Vadisanis & Vadisanis

[2013] FamCAFC 90

FAMILY COURT OF AUSTRALIA

VADISANIS & VADISANIS [2013] FamCAFC 90

FAMILY LAW – APPLICATION IN AN APPEAL – Application by the appellant for the expedition of the substantive appeal – The circumstances justify the expedition of the appeal – Application granted.

FAMILY LAW – APPLICATION IN AN APPEAL – Application by the appellant to adduce further evidence – The further evidence will be allowed in the stay appeal only.

FAMILY LAW – APPLICATION FOR LEAVE TO APPEAL – Application by the appellant for leave to appeal against an order refusing to grant a stay – The order dismissing the application for a stay was an “interlocutory decree” – Leave required – Leave granted on the basis that there is merit in the appeal and a refusal to grant leave would cause a substantial injustice.

FAMILY LAW – APPEAL – Appeal against an order refusing to grant a stay – Where the appellant submits that the appeal would be rendered nugatory if the stay was not granted – The trial Judge erred in failing to accept that the wife had not abandoned her application to retain the home as part of her settlement – Appeal allowed.

FAMILY LAW – RE-EXERCISE OF DISCRETION – The appeal would be rendered nugatory if the stay was not granted – The appeal cannot be said to be without merit and the appeal is bona fide – The appeal was filed promptly – The expedition of the appeal will lessen any prejudice – Stay granted.

Family Law Act 1975 (Cth), ss 93A(2) 94AA
Family Law Regulations 1984, reg 15A
Family Law Rules 2004, r 22.09

Adam P Brown Male Fashions Pty Ltd v Philip Morris Inc. (1981) 148 CLR 170
Carr v Finance Corp of Australia Ltd (1981) 147 CLR 246
CDJ & VAJ (1998) 197 CLR 172
House v The King (1936) 55 CLR 499
Gronow v Gronow (1979) 144 CLR 513
Kowaliw & Kowaliw (1981) FLC 91-092
Malouf v Maloufand Ors (1999) 167 ALR 383
Norbis v Norbis (1986) 161 CLR 513
Rutherford and Rutherford (1991) FLC 92-255
Trahn & Long (No. 2) [2008] FamCAFC 194
Youssef & Youssef (unreported, Full Court of the Family Court of Australia,  10 October 1997)

APPELLANT: Ms I Vadisanis

FIRST RESPONDENT: Mr Vadisanis

SECOND RESPONDENT: Ms J Vadisanis

FILE NUMBER: SYC 6377 of 2008

APPEAL NUMBER:	EA	20	of	2013
EA	59	of	2013

DATE DELIVERED: 7 June 2013

PLACE DELIVERED: Sydney

PLACE HEARD: Sydney

JUDGMENT OF: Thackray, Ryan and Johnston JJ

HEARING DATE: 7 June 2013

LOWER COURT JURISDICTION: Family Court of Australia

LOWER COURT JUDGMENT DATE: 19 April 2013

LOWER COURT MNC: [2013] FamCA 290

REPRESENTATION

COUNSEL FOR THE APPELLANT: Mr Givney

SOLICITOR FOR THE APPELLANT: Campbell Paton & Taylor

COUNSEL FOR THE FIRST RESPONDENT: Mr Dlakic

SOLICITOR FOR THE FIRST RESPONDENT: Johnston Vaughan Solicitors and Attorneys

COUNSEL FOR THE SECOND RESPONDENT: Mr Farmakidis

SOLICITOR FOR THE SECOND RESPONDENT: JSM Lawyers

Orders

1. The appellant’s application to adduce further evidence in this appeal be allowed.

2. The appellant be given leave to appeal against paragraph 1 of the orders of the Honourable Justice Fowler made on 19 April 2013.

3. The appeal be allowed.

4. Paragraph 1 of the orders made by the Honourable Justice Fowler on 19 April 2013 be set aside. 

5. The operation of paragraphs 1 to 5 of the orders made by the Honourable Justice Fowler on 22 January 2013 be stayed until determination of the appellant’s appeal.

6. The first and second respondents have liberty to apply to discharge paragraph 5 of these orders in the event that the wife’s appeal is not prosecuted with expedition.

7. The appeal against the orders of the Honourable Justice Fowler made on 22 January 2013 be expedited.

8. The Court grants to the appellant a costs certificate pursuant to the provisions of s 9 of the Federal Proceedings (Costs) Act1981 (Cth) being a certificate that, in the opinion of the Court, it would be appropriate for the Attorney-General to authorise a payment under that Act to the appellant in respect of the costs incurred by her in relation to the appeal.

