Strahan & Strahan & Anor; (No. 3)

[2012] FamCA 826

FAMILY COURT OF AUSTRALIA

STRAHAN & STRAHAN AND ANOR
(NO. 3) [2012] FamCA 826

FAMILY LAW – PRACTICE AND PROCEDURE – consideration of whether the trial dates should be vacated – where there is now a significant debt owing by the husband to the Australian Taxation Office (‘the ATO’) – where the husband is proposing to object to the tax assessment – where it was not appropriate to maintain the current trial listing – orders that the trial dates be vacated and the trial adjourned pending the resolution of the husband’s indebtedness to the ATO – further orders that the husband regularly provide to the wife documents in relation to his indebtedness. 

FAMILY LAW – PRACTICE AND PROCEDURE – application by the Commissioner of Taxation seeking leave to intervene in the proceedings – where there are concerns regarding the cost implications of granting such an application – where the legal costs of the parties in these proceedings have been significant – leave granted to the Commissioner of Taxation to intervene and further directions made with a view to minimise legal costs to be incurred by the parties and the intervener.

Family Law Act 1975 (Cth) ss 79(10) & 90AE
Family Law Rules 2004 rr 1.04 & 1.12

APPLICANT: Ms Strahan

RESPONDENT: Mr Strahan

INTERVENER: Australian Taxation Office

INDEPENDENT CHILDREN’S LAWYER: Ms Bills

FILE NUMBER: ADF 228 of 2005

DATE DELIVERED: 23 August 2012

PLACE DELIVERED: Adelaide

PLACE HEARD: Adelaide

JUDGMENT OF: Dawe J

HEARING DATE: 23 August 2012

REPRESENTATION

COUNSEL FOR THE APPLICANT: Mr Holland

SOLICITOR FOR THE APPLICANT: Winter & Co

COUNSEL FOR THE RESPONDENT: Mr Berman, SC

SOLICITOR FOR THE RESPONDENT: Kennedy Partners

COUNSEL FOR THE INDEPENDENT

CHILDREN’S LAWYER:

Ms West

SOLICITOR FOR THE INDEPENDENT

CHILDREN’S LAWYER:

Ann Bills & Associates

COUNSEL FOR THE COMMISSIONER OF

TAXATION:

Ms Gleeson

SOLICITOR FOR THE COMMISSIONER

OF TAXATION:

Maddocks Lawyers

Orders

1. The trial dates of 12 November 2012 to 30 November 2012 and the case management listing of 12 September 2012 at 9.15 am be vacated.

2. The Husband do all things necessary to promptly proceed with the objection and any necessary proceedings to resolve the indebtedness to the Australian Taxation Office and endeavour to expedite the conclusion of that matter. 

3. By the end of each month the husband provide to the wife’s solicitors copies of communications and documents created in relation to the husband’s indebtedness to the Australian Taxation Office including any court proceedings.

4. The Commissioner of Taxation be granted leave to intervene in the proceedings.  The rules relating to documents to be provided to the intervener be varied to provide that until further order the husband and wife only be required to serve upon the Commissioner the copies of the current version of applications for final orders and any outstanding application for interim orders together with the current statements of financial circumstances of each party and thereafter to provide to the Commissioner any further application, amendments or affidavits which relate to financial matters.

5. The wife’s solicitor do provide to the Commissioner’s solicitors copies of the orders made and related Notices of Appeal currently outstanding before the Full Court of the Family Court within 14 days of today.

6. The Independent Children’s Lawyer is not required to comply with any of the directions concerning the future progress of the financial matters between the husband, wife and the Australian Taxation Office.

7. Within 14 days of today the wife file and serve an affidavit to which is annexed the final orders which she seeks in relation to the child of the parties S born … June 1996 NOTING THAT if there is no compliance with that order the court will consider dismissing all proceedings of both the husband and the wife in relation to the child including the discharge of the appointment of the Independent Children’s Lawyer.

8. The matter is adjourned for mention to 26 November 2012 at 9.15 am.

IT IS NOTED that publication of this judgment by this Court under the pseudonym Strahan & Strahan (No. 3) 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 ADELAIDE

FILE NUMBER: ADF 228 of 2005

Ms Strahan

Applicant

And

Mr Strahan

Respondent

EX-TEMPORE REASONS FOR JUDGMENT

1. As far as the trial adjournment is concerned, it is not being opposed now by the wife if her conditions were met, I am therefore not making the order by consent because I am not imposing the actual conditions sought by the wife, but taking into account the issues which were to be determined, namely that the first step in the Family Court proceedings for property settlement is usually to ascertain the assets and liabilities of the parties. 

