Swayte and Swayte (No. 2)

[2020] FamCA 678

FAMILY COURT OF AUSTRALIA

SWAYTE & SWAYTE (NO. 2) [2020] FamCA 678

FAMILY LAW – PRACTICE AND PROCEDURE – APPLICATION FOR STAY – Where application for stay of interim financial orders – Where consideration of applicable principles – Where conditional stay ordered.

Family Law Act 1975 (Cth) s 94AA, 114
Family Law Rules 2004 (Cth) r 22.11

Alexander v Cambridge Credit Corporation Ltd (1985) 2 NSWLR 685
Fauna Holding Pty Ltd & Ors & Mitchell [2000] FamCA 548; (2000) FLC 93-024
Gronow v Gronow (1979) 144 CLR 513
House v The King (1936) 55 CLR 499
Jackson & Balen [2009] FamCAFC 131
Medlow & Medlow [2016] FamCAFC 34; (2016) FLC 93-692
Re Middle Harbour Investments Ltd (in Liq) (unreported, Court of Appeal (NSW), 15 December 1976)  

APPLICANT: Mr Swayte

RESPONDENT: Ms Swayte

FILE NUMBER: PAC 633 of 2020

DATE DELIVERED: 14 August 2020

PLACE DELIVERED: Parramatta

PLACE HEARD: Parramatta

JUDGMENT OF: Foster J

HEARING DATE: 16 July 2020 and by way of written submissions last received on 24 July 2020

REPRESENTATION

COUNSEL FOR THE APPLICANT: Mr Hodgson

SOLICITOR FOR THE APPLICANT: Kalmath Lawyers

COUNSEL FOR THE RESPONDENT:

Mr Coleman SC

with him Ms Dart

SOLICITOR FOR THE RESPONDENT: Diamond Conway Lawyers

Orders

1. That Orders 5, 7, 8 and 9 made 5 June 2020 be stayed subject to the following conditions:

   (a)That the wife do all things necessary to sell the property at X Street, Suburb Y (“the Suburb Y property”) for the best price reasonably obtainable. Upon sale the net proceeds of sale after agent’s fees and commission, legal costs on sale, contract adjustments, reasonable costs of preparing the property for sale and discharge of mortgage be paid to a controlled monies account in the name of the wife’s solicitor and that the wife be authorised to utilise such funds in the ordinary course of the parties’ business to meet property outgoings including mortgage payments, accrued liabilities, other payments necessary for the orderly conduct of the residential accommodation facility business conducted at D Street, Suburb F trading as “H Company” and the parties’ affairs;

   (b)That the wife be appointed trustee for sale of the Suburb Y property for the best price reasonably obtainable and for such purpose the property be vested in the wife as trustee for sale;

   (c)That the husband shall vacate the Suburb Y property within seven days of the date of these orders and thereafter the wife have sole use and occupation of the property for the purposes of sale and the husband is restrained from attending at or entering onto the said property without the consent of the wife and only for such periods as she may expressly permit; and

   (d)That the wife do all things necessary to remove and store all furniture, furnishings, effects and antiques situate at the Suburb Y property to a storage facility nominated by her with the wife to pay the storage fees as and when they become due and payable from the controlled money account provided for above.

2. That costs of and incidental to the stay application be reserved to final hearing or agreement.

Note: The form of the order is subject to the entry of the order in the Court’s records.

IT IS NOTED that publication of this judgment by this Court under the pseudonym Swayte & Swayte has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).

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 r 17.02 Family Law Rules 2004 (Cth).

FAMILY COURT OF AUSTRALIA AT PARRAMATTA

FILE NUMBER: PAC 633 of 2020

Mr Swayte

Applicant

And

Ms Swayte

Respondent

REASONS FOR JUDGMENT

1. On 5 June 2020 the Court made certain interim property orders in the context of ongoing property proceedings between the husband and wife. Those orders were as follows:

   (1)That the wife be appointed trustee for sale of the property situate at B Street, C Town (“the C Town property”) for the best price reasonably obtainable and for such purpose the property shall vest in the wife as trustee for sale and that upon sale the net proceeds of sale after agent’s commission, legal costs on sale, contract adjustments, reasonable costs of preparing the property for sale and discharge of mortgage be paid to a controlled monies account in the name of the wife’s solicitor and that the wife be authorised to utilise such funds in the ordinary course of the parties’ business to meet property outgoings including mortgage payments, accrued liabilities and other payments necessary for the orderly conduct of the residential accommodation facility business conducted at D Street, Suburb F trading as “H Company” and the parties affairs.