9. That the Court grants to the first respondent a costs certificate pursuant to the provisions of s 6 of the Federal Proceedings (Costs) Act1981 (Cth) being a certificate that, in the opinion of the Court, it would be appropriate for the Attorney-General to authorise a payment under that Act to the first respondent in respect of the costs incurred by him in relation to the appeal.

10. That the Court grants to the second respondent a costs certificate pursuant to the provisions of s 6 of the Federal Proceedings (Costs) Act1981 (Cth) being a certificate that, in the opinion of the Court, it would be appropriate for the Attorney-General to authorise a payment under that Act to the second respondent in respect of the costs incurred by her in relation to the appeal.

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

THE FULL COURT OF THE FAMILY COURT OF AUSTRALIA AT SYDNEY

Appeal Number: EA 20 of 2013 and EA 59 of 2013
File Number: SYC 6377 of 2008

Ms I Vadisanis

Appellant

And

Mr Vadisanis

First respondent

And

Ms J Vadisanis

Second respondent

REASONS FOR JUDGMENT

Introduction

1. Ms I Vadisanis (“the wife”) has appealed against an order made by Fowler J on 19 April 2013 dismissing her application for a stay of property settlement orders made on 22 January 2013.

2. The appeal is opposed by Mr Vadisanis (“the husband”) and the husband’s mother, Ms J Vadisanis (“the intervenor”).

3. The wife says that if the orders are not stayed her appeal will be rendered nugatory as one of the objectives of the appeal is to ensure she retains the former matrimonial home which pursuant to the orders must be sold.

Background

1. The background to the substantive property settlement proceedings is set out in the Reasons for Judgment delivered by Fowler J on 22 January 2013.

2. The husband and wife were married in 1997 and separated in September 2008. 

3. There are two children of the marriage, now aged 15 and nearly 14 years.  The children live with the wife in the former matrimonial home.  They spend little time with the husband.   

4. In 2001, the children were each given $30,000 by their paternal grandparents, which in turn was invested by the husband and wife in two properties in Town D which cost a total of $100,000.

5. In 2005, the husband and wife acquired the former matrimonial home which the wife now wishes to retain.  The parties borrowed to acquire the property.  Later they sold the two properties in Town D for a total of $161,750 and put the proceeds toward the mortgage on the former matrimonial home.    

6. The husband commenced proceedings for property settlement in October 2008.

7. In January 2009, the wife filed a response.  For present purposes, the most important of the orders she sought was one to allow her to retain the former matrimonial home.    

8. The husband’s mother, now aged 72, intervened in the proceedings in March 2010, claiming to be owed various sums of money by the husband and wife.  There appears to have been little dispute that funds were advanced by the intervenor and her late husband.  Rather, issues were raised by the wife about whether some advances were by way of gift and others statute barred.   

9. The matter proceeded to trial before Fowler J in February, July and November 2012. 

10. In his judgment delivered on 22 January 2013, Fowler J found that the parties owed the intervenor nearly $330,000, most of which comprised unpaid interest which had been allowed to accumulate without demand being made until after the husband and wife separated.   

11. After allowing for the debt to the intervenor, Fowler J found that the net asset pool available for distribution between the parties, inclusive of superannuation, was worth $425,633.  This figure took into account a liability of $60,000 to the children representing the $60,000 given to them 12 years previously.   

12. His Honour concluded that the contributions to the assets should be assessed at 58% by the husband and 42% by the wife. He determined, however, that there should be an adjustment of 15% in favour of the wife on account of the factors in s 75(2) of the Family Law Act1975 (Cth) (“the Act”). The net effect was that the wife was to receive 57% of the net assets and the husband was to receive 43%.

13. Amongst the orders made to give effect to his Honour’s reasons was Order 2, which required the sale of the former matrimonial home by public auction within six weeks.  In his reasons, Fowler J did not explain why the wife was not offered the opportunity to retain the home as she had sought.  It would be fair to presume his Honour considered she could not afford to do so.  

14. The orders made by Fowler J included a requirement for $60,000 from the proceeds of sale of the former matrimonial home to be paid to the wife to be held on trust for the children until they both turned 18.  The order made provision for the wife to apply the funds to the purchase of a home in which she and the children would reside. 

