Tadgell & Hahn & Anor

[2013] FamCAFC 23

FAMILY COURT OF AUSTRALIA

TADGELL & HAHN AND ANOR [2013] FamCAFC 23

FAMILY LAW – APPEAL – NOTICE OF APPEAL – where the parties agree that the discretion of the court should be re-exercised – where the wife seeks to have the husband’s mother joined as a party – where the basis of the application is the allegation by the wife that she and the husband have an equitable interest in a property owned by the husband’s mother – where the application is opposed by the husband and his mother – where the relevant test is whether the wife has a reasonable prospect of success in the claim that she and the husband have an equitable interest in the property – where the question in issue is whether the financial and other contributions made over a period of 22 years are sufficient to cause equity to intervene – where prima facie it seems they could be – where that is sufficient to satisfy the test – husband’s mother ordered to be joined as a party – leave granted to the wife to file an Amended Initiating Application – matter to be listed for directions before and to be heard in its entirety by a Federal Magistrate other than Federal Magistrate Phipps.

Donis v Donis [2007] VSCA 89
Giumelli v Giumelli (1999) 196 CLR 101
Muschinski v Dodds (1985) 160 CLR 583
Waltons Stores (Interstate) Ltd v Maher (1988) 164 CLR 387

APPELLANT: Ms Tadgell

FIRST RESPONDENT: Mr Hahn

SECOND RESPONDENT: Ms S

FILE NUMBER: MLC 7358 of 2009

APPEAL NUMBER: SOA 14 of 2012

DATE DELIVERED: 1 March 2013

PLACE DELIVERED: Adelaide

PLACE HEARD: Melbourne

ADDENDUM JUDGMENT OF: Strickland J

HEARING DATE: 17 January 2013

LOWER COURT JURISDICTION: Federal Magistrates Court

LOWER COURT JUDGMENT DATE: 31 January 2012

LOWER COURT MNC: [2012] FMCAfam 74

REPRESENTATION

COUNSEL FOR THE APPELLANT: Mr Moisidis

SOLICITOR FOR THE APPELLANT:	Meier Denison Guymer Pty Ltd
COUNSEL FOR THE FIRST RESPONDENT:	Mr Crozier-Durham

SOLICITOR FOR THE FIRST RESPONDENT: Brian McGrath

COUNSEL FOR THE SECOND RESPONDENT: Dr Sharpe

SOLICITOR FOR THE SECOND RESPONDENT: Brian McGrath

Orders

1. In substitution for the orders made by Federal Magistrate Phipps on 31 January 2012, the following orders be made:

   (a)The husband’s mother, Ms S be joined as a party to the proceedings in file number MLC 7358 of 2009.

   (b)The wife have leave to file an Amended Initiating Application within such time as may be fixed at the directions hearing hereinafter ordered.

   (c)As soon as possible the proceedings in file number MLC 7358 of 2009 be listed for a directions hearing before a Federal Magistrate other than Federal Magistrate Phipps, and the entirety of the proceedings thereafter be heard by a Federal Magistrate other than Federal Magistrate Phipps.

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

IN THE APPELLATE JURISDICTION OF THE FAMILY COURT OF AUSTRALIA AT MELBOURNE

Appeal Number: SOA 14 of 2012
File Number: MLC 7358 of 2009

Ms Tadgell

Appellant

And

Mr Hahn

First Respondent

And

Ms S

Second Respondent

ADDENDUM REASONS FOR JUDGMENT

Introduction

1. On 11 January 2013 I delivered my reasons for judgment in this matter, and I made orders granting leave to appeal, allowing the appeal and setting aside the orders of the Federal Magistrate, and granting costs certificates to the parties in relation to the appeal.  However, I then adjourned further consideration of the Notice of Appeal to 17 January 2013 “for the purpose of receiving submissions from the parties as to whether the matter should be remitted to the Federal Magistrates Court or whether this Court should re-exercise the discretion and if it is the former, to consider the question of costs certificates to the parties for such rehearing”.

