Tarok & Kardan (No 4)

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FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA

(DIVISION 1)

Tarok & Kardan (No 4) [2024] FedCFamC1F 543   

File number(s): SYC 7133 of 2021
Judgment of: SCHONELL J
Date of judgment: 16 August 2024
Catchwords:

FAMILY LAW – PRACTICE AND PROCEDURE – Joinder – Where the husband sought to join H Bank to the proceedings – Where the wife and H Bank opposed the joinder – Where the wife submitted that if the joinder application were successful the hearing would suffer delay – Where H Bank submitted that proper notice had not been affected – Application dismissed.

FAMILY LAW – PRACTICE AND PROCEDURE – Injunction – Where the Husband sought injunctive relief subsequent to the joinder of H Bank – Where H Bank submitted that the injunctions as sought were prejudicial to H Bank and deprived them of rights under their security facility – Application dismissed.

Legislation: Family Law Act 1975 (Cth) ss 90AF, 90AK, and 114
Cases cited:

Allan & Allan& Ors [2009] FamCA 553

B Pty Ltd & Ors & K & Anor (2008) FamCAFC 113
Division: Division 1 First Instance
Number of paragraphs: 36
Date of last submission/s: 13 August 2024
Date of hearing: 12 August 2024
Place: Sydney
Counsel for the Applicant: Mr Dura SC
Solicitor for the Applicant: Somerville Legal
Solicitor for the Respondent: Dorter Family Lawyers and Mediators
Counsel for the Prospective Respondent: Mr Foley
Solicitor for the Prospective Respondent: O Lawyers

ORDERS

SYC 7133 of 2021

FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)
BETWEEN:

MR KARDAN
Applicant
AND:

MS TAROK
Respondent

H BANK LTD
Prospective Respondent

ORDER MADE BY:

SCHONELL J

DATE OF ORDER:

16 AUGUST 2024

THE COURT ORDERS THAT:

1.The Application in a Proceeding filed 17 July 2024 is dismissed.

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

Note: This copy of the Court’s Reasons for judgment may be subject to review to remedy minor typographical or grammatical errors (r 10.14(b) Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 10.13 Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth).

Part XIVB of the Family Law Act 1975 (Cth) makes it an offence, except in very limited circumstances, to publish an account of proceedings that identify persons, associated persons, or witnesses involved in family law proceedings.

IT IS NOTED that publication of this judgment by this Court under the pseudonym Tarok & Kardan has been approved pursuant to subsection 114Q(2) of the Family Law Act 1975 (Cth).

REASONS FOR JUDGMENT

SCHONELL J:

  1. By Application in a Proceeding filed 17 July 2024 the husband seeks orders to join to the proceedings H Bank and thereafter the making of injunctions. The application is opposed by the wife and by H Bank.

  2. For reasons that will become apparent, the husband’s application will be dismissed.

    DOCUMENTS RELIED UPON

  3. The husband relied upon the following documents:

    (1)Application in a Proceeding…

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Details
Case
[2024] FedCFamC1F 543
Decision Date

CaseChat Overview and Summary

In Tarok & Kardan, the Federal Circuit and Family Court of Australia (Division 1) addressed the husband's application to join H Bank to ongoing financial and parenting proceedings. The wife and H Bank opposed the application, with the wife arguing that a successful joinder would delay the final hearing and H Bank asserting that proper notice had not been served. The court had to determine whether H Bank should be joined to the proceedings and if injunctive relief should be granted to the husband against H Bank. The husband sought to prevent H Bank from appointing receivers and managers to recover a debt secured by a property at Suburb L. H Bank contended that the proposed injunctions were prejudicial and would deprive it of its rights under the security facility.

The court dismissed the application to join H Bank, finding that the husband had not demonstrated a sufficient reason to add the bank to the proceedings, particularly given the potential for significant delay to the final hearing. Additionally, the court dismissed the husband's application for injunctive relief, ruling that the injunctions sought were prejudicial to H Bank and would unjustly deprive it of its rights. The court concluded that the husband had not shown a compelling need for such relief, particularly given the bank's legitimate interest in securing its debt. The court's decision underscored the importance of balancing the interests of all parties involved and ensuring that any application to join additional parties or seek injunctive relief is justified by clear and compelling reasons.

Orders

Orders of the court

SYC 7133 of 2021

FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)

BETWEEN:

MR KARDAN

Applicant

AND:

MS TAROK

Respondent

H BANK LTD

Prospective Respondent

ORDER MADE BY:

SCHONELL J

DATE OF ORDER:

16 AUGUST 2024

THE COURT ORDERS THAT:

1. The Application in a Proceeding filed 17 July 2024 is dismissed.

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

Note: This copy of the Court’s Reasons for judgment may be subject to review to remedy minor typographical or grammatical errors (r 10.14(b) Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 10.13 Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth).

