Vasilias and Vasilias (No. 3)
[2008] FamCA 407
•19 May 2008
FAMILY COURT OF AUSTRALIA
| VASILIAS & VASILIAS (NO. 3) | [2008] FamCA 407 |
| FAMILY LAW – ORDERS – Variation of final property orders – machinery provisions as distinct from substantive orders |
| Family Law Act 1975 (Cth) |
| Bray v Bray (1988) FLC 91-968 B & B (unreported, Full Court of the Family Court of Australia, Fogarty, Nygh & Kay JJ, 7 August 1992) Mullane (1983) FLC 91-303 |
| APPLICANT WIFE: | Mrs Vasilias |
| RESPONDENT HUSBAND: | Mr Vasilias |
RESPONDENT PATERNAL GRANDPARENTS: | Mr and Mrs Vasilias (Snr) |
| THIRD RESPONDENT: | Mr RW |
| FILE NUMBER: | MLF | 3158 | of | 2005 |
| DATE DELIVERED: | 19 May 2008 |
| PLACE DELIVERED: | Melbourne |
| PLACE HEARD: | Melbourne |
| JUDGMENT OF: | Cronin J |
| HEARING DATE: | 19 May 2008 |
REPRESENTATION
| COUNSEL FOR THE APPLICANT: | MR CANTWELL |
| SOLICITOR FOR THE APPLICANT: | HOGG & REID |
| COUNSEL FOR THE RESPONDENT: | IN PERSON |
| SOLICITOR FOR THE RESPONDENT: | BERGER KORDOS |
| COUNSEL FOR THE RESPONDENT: | MR ROCKMAN |
| SOLICITOR FOR THE RESPONDENT: | ROCKMAN & ROCKMAN |
Orders
I make the following orders:
Paragraph 1 of the orders made on 26 February 2008 be amended, and the settlement date be extended to 16 June 2008.
The husband do all act and things forthwith and sign any necessary documents to authorise the ING Bank to book and effect settlement in respect of the property at R, and in particular the husband sign the mortgage discharge request form.
That in the event that the husband fails forthwith to sign those documents and comply with paragraph 2, then any document or authority required to enable settlement to proceed shall be signed in the name of the husband by a registrar of the Melbourne Registry of this court pursuant to s 106A of the Family Law Act.
In the event that the husband is in default pursuant to paragraph 2 of these orders, the filing of an affidavit by the solicitor for the wife showing the husband has failed to comply with paragraph 2 shall be sufficient evidence to enable the said documents to be executed in the name of the husband.
I order that the husband pay to the wife the sum of $2387 costs. That sum be adjusted in the settlement of the sum payable by the wife to the husband.
IT IS NOTED that publication of this judgment under the pseudonym Vasilias & Vasilias is approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth)
| FAMILY COURT OF AUSTRALIA AT MELBOURNE |
FILE NUMBER: MLF 3158 of 2005
| MRS VASILIAS |
Applicant
And
| MR VASILIAS |
Respondent
REASONS FOR JUDGMENT
I have before me today an application in a case which has been filed today with my leave, and which on the husband's version was served upon the solicitor on the record on Friday. It seemed to me looking at the affidavit in support of the application that there can be no argument about the fact that the solicitors for the husband at least, if not the husband himself, were aware that the application was on the way.
The husband appears for himself today, notwithstanding the solicitors who have acted for him all of the way through are still on the record. Somewhat disturbingly, he has told me that some of the correspondence which is annexed to the affidavit of the solicitor for the wife is not correspondence that he has ever seen before and has not given instructions to send. There is one particular letter that I will refer to which is disturbing if that is in fact the correct situation.
This is a case in which the parties litigated over a number of days, a property dispute. Both parties were represented by counsel. In the end I made orders and published a judgment on 31 January this year.
I will not set out the precise details of that order, but in essence I directed that the wife pay to the husband a set sum, and that contemporaneously with the payment of that set sum to the husband, he was to transfer his interest in a property at R. I made further orders that in the event that the wife failed to pay the sum by the due date and failed to discharge some liabilities for which she was responsible, then the husband was to have the option to pay the wife a sum of $174,334 no later than 42 days after the due date.
In the event that the husband did not exercise his option, then I made a specific order that the property be sold anyway and that the wife receive the balance after the husband received the set sum of $58,665 which was the sum that I had ordered the wife to pay in the first place.
There can be little doubt therefore that what I intended and what the orders provide is that the husband was to get a set sum, and the wife was to get the precise equity in the property. The value of the property was not a subject of dispute between the parties during the proceedings.
Subsequent to the making of the orders on 31 January, problems arose. Predominantly those problems arose out of the husband's parents lodging a caveat on the title to the property claiming moneys pursuant to an agreement at the time that the property was bought many years ago.
