Sturnela v Sturnela - [2025] SASC 46

SUPREME COURT OF SOUTH AUSTRALIA
(Appeal to a Single Judge)
STURNELA v STURNELA
[2025] SASC 46
Judgment of the Honourable Justice Stein
4 April 2025
APPEAL AND NEW TRIAL - APPEAL - GENERAL PRINCIPLES - INTERFERENCE WITH DISCRETION OF COURT BELOW - IN GENERAL - FAILURE TO EXERCISE DISCRETION
APPEAL AND NEW TRIAL - APPEAL - GENERAL PRINCIPLES - INTERFERENCE WITH DISCRETION OF COURT BELOW - IN GENERAL - JUDGE MISTAKEN OR MISLED
APPEAL AND NEW TRIAL - APPEAL - GENERAL PRINCIPLES - INTERFERENCE WITH DISCRETION OF COURT BELOW - IN GENERAL - INJUSTICE
Appeal against interlocutory decision of an Associate Justice.

In 1996, the appellant was awarded a sum of damages following litigation arising from injuries sustained in a motor vehicle accident. In 1998, he was made subject to a protection order and the Public Trustee appointed as manager of his estate pursuant to the Aged Care and Infirm Persons’ Property Act 1940 (SA) (the “Act”). A portion of these funds were utilised to purchase a home for the appellant where he lived with the respondent and their children. In 2017, the applicant and respondent separated. In 2023, by order of this Court, the property was sold and the net proceeds of sale paid into the Suitors’ Fund. In 2023, the respondent commenced property settlement proceedings in the Federal Circuit and Family Court of Australia (the “FCFCOA”) against the appellant.
The appellant brought an interlocutory application seeking payment out of the Suitors’ Fund of $200,000 on account of the appellant’s various expenses which he contended could not be met out of the funds held for him by the Public Trustee. The Associate Justice refused the application on grounds including that the funds constituted an asset that had to be considered in the property settlement proceedings; that it was not possible to resolve many of the factual disputes as between the parties; and, that the FCFCOA was better equipped to be deal with the question of the division of monies.
The appellant appealed on the ground that the Associate Justice erred in the exercise of the discretion. The respondent contended the appeal should be allowed solely on the condition that a mutual and equal distribution of $200,000 is paid contemporaneously to her or otherwise it be dismissed. The Public Trustee supported the appeal.
Held (granting leave to appeal, allowing the appeal and re-exercising the discretion):
1.Process errors were occasioned by the Associate Justice taking into account irrelevant considerations and failing to take into account relevant considerations. The errors arose as a direct consequence of the manner in which the application was conducted at first instance.
2.Leave to appeal should be granted as allowing the decision to stand would work a substantial injustice to the appellant given the nature of the decision, while interlocutory, would in a practical sense preclude any subsequent application. The potential existence of an avenue for the appellant to seek an alternate remedy in a different jurisdiction does not ameliorate such injustice.
3.It is appropriate in all…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Sturnela v Sturnela

Details

AGLC: Sturnela v Sturnela [2025] SASC 46
Case: [2025] SASC 46
Decision Date: 4 April 2025

CaseChat Overview and Summary

The matter of Sturnela v Sturnela was an appeal against a decision of the Associate Justice concerning the distribution of funds from the sale of a matrimonial home. The applicant, Mr Sturnela, sought leave to appeal the decision of the Associate Justice that the net proceeds of the sale of the Burnside property should be paid into the Suitors’ Fund and remain there pending a final determination of the parties' property rights in the Federal Circuit and Family Court of Australia (FCFCOA) proceedings. The legal issues before the court were whether leave to appeal should be granted and, if so, the appropriate scope of the appeal.

The court considered the principles for granting leave to appeal, including whether the decision was attended with sufficient doubt, raised an issue of general importance, or if allowing the decision to stand would work a substantial injustice. The court found that the decision was interlocutory, and thus would not finally determine Mr Sturnela’s right to seek payment from the Suitors’ Fund. The court also found that the decision would work a substantial injustice to Mr Sturnela, as the division of monies in the Suitors’ Fund was a significant issue in his protected estate. The court concluded that leave to appeal should be granted and the scope of the appeal should include the question of whether the decision to leave the net proceeds of the sale in the Suitors’ Fund was correct.

The final orders of the court were that Mr Sturnela's application for leave to appeal be granted and that the scope of the appeal include the question of whether the decision to leave the net proceeds of the sale in the Suitors’ Fund was correct. The court found that the decision of the Associate Justice to leave the net proceeds in the Suitors’ Fund was not appropriate, given the substantial impact on Mr Sturnela's protected estate.

