Valder & Saklani (No 2)
[2022] FedCFamC1F 546
Federal Circuit and Family Court of Australia
(DIVISION 1)
Valder & Saklani (No 2) [2022] FedCFamC1F 546
File number(s): CAC 2098 of 2016 Judgment of: ALTOBELLI J Date of judgment: 4 July 2022 Catchwords: FAMILY LAW – PROCEDURAL – Application to set aside joinder order – Where joined parties are found to have an interest in real property subject of a s106B application in the substantive proceedings – Finding that there would be an unfairness to the party who sought their joinder if the joinder were set aside – Finding that any unfairness to the joined parties could be rectified by way of the making of a costs order – Application dismissed. Legislation: Family Law Act 1975 (Cth) s 106B
Federal Circuit and Family Court of Australia (Family Law) Rules 2021
Division: Division 1 First Instance Number of paragraphs: 14 Date of hearing: 4 July 2022 Place: Sydney Counsel for the Applicant: Mr Horobin (direct brief) Solicitor for the First Respondent: Ms Donnelly, Holmes Donnelly & Co Solicitors Counsel for the Second Respondent: Litigant in person Counsel for the Third and Fourth Respondents: Ms Lawson Solicitor for the Third and Fourth Respondents: Blanchfield Nicholls ORDERS
CAC 2098 of 2016 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)
BETWEEN: MS VALDER
Applicant
AND: MS SAKLANI
First Respondent
MR B SAKLANI
Second Respondent
MR C SAKLANI
Third Respondent
MS D SAKLANI
Fourth Respondent
order made by:
ALTOBELLI J
DATE OF ORDER:
4 JULY 2022
THE COURT ORDERS THAT:
1.The Application in a Proceeding filed 4 July 2022 is dismissed.
2.The matter is adjourned to 12 December 2022 at 10am for final hearing, with an estimated hearing time of five days.
3.By no later than 4pm on 7 October 2022, the Applicant is to file and serve any amended Application on which they seek to rely.
4.By no later than 4pm on 28 October 2022, the First, Second, Third and Fourth Respondents are to file and serve any amended Response on which they seek to rely.
5.By no later than 4pm on 4 November 2022, the Applicant is to file and serve one consolidated affidavit in support of the orders sought by them, together with any other witnesses’ affidavits.
6.By no later than 4pm on 25 November 2022, the First, Second, Third and Fourth Respondents are to file and serve one consolidated affidavit in support of the orders sought by them, together with any other witnesses’ affidavits.
7.By no later than 4pm on 9 December 2022, each party is to file and serve exhibits to affidavits and electronic tender bundles of all documents that might be tendered or relied upon in cross-examination.
8.In respect to exhibits to affidavits and tender bundles, only documents which are successfully tendered during the hearing shall be in evidence.
9.By no later than 4pm on 6 December 2022, the parties are to have served objections to evidence on each other.
10.By no later than 4pm on 8 December 2022, the parties shall have conferred, settled and forwarded to the Associate to the Honourable Justice Christie a document in electronic form setting out:
(a)Those parts of the evidence which shall not be read; and
(b)Those parts of the evidence to which an objection is maintained and the reason for that objection.
11.By no later than 4pm on 9 December 2022 the parties shall have conferred, settled and forwarded to the Associate of the Honourable Justice Christie in electronic form a joint trial plan which allows for the trial to completed within five days.
12.By no later than 4pm on 2 December 2022, each party is to file and serve a Case Outline document, setting out:
(a)a list of documents to be read in their case;
(b)a precise Minute of Orders Sought; and
(c)a brief summary of argument touching upon the relevant matters set out in the Family Law Act 1975, with reference to the evidence relied upon, and any other considerations relevant to the decision.
13.Liberty is granted to all parties on short notice to contact the Associate of the Honourable Justice Christie should any party wish to have the matter relisted to deal with any matter which might jeopardise the hearing dates, provided that in the event that such liberty is exercised, the party seeking to relist the proceedings shall:
(a)Forthwith notify all other parties of the intention to make the request and the reason for same;
(b)Make the request for relisting in accordance with the Federal Circuit and Family Court of Australia protocol as to communication with chambers; and
(c)Contemporaneous with any notice of relisting serve upon all other parties a minute of orders to be sought together, in the case of the parties, with such evidence as is relied upon by the party in seeking such orders.
14.No further subpoenas be issued by either party without leave of the Court. Subject to any objection being raised by any person to whom a subpoena has been issued, photocopy access be granted to the parties’ legal representatives for the purposes of providing exhibits to Affidavits and provisional tender bundles.
15.By no later than 4pm on 9 December 2022, each party is to file a notification as to costs pursuant to rule 12.06 of the Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (including complying with rule 12.06(2)).
THE COURT NOTES:
A.The parties need not file Financial Statements or a Balance Sheet.
B.The Third and Fourth Respondents have indicated to the Court through counsel that they may elect not to participate in these proceedings.
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).
Section 121 of the Family Law Act 1975 (Cth) makes it an offence, except in very limited circumstances, to publish 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 Valder & Saklani has been approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
EX TEMPORE REASONS FOR JUDGMENT
(Revised from Transcript)ALTOBELLI J:
BACKGROUND
On 24 May 2022 orders were made granting leave to Ms Valder, the applicant, to join Mr C Saklani as the third respondent and Ms D Saklani as the fourth respondent to these proceedings. I also granted leave to the third and fourth respondents to file an application in a proceeding seeking to vary or discharge this order, together with affidavits in support by 10 June 2022. As it turns out, the third and fourth respondents did not make such an application in compliance with the orders.
