FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 1)Venter & Venter (No 3) [2022] FedCFamC1F 278
File number(s): BRC10651 of 2021 Judgment of: CAREW J Date of judgment: 29 April 2022 Catchwords: FAMILY LAW – INTERIM PROPERTY – PLEADINGS – STRIKE OUT APPLICATION – Where the second, third, fifth, seventh and eighth respondents (“the objecting respondents”) sought to strike out parts of the applicant wife’s Points of Claim – SUMMARY DISMISSAL – Where the objecting respondents sought summary dismissal of parts of the wife’s Initiating Application – Where the wife opposes the strike out application and summary dismissal – Where the first respondent husband supports the strike out application and summary dismissal – Where the fourth and sixth respondents have failed to take part in proceedings to date – Where the wife is ordered to amend her Points of Claim – Where the strike out application is otherwise dismissed – Where the application for summary dismissal is adjourned – Where the wife is ordered to file an amended Initiating Application – Where the eighth respondent’s application to be removed as a party to proceedings is adjourned. Legislation: Family Law Act 1975 (Cth)
Federal Circuit and Family Court of Australia Act 2021 (Cth)
High Court Rules 2004 (Cth)
Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth)Cases cited: Ascot Investments Pty Ltd v Harper (1981) 148 CLR 337
Big and Suzi [1998] FLC 92-799
Dare v Pulham (1982) 148 CLR 658
Fordyce v Ryan (2017) 2 Qd R 240
General Steel Industries Inc v Commissioner for Railways (N.S.W) (1964) 112 CLR 125
Harris & Dewell (2018) 58 Fam LR 313
In the Marriage of Duff and Duff (1977) FLC 90-217
In the Marriage of Goodwin and Goodwin Alpe (1991) FLC 92-192
Kennon & Spry (2008) 238 CLR 366
Khalif v Khalif [2021] FamCAFC 123
Lindon v The Commonwealth (No 2) (1996) 70 ALJR 541
Nevins & Urwin [2022] FedCFamC1A
Public Trustee v Smith [2008] NSWSC 397
Re Webster (1975) 132 CLR 270
Shaeffer v Jacobs [2011] FamCAFC 119
Venter & Venter (No 2) [2022] FedCFamC1F 230
Division: Division 1 First Instance Number of paragraphs: 73 Date of hearing: 7 April 2022 Place: Brisbane Counsel for the Applicant: Mr Shaw QC with Dr Matta Solicitor for the Applicant: Damien Greer Lawyers Solicitor for the First Respondent: Broun Abrahams Burreket Family Lawyers Counsel for the Second, Third, Fifth and Seventh Respondents: Mr Henry SC Solicitor for the Second, Third, Fifth and Seventh Respondents: Barkus Doolan Family Lawyers Fourth Respondent: Did not participate Sixth Respondent: Did not participate Counsel for the Eighth Respondent: Mr Rogan Solicitor for the Eighth Respondent: Pearson Emerson Lawyers ORDER
BRC 10651 of 2021 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)
BETWEEN: MS VENTER
Applicant
AND: MR VENTER
First Respondent
MR B VENTER
Second Respondent
MR C VENTER (and others named in the Schedule)
Third Respondent
ORDER MADE BY:
CAREW J
DATE OF ORDER:
29 APRIL 2022
THE COURT ORDERS THAT:
1.Within 21…
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- AGLC
- Venter & Venter (No 3) [2022] FedCFamC1F 278
- Case
- [2022] FedCFamC1F 278
- Decision Date
CaseChat Overview and Summary
The case Venter & Venter (No 3) involved a dispute regarding the validity of a nuptial settlement agreement. The wife sought to challenge the settlement, arguing that her husband had control over certain entities and thus their assets should be treated as his property. The court was tasked with determining whether the husband's control over these entities was sufficient to recharacterise their assets as his own. The case proceeded with the husband resisting the wife's attempt to strike out specific paragraphs of her pleadings related to the nuptial settlement. The husband contended that the wife's claims were clearly articulated in the pleadings.
The legal issues before the court centered on the interpretation of control over trust assets and whether mere control, without a lawful right to benefit from those assets, could justify treating the assets as property of the controlling party. The court referenced the case of Harris & Dewell to highlight that control alone is insufficient; there must be a lawful right to benefit from the trust assets. The Full Court's decision in Harris & Dewell affirmed that the husband's control over the trust, even through his elderly father who retained his own legal and beneficial interest, did not equate to the trust assets being his property. The court further clarified that control exercised in the interest of the company and its shareholders, rather than for personal benefit, was insufficient to meet the threshold required for such recharacterisation.
