Vilas & Vilas (No 2)
[2024] FedCFamC1F 899
•11 December 2024
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 1)
Vilas & Vilas (No 2) [2024] FedCFamC1F 899
File number(s): NCC 3703 of 2019 Judgment of: SMITH J Date of judgment: 11 December 2024 Catchwords: FAMILY LAW – PRACTICE AND PROCEDURE – Where applicant husband first sought orders pursuant to the Child Support (Assessment) Act 1989 (Cth) in an Amended Initiating Application filed less than two months prior to Final Hearing – where the respondent wife objected on both jurisdictional and procedural fairness grounds - where jurisdictional ground unclear – finding that wife was not given procedural fairness to address the claim at the final hearing – in circumstances where final hearing is likely to be stood-over part-heard – judicial determination as to whether the husband may seek child support departure orders stood-over to a later date Legislation: Child Support (Assessment) Act 1989 (Cth), Pt 7, ss 117, 123A
Family Law Act 1975 (Cth), Pt VIII, s 75
Federal Circuit and Family Court of Australia Act 2021 (Cth), Pts 3, 4, ss 50, 54
Cases cited: Gilford & Cavaco [2024] FedCFamC1A 55
Vang & Chung (No 3) [2024] FedCFamC1A 199
Division: Division 1 First Instance Number of paragraphs: 26 Date of hearing: 2-11 December 2024 Place: Newcastle Counsel for the Applicant, Fourth and Fifth Respondents: Mr Wong together with Mr Butters Solicitor for the Applicant, Fourth and Fifth Respondents: Millyard Family Lawyers Counsel for the First Respondent: Mr Bithrey together with Ms Evelyn Solicitor for the First Respondent: Clarity Lawyers Counsel for the Second and Third Respondents: Mr Sansom SC together with Mr Bland Solicitor for the Second and Third Respondents: Evans & Wislang ORDERS
NCC 3703 of 2019 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)
BETWEEN: MR VILAS
Applicant
AND: MS VILAS
First Respondent
B2 PTY LTD
Second Respondent
B1 PTY LTD (and others named in the Schedule)
Third Respondent
ORDER MADE BY:
SMITH J
DATE OF ORDER:
11 DECEMBER 2024
THE COURT ORDERS THAT:
1.Judicial determination as to whether the applicant’s Fourth Amended Initiating Application filed 18 October 2024 is to be accepted with respect to orders sought pursuant to the Child Support (Assessment) Act 1989 (Cth) is stood-over to a later date.
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 the pseudonym Vilas & Vilas has been approved pursuant to subsection 114Q(2) of the Family Law Act 1975 (Cth).
EX TEMPORE REASONS FOR JUDGMENT
SMITH J:
These are short oral reasons for decision in relation to a recently added application for child support departure to long-extant property proceedings.
The short facts are as follows: the proceedings first commenced in 2019. The husband / father is Mr Vilas, and the wife / mother is Ms Vilas. The parenting proceedings, which were bifurcated for earlier hearing, were settled during the hearing before me in August last year, with the property proceedings continuing.
The property proceedings involve a claim by the wife's father's companies for recovery of substantial alleged debts against the two companies through which the husband and wife ran, and the husband’s now runs, being the two family businesses they built during the course of the marriage.
The claim in debt was commenced in the Supreme Court in 2020, and transferred to this Court for hearing, pursuant to this Court's pendent jurisdiction. That the claim in debt is properly before me is not, as I understand it, the subject of dispute. I note, without criticism, that the commercial issues have added a layer of complexity to the property proceedings which was a factor in the decision to bifurcate.
On 8 March 2024, nine months ago, the property proceedings were listed by me for a 10-day final hearing before me, commencing last Monday, 2 December 2024.
The issue that arises for decision in the Trial is that on 11 October 2024, less than two months prior to the commencement of the final hearing, the husband gave notice of an intention to amend his case to join a child support departure application to these proceedings for determination in this hearing. That was not any part of the matter listed for this Trial.
On 18 October 2024, the wife notified her objection and raised issues of delay. The issue was joined by the husband in his Fourth Amended Initiating Application filed 18 October 2024.
The wife objects on two discrete grounds. The first is jurisdiction noting provisions of s 50 of the Federal Circuit and Family Court of Australia Act 2021 (Cth), and the majority decision in Gilford & Cavaco [2024] FedCFamC1A 55. But I note the decision of a differently constituted Full Court in Vang & Chung (No 3) [2024] FedCFamC1A 199, which may create some uncertainty as to the jurisdictional question. However, it would appear prima facie that I do not have jurisdiction to deal with the application.
The application would be deemed to be extant in Division 2. However, that could be remedied by the recent delegation by the Chief Justice, pursuant to s 54 of the Federal Circuit and Family Court of Australia Act 2021 (Cth), to the Justices of Division 1 of the Court, granting us the authority to transfer a matter from Division 2 to Division 1 pursuant to s 51 of that Act.