15. The former matrimonial home is now unencumbered.  His Honour calculated that after the intervenor had been paid, and after the wife had received the $60,000 to be held on trust, the wife would receive $6,043 from the proceeds of sale and the husband would receive $4,559. These figures assumed the property would sell for its agreed value and did not take account of the costs of sale.

16. His Honour calculated that the wife would receive the following assets:

Assets	($)
57 per centum of the balance of net proceeds of  sale of the [former matrimonial home], after deduction of the parties’ joint liabilities to the intervener and to the children	E 6,043.35
Funds held in controlled monies account payable to the wife	E 162,184.68
Shares	6,018.00
Household contents	3,000.00
Mercedes motor vehicle	10,000.00
Add back: interim distribution pursuant to orders of 5 February 2009	10,000.00
Add back: interim distribution pursuant to orders of 6 June 2011	15,000.00
Superannuation: AMP (accumulation interest)	5,105.00
Superannuation: Care Superannuation (accumulation interest)	3,525.00
Superannuation: First State (accumulation interest)	17,400.00
Superannuation: Scottish Life (UK)	4,335.00
Net assets (including superannuation)	$242,611.03

1. It should be observed that these figures did not take into account the substantial liabilities of the wife, which she estimated totalled $245,351, including unpaid legal fees of $149,563 and a debt to her parents of $46,000. 

2. His Honour calculated that the husband would receive the following assets:

Assets	($)
43 per centum of the balance of net proceeds of sale of the [former matrimonial home] property, after deduction of the parties’ joint liabilities to the intervener and to the children	E 4,559.02
Funds held in controlled monies account payable to the husband	E 69,463.33
Jaguar motor vehicle	25,000.00
Household contents	10,000.00
Diamond ring	1,000.00
Add back: interim distribution pursuant to Orders of 6 June 2011	25,000.00
Add back: unaccounted for funds withdrawn by the husband post separation	17,000.00
Superannuation: Host Plus (accumulation interest)	31,000.00
Net assets (including superannuation)	$183,022.35

1. The wife promptly filed a Notice of Appeal against the property settlement orders.  Her Amended Notice of Appeal, filed 6 March 2013, stated that she was appealing against Orders 1 to 5 of Fowler J’s orders.  This, of course, included Order 2, which had directed the sale of the former matrimonial home. 

2. The Amended Notice of Appeal set out the orders sought in the event that the appeal was allowed.  In summary, the orders were as follows:

   ·The dismissal of the intervenor’s claim and consequential orders, including the setting aside of Order 2 for the sale of the former matrimonial home (Proposed Orders 2 to 6);

   ·An order in much the same terms as the order made by Fowler J permitting the wife to use the $60,000 held on trust for the children to purchase a property in which the children would reside with the wife (Proposed Orders 7 and 8);

   ·If the appeal against the order in favour of the intervenor is wholly unsuccessful “Orders that the asset pool be divided as to 85 percent to the Appellant and 15 percent to the Respondent”;

   ·If the appeal against the order in favour of the intervenor is wholly successful, “Orders that the asset pool be divided as to 60 percent to the Appellant and 40 percent to the Respondent” (Proposed Orders 9 and 10).

The reasons of Fowler J

1. His Honour commenced his discussion of the wife’s stay application by observing there were three matters he was required to consider, namely whether the appeal had been brought in a timely fashion, whether it was brought bona fide and whether or not “the wife’s appeal is likely to succeed”.

2. His Honour noted that there was no dispute that the appeal had been brought in a timely fashion and that the appeal was brought bona fide. 

3. In dealing with the merits of the appeal, his Honour set out the arguments of the husband which concluded with the submission that “on the whole, the Grounds of Appeal do not demonstrate appealable error on their face”. 

4. His Honour then noted the wife’s submission that she had a “strong possibility of success in diminishing the amount payable by the husband and the wife to the intervenor by at least $232,000”.

5. His Honour then briefly discussed the basis of the wife’s case about the intervenor’s claim, noting it was her assertion that the debt, if owed at all, was statute barred.  His Honour recorded that he had dealt with this contention in his primary judgment and, relying upon a decision in Victoria, had found that the limitation period argument was not valid.  However, his Honour said, “the Court cannot, having regard to the fact that the judgment whose reasoning was adopted is a District Court [sic] judgment, say that the appeal has no chance of success”.

