Tripp & Allison (No 2)
[2024] FedCFamC2F 1523
•16 October 2024
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 2)
Tripp & Allison (No 2) [2024] FedCFamC2F 1523
File number(s): CRC 289 of 2023 Judgment of: JUDGE CARTY Date of judgment: 16 October 2024 Catchwords: FAMILY LAW – PROPERTY – interlocutory – application for leave to commence proceedings for property adjustment out of time – consideration of respondent’s jurisdictional objection – consideration of prima facie case for relief – whether the applicant has demonstrated sufficient likelihood of success – where claim is not trifling – consideration of hardship – exercise of discretion – consideration of delay – consideration of prejudice to the respondent – leave granted Legislation: Family Law Act 1975 (Cth) ss 4, 44, 39, 79
Federal Circuit and Family Court of Australia (Family Law) Rules 2021, rr 2.19, 6.06, Chapter 6
Cases cited: Jacenko & Jacenko (1986) FLC 91-766
Sharp & Sharp (2011) 50 Fam LR 567
Skelton & Lindop [2022] FedCFamC1A 47
Voth & Manildra Flour Mills Pty Ltd [1990] HCA 55; (1990) 171 CLR 538
Weir & Weir (1993) FLC 92-338, [2009] FamCA 451
Whitford & Whitford (1979) FLC 90-612
Division: Division 2 Family Law Number of paragraphs: 77 Date of last submission/s: 25 July 2024 Date of hearing: 25 July 2024 Place: Newcastle Counsel for the Applicant: Mr Guyder Solicitor for the Applicant: Tribe Family Lawyers The Respondent: Self Represented ORDERS
CRC 289 of 2023 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 2)
BETWEEN: MS TRIPP
Applicant
AND: MR ALLISON
Respondent
ORDER MADE BY:
JUDGE CARTY
DATE OF ORDER:
16 OCTOBER 2024
THE COURT ORDERS THAT:
1.Pursuant to section 44(3) of the Family Law Act 1975 (Cth) leave is granted to the applicant wife Ms Tripp to apply after the end of the standard application period for an order under s.79 of the Family Law Act 1975 (Cth).
2.The interlocutory orders sought in the Response to Initiating Application filed on 3 October 2023 are dismissed.
3.The respondent husband is directed to file and serve written submissions addressing the applicant wife's costs application filed on 27 April 2024 by no later than 4.00pm on 25 October 2024.
4.The applicant wife is directed to file and serve any short submissions in reply to the husband’s written submissions by no later than 4.00pm on 1 November 2024.
THE COURT ORDERS BY CONSENT THAT:
5.Pursuant to Rule 9.01 of the Federal Circuit and Family Court of Australia (Family Law) Rules 2021 the property proceedings are transferred to the Sydney Registry of the Federal Circuit and Family Court of Australia and are adjourned to 9.30am on 4 December 2024 for first return before Judicial Registrar Reeman of the Federal Circuit and Family Court of Australia.
THE COURT FURTHER ORDERS THAT:
6.The respondent husband is directed to file and serve an Amended Response to Initiating Application and a Financial Statement setting out the precise final property orders that he seeks by no later than 4.00pm on 12 November 2024.
NOTATIONS:
A.The application by the wife for the husband to pay her costs of the leave application has not yet been determined. After 1 November 2024 the decision in the wife’s costs application will be reserved and the parties will be advised of a date for the delivery of reserved Judgment.
B.The respondent husband informs the Court that he presses his Application in a Proceeding which was filed on 28 August 2024, and sealed on 17 September 2024, and that application remains extant and has not yet been heard or determined.
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 a pseudonym has been approved pursuant to subsection 114Q(2) of the Family Law Act 1975 (Cth).
REASONS FOR JUDGMENT
JUDGE CARTY
These reasons were delivered orally and have been corrected from the transcript. Grammatical errors have been corrected and an attempt has been made to render the orally delivered reasons easier to read. The substance is unchanged.
INTRODUCTION
The applicant wife seeks leave pursuant to s.44(3) of the Family Law Act 1975 (“the Act”) to institute proceedings under s.79 of the Act for orders altering the interests of the parties in their property, and the wife seeks costs.
I am not going to make a decision on the costs issue today because I have not heard the husband's submissions in relation to that issue yet.
The respondent husband opposes the application for leave on two bases:
(a)A jurisdictional objection. He says that the doctrine of forum non conveniens applies to the applicant wife's choice to file an Initiating Application in Australia, and that the most convenient forum to determine the property dispute between the parties, including the wife's application for leave to proceed out of time, is Country B, where the wife and the child reside, and where the parenting dispute was most recently determined.
(b)The husband also opposes the wife's application for leave on the basis that she will not suffer hardship if leave is refused, and that the wife has not adequately explained her delay.
