WILKIE & WILKIE - [2014] FamCA 1207

FAMILY COURT OF AUSTRALIA

WILKIE & WILKIE

[2014] FamCA 1207

FAMILY LAW – Enforcement – Wife refuses to sign contract for sale of house – Orders clear – Costs

Family Law Act 1975 (Cth)

Prantage & Prantage [2012] FamCAFC 84

APPLICANT:

Mr Wilkie

RESPONDENT:

Ms Wilkie

INTERVENOR:

INDEPENDENT CHILDREN’S LAWYER:

FILE NUMBER:

MLC

4560

2014

DATE DELIVERED:

26 November 2014

PLACE DELIVERED:

Melbourne

PLACE HEARD:

Melbourne

JUDGMENT OF:

Cronin J

HEARING DATE:

26 November 2014

REPRESENTATION

COUNSEL FOR THE APPLICANT:

Mr Royston

SOLICITOR FOR THE APPLICANT:

Landers & Rogers

COUNSEL FOR THE RESPONDENT:

Mr Lipshutz

SOLICITOR FOR THE RESPONDENT:

Berry Family Lawyers

Orders

That the wife forthwith sign the contract of sale dated 22 November 3014 in relation to the property at B Street, Suburb C.
That the wife pay the husband’s costs of this application on a scale basis by agreement and failing agreement as assessed.
That the reasons this day be transcribed.
That the application filed 26 November 2014 is otherwise dismissed.
That forthwith the wife sign the contract of sale dated 22 November 2014 providing for the sale of the property at B Street, Suburb C;
That the reasons this day be transcribed;

IT IS NOTED that publication of this judgment by this Court under the pseudonym Wilkie & Wilkie has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).