   (2)That pending further order the wife shall have sole use and occupation of the property at B Street, C Town for the purposes of sale and the husband is restrained from attending at or entering upon the said property without the express consent of the wife and only for such purposes as she may permit.

   (3)That the wife be appointed trustee for sale of the properties situate at 1 and 2 J Street, Suburb K for the best price reasonably obtainable and for such purpose the properties shall vest in the wife as trustee for sale and that upon sale the net proceeds of sale after agent’s commission, legal costs on sale, contract adjustments, reasonable costs of preparing the property for sale and discharge of mortgage be paid to a controlled monies account in the name of the wife’s solicitor and that the wife be authorised to utilise such funds in the ordinary course of the parties’ business to meet property outgoings including mortgage payments, accrued liabilities and other payments necessary for the orderly conduct of the residential accommodation facility business conducted at D Street, Suburb F trading as “H Company” and the parties affairs.

   (4)That pending further order, the wife shall have sole use and occupation of the properties at 1 and 2 J Street, Suburb K for the purposes of sale and the husband is restrained from attending at or entering upon the said property without the express consent of the wife and only for such purposes as she may expressly permit.

   (5)That the wife do all things necessary to sell the property situate at L Street, Suburb M (“the Suburb M property”) for the best price reasonably obtainable and that upon sale the net proceeds of sale after agent’s commission, legal costs on sale, contract adjustments, reasonable costs of preparing the property for sale and discharge of mortgage be paid to a controlled monies account in the name of the wife’s solicitor and that the wife be authorised to utilise such funds in the ordinary course of the parties’ business to meet property outgoings including mortgage payments, accrued liabilities and other payments necessary for the orderly conduct of the residential accommodation facility business conducted at D Street, Suburb F trading as “H Company” and the parties affairs.

   (6)That the wife shall provide to the husband by the last day of each month an accounting of funds used by her for the purposes permitted above.

   (7)That the husband shall vacate the said property at L Street, Suburb M within seven days from the date of these orders and that thereafter the wife shall have sole use and occupation of the property for the purposes of sale and the husband is restrained from attending at or entering upon the said property without the express consent of the wife and only for such purposes as she may expressly permit.

   (8)That the wife do all things necessary to remove and store furniture, furnishings, effects and antiques situate at the Suburb M property to storage facilities selected by her with the wife to pay storage fees as and when they become due and payable.

   (9)That pending further order the husband be restrained from doing any act or thing such as to remove any of the Suburb M property contents other than his personal effects without prior court order or written approval of the wife.

   (10)That notwithstanding the previous orders the wife shall do all things necessary to pay to the husband and to herself the sum of $100,000 each from the proceeds of sale of the first property sold with the classification of such sums to be reserved to final trial.

   (11)Liberty to apply as to implementation or enforcement.

   (12)The husband’s application for spouse maintenance be dismissed.

2. The husband has sought leave to appeal those orders to the Full Court of this Court by way of Notice of Appeal filed 12 June 2020.

3. The Grounds of Appeal relied upon by the husband are fulsome and seek to impugn many aspects of the reasons for judgment and orders made.

4. In the Notice of Appeal the husband sets out the Grounds of Appeal as follows:

   (1)That the Trial Judge’s discretion miscarried in that the result embodied in his interim orders is manifestly unreasonable and unjust.

   (2)That the Trial Judge’s discretion miscarried in making interim orders for the sale of the former matrimonial home at Suburb M and the Suburb K properties as upon final hearing, the Appellant’s claim to receive such properties as part of his entitlement to property settlement would be irrevocably lost and rendered nugatory as such interim orders would be incapable of being reversed.

   (3)That the Trial Judge was in error in law in determining it would be appropriate to make an interim order in the interests of justice in circumstances where the Appellant’ legitimate expectations upon property settlement have been compromised in circumstances where the sale of the properties ordered to be sold would be unable to be reversed.