6. His Honour did not further discuss the merits of the appeal, which we note was not restricted to assertions of error in relation to the intervenor’s claim.

7. His Honour went on, however, to observe that in the event that the wife’s appeal in relation to the funds advanced by the intervenor was successful:

   11.… it would be necessary as a matter of justice to allocate to the husband an additional amount of contribution to the acquisition of assets, with a consequential effect, one would imagine, on the result based on contributions finally arrived at as between the husband and wife.

8. His Honour then considered whether the appeal would be rendered nugatory if the stay was not granted.  In dealing with that issue his Honour said:

   12.It is clear that a party to litigation is entitled to receive the fruits of the litigation and it seems to the Court that it is obliged to take into account, in addition to the issue of rendering an appeal nugatory, the comparative issues of hardship and prejudice, and whether those issues can be addressed in the event of a grant or refusal of a stay.

9. Importantly, his Honour next turned to consider the wife’s argument about the necessity for a stay so she could retain the former matrimonial home.   

10. In dealing with this aspect of the matter, his Honour said:

    14.Notwithstanding the assertion by the Counsel for the wife, the wife’s Amended Notice of Appeal does not seek any order as to the acquisition of the [former matrimonial home]. It seeks a variation in the amount payable to the wife to the intervenor, but otherwise does not challenge the sale of the property. This was drawn to [the attention of counsel for the wife] and he argued it was not necessary to contain such a claim in the Notice of Appeal.

    15.It is the Court’s view that, to answer the question of whether the failure to grant a stay would render an appeal nugatory, it has to consider what the Full Court is being asked to do in the appeal.

    16.In this case, there has been a Notice of Appeal and an Amended Notice of Appeal filed by the wife, neither of which prays for a transfer of the property. In the circumstances, the Court cannot find on the basis of the documents that a failure to grant a stay would render the appeal nugatory.

11. Fowler J then went on to consider the “balance of the hardship likely to be suffered by the various parties”.  The first matter to which his Honour referred was the fact that “the wife will have to find alternate accommodation to her present accommodation but, having regard to the Amended Notice of Appeal, she would have to do so in the event that the appeal succeeded”.

12. His Honour also observed that the wife, in any event, would have an entitlement to funds, the extent of which would not be known until the sale of the former matrimonial home.  His Honour commented that “there will be obligations no doubt borne by her in relation to some costs of the proceedings”.

13. His Honour next observed that the intervenor would be disadvantaged “by the absence of her entitlement under the judgment”.  His Honour said that although the intervenor would receive, in due course, interest “at a significant rate”, appearing to be in excess of $22,000 per annum, “the intervenor has made it clear … that she wishes a return of capital to her not a continuation of the payment of interest”.  His Honour also commented that both husband and wife would suffer hardship in having to pay a high rate of interest to the intervenor. 

14. His Honour then returned to the question of the wife and the children being required to leave their home, but once again commented, “that would be a consequence of the wife’s orders sought on appeal in any event”.

15. His Honour also observed that even if the wife was given the opportunity of purchasing the former matrimonial home:

    on the evidence before the Court it seems highly unlikely that she could raise the necessary money to do so.  Certainly on her application for a stay, the wife produced no evidence of her ability to acquire a loan of an amount which would enable her to do so.

16. His Honour also noted that the wife faced outstanding applications for costs. 

17. His Honour next referred to the possibility of a delay as long as two years in determination of the appeal.  In this context, he noted the wife’s statement that she intended to file an application for expedition of the appeal, but observed such an application had not yet been filed. 

18. His Honour commented in relation to this prospect of delay as follows:

    20.If such a lengthy delay as is suggested were to occur and in the event that the appeal was unsuccessful, the delay would result in the accrual of significant costs by way of interest and make perhaps less money available to the wife, the husband and the children.

    21.The Court should consider the protection of the property and its value for the benefit of the parties as an element in considering a stay of proceedings. This is a matter in which the property available to the parties is not great. It seems to the Court that the grant of a stay would likely cause further erosion in the value of the property that was available to the parties.

19. Taking all of the matters discussed into account, his Honour determined that the application for a stay should be dismissed.  The order for dismissal of the stay application is Order 1 of the orders made on 19 April 2013.  The other order made that day is not relevant here.

Application for expedition

1. After the hearing of the stay application, the wife made application for expedition of her substantive appeal against the property settlement orders.  That application was listed before us at the same time as the hearing of her appeal against the order refusing the stay.