BACKGROUND
The parties commenced their relationship in Sydney in 2008, and they were married in Australia in 2010. The parties separated in July 2020. They are divorced, effective 2022.
The wife is an Australian citizen. She currently resides at City D in Country B.
The husband is an Australian citizen. He currently resides at Suburb E in New South Wales.
On 7 August 2023, the wife filed an Initiating Application. Relevantly, the wife seeks an interlocutory order for leave to institute property proceedings, as well as an order that the husband provide full and frank disclosure, and an order for costs.
When the wife filed her Initiating Application, she was present in Australia.[1] It is common ground that the parties sold their jointly owned former matrimonial home at Suburb F, New South Wales in March 2023, and that the sum of approximately $980,000 Australian Dollars is held in an Australian solicitor's trust account pending resolution of the property dispute. The wife has borrowed funds to purchase a real property in Country B.
[1] Initiating Application filed 7 August 2023 at Part B, 11
The time for the wife to bring an application for property orders without leave of the Court expired on 22 April 2023.
On 3 October 2023, the husband filed a Response. The husband noted his objection to jurisdiction and wrote "non-agreed" in respect of the interlocutory and final orders sought by the wife. The husband seeks an interlocutory order in the following terms:
…that the Court grants leave to hear jurisdictional objections raised by the respondent in accordance with rule 2.19.
Rule 2.19 of the Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (“the Rules”) provides that a respondent seeking to object to the jurisdiction of the Court is not taken to have submitted to the jurisdiction of the Court by seeking orders in the response, and that the objection to the jurisdiction must be determined before any other orders sought in response.
On 7 February 2024, Her Honour Turner J made the following Orders and Notations:
(1)That the matter be set down for a final hearing for not more than one day before Judge Carty in the Federal Circuit and Family Court of Australia at City G on a date to be advised, and the Court noted that:
(a)Trial directions shall issue from the chambers of Judge Carty,
(b)The issues that require determination is whether the Court has jurisdiction to determine the property issues, and if so, whether leave is to be given for the applicant to proceed out of time.
On 11 April 2024 I conducted a Directions hearing by Microsoft Teams link, and on that date the parties agreed that it was appropriate to conduct the interlocutory hearing to determine the leave application and the jurisdictional issue on the papers, which means that the hearing is conducted having regard to the material relied upon by each party, including their affidavits, without either party being required for cross-examination, and also material such as a case outline document, which the Court receives as an aide-memoire, not as evidence in the proceeding. The Court has regard to the aide-memoire because it contains submissions and arguments of each of the parties.
The interlocutory hearing proceeded on 25 July 2024 in City G, in part by Microsoft Teams, and the legal representatives for the wife appeared in person. On 25 July 2024, I heard oral submissions for the wife and from the husband. I reserved my decision and made an order adjourning the matter to 1 August 2024 for delivery of Orders and oral reasons for decision.
On 31 July 2024, the husband filed a recusal application, and I made orders and published written reasons for decision in the recusal application on 8 October 2024.[2]
[2] The husband’s application that I recuse myself from further hearing the parties’ dispute was dismissed.
Issues of determination
In the current matter, I am required to resolve the following two questions:
(1)Whether the Court has jurisdiction to deal with the wife's application for an order pursuant to s.79 of the Family Law Act 1975, altering the interests of the parties to the marriage in the property, and
(2)If the Court has jurisdiction, whether the applicant wife will be granted leave pursuant to section 44(3) of the Act to bring her application out of time.
Material read
In support of her case, the wife relied upon:
(a)Her amended initiating application filed 27 April 2024,
(b)Her affidavit filed 31 May 2024, and
(c)Her financial statement filed 28 August 2023.
The wife also relied upon a case outline document prepared by her Counsel, which was filed on 23 July 2024, and read by the Court as an aide-memoire.
In support of his case, the husband relied upon:
(a)His response to initiating application filed 3 October 2023,
(b)His affidavit filed 3 October 2023,
(c)The parties' divorce decree from the Federal Circuit and Family Court of Australia case SYC5040/2021, which is dated early 2022, and
(d)His case outline document, which were his written submissions, which the Court read as an aide-memoire.
Jurisdictional objection
The husband's contentions in relation to his jurisdictional objection appear to be based on two arguments. Firstly, his concern that as the wife supported an application by the independent children's lawyer in the previous parenting proceedings, which were initiated by the husband in Australia and which were transferred to a Court in Country B, the wife may ultimately elect in the current property proceedings to transfer those proceedings to Country B. Secondly, his misapprehension that the wife is seeking leave to institute proceedings for spousal support or child support which, on my reading of her documents, she is not. The wife seeks orders for property settlement.