   (4)That the Trial Judge’s discretion miscarried in failing to place any weight upon the prospective prejudice to the Appellant by making interim orders which would render nugatory his claim to receive the Suburb M and Suburb K properties as part of his entitlement to property settlement.

   (5)That the Trial Judge’s discretion miscarried in determining on the balance of convenience that the Appellant should be excluded from the occupation of the Suburb M property after seven (7) days from the date of the interim orders in circumstances where the Appellant had resided there since 1973 and since the time of separation in June 2007 when the Respondent had voluntarily vacated the property and did not seek to reoccupy it.

   (6)That the Trial Judge was in error in law in failing to provide any or adequate reasons for his determination:-

   (a)To appoint the Respondent as the Trustee for the sale of the C Town property, the Suburb K properties and the Suburb M property; and

   (b)As to the quantum of the award of interim costs/partial property settlement which he determined was to be paid to each of the parties from the proceeds of sale of the first property sold in accordance with his interim orders.

   (7)That the Trial Judge was in error in adopting an approach whereby he ostensibly made findings based upon untested evidence or disputed facts, namely:-

   (a)There was an immediate need to realise capital funds to meet ongoing liabilities and outgoings.

   (b)There appears to be a significant risk of depletion of the asset pool by reason of ongoing accruing liabilities in respect of which the parties’ daughter has already funded over $400,000 to meet ongoing payments.

   (c)That it is readily apparent that outgoings have been funded by capital for some time.

   (d)That inferentially the Appellant was obstructing the Respondent in relation to the operation of the residential accommodation facility business.

   (8)That the Trial Judge’s discretion miscarried by failing to place any or sufficient weight upon the conduct of the Respondent and the undisputed evidence that she had assumed total control of the parties’ significant assets to the exclusion of the Appellant after the time of separation and precluded the Applicant from having access to monies or to be involved in any decision making in regard to the parties’ joint enterprises.

   (9)That the Trial Judge’s discretion miscarried by placing undue weight upon the parties’ son, Mr FF corroborating the Respondent’s evidence of the urgency of the realisation of capital to meet ongoing liabilities, in circumstances where the Respondent and Mr FF were acting in concert with a common purpose to achieve the sale of assets and in particular the sale of the residential accommodation facility business.

   (10)That the discretion of the Trial Judge miscarried in placing undue weight upon the Appellant’s failure to:-

   (a)Assert he was unable to reside at the Suburb Y property.

   (b)Provide objective evidence to support his belief that the Suburb K properties had significant development potential.

   (c)Proffer a solution as to how the further development of the residential accommodation facility could be funded either than by borrowing.

   (d)Proffer a pathway to resolve the ever growing difficulty of the accumulating liabilities except the suggestion that the parties borrow even more funds.

   (11)That the Trial Judge was in error on the facts in ostensibly accepting the existence of the current liabilities asserted by the Respondent in circumstances where the existence of such liabilities was not admitted by the Appellant, not corroborated by up to date evidence and in some instances disputed by the Appellant.

The husband’s application

1. The husband’s application for stay was filed on 12 June 2020.  In that application the husband relevantly seeks the following orders:

   a)that pending the determination of the husband’s application for leave to appeal and in the event the requisite leave is granted, that pending the determination of the husband’s appeal, the operation and effect of the orders made by Justice Foster in the Family Court at Parramatta on 5 June, 2020 be stayed; and

   b)costs.

2. In support of his application for stay the husband relies upon his affidavit sworn 11 June 2020.

3. The matrimonial home at Suburb M, he asserts, is registered in the sole name of the wife.  They have lived in that property since September 1973 until their separation on 22 June 2017 when the wife, he alleges, vacated that property without notice to him.  He further asserts that at the time the wife removed various records relating to the parties’ financial affairs.

4. The husband further asserts that since separation he has continued to reside in the former matrimonial home at Suburb M and it has been his primary place of residence.  He says he has resided there alone since separation having changed the locks on the metal grill gate to the front door.  He asserts that he has a sentimental attachment to the home which is located nearby to his business at Suburb S.  He asserts that should he be required to vacate the home in accordance with the orders it would place a “very onerous burden upon me, particularly having regard to my age and the need to remove all of my possessions, which have accumulated over some forty-seven (47) years of living there.  I do not have other suitable accommodation available to me in Sydney”.

