Strahan & Strahan
[2021] FamCAFC 167
•31 August 2021
FAMILY COURT OF AUSTRALIA
Strahan & Strahan [2021] FamCAFC 167
Appeal from: Strahan & Strahan [2021] FamCA 97 Appeal number(s): SOA 14 of 2021 File number(s): ADF 228 of 2005 Judgment of: AINSLIE-WALLACE, ALDRIDGE & WATTS JJ Date of judgment: 31 August 2021 Catchwords: FAMILY LAW – APPEAL – Where the primary judge ordered that $2 million be paid into the Family Court of Australia Litigants Fund – Where the primary judge granted leave to two firms of solicitors to intervene in the proceedings as between the husband and wife over the payment of the $2 million – Where the solicitors claimed a lien over part of the fund – Where the primary judge dismissed the solicitors’ claims over the fund – Where the husband made an application for enforcement of costs orders to be paid from the fund – Where the primary judge ordered that the wife pay the costs orders from the $2 million before the fund was released to her – Where the wife appealed those orders - Where the appeal is dismissed. Legislation: Family Law Act 1975 (Cth) ss 4, 8, 94(2A), 105, 117(2)
Family Law Rules 2004 (Cth) Ch 19, Pt 20.4, rr 1.10, 19.08, 20.07(d)
Cases cited: Strahan & Strahan (No 4) [2017] FamCA 949 Division: Appeal Division Number of paragraphs: 18 Date of hearing: 9 August 2021 Place: Sydney (via video link) Counsel for the Appellant Mr Handran QC Solicitors for the Appellant McInnes Wilson Lawyers Counsel for the First Respondent Mr Wilson Solicitors for the First Respondent Kennedy Partners Counsel for the Second Respondents Mr Stratton-Smith Solicitor for the Second Respondents PP Lawyers Counsel for the Third Respondent Mr Anderson Solicitors for the Third Respondent NF Lawyers ORDERS
SOA 14 of 2021
ADF 228 of 2005APPEAL DIVISION OF THE FAMILY COURT OF AUSTRALIA
BETWEEN: MS STRAHAN
Appellant
AND: MR STRAHAN
First Respondent
PP LAWYERS PTY LTD AND MS PP
Second Respondents
NF PTY LTD
Third Respondent
ORDER MADE BY:
AINSLIE-WALLACE, ALDRIDGE & WATTS JJ
DATE OF ORDER:
31 AUGUST 2021
THE COURT ORDERS THAT:
1.The appeal be dismissed.
2.Within 28 days of the making of this order, the appellant pay the costs of each of the respondents fixed in the following amounts:
(a)To the First Respondent $10,339.20;
(b)To the Second Respondent $11,886.59; and
(c)To the Third Respondent $4,450.96.
Note: The form of the order is subject to the entry in the Court’s records.
Note: This copy of the Court’s Reasons for judgment may be subject to review to remedy minor typographical or grammatical errors (r 17.02A(b) of the Family Law Rules 2004 (Cth)), or to record a variation to the order pursuant to 17.02 Family Law Rules 2004 (Cth).
IT IS NOTED that publication of this judgment by this Court under the pseudonym Strahan & Strahan has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
REASONS FOR JUDGMENT
AINSLIE-WALLACE, ALDRIDGE & WATTS JJ:
INTRODUCTION
On 23 November 2017 a judge of the Family Court of Australia made final property orders as between Ms Strahan (“the wife”) and Mr Strahan (“the husband”) in what has been a marathon dispute between the husband and wife over property settlement which commenced in 2005. As will become apparent, the November 2017 orders did not bring an end to the dispute between the parties.
The orders of 23 November 2017 provided that the wife receive property and assets to the value of $11.6 million, which the judge observed was in addition to the $20 million already received by her (Strahan & Strahan (No 4) [2017] FamCA 949 at [146] and [149]). Up until the time of the final orders, and pursuant to an order made on 24 April 2012, the husband paid to the wife $26,021 each month by way of interim spousal maintenance. As part of the property settlement order, the judge noting that on making the final orders, that interim order would no longer apply, ordered in addition to the property and assets to which the wife was entitled ($9.6 million), that the husband immediately pay $2 million to the wife to enable her to re-establish herself.
Unsurprisingly given the history of this matter, a dispute arose between the parties about how and to whom that money would be paid. In the first place, the husband tendered the $2 million by cheque to the wife’s then solicitors. The wife objected to that course and in October 2018 the wife sought orders that the husband pay directly to her the $2 million plus $99,452 interest. The husband responded and sought that the wife’s application be dismissed. The wife’s application was set down for hearing. In the interim, two firms of solicitors who had previously acted for the wife, PP Lawyers and Ms PP and NF Pty Ltd (“the intervenors”), sought to intervene in the proceedings, each asserting a lien over part of that sum on account of unpaid professional fees.
