Sutton and Lasko and Anor (No.5) - [2020] FCCA 2183

FEDERAL CIRCUIT COURT OF AUSTRALIA

SUTTON & LASKO & ANOR (No.5)

[2020] FCCA 2183

Catchwords:
FAMILY LAW – Property settlement – uncertain asset pool – failure on the part of the applicant to make financial disclosure – applicant and second respondent not separated – concealment of assets – falsification of bank records – second respondent not separated as she claimed.

Legislation:

Family Law Act 1975 (Cth), ss.75, 79

Cases cited:

Bell & Bell [2000] FamCA 1301

Chang v Su [2002] FamCA 156

Hickey & Hickey & Attorney-General for the Commonwealth of Australia (Intervener) (2003) FLC 93-143
In the Marriage of Black and Kellner(1992) 15 Fam LR 343

In the Marriage of Mezzacappa(1987) 11 Fam LR 957

In the Marriage of Stein(1986) 11 Fam LR 353

In the Marriage of Weir(1993) 16 Fam LR 154

Jewel v Jewel [2013] FCWA 81

Stanford v Stanford [2012] HCA 52

Tate & Tate (2000) 26 Fam LR 731

Applicant:

MR SUTTON

First Respondent:

MS LASKO

Second Respondent:

MS THOMPSON

File Number:

MLC 9211 of 2017

Judgment of:

Judge McNab

Hearing dates:

2, 3 & 4 March 2020

Date of Last Submission:

4 March 2020

Delivered at:

Melbourne

Delivered on:

7 August 2020

REPRESENTATION

Applicant in Person

Counsel for the First Respondent:

Dr Ingleby

Solicitor for the First Respondent:

Berger Kordos Lawyers

Counsel for the Second Respondent:

Ms Ben-Simon

Solicitors for the Second Respondent:

PCL Lawyers

ORDERS

The Applicant forthwith do all acts and sign all documents as is required to transfer to the First Respondent the entirety of the shareholding of Q Pty Ltd in W Pty Ltd.
In default of compliance with order 1 above, within seven (7) days of these orders being made (an affidavit by the solicitor for the First Respondent being sufficient evidence of same) a Registrar be appointed pursuant to section 106A of the Family Law Act 1975 (Cth) to execute all necessary documents to effect the transfer.
The Applicant by his servants or agents or otherwise (the Second Respondent being deemed to be an agent) be restrained from communicating the fact or implementation of these orders to any third party save for his legal and accounting advisors.
The parties otherwise retain assets in their respective possessions and the monies currently held by Bergos Kordos Lawyers in a controlled monies account pursuant to paragraph 3(c)(iv) of the orders made on 14 August 2018 and paragraph 5 of the orders made on 23 November 2018 be released to the First Respondent.
The Applicant indemnify the First Respondent against any debt relating to any of the entities of which he has an interest or related corporations, including without being limited to any debt which is sought to be enforced against the monies in order 4 above.
Paragraph 8 of the orders made on 25 October 2018 be discharged.
The funds held on trust by F Lawyers pursuant to orders of 16 September 2019 be paid to the First Respondent and be treated to be in partial satisfaction…

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.

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Details

Case: [2020] FCCA 2183
Decision Date: 7 August 2020

CaseChat Overview and Summary

In the matter of *Sutton and Lasko and Anor (No.5)*, Judge McNab of the Federal Circuit Court of Australia considered a property settlement dispute between the Applicant and the First Respondent, with the Second Respondent also involved. The core of the dispute revolved around the Applicant's alleged failure to make full and frank financial disclosure, including the concealment and falsification of bank records, and the assertion that the Applicant and the Second Respondent were not separated as claimed.

The court was required to determine the extent of the asset pool available for division, given the Applicant's non-disclosure and the alleged deception regarding the separation status of the Applicant and the Second Respondent. The court also had to consider the appropriate orders to ensure a just and equitable distribution of property, taking into account the Applicant's conduct.

Judge McNab found that the Applicant had failed to make proper financial disclosure and had engaged in deceptive practices concerning his financial position and his relationship with the Second Respondent. Applying principles of family law concerning property settlement and the importance of full disclosure, the court made orders that effectively transferred the entirety of the Applicant's shareholding in Q Pty Ltd to the First Respondent. Further orders were made to restrain the Applicant from communicating the details of these orders to third parties, to release certain funds to the First Respondent, and for the Applicant to indemnify the First Respondent against specific debts. Crucially, the court ordered that the Reasons for Judgment, Transcript, and Exhibits be forwarded to the Commonwealth Director of Public Prosecutions for consideration of potential prosecution of the Applicant.

Orders

Orders of the court

ORDERS

1. The Applicant forthwith do all acts and sign all documents as is required to transfer to the First Respondent the entirety of the shareholding of Q Pty Ltd in W Pty Ltd.

2. In default of compliance with order 1 above, within seven (7) days of these orders being made (an affidavit by the solicitor for the First Respondent being sufficient evidence of same) a Registrar be appointed pursuant to section 106A of the Family Law Act 1975 (Cth) to execute all necessary documents to effect the transfer.

3. The Applicant by his servants or agents or otherwise (the Second Respondent being deemed to be an agent) be restrained from communicating the fact or implementation of these orders to any third party save for his legal and accounting advisors.

4. The parties otherwise retain assets in their respective possessions and the monies currently held by Bergos Kordos Lawyers in a controlled monies account pursuant to paragraph 3(c)(iv) of the orders made on 14 August 2018 and paragraph 5 of the orders made on 23 November 2018 be released to the First Respondent.

5. The Applicant indemnify the First Respondent against any debt relating to any of the entities of which he has an interest or related corporations, including without being limited to any debt which is sought to be enforced against the monies in order 4 above.

6. Paragraph 8 of the orders made on 25 October 2018 be discharged.

7. The funds held on trust by F Lawyers pursuant to orders of 16 September 2019 be paid to the First Respondent and be treated to be in partial satisfaction of a cost order made in her favour on 25 October 2019.

8. The Registrar of the Federal Circuit Court of Australia forward to the Commonwealth Director of Public Prosecutions the Reasons for Judgment delivered as well as the Transcript of the entire proceedings along with the Exhibits (relating to those proceedings) for a consideration by the Commonwealth Director of Public Prosecutions as to whether or not the Applicant should be prosecuted having regard to the findings made by the Court in these Reasons for Judgment.

9. Otherwise all extant applications be dismissed.

10. There be liberty to apply in respect of enforcement of these orders.

11. Any applications for costs be determined on the papers with submissions regarding same to be filed and served within 21 days of the date of these orders with any submission in reply to be filed 14 days thereafter.

IT IS NOTED that publication of this judgment under the pseudonym Sutton & Lasko & Anor (No.5) is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).

Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

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