5. As to the property owned through a corporate entity by the parties at Suburb Y, he asserts that he travels to that property on occasions to spend weekends about every four to six weeks.  He says it would be difficult for him to live at Suburb Y and travel to and from his place of employment.  He does not believe that Suburb Y would be an appropriate primary residence for him.

6. Much of his assertions in his affidavit in support of the stay application repeats evidence that was before the Court at the primary hearing, that evidence being reflected in the reasons for judgment.

7. Otherwise, he agrees to the sale of the C Town property but objects to the appointment of his wife as trustee for sale, asserting that he has no confidence that she would ensure that the best price reasonably obtainable would be achieved on sale.  He provides no basis for his reservations save for referring to the wife’s conduct of their financial affairs since separation. 

8. Otherwise, he again disputes the existence of or the need to immediately address payment of outstanding liabilities as referred to in the reasons for judgment.  He asserts that having regard to the significant assets of the parties, monies would be able to be borrowed on short term to meet pressing liabilities and enable the residential accommodation facility business to meet its outgoings until the termination of his appeal in the event that he is granted leave.  He provides no objective evidence supporting this assertion.

9. Again, as he did in the primary application, the husband repeats that he seeks orders that the wife transfer to him all of the real property owned by him and his wife either in person or through the various corporate entities.  He again asserts that he would then pay to the wife 35 per cent of the net value of the asset pool available for distribution.

10. He asserts that by reason of the quantum of the net asset pool he would be able to raise sufficient funds to meet the wife’s entitlements, particularly if Stage II of the residential accommodation facility business was completed. 

11. How the husband would be able secure finance for such a significant payment having regard to his age and employment circumstances referred to in the primary reasons for judgment must remain a matter of significant conjecture. As properly contended by counsel for the wife, the greater the wife’s entitlement to property over and above the 35 per cent sought by the husband, the more fanciful his position becomes absent any evidence on the issue from him.

12. He asserts that in the event that his application for stay is not granted, a successful appeal would be rendered nugatory as the properties which he seeks to retain as part of his final entitlement to property settlement would be sold.

The wife’s Response

1. The wife relied upon her Response filed 9 July 2020 to the husband’s Application in a Case.

2. In that Response, in summary, she sought the following orders:

   a)that the husband’s application for stay be dismissed;

   b)that in the alternative there be a stay of orders 5, 7, 8 and 9 made 5 June 2020 subject to the following conditions:

   i)that the property at Suburb Y be listed for sale in lieu of the Suburb M property;

   ii)that the wife be appointed trustee for sale of the Suburb Y property for the best price reasonably obtainable and for such purpose the property vested in the wife as trustee for sale;

   iii)that the husband shall vacate the Suburb Y property within seven days of the date of orders and thereafter the wife have sole use and occupation of the property for the purposes of sale and the husband is restrained from attending at or entering onto the said property without the consent of the wife and only for such periods as she may expressly permit;

   iv)that the wife do all things necessary to remove and store all furniture, furnishings, effects and antiques situate at the Suburb Y property to a storage facility nominated by her with the wife to pay the storage fees as and when they become due and payable and that the net proceeds of the Suburb Y property be disbursed in the following order of priority:

   1.to discharge of the mortgage secured over the property,

   2.in payment of the agents fees and commissions,

   3.in payment of the legal costs associated with the sale,

   4.in reimbursement to the wife of any reasonable costs incurred by her in preparing the property for sale,

   5.the balance to be placed in the controlled monies account established by the orders of 5 June 2020 and utilised by the wife as permitted by such orders together with any storage fees incurred as a consequence of these orders.

   c)Costs.

1. The wife relied upon her affidavit filed 9 July 2020 in support of the orders sought by her.

2. The wife opposes the husband’s application for stay and seeks orders for a conditional stay as set out above.

3. The wife, as she did in the primary application, asserts that she has been unable to work with the husband in managing and administering their financial interests.

4. The wife asserts that she and the husband have a number of liabilities which require immediate payment including a claim by the ATO for unpaid GST including penalties and interest totalling $517,667, and an ongoing deficit of about $13,500 per month in the operating expenses of the residential accommodation facility and an ongoing deficit of about $57,500 in respect of their other business interests referred to in the primary reasons for judgment, outstanding land tax totalling $218,864 in respect to properties owned by the parties and their corporate entities. 

