Suiter & Suiter and Ors
[2009] FamCAFC 77
•12 May 2009
FAMILY COURT OF AUSTRALIA
| SUITER & SUITER AND ORS | [2009] FamCAFC 77 |
| FAMILY LAW – APPEAL – Application for leave to appeal interim orders affecting property in which third party claims to have an interest – where one of the respondents seeks that the hearing of the application be adjourned until resolution of substantive proceedings FAMILY LAW – JURISDICTION – whether a single Judge has the power to postpone the hearing of an application for leave to appeal – s 94(2D)(h) –– intention of legislature |
| Family Law Act 1975 (Cth) s 94AA, s 94(2B), s 94(2D) |
| APPLICANT: | FH Suiter |
| FIRST RESPONDENT: | PA Suiter |
| SECOND RESPONDENTS: | RT Suiter & PM Suiter |
| THIRD RESPONDENT: | H Company Pty Ltd |
| FILE NUMBER: | PTW | 501 | of | 2008 |
| APPEAL NUMBER: | WA | 3 | L | of | 2009 |
| DATE DELIVERED: | 12 May 2009 |
| PLACE DELIVERED: | Perth |
| PLACE HEARD: | Perth |
| JUDGMENT OF: | Thackray J |
| HEARING DATE: | By written submissions |
| LOWER COURT JURISDICTION: | Family Court of Western Australia |
| LOWER COURT JUDGMENT DATE: | 5 February 2009 |
| LOWER COURT MNC: | [2009] FCWA 17 |
REPRESENTATION
| SOLICITOR FOR THE APPLICANT: | DCH Legal Group |
| SOLICITOR FOR THE FIRST RESPONDENT: | O’Sullivan Davies |
| SOLICITOR FOR THE SECOND RESPONDENTS: | Paterson & Dowding |
| SOLICITOR FOR THE THIRD RESPONDENT: | Paynes Barristers & Solicitors |
Orders
That the application of RT SUITER & PM SUITER filed on 19 February 2009 for leave to appeal the orders made by the Honourable Justice Martin on 5 February 2009 be adjourned with liberty to seek relisting of that application for further directions following determination of the substantive property settlement proceedings between FH SUITER and PA SUITER.
That the parties have liberty to seek an appointment before Thackray J to make submissions in relation to costs in the week commencing 18 May 2009.
IT IS NOTED that publication of this judgment under the pseudonym Suiter & Suiter and Ors is approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
| THE APPELLATE JURISDICTION OF THE FAMILY COURT OF AUSTRALIA AT PERTH |
Appeal Number: WA 3 L of 2009
File Number: PTW 501 of 2008
| FH Suiter |
Applicant
And
| PA Suiter |
First Respondent
And
| RT Suiter & PM Suiter |
Second Respondents
And
| H Company Pty Ltd |
Third Respondent
REASONS FOR JUDGMENT
Introduction
I am required to determine the application filed on 8 April 2009 by FH Suiter (“the wife”) seeking the following orders:
1.The application of the Applicant for leave to appeal filed 19 February 2009 be adjourned with liberty to relist following publication of Reasons for Judgment by the Trial Judge.
2.The application for leave to appeal filed 19 February 2009 be dismissed.
The application is opposed by RT & PM Suiter (“the husband’s parents”), who filed the application for leave to appeal which the wife seeks to have adjourned or dismissed.
Background
The application for leave to appeal filed by the husband’s parents relates to orders made by the Honourable Justice Martin on 5 February 2009.
Her Honour provided a brief summary of the background facts in her reasons, including the following:
· The wife is 45 years of age and is a homemaker.
· The wife was married in 1994 to PA Suiter (“the husband”), who is also 45 years of age and is a company director.
· The husband and wife separated in 2007.
· There are four children of the marriage aged 5 to 13 years.
· The wife commenced property settlement proceedings in February 2008 and later amended her application to seek spousal maintenance and departure from a child support assessment.
· Interim orders were made by Martin J requiring the husband to pay spousal maintenance and child support totalling $9,500 per calendar month, as well as various other payments.