In his case outline document, the husband properly conceded that the Court has jurisdiction to deal with the wife's property application.[3] In relation to the jurisdictional issue the husband recited the contents of an email which he wrote and sent to the wife's solicitor on 31 January 2024, which included the following statement by the husband:
I accept with caveats that the FCFCOA is a jurisdiction competent to hear this matter. I made many attempts to make a property settlement with your client within time. To facilitate the efficient and equitable progression of this matter, I am agreeable that this matter could be heard on the proviso that any factors that would normally be relevant under the Act in a property settlement that occurred beyond the one-year time limit be inadmissible and not considered.
[3] Husband’s written submissions at pages 12-15 at Sections 6 (g) and (i)
The husband has made it plain that he relies on the doctrine of forum non conveniens, rather than asserting that the Court would not have jurisdiction to entertain the wife's application if leave were granted. To be clear, I consider that the Court has jurisdiction in the sense that I have power to entertain the wife's application if leave is granted by virtue of ss 39 and 4(1) of the Act, which deals with the definition of matrimonial cause. The definition of matrimonial cause is set out in s.4(1) of the Act, and relevantly at paragraph (ca):
Proceedings between the parties to a marriage with respect to the property of the parties to the marriage or either of them, being proceedings arising out of the marital relationship.
This matter, subject to leave, is a matrimonial cause, because the wife is seeking to initiate proceedings between the parties to a marriage with respect to the property of the parties to the marriage, or either of them, being proceedings which arise out of the marital relationship that the parties had, quite clearly.
Section 39(4) of the Act reads:
Proceedings of a kind referred to in the definition of matrimonial cause in section 4 subsection 1 may be instituted under this Act if (a) in the case of proceedings between the parties to a marriage, either party to the marriage is an Australian citizen, is ordinarily resident in Australia, or is present in Australia at the relevant date.
Both parties in this matter are Australian citizens, one party at least is ordinarily resident in Australia, and the wife was present in Australia on the date that she filed her application. In my view the relevant conditions in s.39(4) of the Act are met. I am comfortably able to find that the Court has jurisdiction to deal with the application brought by the applicant for alteration of property interests pursuant to s.79, and that there would be no proper legal basis to refuse jurisdiction based on the Court's powers under the Act.
In this case the husband relies upon his argument forum non conveniens. Before I deal with that argument, it seems that the husband was concerned that the wife was seeking leave to institute proceedings for spousal support or child support. She is not, but if she were then those applications could only be brought are under different sections of the Act to s.79 of the Act, and now the wife's leave application relates only to proceedings under s.79 of the Act. The major asset in dispute is the distribution of the proceeds of sale of the former matrimonial home at Suburb F. There is a property of the wife in Country B, which is subject to a loan, but certainly the total amount in trust in Australia is $980,000.
In terms of forum non conveniens, the first observation I would make is that there was no evidence provided by the husband in relation to the capacity of a court in Country B to deal with a property settlement between two Australian citizens involving property which, at least the major part, is in Australia. There was simply no evidence in the husband's affidavit about that. The husband did provide evidence in his affidavit about the fact that the Court in Country B had determined the parenting dispute, but in my view, that is an entirely different proposition. The child of the parties is habitually resident in Country B, and therefore the Court in Country B was the most appropriate form to deal with the parenting aspect of the matter. There are no current parenting proceedings between the parties currently before any court, including before any court in Country B, and there is no evidence that there is any extant proceeding before any court in Country B.
In terms of the factual situation in the property matter, it is very different situation to the parenting matter. At the date of separation, the parties jointly owned a property at J Street, Suburb F, in the state of New South Wales, Australia. The Suburb F property was sold, and settlement of the sale occurred in about March 2023. Since March 2023 the net proceeds of sale of the Suburb F property in the sum of $980,000 have been held in a solicitor's trust account in Australia.
The applicant wife has chosen to initiate property proceedings in this Court. She has deposed that she has suffered financial detriment due to the settlement funds being retained. In particular, the wife deposes that the bulk of the parties' financial assets is the proceeds of sale of the house in Suburb F. She deposes that by having her potential share of the sale proceeds held in the trust account, she has been unable to do repairs to her home in Country B. She deposes that she currently has cracked pipes under the floor which has resulted in mould in the bathroom, and the spare bathroom downstairs is unusable. She says that the issues are worsening due to the delay in repairing them. She says that without finality to the property proceedings, she is losing the opportunity to properly establish herself in Country B, and she says that she wants to build a comfortable life there, and she plans to live there, but while her assets are held in Australia, she's unable to progress her plans.