5. She asserts that the combined mortgage and other liabilities of the parties total $3.986 million.  Otherwise, she asserts a liability in relation to the deceased estate of a former tenant of the residential accommodation facility who has demanded a refund entitlement of about $643,000.

6. She asserts that she is agreeable to the husband remaining at the former matrimonial home and the Suburb Y property being sold in lieu thereof.  She asserts that the Suburb Y property has a present value of about $2.5 million. 

7. The wife asserts that the Suburb K properties purchased in 1989 and 2006 have not been the subject of any application for amalgamation nor any application for development approval from the local authority.  The husband, she asserts, has not provided any evidence of any intention to proceed with amalgamation or proposed redevelopment nor has he in the context of the present application revealed any financial capacity to fund such proposals.

8. The wife asserts that if the Suburb Y property is sold together with the C Town and Suburb K properties there would be realised from the sale of the Suburb K properties about $517,000, from the C Town property sum of approximately $156,000 and from the Suburb Y property about $1.26 million.

9. The sales, she asserts, would achieve net proceeds of just under $2 million which would be applied to the necessary roadworks to be undertaken at the residential accommodation facility as referred to in the primary judgment, payment of ATO liabilities, payment of land tax, payment in compliance with order 10 of the primary judgment and the discharge of the mortgage over the Suburb M property in the sum of $420,000 that is sought to be occupied by the husband since separation and who has made no personal contribution to the mortgage payments since separation.

10. The wife further asserts that funds referred to in the primary judgment that were held by the parties’ accountants have now further diminished to the sum of only $67,000 to meet ongoing liabilities.  No mortgage payments have been made in respect to the mortgages in the period from 3 April 2020.

11. Otherwise, the local council has directed, by letter dated 13 May 2020, that the parties carry out landscaping and fencing works to the residential accommodation facility at an estimated cost of about $300,000.

The Stay Application: Discussion

1. It is well settled that a stay will not be granted lightly or as a matter of course.

2. The power to order a stay (r 22.11 of the Family Law Rules 2004 (Cth)) is incidental to the right of appeal and derives from the inherent power of the Court to do whatever is necessary to prevent injustice in relation to the proceedings in the Court: Fauna Holding Pty Ltd & Ors & Mitchell [2000] FamCA 548; (2000) FLC 93-024.

3. In Jackson & Balen [2009] FamCAFC 131 the Full Court said at [28]:

   The principles to be applied in hearing a stay application pending an appeal are well settled (see Federal Commissioner of Taxation v Myer Emporium Ltd [No. 1] [1986] HCA 13; (1986) 160 CLR 220 at 222; Alexander v Cambridge Credit Corporation Ltd (1985) 2 NSWLR 685; Jennings Construction Ltd v Burgundy Royale Investments Pty Ltd [1986] HCA 84; (1986) 161 CLR 681).

   Those authorities stress the discretionary nature of the application which should be determined on its merits. Principles relevant to this matter include the following:

   a)the onus to establish a proper basis for the stay is on the applicant for the stay. However it is not necessary for the applicant to demonstrate any “special” or “exceptional” circumstances;

   b)a person who has obtained a judgment is entitled to the benefit of that judgment;

   c)a person who has obtained a judgment is entitled to presume the judgment is correct;

   d)the mere filing of an appeal is insufficient to grant a stay;

   e)the application must be bona fides;

   f)a stay may be granted on terms that are fair to all parties - this may involve a court weighing the balance of convenience and the competing rights of the parties;

   g)a weighing of the risk that an appeal may be rendered nugatory if a stay is not granted – this will be a substantial factor in determining whether it will be appropriate to grant a stay;

   h)some preliminary assessment of the strength of the proposed appeal – whether the appellant has an arguable case.

4. In Alexander and Others v Cambridge Credit Corporation Ltd (Receivers Appointed) and Another (supra) the NSW Court of Appeal outlined relevant principles as follows (at 694-695):

   It is sufficient that the applicant for the stay demonstrates a reason or an appropriate case to warrant the exercise of discretion in his favour.