· The husband had claimed he was unable to afford to pay the amounts sought by the wife and asserted he and the wife had only been able to maintain a very high standard of living during their relationship with the assistance of funds lent by his parents.
· Martin J had noted, when making the interim orders, that the husband had a boat worth millions of dollars and his parents had recently purchased a home for him at a cost of $7.65 million. She further noted the husband had provided no explanation why he needed three late model [luxury] motor vehicles.
· There was no appeal against the interim orders for spousal maintenance and child support.
· The husband failed to pay the full amount ordered and the wife commenced enforcement proceedings, seeking the sale of one of the [luxury motor] vehicles.
· On 30 July 2008, solicitors acting for the husband’s parents wrote to the husband demanding repayment of funds said to be owing to the husband’s parents and seeking a charge over any vehicle owned by the husband. The correspondence noted that the vehicle “is not presently the subject of a charge…”.
· On 31 July 2008, Martin J ordered the husband to sell a [luxury motor vehicle] and directed that the proceeds be held in a trust account pending further order.
· On 21 August 2008, the wife filed an application seeking that she be appointed as trustee for sale of the [luxury motor vehicle].
· On 26 August 2008 the wife was informed by the husband’s solicitors that the husband had received the notice of demand from his parents dated 30 July 2008.
· The husband’s parents were joined as parties to the proceedings. They maintained they were entitled to receive the proceeds of sale of the [luxury motor vehicle] pursuant to the terms of a loan agreement entered into in 2002.
· The wife’s position was that the loan agreement was a sham but in the event the agreement was found to be valid, she maintained that the husband’s parents were, at best, unsecured lenders - at least in relation to the [luxury motor vehicle].
· The husband said the matter was “outside his control”.
The trial Judge’s reasons for judgment
Martin J made the following findings when giving reasons for making the orders which the husband’s parents seek leave to appeal:
87These proceedings are for enforcement and interim relief sought well prior to the trial of the proceedings, at which some very substantial issues are to be determined, including the validity of the loan agreements between the husband and his parents and whether any documentation should be set aside pursuant to section 106B of the Family Law Act. On the evidence before me, it is not appropriate to make even preliminary findings as to the substantive issues – discovery is far from complete, there are significant credibility issues and there has not been proper consideration of all the issues.
88If the second respondents are regarded as secured creditors, then the provision of Pt VIIIA [sic] of the Family Law Act will be relevant in relation to the substantive proceedings, and all the relevant issues should be considered at that time. If they are unsecured, the issues will also be considered in the substantive proceedings, but it is well established that debts may be discounted or disregarded, perhaps in situations where money has been advanced by a family member (e.g. Af Petersen and Af Petersen (1981) FLC 91-095).
89For the second respondents, it was submitted that, as third parties they should be treated no different from strangers. Having regard to all the evidence to date, this submission bears little weight when, at a time when the second respondents were expressing concern about security for funds said to be owed to them by the husband, they were making substantial gifts to the husband of $68,000 in May, June and July 2008 and, as referred to in my interim spousal maintenance and child support decision, providing such assistance to the husband as to enable him to fully maintain his very high standard of living.
90The second respondents have every right to do this and, they have been frank that while they will continue to support their son, they are not prepared to provide funds for the wife.
91There is also the issue that the notice of demand which purported to legally charge the [luxury motor vehicle], was made the day prior to my judgment, being delivered in circumstances where it is apparent that the second respondents knew the nature of, and state of the proceedings. There is an issue here as to whether the demand was made with the intention of defeating an expected order. The second respondents are now parties to the proceedings, and have had an opportunity to be heard in them. The second respondents have purported to encumber all the husband’s other assets and also claim an equitable mortgage or lien over the vehicle, which was not legally charged until 30 July 2008.
92While there may be a dispute over current values, there is very valuable real property available to meet any debt owed to the second respondents. There is a significant issue as to the precise amount asserted as being owed by the husband to his parents. If the wife’s case is entirely unsuccessful, she does have significant assets of her own, which are presently available to meet any orders requiring recompense to the second respondents or the husband.