In Order 4, I ordered that if the third and fourth respondents did not file an application in a proceeding aforementioned, then by no later than 24 June 2022, they were to file and serve a response to the applicant’s Amended Initiating Application filed 26 April 2022. I made an order for the third and fourth respondents to file and serve a notice of address for service, and then finally I ordered that within seven days of the date of these orders, the first respondent notify the third and fourth respondents of the orders.
INTRODUCTION
The third and fourth respondents have appeared through their counsel, Ms Lawson, and they have caused to be filed a number of documents just after 9am this morning. There is an Application in a Proceeding and two supporting affidavits by the third and the fourth respondents. The application seeks that Order 2 made by myself on 24 May 2022, that is, the order joining them as parties, be discharged. There are two affidavits in support that I have had regard to.
To the extent that leave was required from the Court to deal with the application in a proceeding and to receive the affidavits, given that they were made out of time and given that there was a potential prejudice to the other parties, but in particular to the applicant, I grant that leave in circumstances where I felt that the matters could be dealt with without causing prejudice to the other parties.
discussion
In determining the question of whether or not the third and fourth respondents should remain as parties to the proceedings, the starting point is to refer to the orders sought against them in the applicant’s Amended Initiating Application filed on 26 April. Order 1 seeks, pursuant to s 106B of the Family Law Act 1975 (Cth) (“the Act), that the first respondent’s transfer of a property containing four lots, including the E Property and a cottage and a vacant block of land and the F Town homestead to the third and fourth respondent, effected on 17 January 1999, be set aside.
There is no dispute that the property in question sought to be set aside pursuant to that power is owned by the third and fourth respondents, and there is no dispute that the third respondent is the son of the first and the second respondents. Effectively, Order 1 seeks to set aside the transfer to the third and fourth respondents and remove from them an interest which they currently have, and that is the ownership of the property referred to in that order.
When I made the order joining the third and fourth respondents, I did so pursuant to the provisions of Part 3.1 and 3.2 of the Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (“the Rules”). It is worth noting that r 3.01 under the heading ‘Necessary Parties’ states that:
a person whose rights may be directly affected by an issue in a proceeding, and whose participation as a party is necessary for the court to determine all issues in dispute in the proceeding, must be included as a party to the proceeding.
I was clearly satisfied of that when the order was made.
Counsel for the third and fourth respondents made a number of submissions that are duly noted in the transcript of the proceedings. The essence of the submissions is that for the third and fourth respondents to remain as a party to the proceedings there is inconvenience, there is an emotional burden and there is cost, or certainly a potential cost. I accept all of those matters as being prima facie correct. Nonetheless, they own property the ownership of which is, in effect, put in contention by the application that is brought by the applicant in this case. There is no doubt that they are directly affected by an issue in the proceeding. Three questions arise. First, whether it is nonetheless necessary for them to participate. Second, whether their participation as a party is necessary for the Court to determine all issues in dispute in the proceedings. Third, if the former is answered in the affirmative, whether it is inconsistent with the powers I have under the Rules to discharge the third and fourth respondents.
I am not convinced of the necessity to formally discharge the third and fourth respondents. To do so would be productive of further issues at the time of the hearing, depending on the outcome thereof. I observed during the course of the exchange between the bench and the bar table that there did not seem to be that much difference between the third and fourth respondents not being a party to the proceedings and remaining as parties to the proceedings and not participating. In fact, the difference is significant in the sense that it is for the third and the fourth respondents to decide whether and to what extent they participate in the proceedings, or whether they simply formally acknowledge that they will abide by the order of the Court. Such concession has not, to the best of my understanding, been communicated today.
I want to emphasise that if we look on the applicant’s best case scenario, an order will be made setting aside the transfer by which the third and the fourth respondents have gained ownership of the property. It may well be that certain consequential orders flow from that. By virtue of the vested interest that they have in these proceedings, on balance I think that there is fairness to them, let alone to the applicant, in keeping them as parties. Ms Lawson made submissions about potential disadvantages arising out of them being parties but not participating, or not being parties but participating. It is highly likely, I would have thought, that they would give evidence in this case. They are going to be participants anyway in one way, shape or form.
The first observation I make is that the unfairness to the applicant of not having the third and the fourth respondents as parties is potentially acute. The unfairness to the third and fourth respondents can certainly be measured in terms of inconvenience and emotional pressure, but they are beneficiaries of a property that is very much caught up in a complex dispute between the applicant and the first and the second respondents. There is no doubt that if the third and the fourth respondents are found not to have acted in any way inappropriately or improperly, there is a spectre of a costs order being made in their favour. Ms Lawson submits that sometimes costs orders do not necessarily cover all of the costs incurred. That is true, but that is why we have indemnity costs orders, and I must say that in my experience the prospect of an indemnity costs order is far greater in proceedings that involve third parties under the Act than it does otherwise.
I made the observation that s 106B deals with the question of costs and raises the spectre that it is not necessarily the applicant who may bear the responsibility for costs of the third and fourth respondents but other parties. That is simply part and parcel of litigation under s 106B. I see no disadvantage to the first respondent or the second respondent in having the third and the fourth respondents being parties to this case. When everything is put in balance, the balance tips in favour of the applicant in keeping the third and the fourth respondents in the litigation. Of course, if it is the case that the applicant is wrong, there may well be a costs implication as a result of that.
Accordingly, I dismiss the application in a proceeding filed by the third and the fourth respondents today.
I certify that the preceding fourteen (14) numbered paragraphs are a true copy of the ex tempore Reasons for Judgment of the Honourable Justice Altobelli. Associate:
Dated: 4 July 2022
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