   There are other principles to be kept in mind. The onus is upon the applicant to demonstrate a proper basis for a stay that will be fair to all parties ... The mere filing of an appeal will not, of itself, provide a reason or demonstrate an appropriate case, nor will it discharge the onus which the applicant bears ... The Court has a discretion whether or not to grant the stay and, if so, as to the terms that would be fair. In the exercise of its discretion, the Court will weigh considerations such as the balance of convenience and the competing rights of the parties before it.

   ...

   Two further principles can be mentioned. The first is that where there is a risk that the appeal will prove abortive if the appellant succeeds and a stay is not granted, courts will normally exercise their discretion in favour of granting a stay ... Thus, where it is apparent that unless a stay is granted an appeal will be rendered nugatory, this will be a substantial factor in favour of the grant of a stay ... Secondly, although courts approaching applications will not generally speculate about the appellant's prospects of success, given that argument concerning the substance of appeal is typically and necessarily attenuated, this does not prevent them considering the specific terms of a stay that will be appropriate fairly to adjust the interest of the parties, from making some preliminary assessment about whether the appellant has an arguable case. This consideration is protective of the position of a judgment creditor where it may be plain that an appeal, which does not require leave, has been lodged without any real prospect of success and simply in the hope of gaining a respite against immediate execution of judgment...

5. The Court of Appeal also referred with approval to the approach enunciated by Mahoney JA (with whom Moffitt P and Glass JA agreed) in Re Middle Harbour Investments Ltd (in Liq) (unreported, Court of Appeal (NSW), 15 December 1976) (at 2):

   Where an application is made for a stay of proceedings, it is necessary that the applicant demonstrate an appropriate case. Prima facie, a successful party is entitled to the benefit of the judgment obtained by him and is entitled to commence with the presumption that the judgment is correct ... where an applicant for a stay has not demonstrated an appropriate case but has left the situation in the state of speculation or of mere argument, weight must be given to the fact that the judgment below has been in favour of the other party.

6. The husband, in effect, in his application for final orders seeks that he receive the entirety of the parties’ assets with a cash adjustment payable by him to the wife. It is not readily apparent how he would be able to do so and he adduces no evidence on the issue save for his bare assertions.

7. It is not a matter for a party to seek final orders that are aspirational or at large and then assert such an application should present as a bar to any interlocutory order sought by the other party that seeks to realise one or more of the parties’ combined assets for good reason.  It is proper for the Court to give some consideration of the case asserted to the party who seeks the stay and to the reasonableness of same in all the circumstances including the balance of convenience as it applies to both parties.

8. It may be argued that the Court should make an order for the husband to pay by way of interlocutory payment a significant sum by way of partial property settlement to the wife with the ultimate disposition of those funds by her to be considered and characterised at final trial.

9. Yet the husband adduces no evidence of any capacity to make such a payment. His default in making any such payment would of necessity then see the realisation of part of the assets of the parties to secure those funds. In the present instance, there is simply no utility in making a monetary order that on the evidence has no possibility of being paid absent realisation of assets.

10. Here the husband says that he wants all the assets and thus any order that impugns on that position must be stayed pending a final trial. Yet the wife seeks in her final orders, somewhat inelegantly, that the property of the parties be divided as to 65 per cent to her and as to 35 per cent to the respondent husband. How that was to be achieved is not stated.

11. The primary orders made were in the exercise of the Court’s jurisdiction to make such orders as it considers proper under s 114 of the Family Law Act 1975 (Cth) (“the Act”) as to the property of the parties. Otherwise, interim property orders were made by reason of the funds that would then be realised and available.

12. The husband’s application for stay, pending leave to appeal the interlocutory orders, is made in part by reason of his desire to remain in the home at Suburb M. The wife concedes this and seeks a sale in the alternative. Otherwise, the application for stay seeks to preserve all assets as sought by the husband by way of final orders.

13. Yet the husband has not sought expedition of his application for leave to appeal in circumstances where the delay in the matter coming before the Full Court could wreak significant financial damage on the property pool as the parties are left without funds to meet ongoing obligations. At present it appears that the application for leave to appeal may be dealt with by a judge of the Full Court with such application, subject to the consent of the parties, being dealt with in chambers on the basis of written submissions. No such directions have as yet been made. There is no evidence as to when, if leave is granted, the appeal may be heard by the Full Court and no indication as to when judgment of the Full Court would be anticipated.