Orders

Orders of the court

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Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

By interlocutory application dated 6 February 2025, Mr Sturnela applied for leave to amend the notice of appeal to seek that leave to appeal, to the extent necessary, be given.Decision of the Associate Justice[1][1] The Associate Justice set out the background circumstances in which the Public Trustee applied to the Court for leave to sell the matrimonial home. The Associate Justice referred to the affidavit of Mr Sturnela’s father in support of the application for approval to sell the Burnside property and the intention to find rental accommodation for Mr Sturnela or for Mr Sturnela to live with his parents. During the hearing of the application for approval of the sale, counsel for Mr Sturnela had informed the Court of the intention that Mr Sturnela would rent accommodation, and the Public Trustee would pay expenses from monies held on his behalf, continuing to say that the Public Trustee would pay the amounts until settlement of the FCFCOA proceedings. The Associate Justice observed that because of the assurances received about Mr Sturnela’s future living arrangements, the sale of the property was allowed to proceed on the basis the net proceeds of sale would be paid into the Suitors’ Fund. The Associate Justice also referred to Mr Sturnela’s father’s affidavit which stated the Public Trustee held less than the amount required for the lease and the Public Trustee had refused to sign the lease agreement. The Associate Justice referred to the range of accusations made by Mr and Ms Sturnela against each other concerning their contributions to the marriage, access to bank accounts and use of monies received from earnings, Centrelink or protected funds, ultimately observing that it was not possible to resolve those factual disputes on an application such as this. The Associate Justice was taken to the decision of In the Marriage of O’Brien[2] (“O’Brien”) wherein McGovern J considered whether property the subject of a protection order pursuant to the Act should be regarded as property held by one of the parties for the purposes of s 79 of the Family Law Act. On the basis of the decision in O’Brien, the Associate Justice concluded the matrimonial home was an asset of Mr Sturnela which would be taken into consideration in any determination of property rights on the termination of marriage. The net proceeds of the sale of the Burnside property were thus an asset that must be considered when exercising a discretion under s 79 of the Family Law Act.[2] In the Marriage of O’Brien [1982] FamCA 76; (1982) 8 Fam LR 691. The Associate Justice referred to Mr Sturnela’s submissions that he was in dire financial need, had been given notice to vacate his rental property, had incurred legal fees, and required medical and dental treatment following a fall. Mr Sturnela submitted that Ms Sturnela had no claim on the money in the Suitors’ Fund because of the way she dealt with her own and Mr Sturnela’s finances during the marriage. The Associate Justice also referred to Ms Sturnela’s submissions that she had the same expenses as Mr Sturnela including ever increasing legal fees so an order in favour of both parties was the fairest way to deal with the matter leading up to a trial in the FCFCOA.

Ratio Decidendi

Legal Principle Established

In considering what order, if any, should be made under the section in property settlement proceedings, the Court is required to take into account a number of factors which include direct or indirect financial contributions to the acquisition, conservation or improvement of any of the property of the parties to the marriage or either of them; contributions other than financial contributions to the acquisition, conservation or improvement of any of the property of the parties to the marriage or either of them; the contribution to the welfare of the family; the effect of any proposed order on the earning capacity of either party and other specified matters.ConsiderationLeave to appeal The decision on appeal is properly characterised as interlocutory.[14] It does not finally determine Mr Sturnela’s right to seek payment out of the funds in the Suitors’ Fund. [14] Angelou v Brandenburg [2025] SASC 15 at [15]-[17] and [29] (McIntyre J). Accordingly, leave to appeal is required. In determining whether to allow an application for leave to appeal, the Court will take into account factors including whether: [15] 1.the decision is attended with sufficient doubt to warrant re-consideration;2.the appeal raises an issue of general importance or principle; and3.allowing the decision to stand would work a substantial injustice to the applicant. Ultimately, the Court will act in the interests of justice.[16][15] Rankine v State of South Australia [2022] SASCA 18 at [2]-[3] (Livesey P, Lovell and S Doyle JJA).[16] Rankine v State of South Australia [2022] SASCA 18 at [3] (Livesey P, Lovell and S Doyle JJA). While the decision is interlocutory and thus would not preclude another interlocutory application, the conclusion that the division of monies in the Suitors’ Fund is appropriately left to the FCFCOA proceedings in practical sense precludes a further application. I do not accept the Ms Sturnela’s contention that the potential avenue open to Mr Sturnela to bring an application in the FCFCOA for an interim property order has the consequence that there is no substantial injustice to Mr Sturnela. Mr Sturnela sought a payment out of the Suitors’ Fund in circumstances in which the funds from the sale of the Burnside property formed the vast majority of his protected estate. He is entitled to bring an application for payment out. An application for an interim property order in the FCFCOA is a different kind of application, entailing different considerations. Contrary to Ms Sturnela’s argument, it is not obvious to me that such an application would be quicker and less costly. It can be assumed the factual controversies traversed in the various affidavits sworn by the parties in support and in opposition to the application for payment out of the Suitors’ Fund would be relevant and require determination. For the reasons I address below, I do not consider those factual controversies must first be determined for an application for payment out of the Suitors’ Fund to be addressed.