1. The husband and the intervenor neither consented to, nor opposed, the application for expedition.

2. In our view, the wife has made out a case for expedition.  We arrive at this view for these reasons:

   ·The litigation has been ongoing since October 2008 and has cost the parties a great deal in legal costs;

   ·The husband does not deny the wife’s contention that the entire litigation was stalled as a result of his delay in prosecuting an earlier appeal in this Court;

   ·The orders as they presently stand require the sale of the home in which the wife and children are residing and the wife seeks to challenge that order on the appeal;

   ·If a stay is granted, the home will not have to be sold but the intervenor will be denied the opportunity to recover substantial funds which have been found to be owing to her;

   ·The Appeals Registrar has advised that there is a prospect the substantive appeal can be accommodated in either the July or August 2013 sittings in Sydney;

   ·The wife’s counsel advised that the Appeal Books can be filed within 14 days if required; and

   ·The application for expedition is not opposed. 

3. We have therefore determined the appeal will be expedited. 

4. This decision places an entirely different complexion on the matter since the delay in resolution of the appeal will now be significantly less than was suggested in argument before Fowler J. 

Application to adduce further evidence

1. The wife applied to adduce further evidence on the hearing of the appeal in the form of an affidavit sworn by her on 23 May 2013.  The application to adduce the further evidence was opposed.

2. The affidavit was primarily relied upon to establish that the wife has:

   ·received pre-approval from a bank to allow her to obtain $300,000 to assist her to retain the former matrimonial home;  and

   ·made an arrangement with her legal advisors for the payment of their fees, which will not necessitate the sale of the former matrimonial home.

3. The affidavit also contained a brief history of the earlier appeal in order to show the husband had been dilatory in his conduct of that appeal and has not paid a number of outstanding costs order in relation to that appeal.

4. The principles relating to the introduction of further evidence in an appeal to this Court were discussed by the High Court in CDJ & VAJ (1998) 197 CLR 172. The High Court there considered the operation of s 93A(2) of the Act which relevantly provides:

   … in an appeal the Family Court shall have regard to the evidence given in the proceedings out of which the appeal arose and has power to draw inferences of fact and, in its discretion, to receive further evidence upon questions of fact, which evidence may be given [inter alia by affidavit]…

5. In the course of their majority judgment, McHugh, Gummow and Callinan JJ, said:

   [109]One consideration in construing s 93A(2) is its remedial nature. Its principal purpose is to give to the Full Court a discretionary power to admit further evidence where that evidence, if accepted, would demonstrate that the order under appeal is erroneous. The power exists to facilitate the avoidance of errors which cannot be otherwise remedied by the application of the conventional appellate procedures…

6. Their Honours went on to say (footnotes omitted):

   [110] Another consideration is the effect of the principle that a provision conferring judicial power upon a court should be construed liberally and without the making of implications or the imposition of limitations not found in the words used by the legislature. That is so whether the limitation derives from the common law principles governing the grant of new trials upon proof of fresh evidence or from some other source.

7. Later their Honours said:

   [114]No doubt the Full Court will readily admit further evidence which is not in dispute and which the Court is able to evaluate and take into account in considering the appeal without the necessity to have the proceedings re-heard. Further evidence of this kind is particularly likely to be admitted where the evidence relates to events occurring after trial. In the case of undisputed evidence which the Full Court can evaluate as part of the evidence in the appeal, the discretion to admit the evidence may even be properly exercised without the Full Court considering what effect it would have had on the trial judge’s decision. In that context, the likely effect of the further evidence on the Full Court’s view of the evidence before the trial judge is the important consideration. Where there is no need for a new trial or extensive taking of evidence, other discretionary factors such as the availability of the evidence at the trial and the need for finality of litigation are likely to be more relevant in the exercise of the discretion than the effect that the evidence would have had at the trial.

8. Counsel for the intervenor argued that there was no adequate explanation for the failure to adduce the evidence now sought to be relied upon at the time of the hearing before Fowler J.  He further drew attention to the fact that the finance approval was only “preliminary” and that the evidence relating to the arrangement between the wife and her solicitors about their fees was vague.

9. In response, counsel for the wife noted that the wife had not been cross-examined at trial about her financial capacity to retain the former matrimonial home and said, in effect, that it was only at the hearing before Fowler J of the wife’s application for a stay that it became apparent that her capacity was challenged.  He also submitted that counsel at the hearing before Fowler J would not have known of the arrangement between the wife and her solicitors relating to her fees.