The more difficult aspect is the wife's submission that she is prejudiced in being required to face this application in circumstances where it was first raised less than two months prior to the final hearing, and where the proposed mechanism to correct the apparent jurisdictional issue arose only during the course of proceedings.
The husband has today narrowed his child support departure application to only include the matters at paragraphs 60 and 61 of his Fourth Amended Initiating Application, and he does not press his applications in respect of section 117(2) and 123A of the Child Support (Assessment) Act 1989 (Cth) as set out at paragraphs 58 and 59 of his Fourth Amended Initiating Application.
Even noting the narrowed scope of the claim, the mother nevertheless raises the issue of prejudice in relation to preparation. The husband points out that the mother did address child support in her affidavit of reply, filed on 11 November 2024. I note that it is dealt with very briefly at paragraph 65 to 68. The husband has tendered documents concerning the children's enrolment, which were called for yesterday and provided by the wife overnight (Exhibit 19 in the extant proceedings). The husband says he does not contest his capacity, so that, in effect, there is no real prejudice.
Unfortunately, the husband's narrowing of his claim, concessions and submissions and the material tendered do not, in my view, sufficiently address the question of prejudice in all the circumstances.
While the issues under s 75 of the Family Law Act 1975 (Cth) and the assessments to be made concerning the husband's claim for child support departure very substantially overlap, they do not overlap entirely, and given the precision of the issue still sought to be determined, I am not satisfied that the issue of prejudice has been properly addressed.
I note the wife has her correspondence with the school, but it may be that a subpoena to the children's school concerning the specific issues around funding and enrolment might produce something. It might not. But the husband's claim, as pleaded at paragraph 60(a) of his Fourth Amended Initiating Application, exceeds $200,000. It is a substantial claim, including other matters.
The essence of the relevant prejudice is that the wife has lost an opportunity to make all relevant inquiries and adequately obtain evidence by reason of the lateness of the decision to add child support. The fact that it may be that all these inquiries add nothing is not relevant to the question. It is the prejudice that she has lost the opportunity that I must consider.
I note that it will be rare, in my view, that it would not be in the interests of justice for a properly commenced child support departure application to be heard concurrently with property proceedings, given the usually very substantial overlap of the issues and noting the additional cost to the parties of a further hearing, and the requirement to use publicly funded court resources for additional hearing if they are heard separately.
In this case, unfortunately, I find that the child support departure application has been sought to be joined too late, and I think it would be unfair to the wife, and so not in the interests of justice, to require the wife to meet this case in this hearing.
That finding assumes that this hearing, or at least the evidence in this hearing, will conclude this week, even if submissions are listed for a later date.
Assuming for the moment that the matter will conclude all evidence this week, then if the effect of s 50 of the Federal Circuit and Family Court of Australia Act 2021 (Cth) is that the child support departure application is not before me but rather is extant in Division 2, I decline to exercise the power given to me to transfer the matter from Division 2 to Division 1 at this time, given the timing of its commencement and the prejudice I find the wife would face.
If, on the other hand, the child support departure application is in Division 1, noting the potential controversy around s 50, I would consider it too late to join it to the current proceedings and Trial, noting that it was not an issue that was extant at the time the matter was listed for hearing, and given that I consider it was joined too late and would prejudice the wife.
Accordingly, on that basis I would consider, if it is in Division 1, it to be an extant application, but not having been listed to be part of this hearing, and not presently before me.
I will note that if the evidence does not conclude this week, and it becomes necessary to allocate further hearing dates, which I note my comments about, which would allow the prejudice to the wife to be ameliorated, then I would be willing to consider a further application to either transfer the matter from Division 2 to Division 1, or to allow the extant Division 1 child support departure application to be joined into this part-heard hearing, and either way for additional evidence to be taken on that issue on the next occasion, so in effect granting the husband’s application to have the matters heard all together.
I say that as inquiries can be made in the meantime and I would have thought that the additional evidence would not take up a great deal of time, and that would be in the interests of the parties and the Court and the public resources required to have all issues dealt with in one hearing, rather than have the property proceedings dealt with by me, and then the parties, who have shown a willingness to litigate at length and cost, to end up in front of another judge at another time.
Accordingly, I will not enter orders finally determining the issue at the moment, but that is the effect of my decision, and the parties can conduct the hearing for the present on the basis that child support departure is not part of this Trial.
Those are my reasons.
I certify that the preceding twenty-six (26) numbered paragraphs are a true copy of the ex tempore Reasons for Judgment of the Honourable Justice Smith. Associate:
Dated: 23 December 2024
SCHEDULE OF PARTIES
NCC 3703 of 2019 Respondents
Fourth Respondent:
J PTY LTD
Fifth Respondent:
H PTY LTD
0
2
3