The wife has a pension in Country B which she says she has been accruing since 2019. She says it won't be enough for retirement purposes. She is not clear whether she will stay in Country B in retirement, as she is yet to establish herself and plan for her future, and she says that the financial uncertainty and the hindrance in relation to the funds being held in trust in Australia is adding to her pressures. She deposes that since 2020 she has paid for all the child's costs and that she has received no financial contribution or support from the father, even when he was working full-time. She says that she has funded four trips back to Australia so that the child could spend time with the husband and his extended family, and that those trips took place in December 2022, July 2023, December 2023, and she said that she had paid for flights back to Australia in July 2024. And I note that on 25 July 2024, the husband informed the Court that the wife was indeed present in Australia, and that the child spent four or five weeks in Australia with the husband in the July period.
The wife says that financial settlement would help alleviate the financial burden of the expenses that she incurs in paying for the child's costs, including his travel between Europe and Australia. The wife says that in late 2023 and early 2024, she has taken leave from work after, she says, she was diagnosed with post-traumatic stress disorder (“PTSD”). She says that the chronic stress of working as a professional in a full-time position and solo parenting and also managing the legal proceedings is taking its toll, and she says that if the Court grants leave for the matter to be heard out of time it will assist her by providing a pathway to finalise the property matters, and that the wife can move towards recovery and healing.
The wife says that she has taken time off work for treatment of PTSD, that she suffered financial loss and loss of workplace bonuses and incentives and possibly a loss of opportunity for promotion, and that those losses have spanned the 2023 and 2024 Country B financial years.
The wife’s untested evidence, and I cannot make any findings about this, is that she believes that through continued and sustained legal procedures and actions taken by the husband over the last four years, he is perpetrating coercive control through systems abuse against her. The wife says that when she was self-represented, the husband's legal team would regularly write to her claiming that she was an abusive parent who regularly endangered the life of the child. She says that her bank account was frozen, her childcare payments were obstructed, and she believes that the husband's current action in arguing out of time and jurisdiction are examples of him using the Court system to cause unnecessary delay, and particularly where the legal representatives for the husband stated that they would file proceedings in Australia and would not take issue with the out of time argument, and that the wife considers that this has caused unnecessary delay. As I have said, I cannot make findings about those matters, but that is the wife's evidence, including about why she has chosen to initiate these proceedings in Australia, and she says that she needs the proceedings to be resolved sooner rather than later so that she can move forward.
The husband says that he is concerned that, down the track, the wife may decide that she would rather have the property matter determined in Country B. As I noted in the recusal decision, the wife has sought to invoke the jurisdiction of this Court in Australia to deal with the parties' property dispute. It is the husband who objects to the jurisdiction, based on doctrine of forum non conveniens. The husband has asserted, and again I cannot make findings on contested factual matters in an interlocutory hearing where I have not had an opportunity, as a judge will have in a final hearing, to hear evidence on the contested factual issues, in so far as such issues are relevant. I can only recite the evidence of the parties and decide on the factual matrix, as best as I can determine it, and the law.
The husband has asserted that, in the parenting proceedings in 2022, the wife used European privacy laws to avoid disclosing documents which she was required to disclose, and he says that he fears that the wife will hide again behind European privacy laws. The husband conceded that his fear was hypothetical. He suggested that Country B would be better placed to make orders for full disclosure, although he did not articulate in his evidence why that might be the case, and he did not provide any evidence about how a court in Country B would be better placed to make orders for full disclosure than this Court.
This Court has very robust rules relating to disclosure. Chapter 6 of the Federal Circuit and Family Court of Australia (Family Law) Rules 2021 sets out very clearly the obligations of the parties in relation to disclosure in this Court. There is a general duty of disclosure, whereby each party to a proceeding has a duty to the Court and to each other party to give full and frank disclosure of all information relevant to the proceeding in a timely manner, and the duty of disclosure applies from the start of the proceeding and continues until the proceeding is finalised. There is a provision for undertakings by the parties, that is written notices, confirming that they have complied with their duty of disclosure. The duty of disclosure applies to each document that is, or has been, in the possession or under the control of the party disclosing relevant to an issue in the proceedings, and there are duties of disclosure in specific types of proceedings, as well as the duty of disclosure in a general sense. In the type of proceeding that the wife is seeking to initiate in this Court, Rule 6.06 of the Rules, which is a very extensive rule with many subparagraphs, sets out very clearly the duty of disclosure in a financial proceeding such as this, and there are other procedures and processes for disclosure, including production and inspection of documents, and the like. There is a very extensive disclosure regime in this Court. There was no evidence provided by the husband about what the disclosure regime is in a Country B court.