The reasoning of the court in Venter & Venter (No 3) mirrored the principles established in Harris & Dewell, emphasizing that the wife's pleadings did not demonstrate a lawful right to benefit from the assets controlled by the husband. The court found that the evidence, including parts of the transcript, suggested that other individuals also had an interest in the entities, contradicting the wife's assertion that the husband alone controlled the assets. Therefore, the court upheld the husband's argument and dismissed the wife's claims regarding the nuptial settlement. The final orders of the court reflected this decision, with the wife's attempt to strike out the relevant paragraphs being unsuccessful.
The legal issues before the court centered on the interpretation of control over trust assets and whether mere control, without a lawful right to benefit from those assets, could justify treating the assets as property of the controlling party. The court referenced the case of Harris & Dewell to highlight that control alone is insufficient; there must be a lawful right to benefit from the trust assets. The Full Court's decision in Harris & Dewell affirmed that the husband's control over the trust, even through his elderly father who retained his own legal and beneficial interest, did not equate to the trust assets being his property. The court further clarified that control exercised in the interest of the company and its shareholders, rather than for personal benefit, was insufficient to meet the threshold required for such recharacterisation.
The reasoning of the court in Venter & Venter (No 3) mirrored the principles established in Harris & Dewell, emphasizing that the wife's pleadings did not demonstrate a lawful right to benefit from the assets controlled by the husband. The court found that the evidence, including parts of the transcript, suggested that other individuals also had an interest in the entities, contradicting the wife's assertion that the husband alone controlled the assets. Therefore, the court upheld the husband's argument and dismissed the wife's claims regarding the nuptial settlement. The final orders of the court reflected this decision, with the wife's attempt to strike out the relevant paragraphs being unsuccessful.
Orders
Orders of the court
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Background
Background to the litigation
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Evidence
Evidence Before The Court
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Decision
Reasons for decision
Mr Shaw QC resists the strike out of these paragraphs, submitting, again somewhat remarkably, that the wife’s case in relation to the nuptial settlement “is set out with clarity in the pleadings”. Conclusion in relation to the strike out application In relation to the paragraph from Harris & Dewell cited by Mr Shaw QC on behalf of the wife (set out at [48] above) the paragraph following the one relied upon states as follows:[68]Control is not sufficient of itself. What is required is control over a person or entity who, by reason of the powers contained in the trust deed can obtain, or effect the obtaining of, a beneficial interest in the property of the trust. In our respectful view, it is in that sense, that Finn J speaks of “some lawful right to benefit from the assets of the trust”. Harris & Dewell[11] involved a claim by the wife that the husband controlled a trust such that the assets of the trust should be treated as the property of the husband. The wife was unsuccessful in that argument notwithstanding the fact that the trustee of the trust was the husband’s 99 year old father whom it was found continued to maintain his legal and beneficial interest in the trust. In upholding the decision of the primary Judge, the Full Court said:[66]In concluding that the EUT was not property of the husband and that “[t]he [father], albeit he is 99 years of age, continues to maintain his legal and beneficial interest in the [EUT]” (at [103]) her Honour quoted, at [102] what was said by Finn J in Stephens v Stephens:… I accept that no earlier authority in this court has gone so far as to hold that control alone without some lawful right to benefit from the assets of the trust, is sufficient to permit the assets of the trust to be treated as property of the party who has that control …[11] Harris & Dewell (n 10). The Full Court went on to say:[71]The husband did not have the powers vested in him, or in any entity which he controlled or would do his bidding, that permitted of that result for him. … In the current case it is not apparent on the pleadings, nor on the other evidence to which I have been taken by the wife, that the “control” exercised by the husband over the objecting respondents and the “[D] Group” (as identified) includes “the ability to treat the compan[ies] and its affairs as his own” as opposed to the “[c]ontrol he might exercise in the interests of the company[ies] and all its shareholders…”,[12] the latter being insufficient to support the wife’s claim that the assets of those entities should be treated as assets of the parties or either of them.[13] [12] This distinction being made in Ascot Investments Pty Ltd v Harper (1981) 148 CLR 337 at 343-4 (“Ascot Investments”). [13] See also Public Trustee v Smith [2008] NSWSC 397 at [125] cited with approval in Harris & Dewell (2018) 58 Fam LR 313 at 324. Even parts of the transcript to which reliance was placed by the wife, seem to indicate a recognition that persons other than the husband and wife have an interest (be it legal or equitable) in the property which the wife loosely describes as part of the “[D] Group”, as a result of contributions made by those persons. The statements made by Ms Glynn repeatedly refer to “they” not just the husband, which seems contrary to the submission by the wife that the conversation relied upon her supports her allegation that the husband alone is in control.
Ratio Decidendi
Legal Principle Established
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