2. It appears that there is an extremely significant debt now owing to the Australian Taxation Office of in excess of $70,000,000 and that the husband is proposing to object to the assessment. 

3. It appears to me that it is not appropriate to continue to list the trial in the three weeks which have now been set aside in November 2012.  I do that notwithstanding that somewhere in the documents there is reference to the trial being adjourned on six previous occasions.  My recollection is that I personally have attempted to list the trial in 2010, 2011 and 2012 on various occasions.

4. I am concerned that the parties and the Court would like to see the matter resolved, but as the issue in relation to the indebtedness to the Australian Taxation Office is a significant issue which has to be determined by either the Australian Taxation Office and the husband in negotiations or in another Court, I see that there is no alternative but to adjourn the trial.  I grant the adjournment sought by the husband on condition (and I make further orders) that the husband do all things necessary to proceed with the objection and any proceedings necessary to resolve the indebtedness with the Australian Taxation Office promptly and endeavour to expedite the conclusion of the matter.

5. Normally I would not necessarily make an order that required the husband to provide copies of the documents to the wife’s solicitors but I see that it is appropriate in this matter to put a time limit on that.  They would be discoverable documents in any event, but it is a sensible order to make that by the end of each month the husband provide to the wife’s solicitors copies of communications and documents created in relation to the indebtedness to the Australian Taxation Office, including Court proceedings. 

6. The matter which has been taken out of the November trial date was previously listed before me for directions on 12 September 2012.  I understand now from the counsel for the wife that there will now be proceedings brought in relation to the wife’s former solicitor’s file.  There are still two appeals from interim orders made by me outstanding.

7. In order to keep the matter before the Court I propose to list the matter for mention only before me on 26 November 2012, which was part of the third week of the trial listing.  We might have more information available by then as to the progress generally of the matter.  I am therefore listing the matter for mention at 9.15 am on 26 November before me. 

8. In relation to the joinder and the intervention of the Commissioner of the Australian Taxation Office I also understand the parties’ concern about the impact that might have upon the overall question of costs, but the Family Law Act 1975 (Cth) (‘the Act’) clearly provides in section 79(10), for people being entitled to become parties, including a creditor:

   …if the creditor may not recover his or her debt if the order were made.

9. I will make an order for the Australian Taxation Office or the Commissioner to be given leave to intervene, but I would do so on the understanding that I would propose to make directions which would limit the costs.  I ask counsel to give some considerations to those directions.  The ones I had in mind were that it not be necessary for the Commissioner to access all of the documents which are already on file, which would seem to be a huge unnecessary cost for both the Commissioner and the other parties.  I would relieve the Independent Children’s Lawyer of any obligation to provide any documents or information to the Australian Taxation Office as that is a completely separate issue.  I suggest that the intervener, as the Australian Taxation Commissioner would then be, simply served with future proceedings. 

10. As far as past proceedings are concerned service of just the copies of the current versions of the final orders that the parties are seeking and any outstanding interim orders that the parties are now seeking.  Copies of the present, current matters and then copies of all future applications be given and notice of hearing dates.  The intervener should be served with any further proceedings in relation to financial matters.

11. I am suggesting that counsel consider these matters and make further submissions on 26 November 2012.  The orders will limit the involvement of the Commissioner in the final proceedings to ensure that, first of all due process and that the Commissioner is aware of all relevant matters but, at the same time, try to limit the cost to the Commissioner and the parties of having counsel or instructing solicitors or both sit in for what was going to be a three-week trial.  The Court’s obligation is to ensure procedural fairness but the rules, and particularly rules 1.12 and 1.04 give me the capacity to vary the rules and, at the same time, ensure procedural fairness. 

12. I understand that the Commissioner of Taxation, as an intervener, is there to ensure that I do not make, or whoever hears the trial eventually, does not make an order that reduces the capacity of the Commissioner to collect whatever sums are due and owing to the Commissioner.  The Court takes into account the impact of section 90AE. 

13. There should be a process which can be followed to limit the costs of the parties and the intervener when the Commissioner is given leave to intervene.

I certify that the preceding thirteen (13) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Dawe delivered on 23 August 2012.

Associate: 

Date:  26 September 2012