14. As said in the primary judgment, the husband has not sought any orders to address such a situation. His bona fides in bringing the application for leave to appeal are not readily apparent.

15. The position, absent a conditional stay order as sought by the wife, raises the prospect of the parties either being the subject of bankruptcy applications or the winding up, or the placing into receivership of their various corporate entities including what appears to be their flagship enterprise of the residential accommodation facility. Such an outcome would be prejudicial to preserving the value of the asset pool by way of cash or property for division and the wife’s ultimate interest therein.

16. The husband’s stay application seeks to ignore the reality of the parties’ financial position as asserted by the wife and in respect to which he says he has no detailed knowledge.  Ongoing delay can only diminish the net value of the parties’ asset pool.

17. It is considered that that there is no proper basis for a stay save on terms as sought by the wife. As contended by counsel for the wife, ordering a stay without conditions will leave the parties without sufficient funds to meet their financial obligations and result in a further diminution of the property pool as a consequence of escalating debt.  Conditions as sought would reflect the Court weighing the balance of convenience and the competing rights of the parties as discussed above in favour of the wife.

18. The wife is entitled to the benefit of her judgment and is entitled to accept it as correct.

19. As to the necessary preliminary application for leave to appeal, the test for leave pursuant to section 94AA of the Act was reiterated by the plurality of the Full Court in Medlow & Medlow [2016] FamCAFC 34; (2016) FLC 93-692 who said:

    We are of the opinion that, subject to the caveat just discussed, the test to be applied in applications for leave to appeal under s 94AA of the Act is whether, in all of the circumstances, the decision is attended by sufficient doubt to warrant it being reconsidered by the Full Court and whether substantial injustice would result if leave were refused, supposing the decision to be wrong.

20. As properly summarised by counsel for the wife, the husband’s Notice of Appeal sets out 11 grounds of appeal, which broadly go to a general dissatisfaction as to each of the orders made and that the sale of the Suburb M and Suburb K properties would be unable to be reversed on a final basis, adversely impacting the husband’s capacity to retain these properties. 

21. Grounds 7, 8, 9, 10 and 11 of the appeal are directed to a complaint about the weight placed on various matters, including the ostensible acceptance of the wife’s evidence as to the current liabilities of the parties in circumstances where such liabilities were not admitted by the husband, not corroborated by up to date evidence and in some circumstances disputed by the husband.

22. Counsel for the wife properly submits that the following emerges from an examination of the grounds relied upon by the husband:

    (i)that no ground expressly or impliedly articulates an error of law;

    (ii)that nine of the first 10 grounds of appeal go to a challenge as to the Trial Judge’s exercise of discretion;

    (iii)none of the grounds assert a material error of fact; and

    (iv)to the extent that ground 11 seems to assert that the trial judge was in error in “ostensibly accepting” the existence of current liabilities asserted by the wife, the ground does not assert that decision is vitiated by a material error of fact.

23. The prospects of establishing these grounds on appeal will be significantly diminished by the husband’s failure to have led any evidence in challenge to that led by the wife.  Whereas the wife’s evidence was supported where possible by objective documentation and the evidence of the parties’ adult son.

24. The husband, in his affidavit filed 12 June 2020, remarkably deposed to having no knowledge of the parties’ financial affairs, such that the husband is not aware of the bank accounts he owns or the balances of each account. He further proceeds to make vague allegations of fraud which he has failed to particularise.

25. In the event that the husband is granted leave to appeal from the primary discretionary judgment, he will need to contend with the well-established principles on the limits of interference by an appellate court with such judgments: House v The King (1936) 55 CLR 499; Gronow v Gronow (1979) 144 CLR 513. It is properly submitted by counsel for the wife that a consideration as to the grounds of appeal asserted by the husband does not establish an identifiable error that would render his prospects of success on the appeal particularly strong.

26. In all of the circumstances there will be a conditional stay ordered as sought by the wife.

27. Orders will be made accordingly.

I certify that the preceding fifty six (56) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Foster delivered on 14 August 2020.

Associate: 

Date:  14 August 2020