10. Although it is true that the letter from the bank relating to the wife’s finance application indicates it is only an “in principle” approval, in the circumstances it would not be realistic to expect more until the wife is in a position to make a formal application.  Furthermore, although we accept that the evidence relating to the arrangement between the wife and her solicitors is somewhat vague, the wife’s solicitor drafted the affidavit in which the arrangement was mentioned and was present at the hearing of the appeal.  There is, accordingly, no reason to doubt that an arrangement has been made as described by the wife. 

11. The evidence relating to the availability of finance and the arrangement relating to the wife’s unpaid legal costs would demonstrate that the decision under appeal is erroneous, as it is based on an assumption the wife would not be able to acquire the former matrimonial home.  Furthermore, we are satisfied with at least part of the explanation advanced for the evidence not having been given previously.  We therefore propose to allow the affidavit to be relied upon. 

12. We should record that we have accepted this evidence for the purposes of this appeal only.  It will be necessary for the application for introduction of further evidence to be renewed in the event the evidence is sought to be relied upon for the purposes of the substantive property settlement appeal.

Does the wife need leave to appeal the order dismissing the stay?

1. The Notice of Appeal against the order refusing the stay did not contain an application for leave to appeal, but it was submitted by the intervenor that leave to appeal was required. 

2. Counsel for the wife was unprepared for this argument, but made an oral application for leave to appeal in the event leave was needed.  The intervenor did not make any submissions in support of the proposition that leave to appeal was required. 

3. Consideration of s 94AA(1) of the Act and Regulation 15A of the Family Law Regulations 1984 indicates that leave to appeal is required if the order is properly characterised as an “interlocutory decree”, since the proceedings are not “in relation to a child welfare matter”.

4. As presently advised, we consider that the order dismissing the application for a stay was an “interlocutory decree” since the dismissal of the application for a stay would not prevent a further application being made prior to the hearing of the appeal: Carr v Finance Corp of Australia Ltd (1981) 147 CLR 246 and see the summary of the law relating to the meaning of “interlocutory” in Malouf v Maloufand Ors (1999) 167 ALR 383.

5. We note that in Youssef & Youssef (unreported, Full Court of Family Court of Australia,10 October 1997, in NA 39 of 1997) Lindenmayer J (with whom Finn and Mushin JJ agreed) said that an order refusing a stay is “clearly” an interlocutory order.

6. We therefore proceed on the basis that leave to appeal is required and that the wife must therefore demonstrate that there has been an error of principle and/or a substantial injustice to one of the parties:  Adam P Brown Male Fashions Pty Ltd v Philip Morris Inc. (1981) 148 CLR 170 at 176. Rutherford and Rutherford (1991) FLC 92-255 at 78,715.

7. The application for leave to appeal was argued together with the appeal itself.  Counsel for the wife submitted that there would be a substantial injustice in the event that the former matrimonial home was sold as a result of an error made by his Honour in dealing with the stay application. Given the view we have formed in relation to the merits of the stay appeal, we accept that a refusal to grant leave would visit a substantial injustice on the wife and therefore propose to grant leave to appeal.

The Grounds of Appeal

1. The wife relied upon four grounds of appeal namely:

   1.        In failing to grant the stay His Honour failed to properly consider:-

   1.1      The appeal if successful would be made nugatory.

   1.2 The need of the Appellant to properly house the two children of the marriage pending the appeal and afterwards.

   1.3 The Respondents to the appeal if successful are protected from loss by the imposition of interest on outstanding monies due pursuant to the judgment.

   2. His Honour failed to properly consider that the wife sought a specific order to retain the former matrimonial home at the Trail [sic].

   3. His Honour was in error in finding that because the wife had not sought a specific order as to retaining the former matrimonial home in the Notice of Appeal a presumption arose that she was not seeking such an order.

   4.        His Honour failed to properly consider the merits of the appeal.

Applicable principles

1. The appeal is against a discretionary order.  The principles governing such appeals are well established; see House v The King (1936) 55 CLR 499, Gronow v Gronow (1979) 144 CLR 513, Norbis v Norbis (1986) 161 CLR 513 and CDJ v VAJ (supra).

2. The principles to be applied in applications for a stay of orders pending an appeal are also well established; see the authorities mentioned in Trahn & Long (No. 2) [2008] FamCAFC 194 at [38].