The penalties or the sanctions for failure to disclose are quite robust in this Court, and I make particular reference to the case of Weir & Weir[4] which is a 1993 Full Court decision, where it was held that it is the duty of a party who is involved in property proceedings in the Family Court to make full disclosure of his or her financial affairs, and that once it has been established there has been a deliberate non-disclosure by a party, then the Court should not be unduly cautious about making findings in favour of the innocent party. The Court may make an order going beyond the identified property resources if it is established that a party has not made full disclosure of his or her assets. There are very real consequences for deliberate non-disclosure in this jurisdiction in this Court, and the husband did not provide any information in this interlocutory application as to the disclosure provisions that are applicable in Country B.
[4] (1993) FLC 92-338
The husband relied upon a decision of the High Court in the Voth & Manildra Flour Mills Proprietary Limited[5] High Court decision, where the High Court said that it has long been regarded as the law that:
A party who has regularly invoked the jurisdiction of a competent court has prima facie right to insist upon its exercise and to have his claim heard and determined.
[5] [1990] HCA 55; (1990) 171 CLR 538
The use of the word "regularly" does not mean frequently, it is not a temporal reference, it is a reference to properly invoking the jurisdiction in accordance with the Act and the Rules of Court.
In my view, the facts of this case have a significant connection with this jurisdiction, namely:
(a)The marriage of the parties in Australia
(b)The property held in Australia. There is property in Country B, but that does not exclude the jurisdiction of this Court; and
(c)Two Australian citizens, one of whom is ordinarily resident in Australia.
Overall, I consider that the husband has not demonstrated in this application why it is that Country B, rather than Australia, is an appropriate forum in which to determine the wife's leave application and, if leave is granted, the property dispute. If Country B is the most appropriate jurisdiction, there is no explanation provided by the husband as to why he did not commence property proceedings in Country B himself. Like the wife, the husband seeks orders to alter the interests of the parties in property. He argued in his case outline document, although not in his response, that he considers that his entitlement to the proceeds of sale held in respect of Suburb F exceeds the entitlement of the wife. That is his argument if the proceedings are allowed to proceed.
What the Court is faced with, effectively, is two parties who are arguing that, rather than an equal division of the proceeds of sale of the Suburb F property, there is to be an alteration of what were the legal interests of the parties in that jointly owned property.
I accept the submission of the wife that there is no proper basis for me to refuse jurisdiction to allow her application for leave to proceed and, if leave is granted, to allow her property application to be determined in the Federal Circuit and Family Court of Australia. I also accept the wife's submission that there would be no proper basis upon which the Court would limit the evidence or the issues which the Court would take into account in accordance with the legislation, if it comes to the Court determining the substantive dispute between the parties in relation to the alteration of the interests.[6]
[6] The husband proposed an order that the Court would be limited as to what property could be taken into account: Refer Husband’s case outline page 2 section 6(a)
In the jurisdictional aspect of the case, I am comfortably satisfied that this Court is the most appropriate forum to determine the matter, and that this Court has jurisdiction to deal with the application brought by the wife for alteration of property interest pursuant to s.79 of the Act.
The leave application
Relevantly, for the purposes of this leave application, section 44(3) of the Act provides that property proceedings pursuant to s.79 of the Act shall not be instituted, except by leave of the Court or with the consent of both parties to the marriage, after the expiration of 12 months from the date upon which the divorce order took effect. Section 44(4) of the Act provides relevantly that the Court shall not grant leave under section 44(3) unless it is satisfied that hardship would be caused to a party to the relevant marriage or a child if leave were not granted.
The approach to be taken by the Court when dealing with an application for leave is well settled, and, indeed, both parties referred the Court to the decision of the Full Court in Whitford & Whitford[7] which provides guidance. That case considered the provisions of section 44(4) of the Act, and the Full Court observed in Whitford that two broad questions may arise to be determined: firstly, whether the Court is satisfied that hardship would be caused to the applicant or a child if leave were not granted, and if the Court is satisfied that hardship would be caused to the applicant or to a child if leave were not granted, then whether in the exercise of discretion the Court should grant or refuse leave.
[7] (1979) FLC 90-612
Whitford is authority for the proposition that the hardship referred to in section 44(4) of the Act is the consequences which flow from the loss of the right to institute proceedings, not the loss of the right per se.
In considering the meaning of the word "hardship" the Full Court in Whitford observed[8]:
In ordinary parlance, "hardship" means something more burdensome than any appreciable detriment. We consider that in subsection 44(4), the word should have its usual, though not necessarily its most stringent, connotations. It is impossible to lay down in advance what particular facts may or may not amount to hardship in the relevant sense. As a general proposition, it might be said that the inability of an applicant to pursue a claim which in the circumstances of the applicant or a child of the marriage is trifling generally will not cause hardship. Similarly, where the costs which the applicant will have to bear himself or herself are about as much or more than what the applicant is likely to be awarded on a property claim, ordinarily, hardship would not result if leave to institute proceedings were not granted.