On 24 January 2020 the primary judge ordered that the $2 million be paid into the Family Court of Australia Litigants Fund (“the Fund”) “… in full and final satisfaction of the husband’s obligation” ordered on 23 November 2017. The primary judge further granted leave to the two firms of solicitors (to the extent that was necessary) to intervene in the proceedings as between the husband and wife over the payment of the $2 million. The determination of the solicitors’ claims to liens over part of that Fund was set down for a separate hearing which took place on 11 May 2020.
The position at that time was that the Fund was the property of the wife alone, subject to the claims by the lawyers that they held a charge over it.
On 21 February 2020 the husband filed an application for enforcement of costs orders made against the wife resulting from various litigious skirmishes conducted after the making of the 23 November 2017 orders. He sought an order that those costs be paid from the wife’s interest in the Fund.
On 5 March 2021 the primary judge dismissed the solicitors’ claims to liens over some or all of the Fund, finding neither had established a sufficient causal link between the sum paid into Court and their efforts on the wife’s behalf.
Her Honour then moved to consider the husband’s application for enforcement of the costs orders and ordered that the wife pay those costs from the $2 million before the balance was released to her. The primary judge fixed those costs including interest in the sum of $167,347.
The wife appealed her Honour’s orders contending that she erred in ordering the husband’s costs to be paid from the sum held by the Court (Ground 1) and secondly in failing to make orders for costs against the solicitors in relation to their unsuccessfully claimed liens (Ground 3). Ground 2 was abandoned.
Neither ground of appeal is made out and the appeal will be dismissed. Our reasons for that conclusion will be in short form pursuant to s 94(2A) of the Family Law Act 1975 (Cth) (“the Act”) which provides that this Court is entitled to give its reasons in short form in the event that an appeal is to be dismissed and if, in the opinion of the Full Court, the appeal does not raise any question of general principle. Those conditions are met here.
THE APPEAL
The challenge to the enforcement order
The thrust of this challenge is that the primary judge erred in ordering the satisfaction of the husband’s costs from the Fund without giving consideration to a number of matters, all of which concern the purpose for which the money was paid into the Fund. In essence, it was argued that since it was not contemplated that the money paid into the Fund would be used for a purpose other than that identified when the order was made, the primary judge erred in having recourse to that sum to satisfy an “unsecured debt” of the husband.
The flaw in the argument is that it fails to take into account the nature of the husband’s application for enforcement of his ordered costs. Payment was sought from a fund which was an asset of the wife and which had become so on it being paid into the Fund. The wife filed no response to this enforcement application.
Section 105 of the Act provides the power to enforce all decrees made under the Act. The section is expressed to be “[s]ubject to… the applicable Rules of Court”. Rule 20.07(d) of the Family Law Rules 2004 (Cth) (“the Rules”) is the power under which the husband’s application was brought seeking enforcement of a financial obligation. Indeed, the Family Court exclusively has the jurisdiction to enforce decrees made under the Act (see s 4(1)(f) and s 8(1)(a) of the Act). Under r 20.07(d) the court may make an order for payment from funds held on behalf of the wife, being an order in aid of “enforcement of an obligation”. The process is akin to the issue of a Third Party Debt Notice (Pt 20.4 of the Rules) but simply more direct.
True it is that the husband, like the intervening solicitors was a creditor of the wife. He, however sought enforcement of the wife’s obligation to him under the Act. The solicitors sought enforcement of a charge. Having dismissed the solicitors’ claimed charges, the primary judge considered the other application before her, that of the husband seeking enforcement and made an unremarkable order for payment. Her Honour made no error in doing so.
This challenge is not made out.
Failure to make an order for costs against the Intervenors
It was argued that the primary judge erred in failing to make a costs order against the unsuccessful intervenors and in failing to advert to the existence of the discretion to make such an order.
Again, the argument is flawed, and fatally so. The costs power, s 117(2) of the Act, is subject to the applicable Rules of the Court. The rules in respect of costs are contained in Chapter 19. Rule 19.08 of the Rules provides that a party may apply for an order that another person pay costs. No application for costs was made by the wife against the intervenors. Although as senior counsel for the wife correctly noted, r 1.10 of the Rules provides that the Court may make an order in relation to any matter referred to in the Rules whether in response to an application or of its own initiative. In the Family Court as in other civil courts, it is the parties that determine the metes and bounds of the dispute for the court to determine and consequently the court is entitled to assume that issues not raised by the parties do not require determination. Accordingly, it was not an error by the primary judge to fail to do so on her Honour’s own initiative and Ground 3 is not made out.
COSTS
All three respondents sought costs orders against the wife in the event that the appeal failed. Senior counsel for the wife sensibly conceded that he could neither argue against costs orders nor against the quantum of costs claimed by each respondent and orders will be made accordingly, save in respect of the first and second respondent’s claim for costs of drawing the costs schedule which we will not allow as a reasonable cost necessary to the appeal.
I certify that the preceding eighteen (18) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justices Ainslie-Wallace, Aldridge & Watts. Associate:
Dated: 31 August 2021
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