93Having regard to all these issues, I do not accept that, on an interim basis, the proceeds of sale of the [luxury motor vehicle] should be paid to the second respondents, or held pending further determination of the proceedings, in circumstances where the husband is indebted to the wife by Court Order, with which he has failed to comply, and when further funds are required to fund the proceedings.
94I do not accept, on the evidence, and having regard to the sum involved, and since there are very substantial other assets available, that there is any hardship, or significant prejudice, to the second respondents.
95I have also, for the same reasons, concluded that the proceeds of sale of the [luxury motor vehicle], with suitable limits and controls, should be made available to meet, not only the enforcement orders, but orders in relation to costs.
In accordance with these reasons, Martin J ordered that the proceeds of sale of the [luxury motor vehicle] be disbursed to meet $25,000 by way of arrears of spousal maintenance and child support; $8,000 costs ordered in favour of the wife; and a further $60,000 to the wife on account of interim costs. The remainder of the funds was left in an interest bearing trust account with liberty to the parties to apply.
Events since the making of the orders
On 19 February 2009, the husband’s parents applied for a stay of the orders made on 5 February 2009. Martin J dismissed that application on 20 February 2009, after receiving an undertaking from the wife not to deal with her interest in a specific property without giving the other parties at least 21 days notice. The value of the wife’s interest in the property is said to be $300,000, which is significantly more than the amount the wife received from the [luxury motor vehicle].
On 18 February 2009, the husband’s parents filed an application seeking leave to appeal the orders of 5 February 2009. They also sought an order for the application to be heard by video link at the first available appeal sitting of the Full Court in any registry in Australia. The husband’s parents filed a Form 20 Notice of Appeal with the application for leave to appeal.
The brief facts relied upon in support of the application for leave to appeal were as follows:
1.At all times during the course of these proceedings, the Second Respondent has asserted that they are secured creditors of the husband in respect of loans that they have made to the husband. The secured property included a [luxury] motor vehicle registration number ….
2.On 31 July 2008, Justice Martin ordered that that motor vehicle be sold. It was sold and the proceeds of sale, being the sum of $250,000, was [sic] held in an interest bearing trust account until further order of the Court.
3.In proceedings held before Justice Martin on 17 October and 18 November 2008, the Second Respondent claimed the entirety of the $250,000 proceeds of sale as secured creditors of the husband.
4.Pursuant to paragraph 1 and 2 of the Orders made by Justice Martin on 5 February 2008, her Honour has overridden the claim of the Second Respondent to the proceeds of sale of this motor vehicle. Her Honour has ordered that some $93,000 of the proceeds of sale be provided to the wife and the remainder held in an interest bearing deposit account to await further order.
The grounds of appeal upon which the husband’s parents proposed to rely, if leave to appeal was granted, were as follows:
1.Her Honour erred in law in not giving full weight and effect to the fact that the Second Respondents were third parties and as such should be treated no differently from strangers to the marriage [para. 89].
2.Her Honour erred in law in making a determination that the proceeds of sale of the [luxury motor vehicle] not be paid to the Second Respondents, without first determining the following relevant matters in issue:
(a)whether the Second Respondents were secured or unsecured creditors [paras. 88 and 120];
(b)whether the notice of demand on 30 July 2008 by the Second Respondents to the husband in so far as it refers to the [luxury motor vehicle] was made with the intention of defeating an anticipated order [para. 91].
3.In circumstances where it was apparent to her Honour that the amount owing by the Husband to the Second Respondents was many millions of dollars greater than the proceeds of sale of the [luxury motor vehicle] [see para. 64], her Honour erred in the exercise of her discretion by regarding as relevant to her determination the fact that the total amount owing by the Husband to the Second Respondents was uncertain [para. 92].
4.Her Honour erred in fact in stating that, while there may be a dispute over current values, there is very valuable real property available to meet any debt owed by the Husband to the Second Respondents [paras. 92 and 94].
On 27 February 2009, the wife filed a response in which she sought the dismissal of the application for leave to appeal.
The application of the husband’s parents came before me on 27 February 2009. The application for the appeal to be heard by video link in any registry in Australia was not pursued. It had been based on what I considered was an incorrect assumption that because the March 2009 Perth sittings had been cancelled, there would not be room for the matter to be heard in the June/July 2009 Perth sittings.