3. The cases emphasise that such applications are discretionary in nature; however, they also point to a number of principles to be applied and matters to be taken into account when determining a particular application. 

4. These include:

   ·the mere filing of an appeal is an insufficient basis for granting a stay;

   ·the applicant has the onus of establishing a proper basis for the stay;

   ·it is not necessary to show “special” or “exceptional” circumstances;

   ·a litigant is prima facie entitled to the benefit of their judgment;

   ·the applicant’s bona fides;

   ·whether there has been delay in applying for the stay;

   ·the time that will elapse before the appeal can be heard;

   ·a weighing of the risk that an appeal may be rendered nugatory if a stay is not granted – this will be a substantial factor;

   ·some preliminary assessment of the strength of the proposed appeal – whether the appellant has an arguable case; and

   ·a stay may be granted on terms – this may involve weighing the balance of convenience and the competing rights of the parties.

Grounds 1 to 3 – The wife’s claim to retain the former matrimonial home

1. These three grounds need to be considered together as they contain a common theme relating to the way in which Fowler J dealt with the wife’s assertion that the appeal would be rendered nugatory if the home in which she and the children are living is sold prior to determination of the appeal.

2. Consideration of these grounds requires close attention to the relief sought at trial, the orders made by the trial Judge and the relief sought in the Amended Notice of Appeal filed 6 March 2013.   

3. We have noted already that the wife’s case at trial was that she should receive the former matrimonial home as part of her settlement.  Her order seeking this was recited at paragraph 72 of his Honour’s reasons. 

4. There was no discussion in his Honour’s reasons of the capacity or otherwise of the wife to retain the property, whilst at the same time ensuring the intervenor received the funds to which his Honour found she was entitled.  (The husband’s interest in the property was of very little moment, given that his settlement was to come almost entirely from other sources). 

5. It may be, as we have already suggested, that his Honour simply assumed the wife could not afford to meet all of her commitments without selling the property.  She was, however, in regular employment, and had previously been lent funds by her family.  In the previous year, she had earned $71,120 gross and had reportable fringe benefits of $16,998.  Although the husband had only paid nominal child support, his Honour anticipated that he would be reassessed having very recently gained full time employment. 

6. We note also that his Honour’s orders contemplated the wife being able to acquire property, because he gave her liberty to use the $60,000 held on trust for the children to purchase a home for herself and the children.  There was therefore nothing to prevent the wife from leaving the children’s funds invested in the former matrimonial home; save for the fact an order was made for its sale.

7. We note, however, that the wife’s Amended Notice of Appeal does not assert that the trial Judge erred in failing to allow her the opportunity to acquire the husband’s interest in the former matrimonial home.  This might be seen as tacit acceptance of the fact that the trial Judge was right in assuming that the wife could not borrow sufficient funds to pay out the intervenor’s entitlement, while at the same time making arrangements to meet her commitments. 

8. Importantly, however, the wife’s appeal strongly challenges his Honour’s treatment of the intervenor’s claim.  If the wife is even partly successful, her prospects of being able to keep the home will increase.

9. This then brings us to the way in which the wife’s Amended Notice of Appeal was framed.  Although no reference was made to this fact during the argument before his Honour, Part D of the Amended Notice of Appeal expressly states that the wife is appealing Order 2 of his Honour’s orders which directed the sale of the property.  This is reinforced by the fact that amongst the orders sought at Part F of the Notice of Appeal is an order setting aside Order 2. 

10. We accept that the orders proposed at Part F of the Amended Notice of Appeal do not seek an order in the same specific terms as that sought at trial for the wife to retain the home, but they do contain the following claims:

    9.In the event the appeal is wholly unsuccessful as to the sums ordered by the trial Judge to the Intervener the Appellant seeks Orders that the asset pool be divided as to 85 percent to the Appellant and 15 percent to the Respondent.

    10. In the event the Appellant is wholly successful as to the sums ordered payable to the Intervener the Appellant seeks Orders that the asset pool be divided as to 60 percent to the Appellant and 40 percent to the Respondent.

11. It goes without saying that a court could not make orders in those terms, given they provide no direction as to which party is to receive the different assets referred to in his Honour’s reasons.  Although the practice of framing orders in this fashion is not to be encouraged, the orders as drafted should be seen as a shorthand expression of the result the wife hoped to achieve in the appeal. 

