeal
The husband’s appeal is one which proceeds on a number of grounds from a decision which is essentially discretionary.
The husband submits that the merits of the appeal are strong. The written submissions of the husband in this respect can be summarised as follows:
·The eight per centum adjustment to the wife based on s 75(2) factors was unwarranted given that the wife received 40 per centum of the asset pool based on contributions, she is a self-employed healthcare professional and she is receiving child support from the husband.
·The husband’s inheritance of $2,810,000 ten months prior to separation should have either been discounted entirely or otherwise subject to a two asset pool approach and a reduced weighting applied to the wife’s contribution-based entitlement, as opposed to the 40 per centum granted to her on a global approach.
·With respect to the finding of the Court at trial that the husband failed to provide a full and frank disclosure, the husband submits that a “more critical analysis” would “disclose hubris coupled with a lack of preparation of his case as opposed to deliberate evasion.” On this note, the husband contends that there appear to be no contentions or direct findings that other substantial assets were not disclosed and, accordingly, nothing in the reasons to enable one to understand whether a penalty or additional weighting was applied to such conduct in favour of the wife.
·The husband’s case is that the cumulative error amounts to approximately $1,600,000 awarded in favour of the wife.
With respect to the merits of the husband’s appeal, Counsel for the wife submitted that the husband’s Notice of Appeal as currently drafted fails to discern or distil arguable grounds before the Full Court. The oral submissions made by Counsel for the wife with respect to the merits of the husband’s appeal can be summarised as follows:
·
In Ground 1 of the Notice of Appeal, the husband asserts that the trial judge erred in finding a 40 per centum entitlement or any entitlement greater than 33 per centum for the wife based on contributions. In response to this, the wife submits that the sum of $480,000 offered by the husband on a stay is not a sum that gives rise to anywhere near a
33 per centum finding, as such a finding would see the husband paying to the wife something in the order of $800,000.
·Submissions were put to the Court by the husband about the inadequacy of his representation in the preparation of his case and during the hearing, however, that is not a ground of appeal in the Notice of Appeal and the husband’s remedy for that lies elsewhere than in this Court.
·It was submitted by the husband that the Court should have taken into account the issue of Capital Gains Tax, however, that was not argued at the hearing nor does it constitute one of his grounds of appeal.
·There is no ground of appeal addressing stage one – that is, the identity of the pool of assets. The wife submits that when one goes through each of the husband’s grounds of appeal, many of which are a repetition of the same point, one finds the last line of defence in an appeal: namely an appeal addressing weight, inadequacy or insufficiency of reasons.
·The submissions of the husband have not directed the Court to where the judgment demonstrates an insufficiency of reasons, and appeals that rest upon weight are notoriously difficult to succeed.
Counsel for the husband concedes that there was no submission made to the trial judge concerning the liability for capital gains tax and, if it existed, the quantum of such capital gains tax. The argument of the husband with respect to this issue also ignores the fact that the husband is the owner of property which on sale would not attract a capital gains tax liability, namely his principal place of residence. Although Counsel for the husband makes submission as to the existence of an “all monies” mortgage, there is no evidence of any negotiation with bankers in relation to the management of that liability.
The husband further complains that the absence of a stay will affect the orderly marketing of his investment properties in particular.
The husband complains of the default provision in the Orders of 18 April 2013 appointing the wife as Trustee for sale. Counsel for the husband asserts that the wife will be pursuing her own interests, although acting as a Trustee for sale.
In response to this, the Court finds that any Trustee for sale appointed by the Court can be subject to supervision and direction by the Court on proper application and on reasonable grounds. The husband nevertheless seeks the same default provision in any appeal order which might be made.
The husband asserts that whilst he had failed to make full and frank disclosure, as has been found, he contends that a more critical analysis on appeal will disclose hubris coupled with a lack of preparation of his case as opposed to deliberate evasion. The Court has not found that this is so and, even if it had so found, the facts remain that there was a failure to disclose and false and misleading disclosure.
The appeal against the decision is one which encompasses two broad grounds: one is an absence of sufficient reasons; and the other is a failure to properly weigh or to give undue weight to some of the evidence before the Court.
The husband’s reference to the Court’s treatment of his recent inheritance fails to acknowledge that his entitlement to some part of that inheritance was obtained by the husband’s purchase with borrowed funds of his sister’s interest in his late mother’s property prior to cohabitation.
The Court cannot say that there is no chance of any success in relation to the husband’s appeal – but appeals argued along these lines notoriously face difficulties.
The Court does not accept that no or inadequate reasons were given, nor does it, having regard to the principles of House v The King (1936) 55 CLR 499, see an argument being successful in relation to the exercise of the Court’s discretion, and that is by reason of not only but including the fact that the
non-disclosure referred to in the judgment, entitled the trial judge to take a “robust approach”: see Gould v Gould (2007) FLC 93-333 at [26].
There is no basis in the evidence having regard to those matters of
non-disclosure and false disclosure on which the trial judge could come to the conclusion that the extent of non-disclosure or false disclosure was necessarily limited in any way.
It is the Court’s view that on a preliminary assessment the appeal has little merit.
Whether there has been any delay by the applicant
The Court finds that both the husband’s appeal and his application for a stay have been lodged promptly.
The period of time within which the appeal might be heard
It is suggested by the husband that the appeal might be heard within four to six months. That suggestion allows no time for the delivery of a judgment by the Full Court, and the Court does not have information before it which would enable it to make an accurate assessment of the time which might be taken to hear and determine the husband’s appeal.
In summary, the Court finds that a case has not been made out for a stay of proceedings. The application of the husband for a stay in relation to the Orders made in the primary proceedings is dismissed.
I certify that the preceding ninety-six (96) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Fowler delivered on 19 June 2013.
Associate:
Date: 19 June 2013
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