During the course of the hearing on 27 February 2009 I was informed that the wife would oppose the making of the standard direction that the appeal be argued at the same time as the application for leave to appeal. The matter was then set down for a directions hearing on 6 April 2009.
At the directions hearing it became apparent the wife’s preferred position was not that the application for leave to appeal proceed independently of the appeal but rather that the hearing of the application of the husband’s parents should be adjourned pending finalisation of the substantive proceedings.
Queens Counsel appearing for the husband’s parents protested that he had received no notice of the wife’s intention to make such an application, having only been informed that the wife would be opposing a direction that the appeal and the application for leave to appeal be argued together. He expressed preliminary reservations as to whether I had jurisdiction, sitting as a single Judge, to order the postponement of the hearing. I informed counsel that my preliminary view was that this was a matter of procedure relating to the conduct of the application/appeal and as such I did have jurisdiction.
Given the objections of Queens Counsel for the husband’s parents, I made a direction for the wife to file a formal application setting out the relief sought. I laid down a timetable for written submissions (as I was about to commence annual leave and proposed to deal with the matter during my leave). The timetable accommodated the possibility of formal objection to jurisdiction.
The wife’s written submissions were received on 8 April 2008. Those of the husband’s parents were received on 14 April 2009. The submissions of the husband’s parents did not raise any jurisdictional issue.
The wife’s submissions
The wife’s submissions acknowledge that the general rule in this jurisdiction is that an application for leave to appeal is heard by the Full Court at the same time as the appeal. Whilst noting there were “sound policy reasons” for this practice, it was submitted nevertheless that there were disadvantages “from a party’s point of view”, which were expressed as follows:
(a)they must incur the not insignificant costs of the preparation of the appeal;
(b)they are faced with the time and effort of preparation of the appeal;
(c)they are distracted from the preparation of the substantive case;
(d)an order for costs is not adequate recompense for the disadvantages.
It was submitted by the wife that I should order the adjournment of the application for leave to appeal until after the hearing of the substantive issues because this would “leave open the right to appeal and also enable the substance of the appeal to be considered in the trial when matters of evidence, disclosure and credibility have been determined”.
It was further submitted that:
· The only prejudice to the parents was that they “could potentially be delayed receiving monies longer than if the appeal were allowed to proceed and was successful”.
· The costs of any delay could be considered and adequately compensated by the trial Judge.
· The costs of the appeal if it proceeded would be likely to be greater than the loss to the husband’s parents brought about by the delay in payment of the monies they were allegedly owed.
· There would be prejudice to the wife because of the “cost and distraction of the potentially pointless appeal when the parties could be focusing on resolution of substantive matters”.
· The wife’s capacity to meet costs is different to that of the husband’s parents.
It is unnecessary to consider the balance of the wife’s submissions other than to note they emphasised that the wife has assets exceeding the value of the funds she received from the [luxury motor vehicle] and there was no evidence she would dispose of those assets (and in any event had given an undertaking not to do so).
The submissions of the husband’s parents
Amongst other things, it was submitted on behalf of the husband’s parents:
· They are an unwilling third party to the proceedings, having been joined at the request of the wife.
· The Family Court has “no greater power to interfere with the rights of a third party who is a party to proceedings than it has in respect of a third party who is not a party to proceedings”.
· The trial Judge has left the issue of whether or not the husband’s parents have a good claim to the proceeds of the [luxury motor vehicle] to such time as the substantive proceedings are determined, but in the meantime has effectively treated the proceeds as a pool of money to be used for payment to the wife for her own purposes.
· By not arriving at a decision in relation to the claim of the husband’s parents and instead treating the proceeds as a fund available for other purposes, the rights of the husband’s parents “are effectively being ignored pro tempore” and that “this is contrary to the law”.
· Not even the provisions of Part VIIIAA enable the Court to use a third party’s assets “as a source of funds for incidental purposes pending suit”.