12. Importantly, counsel for the wife made very clear in oral argument on the stay application that the wife was seeking the home as part of her settlement, as she had done at trial.  Counsel for the wife submitted to his Honour that it was not necessary for the wife to amend the Notice of Appeal to specifically seek such an order, but said that could be attended to if it was deemed necessary.  (Transcript 10 April 2013, p 13, 16 and 17). 

13. In this regard, we note that r 22.09 of the Family Law Rules 2004 permits amendment of the orders sought in the Notice of Appeal at any time up to and including the date fixed for the filing of the appellant’s summary of argument. The wife has, since the hearing before Fowler J, formally amended her Notice of Appeal to make clear the relief she is seeking.

14. While we accept the Amended Notice of Appeal filed 6 March 2013 could have been drafted with greater precision, we are of the view that his Honour erred in giving judgment on the stay application on the basis that the wife would not be seeking the home as part of her settlement in the event her appeal succeeded. 

15. His Honour’s approach, with respect, did not take sufficient account of:

    ·the history of the litigation in which the wife had maintained a request for the home as part of her settlement;

    ·the fact that the wife and children had lived in the home for many years and it would not be expected that she would abandon her claim to keep the property in the absence of clear evidence to the contrary;

    ·the content of Parts D and F of the Amended Notice of Appeal; and

    ·counsel’s advice that the wife wanted to keep the home and would, if required, file a further Amended Notice of Appeal to make this clear. 

16. It follows that his Honour’s discretion miscarried when he came to consider the important issue of whether a successful appeal would be rendered nugatory if the stay were not granted.

17. Our decision on this point makes it unnecessary to consider any further the first three grounds or Ground 4. 

Re-exercise of the discretion

1. We now turn to consider the matters relevant to the re-exercise of his Honour’s discretion.

2. The most important is that a successful appeal would be rendered nugatory in the event the home was sold prior to the determination of the appeal. 

3. We do not consider it necessary to enter into the mathematical exercises engaged in by counsel to determine whether the wife’s proposal is affordable.  This is dependent on many variables but, on at least some scenarios, the wife could retain the property, especially now she has made the arrangement mentioned with her solicitors for payment of their fees.

4. Given that the wife and children have lived in the home for many years, it is desirable they be given at least the chance of continuing to do so.  It is worth observing in this context that $60,000 of the children’s money (which has had no increment in its value in 12 years) remains invested in the property.

5. His Honour has properly acknowledged that it cannot be said the appeal has no chance of success.  His Honour was there discussing the issue relating to the intervenor, which involves quite difficult issues of law and fact.  We note that his Honour expressed no view about the prospects of success of other grounds of appeal, including Grounds 20, 21 and 22 which challenge:

   ·findings about credit (in light of other findings about honesty which caused his Honour to draw some aspects of the conduct of the intervenor to the attention of the authorities);

   ·the treatment of post-separation contributions; and

   ·the s 75(2) adjustment, including a claimed failure to rule on a $100,000 waste argument advanced by the wife (see Kowaliw & Kowaliw (1981) FLC 91-092).

1. These grounds of appeal also cannot be said to be demonstrably without merit.

2. The wife’s bona fides have not been doubted.

3. The appeal was filed promptly. 

4. The application for a stay was made promptly. 

5. The appeal has been expedited and any prejudice to the husband and the intervenor will therefore not be as great as originally feared.

6. In considering the prejudice to the intervenor, it is significant to observe that she has never formally demanded payment of the monies now found to be owing until after the husband and wife separated.  Indeed, she did not even seek payment of the interest now found to have been accumulating. 

7. We consider it is also proper to have some regard to the fact that the husband was given repeated indulgences during the earlier appeal that was finally abandoned.  It is not in dispute that his delay in that appeal resulted in delay in resolution of the property proceedings and a significant accumulation of interest on the debt now found to be owing to his mother. 

Orders and costs

1. For these reasons, we propose to make the orders set out at the commencement of our judgment.

2. We heard submissions in relation to costs when hearing the submissions in relation to the substantive issue.  Counsel agreed that it would be appropriate, in the event that the appeal was allowed, that all parties be granted a costs certificate.  The appeal has been allowed on the basis of an error of law and we consider it appropriate for costs certificates to be granted. 

I certify that the preceding one hundred and two (102) paragraphs are a true copy of the reasons for judgment of the Honourable Full Court delivered on 7 June 2013.

Associate: 

Date:  7 June 2013