Part XIVB of the Family Law Act 1975 (Cth) makes it an offence, except in very limited circumstances, to publish an account of proceedings that identify persons, associated persons, or witnesses involved in family law proceedings.

Background

Background to the litigation

H Bank relied upon the following documents:(1)Affidavit of Mr N filed 29 July 2024; and(2)Case Outline.BACKGROUND The husband and wife are engaged in financial and parenting proceedings which are listed for final hearing for five days commencing 16 September 2024. The parties, according to the wife, commenced cohabitation in 2005, were married in 2013 and separated on a final basis in August 2021. They were in a relationship, according to the wife, for approximately 16 years. There are three children of the marriage who are aged 15, 12 and 7. Their assets were recorded in a Balance Sheet prepared by the wife’s solicitor (Exhibit 4). According to that document, the wife asserts net assets of approximately $8 million. The husband’s senior counsel submits that notwithstanding the assertions in that document, the net pool of assets is approximately $7 million. The asset pool is comprised of funds in a bank account of approximately $565,000 (after allowance is made for interim property orders), a home at Suburb P and one at Suburb L and various corporate entities. By her Third Further Amended Initiating Application the wife seeks final orders for the transfer to her of the Suburb L property on an unencumbered basis and transfer to her of a property at Suburb P subject to an existing mortgage. The Third Further Amended Initiating Application records that the effect of these orders is a property settlement of 67% in favour of the wife. The husband, by way of his Third Further Amended Response, seeks orders that the wife transfer to the husband her interest in the Suburb L property, the husband transfer to the wife his interest in the Suburb P property subject to the mortgage, the husband pay the wife the sum of $130,000 and the wife receive $800,000 from a controlled monies account. The Third Further Amended Response does not contain any indication as to the percentage entitlement. That said, during submissions, the husband’s senior counsel submitted that the effect of the orders sought by the husband was to divide the parties’ assets as to 48% to the wife and the balance to the husband. In circumstances where the husband’s senior counsel submitted that the pool of assets was approximately $7 million the effect of the orders does not appear to accord with that percentage division. During the marriage the parties conducted a number of commercial enterprises including a business trading as Q Company. In addition, the husband also conducts a number of commercial enterprises which as best as I understand operate as a business on behalf of Australia and New Zealand Banking Group Limited (“ANZ Bank”). The husband gives evidence that in 2016 he acquired M Pty Limited financed by a loan from H Bank. He says that the loan was obtained by R Pty Ltd in its capacity as trustee for the Kardan & Tarok Family Trust. The husband and the wife are guarantors under the loan. It would appear from the evidence that the loan has been in default since at least late 2023. In that respect, the husband gives evidence as follows:30.On 16 July 2024, [Ms Tarok] and I received correspondence from [O Lawyers], representing [H Bank], advising that [J Company] had been appointed as receivers and managers of [M Pty Limited] to recover the debt owing under the Finance Agreement…31. [Ms Tarok] and I received three Default Notices from the Bank as follows:(a) 5 December 2023;(b) 20 February 2024; and (c) 8 May 2024.32.After receipt of each Default Notice, I emailed [Ms Tarok] and either put forward an offer of settlement or request that she consent to transfer the title of the [Suburb L] property to me solely so that I would be able to secure a loan refinance with Westpac Limited, and in exchange I would transfer the title of the remaining jointly held property at [S Street], [Suburb P] NSW […] to [Ms Tarok] solely, and to also provide an undertaking, signed by me, confirming that [Ms Tarok] holds a 50% interest in the [Suburb L] property once the title had been transferred to me. …35.It is prejudicial to both [Ms Tarok] and me to permit [J Company] to be appointed as receivers, as they will undertake all necessary actions to enforce the Bank's security, which is held over the [Suburb L] property. This property is sought to be retained by both [Ms Tarok] and me in the final hearing.36.As of today’s date, the outstanding amount payable pursuant to the Default Notice is $2,011,151.89.37.I have engaged with [H Bank] to resolve this issue and attempt to refinance the existing facility however have not been able to do so without the [Suburb L] property being registered in my sole name. I have also enquired with Westpac to refinance the [H Bank] facility and move it to Westpac to avoid any enforcement action being taken. I have been advised by Westpac that they require the same form of security before the will consider and/or approve my request, namely that the [Suburb L] property be in my sole name and it be used as security for the facility.38.It is my intention to retain the [Suburb L] property on a final basis and refinance the [H Bank] facility so as to ensure that I can keep trading. Should the [H Bank] proceed with their current action, it will have a detrimental impact on any ability to retain the property and/or operate my business as it will have an impact on my financial and credit history.

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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