Watson & Watson
[2006] FMCAfam 293
•7 July 2006
FEDERAL MAGISTRATES COURT OF AUSTRALIA
| WATSON & WATSON | [2006] FMCAfam 293 |
| FAMILY LAW – ENFORCEMENT – Property orders – discretion to enforce – breadth of discretion – relevance of equitable interests – judgment enforced. |
| Evidence Act 1995, s.140 Family Law Act 1975, s.105 Limitation of Actions Act 1958 (Vic), s.5(4) |
| Waltons Stores (Interstate) Ltd v Maher [1988] HCA 7 Ramsey & Ramsey (1983) FLC ¶91-301 Ramsey & Ramsey (No.2) (1983) FLC ¶91-323 Thwaite v Thwaite [1981] 3 WLR 96 |
| Applicant: | THOMAS JAMES WATSON |
| Respondent: | MARGARET PAULINE WATSON |
| File Number: | DGM 910 of 2005 |
| Judgment of: | Riethmuller FM |
| Hearing date: | 30 May 2006 |
| Date of Last Submission: | 30 May 2006 |
| Delivered at: | Dandenong |
| Delivered on: | 7 July 2006 |
REPRESENTATION
| Solicitor for the Applicant: | Mr R. Meier |
| Solicitors for the Applicant: | Meier Denison |
| Counsel for the Respondent: | Mr G. Dickson |
| Solicitors for the Respondent: | Hayes & Associates |
ORDERS
That the wife transfer to the husband on trust for sale the property at
11 Maretimo Court, Frankston being the whole of the land more particularly described in Certificate of Title Volume 9084 Folio 574 (“the property”).
That the property be sold and the proceeds of sale divided as follows:
(a)In payment of the costs commissions and expenses of sale;
(b)To discharge the mortgage or any other encumbrance over the property;
(c)In payment of the sum of $50,000.00 plus interest that has been accrued since 30 October 1993 to the husband;
(d)The balance to the wife.
That the Agents engaged for the purposes of the sale be nominated by the President of the Real Estate Institute of Victoria.
If the property does not sell at public auction that it remain listed for sale by private treaty at the price nominated by the Agents for a period of 60 (sixty) days thereafter whereupon if it has not been sold the matter return to Court for further directions pursuant to the liberty to apply provisions herein.
Liberty to both parties to apply with respect to the terms and conditions of the sale of the property.
Liberty to the wife to apply should she be able to pay the husband without the need to sell the property.
The respondent pay the applicant’s costs fixed in the sum of $20,000.00.
| FEDERAL MAGISTRATES COURT OF AUSTRALIA AT DANDENONG |
DGM 910 of 2005
| THOMAS JAMES WATSON |
Applicant
And
| MARGARET PAULINE WATSON |
Respondent
REASONS FOR JUDGMENT
The applicant seeks to enforce consent orders made in the Family Court of Australia on 30 August 1993. The orders were made by consent in proceedings ML8074/93, and provided for the payment of a sum of money by the wife to the husband and, contemporaneously with that payment, the transfer of the husband's interest in a property held by the parties as joint tenants to the wife. The relevant part of the orders of the Family Court are as follows:
1.That the wife pay to the husband the sum of $70,000.00 (‘the payment’) within 60 days of the making of the orders, of which $20,000.00 of the payment (or such other sum as may be necessary to satisfy account number 30251574 with Toyota Finance Australia Limited (‘Toyota’) shall be paid directly by the wife to Toyota and such payment to Toyota shall be deemed to be to the husband.
2.That contemporaneously with the payment:
(i)the husband do all such acts and things and sign all such documents as may be required to transfer to the wife at the expense of the wife all of his right title and interest in the real property situate at and known as 11 Maretimo Court, Frankston being the whole of the land more particularly described in Certificate of Title Volume 9084 Folio 574 (‘the real property’);
(ii)the wife indemnify the husband against all payments and liabilities pursuant to the mortgage to Housing and Construction Victoria/Department of Planning and Housing (‘the mortgage’) and all rates, taxes and outgoings of or with respect to the real property of whatsoever nature and kind.