In addition a caveat was lodged by a friend of the husband who ironically enough was a witness in the proceedings, claiming that he was owed money as well pursuant to a loan agreement that was executed just prior to the proceedings being commenced.
The husband's father gave evidence in the proceedings and at no stage was I satisfied that he had any caveatable interest in the property. I made it very clear in the judgment that the husband's father had no intention of recovering the money from his son in any event. The husband's father's evidence on that issue was very clear. In respect of the other caveator, notwithstanding he gave evidence in the proceedings, at no stage did he mention that he had a caveatable interest. When the matter came on for hearing before me on 26 February, both the husband and the wife were represented. By their agreement, the settlement time set out in the orders that I made on 31 January 2008 was extended to 14 May 2008.
I adjourned the proceedings to 12 March.
When the matter came back on for hearing on 12 March 2008, counsel appeared for the wife as he had during the trial, and a Ms Piggott appeared for the husband's parents and Mr Rockman the solicitor for the other party appeared as well.
Unfortunately on that day the husband did not appear, nor did he have any representation here, but there can be no doubt that he knew exactly what was happening because the solicitors for him sent along a letter saying that he consented to any orders that the court might make. There was some doubt about exactly what that meant, as a result of which I left a provision in the orders for the husband to make an application to set aside the orders that I had made.
Ultimately what occurred was that the parties present before me that day reached agreement that of the money that was due to be paid to the husband, it was to be effectively redirected to be paid to the parents and to the other caveator. There was virtually no money, if any, to go to the husband.
The husband today mentions the fact that I raised the question of jurisdiction and I certainly did at that stage, but that was on the basis of there being no argument about whether the orders I had made were machinery orders or orders of a substantive nature. In any event, all consented.
With the consent of all parties I extended the payment of the sum by the wife to the husband to 14 May.
What has transpired since then is that a significant amount of correspondence and work has been undertaken by the solicitors for the wife to get the settlement to the stage where it can take place. It seems to me on reading the material filed on behalf of the wife, that her solicitors were handicapped by virtue of the fact that the mortgagee who had control of the title would only deal with the husband or his lawyers, and as a result of that everything had to go through the solicitors for the husband to get the matter settled.
The affidavit sets out chronologically all of the events that have occurred in an endeavour to settle the matter in accordance with the amended orders that I made. I have some serious concerns about exactly what the husband's position was, but he has appeared today and told me that a lot of the things were not of his doing, and in reality he provided the settlement documents in a date in April. What is disturbing is that the settlement date has now expired. On 15 May 2008 Berger Kordos the solicitor still on the record for the husband, wrote a letter to the solicitors for the wife indicating that their client had complied with the orders that I made on 31 January, and then, "The default of settlement is solely attributable to your client's inaction and therefore the self executing default orders now apply."
Having looked at what had occurred and the stream of attempts that the solicitor for the wife made on behalf of the wife to get the matter to the settlement stage, bearing in mind that the solicitors for the mortgagee would not deal with her directly, I am quite satisfied that there can be no basis for the solicitor for the husband to say that the default that has now arisen is attributable to the wife's inaction. It seems now that the husband wants to rely upon the default provisions in the orders as they have now been extended by virtue of the earlier orders in February. What is clear is that the time has now expired under the orders and the only question is whether or not I have the power to extend the time for settlement.
The application before me today, seeks an order for the extension of time, but also that the husband do all things necessary to sign documents to ING to give effect to the settlement, and if he fails to do that then the provisions of s 106A be applied so that the registrar can sign any document on his behalf. With some difficulty in understanding exactly what I was talking about, the husband concedes that if I did extend the time under the order then the settlement could proceed because he has given all of the documents to ING in any event. He assures me that he has not done anything to cancel the settlement. Again I have some doubts about all of that, having regard to the correspondence from Berger Kordos, but I propose in this case to make orders under s 106A as a matter of precaution.
The question in this case really boils down to one of whether or not firstly I should hear the matter immediately, and then whether or not there is a power giving rise to a jurisdiction to amend the orders. The husband appeared today and said that he had not seen the documents, but he still wanted me to dismiss the application having regard to the fact that he was relying upon the default orders that I made in January. I have given him a number of opportunities to indicate exactly what he does want to do, and he has maintained consistently that he does not propose to file any material, but rather wants me to dismiss the application so that he get on with the default provisions.
As such I am dealing therefore with the wife's application in a case. The application gives rise to the question of whether or not there is power to amend the orders. There has been very clear authority set out by the High Court in Mullane (1983) FLC 91-303 that s 79 is a once only provision and the power, once exercised, is exhausted. There is a provision in s 79A to set aside or vary orders where there is some impracticability about carrying orders out, but I have not been asked to exercise that power today. The question therefore is whether or not the power is exhausted under s 79.