2. On 17 January 2013 counsel for the wife and counsel for the husband sought that I re-exercise the discretion, but counsel for the husband’s mother sought an adjournment to take instructions.  I granted that application and adjourned the matter to 1 February 2013.  However, on 31 January 2013 the husband’s mother’s solicitors advised the court that their client agreed that I should

   
   

   re-exercise the discretion.  As a result of this advice the further hearing was vacated.

3. I now proceed to set out my reasons on the re-exercise of the discretion.  I note that no party sought to put further evidence before the court for this purpose.

Discussion

1. The application before his Honour was an application by the wife seeking to join the husband’s mother as a party and file an Amended Initiating Application as a result.  That application was opposed by the husband and by his mother.

2. I have set out in my earlier reasons the relevant background to that application (see paragraphs 5–13), and I do not need to repeat that detail here.

3. The basis of the application is the allegation by the wife that she and the husband have an equitable interest in the husband’s mother’s property at M.

4. It is common ground that the relevant test as to whether the wife should be permitted to join the husband’s mother as a party is whether the wife has a reasonable prospect of success in the claim that she and the husband have an equitable interest in the property.

5. I have also set out in detail in my earlier reasons the wife’s evidence in support of the application, and the evidence of the husband and his mother in opposition, and again I do not propose to repeat that detail.  I refer though to the summaries of that evidence set out in paragraphs 16, 17 and 18 of my earlier reasons.

6. As to the representations allegedly made by the husband’s mother, it is not possible to make a finding as to their correctness or otherwise at this stage, and to that extent that can be treated as evidence of an ambivalent character, which provides a reasonable prospect for success as far as that goes (see paragraph 50 of my earlier reasons).  However, even assuming, as his Honour did, and as I now do, that those representations were made by the husband’s mother, to establish a constructive trust or obtain an equitable remedy, the wife must demonstrate that she and the husband suffered detriment relying on those representations (Muschinski v Dodds (1985) 160 CLR 583; Waltons Stores (Interstate) Ltd v Maher (1988) 164 CLR 387; Giumelli v Giumelli (1999) 196 CLR 101).

7. The detriment alleged by the wife, as I identified in paragraph 43 of my earlier reasons, consists at least of the financial contributions to renovations undertaken on the property, the maintenance and improvement of the property over a period of 22 years, the gratuitous payments to the husband’s mother, and the payment of rates, taxes and insurance.

8. As I understand it there is no dispute that these things were done, but the question in issue is whether they are sufficient to cause equity to intervene.  Prima facie, it seems to me that they could be, and that is sufficient to satisfy the test.  In support of that I refer again to what the Court of Appeal said in Donis v Donis [2007] VSCA 89, at paragraph 53, as set out in paragraph 46 of my earlier reasons for judgment. And in any event I would also want to rely on what the Court of Appeal said in that case at paragraph 20, and it bears repeating, namely:

   … The object of the exercise is to do equity and for that purpose “detriment” is no narrow or technical concept.  It need not consist of expenditure of money or other quantifiable financial disadvantage so long as it is something substantial.  The requirement must be approached as part of a broad enquiry as to whether departure from a promise would be unconscionable in all the circumstances. [Footnotes omitted]

9. To repeat though, my task is not to find that the wife’s claim is established, but to determine whether that claim has a reasonable prospect of success.  In that regard I am comfortable in finding that the wife has established at least that on the evidence before the court.  Accordingly, the husband’s mother should be joined as a party, and the wife given leave to file an Amended Initiating Application.  As to whether the application should be in the form annexed to the Application in a Case filed by the wife on 11 May 2011, and as to what further procedural orders should be made, including as to “disclosure” by the husband’s mother, as was also sought by the wife in that application, I consider those issues should be left to a directions hearing before a Federal Magistrate other than Federal Magistrate Phipps.  Indeed, another Federal Magistrate other than Federal Magistrate Phipps should be assigned to hear this case in its entirety.

I certify that the preceding twelve (12) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Strickland delivered on 1 March 2013.

Associate:     

Date:              1 March 2013