But otherwise, we find no warrant in either subsection 44(3) or 44(4) for saying that the right or entitlement lost must be a substantial one. Hardship may be caused to an applicant if leave were not granted to institute proceedings, although the applicant is not in necessitous circumstances. Whatever the financial situation of an applicant may be, his or her loss of a prospective entitlement to property, including money, or his or her inability to have the financial and property relations of the parties adjusted or resolved may constitute hardship. If the Court is not satisfied that hardship would be caused to the applicant or a child if leave were not granted, then that is the end of the matter. If the Court is so satisfied, then the Court must exercise discretion whether to grant or refuse leave.
[8] Ibid at 78,145
On the question of the exercise of discretion, the Full Court in Whitford stated[9]:
The determination of how this discretion should be exercised must depend on the facts of the particular case. Due weight must be given to the expressed legislative intendment that ordinarily, proceedings should be commenced within a year from the date of the decree nisi and the general policy of the Act, which appears from section 44(3) and section 81, that financial relationships between the spouses should, wherever possible, be brought to finality within a reasonable time after the dissolution of marriage. Hence, such matters as the length of the delay, the reasons for the delay and prejudice occasioned to the respondent by reason of the delay, and the strength on the merits of the applicant's case, and the degree of hardship which would be suffered unless leave were granted are matters affecting the exercise of discretion.
These matters are not necessarily the only ones. On the other hand, section 44(3) and section 44(4) point to the conclusion that the legislature intended to confer power on the Court to grant leave to institute proceedings in order to avoid hardship. Having regard to the nature of jurisdiction with which this Court exercises, this power should be exercised liberally in order to avoid hardship, but, nevertheless, in a manner which would not render nugatory the requirement that proceedings should be instituted within a year from the decree nisi.
[9] Ibid at 78, 146
The outcome of this leave application will depend on the Court being satisfied that the applicant has demonstrated that she will suffer hardship if deprived of the chance to bring her property claim, which depends on whether she has a prima facie claim for relief which is not trifling and where the costs of pursuing her claim will not be equivalent to or exceed the amount which is likely to be awarded if her claim is successful, and the other discretionary factors such as length of and reason for delay and any prejudice to the respondent occasioned by such delay. The applicant's evidence is taken at its highest for the purposes of her application.
The parties' divorce became effective in early 2022. The wife's application for property proceedings could have been brought without the leave of the Court only if filed by no later than early 2023. The wife's initiating application was filed on 7 August 2023 and is therefore filed more than three months out of time.
The question of whether the applicant will suffer hardship depends on whether she has a prima facie claim for relief which is not trifling and where the costs of the applicant pursuing her claim will not be equivalent to or exceed the amount which is likely to be awarded if her claim is successful. Nye J in Jacenko & Jacenko[10] held that:
The general principle is that on the issue of the establishment of prima facie case, the Court proceeds on the basis that the evidence of the applicant, unless it is inherently unbelievable or contradictory, should be accepted, and the Court should, therefore, decide whether or not on that basis a prima facie case has been made out. If leave is granted, then it is for the Court conducting the ultimate hearing to determine whether that prima facie case can be established.
[10] (1986) FLC 91-766
In a recent decision in Skelton & Lindop[11]Austin J referred to several authorities which deal with an interlocutory application where an applicant is required to demonstrate a prima facie case. His Honour's observations include the following:
[11] [2022] FedCFamC1A 47
In Beecham Group Limited v Bristol Laboratories Proprietary Limited (1968) 118 CLR 618 at 622-623, the High Court of Australia said that, for the purposes of an interlocutory application in which it is necessary for an applicant to demonstrate a prima facie case:
“The first [inquiry] is whether the [applicant] has made out of time a prima facie case, in the sense that if the evidence remains as it is, there is a probability that at the trial of the action the [applicant] will be entitled to relief.
How strong the probability needs to be depends, no doubt, upon the nature of the rights the [applicant] asserts and the practical consequences likely to flow from the order the [applicant] seeks.”
The Full Court has previously affirmed that the principle binds the determination of interlocutory applications under s 44 of the Act (Edmunds & Edmunds at [19]-[20]).
In Australian Broadcasting Commission v O'Neill (2006) 227 CLR 57 (at [65] and [69]), the High Court of Australia said this to explicate the test established in Beecham:
“65. … By using the phrase "prima facie case", their Honours did not mean that the [applicant] must show that it is more probable than not that at trial the [applicant] will succeed; it is sufficient that the [applicant] show a sufficient likelihood of success to justify [the interlocutory relief].
…
69. ...it [is] not necessary for the [applicant] to show that it [is] more probable than not that the [applicant] will succeed at trial.”