3.That in the event that the whole of the payment has not been made by the date then the real property be sold forthwith altogether out of Court (‘the sale’) and the proceeds of the sale be applied:
(i)firstly to pay all costs, commissions and expenses of the said sale;
(ii)secondly to discharge the mortgage and any other encumbrance affecting the real property;
(iii)thirdly so much of the payment is then outstanding together with interest thereon at the rate of 10% per centum per annum adjusted monthly from the date to the husband;
(iv)fourthly the balance to the wife.
The applicant says in an affidavit that the $50,000 that the wife was required to pay him under order 1 (being the payment less the $20,000 payment to Toyota Finance Australia Ltd) has not been paid. He further states that on 15 October 2004 and 17 November 2004, his solicitor wrote to the wife on his behalf seeking payment and he received no response. As a result, the application was brought seeking orders to effect the sale of the property.
In support of the application, the applicant filed an affidavit by a valuer, a Mr McLean, setting that in his opinion the reasonable market value of the subject property in its present condition is $261,000. The wife, in an affidavit filed on 18 May 2005, opposed the orders sought by the husband, alleging that the signature on the orders (made by consent in the Family Court) was not hers, and that she had no recollection of attending upon the solicitor's firm, Holding Redlich, who prepared the orders.
Whether the orders are genuine
At the hearing of the matter, the husband and the wife both gave oral evidence. The husband called a handwriting expert and the solicitor who had acted in the original proceedings as witnesses. The wife called her son.
The husband's evidence was that the wife presented the orders drawn by the solicitor to him for signing, effectively as a fait accompli. He said that he signed them and thought nothing more of the matter. He said that at various times he had asked the wife about her making a payment and described her as non-responsive, and that he had chosen not to press for payment until all of the children had attained 21 years. The children he refers to are children of the wife from a former relationship.
The husband presented well in the witness box and appeared to give a credible account of the events. This was hampered somewhat by the time that has since elapsed, resulting in some lack of detail and confusion as to particular dates.
The solicitor who acted in the previous proceedings was called to give evidence. She produced copies of her and her assistant's diaries, showing a number of appointments whereon the wife had attended upon her. The first appointment was on 15 June 1993, where the diary note indicates that Mrs Watson had attended in accordance with an arrangement with the Transport Workers Union (the first consultation being free for union members), and included her telephone number, which the wife agreed in evidence was her telephone number at the time.
Further appointments on 9 July and 20 August were also noted. The solicitor produced, from the computerised business records of the firm, a printout showing that a file was created in the name of M.P. Watson for matrimonial proceedings on 22 June 1993, and ultimately closed on 14 March 1996. The computerised records included the correct telephone number and residential address for the wife. Unfortunately, the file has since been destroyed, and the solicitor took some time to produce the relevant invoice from the records management company and computerised records to show that the file had in fact been destroyed as part of the normal document destruction process of the firm, on 10 January 2005, some nine years after the file was finally closed.
The solicitor gave evidence that she had arranged for an extensive search of the firm's computer records, and that the information technology department had located an old file which was a copy of an affidavit of understanding filed by her, as sworn by the husband. This was an affidavit that briefly set out the assets and liabilities of the parties and requested the court to make the consent orders in the terms drafted. She also confirmed that the documents on the Family Court file appeared to be documents drawn by her, although she had no independent recollection of the particular documents by the time of this trial.
The solicitor also gave evidence that when she attended at the Federal Magistrates Court at Dandenong she noticed the applicant outside of the court building on her way into the court. She stated that she had a mental image of what the applicant looked like before coming to court, although was unsure whether the mental image was in fact Mrs Watson or another client. Upon arriving, she recognised the wife. She gave evidence that there were other people outside of the court. The hearing was a day on which there were a large number of matters were listed and a number of people present at the Dandenong Courts Complex. She also gave evidence that she had not acted for Mrs Watson in any other capacity, nor was there any record of Mrs Watson attending upon the firm for any legal work other than the matrimonial proceedings that had led to the disputed order.