In Bray v Bray (1988) FLC 91-968 the situation was very similar to this. Lindenmayer J went through all of the authorities including Cranage (1981) FLC 91-039, Molier v Van Wyk (1980) FLC 90-911 and Ravasini (1983) FLC 91-312. His Honour looked at all of those cases and ultimately said that what was important was that the court had to determine whether or not the order that is now being sought to be varied was a substantive order or a consequential or machinery order. It has to be determined by the construction of the entire order and not by reference to part only of that order.
The same issue arose in an unreported decision of B & B, which is a Full Court decision handed down by Fogarty, Nygh and Kay JJ on 7 August 1992. Its Court of Appeal reference is EA38 of 1992. That was also a similar position except that the application before the trial judge was under s 79A. The Full Court looked at a variety of issues and one of them was the question of the distinction between the substantive and machinery provisions. In that case the provision relied upon was the impracticability of carrying out the orders under s 79A.
What the Full Court there said was that when one looked at the basis behind the order you could see that things like the fluctuations in property markets and so forth would make it more advantageous for one party than the other to have the sort of default provisions that apply in the case that I am dealing with. The Full Court said that a person given an option to act within a certain time could only have the time extended if that option was not exercised, in circumstances where the provision was clearly a machinery one. That had to be determined on the basis of the context of the orders in total. As I have already pointed out the orders I made in January were clear in that the wife was to get either the set equity in the home, and I specifically set out what that was to be, or if she did not get that equity by virtue of not being able to buy the home, then she had to get the set amount of money from the husband or by virtue of a sale.
The provisions I made in the relevant orders were of a consequential nature rather than of a substantive nature. It certainly was not my intention to give the husband a specific property right. In this case the other issue which is of some significance is that the wife has had absolutely no control over the process that has lead to the delay. The husband says two significant things. The first is that if the wife had been serious about wanting to retain the home then she should have borrowed funds and paid out the order that was holding up the settlement. That seems to me to ignore the fact that she would then have had to have dealt with the mortgagee over whom she had no control and specifically even if she had paid out the mortgage for example, she would not have been able to obtain the relevant title documents without the written consent of the husband.
The second point that he makes is that her inactivity has lead to the time elapsing in circumstances where he has always had the right to buy the home. I do not accept that that is the situation in circumstances where the solicitor for the wife has consistently been endeavouring to get the settlement at a particular time prior to the time that the orders expired. The correspondence attached to the affidavit dated 12 May 2008 shows that the solicitors for the husband had written to the solicitors for the wife indicating that there was a problem with Gadens as solicitors for the mortgagee not being in a position to settle because "They are not in receipt of security documents". There is no indication as to exactly what that means other than attached to that annexure is a letter from Gadens dated 9 May 2008 in which they suggest that they were waiting for the security documents to be released from the document custodian.
A little further down it makes clear that as at 9 May, the husband had to pay out any other debt that he had to ING. It is quite clear that that had not been done until very recently as well. So on any view of what I am determining today, the husband had not been in a position to provide settlement instructions until very late in any event.
In the circumstances, it seems to me that the test is still a question of whether or not this is a substantive or machinery consequence, and I am quite satisfied that it is a machinery circumstance and not a substantive right that the husband has. In those circumstances I propose to make the orders sought by the wife.
I have now been asked to make orders in respect of costs by both parties for the proceedings today. An order for costs can only be made in certain circumstances. Section 117 of the Family Law Act 1975 (Cth) sets out that the fundamental principle is that each party bears their own costs. The only time the court can and should depart from that position is where it is justified in so doing. I am satisfied that this application was appropriately brought by the wife in circumstances where the husband at least through his solicitors, was painting a picture that he was not going to do anything to assist the completion of the orders. In those circumstances I am quite satisfied that the wife is justified in having her costs.
The husband's costs for the day he says are $800 for what he has lost. The reality is that had the position been sorted out much earlier then he probably would not have lost anything by needing to be here today. In the circumstances I do not see any basis to make an order for costs in his favour. Before I can make an order for costs however, having found that there is some justification for that, I must determine the matters under s 117, and in specific terms the provisions of sub-s 2A. In this case I have had the advantage of obviously dealing with the financial circumstances of each of the parties during the proceedings and I am assured as I recalled on the last occasion that neither party is in receipt of Legal Aid.
The question of the conduct of the parties is integral to all of this and I am satisfied that the husband has not been proactive in ensuring that the settlement could take place. Whether that is a matter of his doing or his solicitor's is of some argument. I am also satisfied that this is a case where the husband has been wholly unsuccessful in the proceedings and in the circumstances it is appropriate that there be an order for costs. The costs sought are $1100 for counsel and the solicitor's fees of $1287. It seems to me having regard to all of the work that has been done and the size of the affidavit filed, that that is a sum which is reasonable in the circumstances.
I am not prepared to make an order for an injunction in these circumstances. In the event that the matter does have further problems the parties have got leave to make a further application.
I certify that the preceding Thirty Two (32) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Cronin
Associate:
Date: 29 May 2008