In this case, putting aside the jurisdictional issue which the husband has raised, where I have found that this Court is the appropriate forum to determine the property dispute, both parties seek an adjustment of property interests. That is evident from the wife's amended initiating application filed 27 April 2024, and from the husband's case outline, in which he proposes that if there is to be an order for distribution, then he ought to receive $908,627 from the net proceeds of the J Street property, which would see the husband receive just over 92.5 per cent of net proceeds of sale, and the wife would receive $73,500. The wife seeks an alteration of property interests, and so does the husband.
The husband recited the contents of an email which he wrote and sent to the wife's solicitor on 31 January 2024, wherein he proposed an order for leave pursuant to section 44(3) of the Act as follows:
Under section 44(3) of the Act, the FCFCOA orders that it will hear the property matter between the parties out of time and will limit consideration to only factors relevant to the Act and within the jurisdictional scope, as ordered or stated above, between the date ranges of (a) the commencement of the parties' relationship; and (b) one year after their divorce was made by this Court [in early] 2022 -
It is uncontroversial that both parties contend that it is just and equitable to make an order altering the interests of the parties to their property. Section 79(2) of the Act is readily satisfied.
For the purposes of determining the interlocutory dispute under section 44(3) of the Act, the untested evidence of the wife is accepted unless it is inherently unreliable or improbable.
If the wife is granted leave to proceed with her application out of time, she seeks final property orders which would require the net proceeds of sale of the parties' jointly held property at Suburb F New South Wales, currently held in a solicitor's account, to be distributed as to 90 per cent to her and 10 per cent to the husband, and that otherwise the parties retain the property currently in their possession or under their control.
At the date of the hearing in the leave application, the husband had not filed a financial statement. He submitted that he had attempted to do so back in October 2023 and had been unsuccessful. Without a filed financial statement from the husband, it is not possible to come to a concluded view about the net pool of property that is available for distribution between the parties. On the wife's case, the net pool amounts to about $1.9 million, of which she currently controls about $556,751 net, which is equivalent to about 47 per cent of the pool. If the wife's claim is successful, then she will receive an additional amount of money which is certainly not trifling.
It is quite plain on the evidence that if the moneys are split equally, which neither party seeks, then the wife would receive about $490,000 given that there is $980,000 in the solicitor's trust account. Even if the wife was entitled to half that property, she would receive an amount that would not be trifling. If she is successful in her claim for 90 per cent of that amount of money, then that would not be a trifling. Additionally, if the wife was somewhat less successful on her claim and was entitled to even 30 per cent of the money that is held in the trust account, that amount is not trifling.
It is not the Court's task at this stage of the proceeding to undertake a detailed consideration of the s.79 issues. The task at this stage of the proceeding is to consider whether the wife has raised a prima facie case. The marriage endured for more than 12 years and produced one child. To date, there have been no prior final property orders or any enforceable agreement between the parties as to how their property is to be divided.
The orders that the wife seeks would see her retain property equivalent to just over about 75 per cent of the net pool, and the respondent just shy of 25 per cent of the pool. The wife submits that such a division is just and equitable because she contends that she made superior financial and non-financial contributions to the husband. She contends, and I am not making findings about these contentions, I am simply reciting what her evidence is, that the husband caused waste when he left the J Street property untenanted between 2020 and March 2023 when the property was sold, and the wife contends that her homemaker and parenting contributions are superior to those made by the husband, particularly because she has been solely responsible for the financial support of the parties' child, she says, since July 2020, as well as for the majority of the child’s day-to-day care in Country B.
As I mentioned in my recusal decision, there are mutual allegations of family violence, and it appears that each party claims that the other party is a perpetrator. It will not be possible to make any finding about that aspect of the parties' dispute until such time as the evidence is properly tested, most likely at a final hearing if a final hearing is necessary, and if such evidence is relevant to the Court's task of determining a just and equitable distribution of the property.
Having regard to the wife's prima facie case, I consider that she has made out a prima facie case for relief which is not trifling. Her evidence taken at its highest shows sufficient likelihood of her obtaining an order for property settlement, which while it might ultimately fall short of the outcome she seeks, will place her in a more favourable financial position than she is in currently, given that her present legal entitlement to the property and the dispute holding up the distribution of the proceeds of sale which are held in the solicitor's trust account.
The wife has filed a Notice as to Costs. Her actual fees up to and including the Court event on 25 July 2024 are $23,076. Her estimated future fees are $37,400. I consider that the applicant's costs will not equal or exceed the award she will receive if her prima facie case is ultimately accepted by a court. It follows that I am satisfied that the applicant wife would suffer hardship if denied the opportunity to prosecute her prima facie case due to the financial consequences that may flow from the denial of that opportunity, including that she will be left with a smaller amount of property than she currently has, and where she says on her untested evidence that she is not currently in a position to accumulate further wealth into the future which will be sufficient to meet her future needs.