The solicitor was cross-examined about her ability to recall a client from some years ago. She maintained that she was able to recall the wife in this matter. Having observed the wife at trial, it appears to me that the wife's physical appearance is somewhat distinctive. In the circumstances I accept that the solicitor had a recollection of the appearance of the wife. I also accept that the solicitor recognised the wife at the Dandenong courthouse, and that there appears to be no other explanation as to why the wife would be known to the solicitor.
The husband also called evidence from a handwriting expert. He prepared a report and was cross-examined upon it. His evidence was to the effect that in his opinion, the signatures of the wife, ‘M.P. Watson’, on a large number of documents including the disputed documents, many of which contained signatures of the wife that were not disputed, were all fluently executed, with complex formations that did not exhibit any evidence to suggest that they were the product of simulation or copying. He was of the view that all of the signatures were written by one writer.
He was cross-examined as to some variations in the formation of the letter ‘M’ which could be seen between some of the documents. He explained that in his opinion this was a minor variation, and that his opinion was based upon comparison of a large number of signatures, not simply two signatures which were written many years apart.
I have taken the opportunity of looking at the signatures he refers to in his report. I accept the evidence of the handwriting expert in this matter.
The wife gave evidence and denied that the signatures were hers and denied ever having met the solicitor. The wife produced receipts from businesses in the inner suburbs of Melbourne dated the same date that she was said to have attended upon the solicitor. She also produced documents showing that she had made deposits at a bank at Frankston on that day. The documents, however, do not provide times either for the attendances upon the businesses or the bank transactions.
The wife also produced two diaries to show that there were no entries in them with respect to the attendances upon the solicitor. However, there were very few entries in the diaries at all: one diary appeared to contain (almost exclusively) entries relating to the wife's work as a seamstress (save for two or three entries), and the second, smaller diary contained few entries.
I did not find the wife a particularly impressive witness. During cross-examination she was dogmatic and at times aggressive. I do not find the evidence of the wife to be evidence upon which I can rely.
The wife's son also gave evidence. He agreed that over the years he had seen the husband from time to time at the cricket club, and that on one occasion the husband had told him that the wife owed the husband money. He also told of his recollections as a child of the wife's strong commitment to maintaining the family home in a dispute with the wife's first husband, and his belief that he would have been aware of any issues relating to property settlement between the wife and the husband in this case, had they occurred. He was, however, at the relevant times a child. I found the wife's son to generally be an impressive witness and accept the evidence that he gave.
I have regard to section 140 of the Evidence Act1995 with respect to the burden of proof. That section provides:
(1)In a civil proceeding, the court must find the case of a party proved if it is satisfied that the case has been proved on the balance of probabilities.
(2) Without limiting the matters that the court may take into account in deciding whether it is so satisfied, it is to take into account:
(a)the nature of the cause of action or defence; and
(b)the nature of the subject‑matter of the proceeding; and
(c)the gravity of the matters alleged.
In this case, the husband alleges that the wife signed documents, and the wife alleges that the signatures are fraudulent. These are serious questions and not matters to be treated lightly.
On the evidence before me, I accept that the signatures upon the documents and orders in the original Family Court proceedings are in fact those of the wife. I also accept that the wife attended upon the solicitor who generated the documents and lodged the application in the Family Court in order to obtain the consent orders. In the circumstances, I reject the wife's case to the contrary.
I therefore find that there are valid and enforceable orders in force as made by the Family Court on 30 August 1993.
Enforcement of the orders
Enforcement of orders under the Family Law Act1975 is provided for in s.105, which is in the following terms:
(1)Subject to this Part, to the regulations and to the applicable Rules of Court, all decrees made under this Act may be enforced by any court having jurisdiction under this Act.