· In the event the wife delays hearing of the application for leave to appeal until the substantive proceedings have been determined, she will be provided with future opportunities to claim further funds from the remaining proceeds of sale of the [luxury motor vehicle].
· The proposed grounds of appeal are narrow, being limited to “the ability of the Family Court to put a third party’s claim to property in abeyance” so the property can be used in the meantime for the benefit of a party to the marriage. In light of the narrow scope, the hearing of the application in the forthcoming Perth sittings would not involve significant costs and ought not to cause the wife to be distracted from preparation of the substantive case.
Jurisdiction
Although the wife’s application filed on 8 April 2009 repeated her earlier proposal for the application for leave to appeal to be dismissed, there is no basis upon which I can make such an order as a single Judge.
Section 94AA provides that an application for leave to appeal from “a prescribed decree” of a State Family Court is to a Full Court of the Family Court. The orders which are the subject of the application for leave to appeal here fall within that category. The only relevant exception to this provision is contained in s 94AA(2), which permits a single Judge to dispose of an application for leave to appeal by consent.
I do, however, consider I have jurisdiction to deal with the other aspect of the wife’s application, namely the adjournment of the application for leave to appeal until the substantive proceedings are resolved. Section 94(2B) provides that a Judge of the Appeal Division (or another Judge if there is no Judge of the Appeal Division available) may, amongst other things, give directions about the conduct of an appeal. Section 94(2D)(h) provides that “Applications of a procedural nature,, including applications… to adjourn the hearing of an appeal” may be heard and determined by a Judge of the Appeal Division (or another Judge if there is no Judge of the Appeal Division available).
It will be observed that s 94(2D)(h) refers to the adjournment of appeals and not applications for leave to appeal. It is sufficiently clear, however, that the legislative intention is that the powers given to single judges in relation to appeals should be read as applying also to applications for leave to appeal. Thus, for example, s 94(2D), which sets out the powers that may be exercised by a single Judge in relation to appeals, also contains a provision relating to extending time for filing of an application for leave to appeal. It could not have been the intention of Parliament that a bench of three Judges would need to be assembled to make all of the many procedural orders necessary concerning an application for leave to appeal.
The outcome
It is in the interests of justice and the orderly disposal of the business of the Full Court for the application for leave to appeal to be postponed until after determination of the substantive proceedings.
Martin J has made no final findings adverse to the interests of the husband’s parents. Her reasons make clear they will be afforded a full opportunity at trial to seek to establish their entitlement to the funds from the sale of the [luxury motor vehicle]. If they succeed, the wife has property against which orders can be made to ensure they receive their full entitlement. It presumably matters not to them whether the funds they receive come from the [luxury motor vehicle] or from another source.
The husband’s parents properly concede in their submissions they would not have been in a position to “argue” if the entire proceeds of the [luxury motor vehicle] had been held intact pending resolution of the proceedings. Given there is no reason to anticipate they will not be able to be fully reimbursed if they succeed at trial, no prejudice will have been occasioned to them by the postponement of the hearing of their application for leave to appeal. Indeed, in that event it will presumably be unnecessary for them to pursue their application for leave to appeal (save perhaps in relation to costs issues if they cannot be agreed).
Although it is probable that the application for leave to appeal could be accommodated in the June/July Perth sittings, it is the case that the Full Court has great demands on its limited resources. In my view, it is imperative that the work of the Full Court be prioritised so as to ensure that urgent matters are able to receive not only priority hearing but priority in delivery of judgments. There are many pressing matters pending in the Full Court where judgments cannot be delivered with the expedition they warrant because of the pressure of work. Any time devoted to the present matter (and other matters of low priority) will inevitably distract members of the Full Court from dealing with more pressing matters.
As there is a prospect in this case of the issues between the parties being resolved according to law without utilising any resources of the Full Court and without any prejudice to the parties, that prospect should be explored first.
Costs
As I remain on “annual leave”, these reasons will be published in chambers. Should the parties be unable to reach agreement in relation to costs, they are at liberty to seek the listing of an appointment in the week commencing 18 May 2009 in order to make brief submissions.
I certify that the preceding thirty two (32) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Thackray
Associate:
Date: 12 May 2009
0
0
1