The decision whether to grant leave still requires the exercise of discretion in the applicant's favour. The discretion which the Court has under s.44 of the Act is for the sole purpose of enabling the Court to do justice as between the parties. The Court is required to balance the matters to be considered in the exercise of the discretion to avoid hardship, but nevertheless in a manner which gives due weight to the legislative intention that proceedings for alteration of property interests ought to be brought within the period of 12 months after the divorce order becomes effective.
The length of delay is not in and of itself sufficient to deny a grant of leave. In this case, the length of the delay is around three months, which is not an unduly lengthy delay.
I accept that the applicant wife has given a reasonable account for her delay in filing her application. Only a matter of days before the limitation period expired in early 2023, the then legal representative for the husband Mr K of L Law Firm wrote, in early 2023 at 5.05 pm to the wife's legal representative and noted the following:
In circumstances where your client is located overseas and the law requires an issuing party to be located or present in Australia at the time of issuing, it is likely, and in order to circumvent any issues with time arising to file within 12 months of divorce pursuant to section 44 of the Family Law Act, that my client will need to take positive steps to file proceedings on or before […] 2023. As we discussed, regardless of the above, could you kindly immediately provide confirmation in writing that your client, by way of acquiescence, will not take issue with the issuing of proceedings out of time should my client's application, for whatever reason, run past the requisite 12 months time limit.
The wife's solicitor responded to that email from the husband's solicitor on the following day as follows:
In respect to point 1(a), I confirm [Ms Tripp] will not take issue with the issuing of proceedings outside of any limitation period.
On the previous day at 1.12 pm, prior to the email from Mr K, at 5.05 pm on the same date, Mr K for the husband, wrote as follows:
I just left a message with your reception. I am hoping that you can call me urgently today on (a number)…and specifically regarding point 2, parties agreeing expressly to not take issue with time running pursuant to section 44 of the Family Law Act, and where I note your client's recent offer indicated you would issue proceedings. I assume, by the last day to issue on […] 2023 pursuant to section 44, my client can issue by [that date], but given some of the urgent and concerning issues arising such as with non-disclosure and the handover of the file between our [Ms M], I would prefer an additional seven days to issue at our end, that is, unless you undertake your client will be issuing in time.
It is clear to me that the parties were both cognisant of the fact that the time limit for issuing the proceedings was fast approaching. There were clearly some negotiations going on between their respective solicitors and, to her detriment, the wife relied upon assertions made by the husband's former solicitors to the effect that they were instructed to file an application in the Federal Circuit and Family Court of Australia and that there was an agreement not to take issue with the application being filed out of time.
In terms of any prejudice to the respondent husband by reason of the wife's delay of over three months, the Court takes into consideration the observations of the Full Court in Sharp & Sharp[12]that:
Merely because the respondent to an application for leave does not point to particular prejudice that might arise if leave were granted, does not dispose of the question. The law presumes prejudice to flow to a person sought to be joined in litigation after the effluxion of the relevant time limits. Even if the Court came to the view that there was no significant prejudice to the respondent, the Court may consider whether in all of the circumstances of the case, it is just and reasonable to grant the extension sought.
[12] (2011) 50 Fam LR 567
There is no evidence before this Court of any actual prejudice to the respondent, in the sense that delay will negatively impact the preparation of his case, for example, by reason of the availability of witnesses or any difficulty valuing any item of property relevant to the dispute.
There is no evidence from the respondent that the applicant's delay has led him to act to his prejudice on the assumption that no claim by the applicant would be made. Clearly, there was an assumption that one or other of the parties would be filing an application in this Court in relation to their dispute about the property. I consider that the applicant's delay has not led the respondent to act, to his prejudice, on the assumption that there would be no claim by her, and I consider that any prejudice to the respondent is limited to the prospect that the applicant, if she is successful in her substantive application, might receive a greater amount of cash from the sale of the Suburb F property than the respondent.
When considering the relative prejudice to the applicant if she is denied the opportunity to prosecute her prima facie claim, a claim which may result in her being awarded a monetary sum which, in her current circumstances, may be significant, against any prejudice to the respondent, which the Court has identified is limited to the possibility that he may receive less than the wife from the proceeds of sale of the home, I am satisfied that the prejudice to the respondent when balanced against the prejudice to the applicant is not sufficient to deny the exercise of discretion in favour of the applicant.
In all of the circumstances of this case, I am satisfied that the Court's discretion ought to be exercised in favour of granting leave to the applicant to bring her application pursuant to s.79 of the Act.
I certify that the preceding seventy-seven (77) numbered paragraphs are a true copy of the Reasons for Judgment of Judge Carty. Dated: 29 October 2024
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