(2)Except as prescribed, a court shall not entertain a proceeding under this Act for the enforcement of a decree made by another court unless the decree is registered in the first‑mentioned court in accordance with the regulations.
In Ramsey & Ramsey (1983) FLC ¶91-301, the Full Court of the Family Court found that enforcement of orders is discretionary as a result of the clear wording of the section however, the court did not set out how that discretion should be exercised.
The Full Court referred to a passage by the English Court of Appeal in Thwaite v Thwaite [1981] 3 WLR 96 at 102, where the Court of Appeal said:
Where the order is still executory, as in the present case, and one of the parties applies to the court to enforce the order, the court may refuse if, in the circumstances prevailing at the time of the application, it would be inequitable to do so.
In Ramsey & Ramsey (No.2) (1983) FLC ¶91-323, Nygh J considered the nature of the discretion referred to in Ramsey & Ramsey, and noted that:
As the Full Court made clear in Molier & Van Wyk, the court has no power to vary an order made under section 79 or 86 of the repealed Act, except in its machinery provisions. This was affirmed by the High Court in Mullane & Mullane.
Whatever may be the effect of section 80k of the present Act, it does not in my opinion allow the court to refashion an original order, however unjust that order may seem by hindsight.
His Honour concluded that:
If I have no discretion to vary the original order, a refusal to enforce can only be justified on the basis that the unconditional transfer of the legal title to the wife no longer represents her entitlement in equity because, by subsequent conduct of the parties, the husband has reacquired a beneficial interest in the subject property.
It appears that his Honour took the view that the discretion not to enforce an order would only be exercised if enforcement would mean that the party would not receive their entitlement in equity because of subsequent conduct of the parties.
In this case, I have rejected the evidence of the wife, that she had no knowledge of the orders until the enforcement proceedings were commenced.
There is no evidence of a representation upon which she could have acted to her detriment in the sense required to create an equitable estoppel: see Waltons Stores (Interstate) Ltd. v. Maher [1988] HCA 7. There is no evidence of contributions to the property or the circumstances of the parties that would give rise on the part of the wife, to an equitable interest greater than her entitlements under the order: see for example Ramsey & Ramsey (No.2).
I am not convinced that the discretion to enforce is limited to protecting subsequent equitable rights or interests. I see no reason that the broad discretion in s.105 should be limited by equity’s doctrines. If it were, Thwaite’s case is difficult to rationalise. Rather the discretion would be exercised after consideration of the relevant facts and circumstances in the context of the legislative scheme.
I am satisfied that the discretion needs to be founded on conduct or events that occurred after the orders were made (for conduct prior to the order the appropriate course is to apply under s.79a). As a result, delay may be the basis for the exercise of the discretion, analogous to laches being a basis for not exercising the discretion to grant equitable relief. However, delay, of itself, would rarely be sufficient, particularly if the delay is less than the limitation period for enforcement of judgments generally in the jurisdiction. Whilst there is no Commonwealth limitation period, the Limitations of Actions Act 1958 (Vic) provides for a 15 year period on enforcement of judgments in the state courts: see s.5(4).
Significant weight must be given to the importance of litigants being able to enforce orders: prima facie orders should be enforced If the discretion is to be exercised against enforcement, it appears to me that it would be important to clearly identify the facts or circumstances relied on.
In this case, the wife has had the unrestricted use of the property through the period. The husband seeks simple interest, not compound. The wife has not altered her position in reliance on the orders not being enforced. Aside from simple delay, there is nothing that the wife can rely upon as a basis for not exercising the power to enforce. In the circumstances of this case, there is nothing that satisfies me it is appropriate to decline to enforce the judgment.
I therefore make orders for the enforcement of the consent orders in the terms of the application.
I certify that the preceding thirty-five (35) paragraphs are a true copy of the reasons for judgment of Riethmuller FM
Associate:
Date:
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