FAMILY COURT OF AUSTRALIA AT MELBOURNE

FILE NUMBER: MEL 4560 of 2014

Mr Wilkie

Applicant

And

Ms Wilkie

Respondent

REASONS FOR JUDGMENT

On 3 October 2014, in the judicial duty list, based upon an application brought by the husband relating to the disputed sale of the property at B Street, Suburb C, Thornton J dealt with a variety of orders – some of which were by consent and some of which were not – it seems common ground that the prelude to that application was that the property had been on the market since January of this year and had not been sold.
It is, therefore, of some significance that her Honour made the orders that she did on 3 October. Those orders included the specific appointment of D Agents. I note that that was not an order by consent and, indeed, I have had the advantage today of reading some of the background material. It was quite clear that the wife wanted a different agent to whom she also makes reference in the affidavit she has relied on today. In any event, her Honour made the order and no appeal resulted.
Her Honour then made a second order which clearly is marked as being by consent of both parties. That order provides that the property was to be sold by public auction on terms and conditions to be agreed and, failing agreement, as determined by the selling agent. Those last words were not by consent but, rather, orders of the Court. Again, there has been no appeal against that order. I do not have the reasons that her Honour gave to make that order.
In any event, the orders then provide:
In the event the parties cannot jointly agree on whether to accept or reject any offer then the parties shall abide by the recommendations of the selling agent and there be liberty to the wife to apply on short notice.
It is quite clear that an auction did take place and it seems the reserve price was $1.55 million. The wife today has provided me with an affidavit. Attached to which is a sworn valuation by a firm E Valuers and signed by a Mr F. Mr F said that he inspected the property on 5 June and valued it on that date at $1.55 million. One can, therefore, understand why – whatever the husband wanted at the auction – the wife had at least that figure to work with and that was the auction reserve.
The evidence of the husband shows that the property did not reach that price and, ultimately, the agent has now provided advice to both parties that, at best, he can come up with a purchaser who will pay $1.5 million. The dilemma is that it seems to be a conditional offer that the contract has to be signed by the vendors by close of business today. It seems to me that the purchaser is a bona fide purchaser because there is a contract signed. The problem is that the wife is of the view that the property is being undersold.
Notwithstanding that this matter was brought on with very short notice, Mr Lipshutz – on behalf of the wife – has made an oral application which is said to rely on the liberty to the wife to apply. Unfortunately or otherwise, I do not know what those words mean. There is no limitation on them as to the nature of the application that the wife could make. What Mr Lipshutz has put to me is that I should interpret them so that the wife can apply to set aside the very terms of the earlier part of the order which is to allow the selling agent to decide the price.
Whilst the words are confusing, the rest of the order is quite clear and, it would seem odd that a court would say that if the parties are bound by the recommendations and one of them does not like it, they can come back to Court again. Again, I do not understand why those liberty to apply provisions are there.
What the wife relies upon in paragraph 9 of her affidavit is inquiries that she has made of two agents in the relevant area. She says that they believe that the property has been undersold and ought to be sold for at least $1.65 million. I hesitate to be critical but, indeed, I have no idea where they get those figures from. I do not know whether I can accept their expertise or whether they are simply just experienced agents guessing what the market will bear. I look at their unqualified views in the light of what the wife provides herself from the sworn valuation in June. It seems to me that I can give very little weight to the words that the property ought to be sold for at least $1.65 million and, indeed, that they believe that it has been undersold.
That agent estimate or statement might have some weight and, indeed, credibility, if they were able to show comparable sales and point to purchasers or clients who are willing to pay that sort of money. I have no idea where all of that is coming from. At its highest, the wife said there was a property which was in the same area but of a lesser value which has recently sold for $1.495 million. What inference that permits remains unclear. Is that something that she has found out herself or is that something that the agents have told her? In any event, who decides that it is of lesser value – albeit in the same area – and where did the information come from that it sold for $1.495 million?
The wife then goes on to say that she had been further advised by one of the two agents that the property had been marketed by the nominated agent in the orders in the range of $1.3 million. She commented that was undervalued and not designed to achieve the highest and best price. The problem with that statement is that it is without any factual foundation. As I pointed out earlier, paragraph 1 of the orders of Thornton J appointed the particular agent. Paragraph 2 of the orders was that the parties were to sell the property by public auction on terms and conditions to be agreed. Whether the wife was complaining about the marketing of the property prior to the auction, I am unsure. But I am told today that the registered proprietor of the property is the wife and, indeed, the auction went ahead.
Thus, the best evidence I have today is that the only person around who is willing to pay the amount of $1.5 million is a purchaser and in line with the words in paragraph 6 of the orders – the agent has now recommended that.
The alternative is for me to take the path suggested by the wife and refuse the husband’s application. Her position by what is an offer as to damages. Whilst, superficially, that is attractive, it seems to me that it is ill-considered having regard to the fact that paragraph 9 of the wife’s affidavit is of little weight in the circumstances.
As I pointed out, I do not have reasons why her Honour made those orders. I draw some comfort from the fact that the auction went ahead after the orders were made at a point in time when neither party appealed.
The application in a case lodged by the husband today seeks that that the contract of sale – which is now dated 22 November – be signed and, failing that, the Court appoint a Registrar to exercise the powers under s 106A of the Act to execute the contract. I shall return to that issue in a moment after I have some discussions with counsel as to whether or not it is necessary for me to make that order, but I observe also that any order I make today does not preclude the wife from pursuing, as against the husband, any action that she considers he may have been involved in, in relation to selling the property at a price less than what is appropriate in the market sense.
The same comment applies in respect of any cause of action that the wife may have in relation to the agent if, indeed, there is some evidence to show that D Agents marketed the property for an amount less than it should have been. To that extent, it seems to me the prejudice to the wife in me making the orders is extremely limited. I am, therefore, exercising the powers of enforcement of her Honour’s orders rather than making any other orders relying on powers in section 114 of the Act.
ORDERS DELIVERED
I have an application by the successful applicant for costs. Section 117 of the Family Law Act 1975 (Cth) (“the Act”) provides that in proceedings under the Act, each party shall bear their own costs unless there is a reason to justify departure from that principle. If the Court is contemplating departing from that principle, it must contemplate the matters set out in s 117(2A) of the Act. In this particular case, the claim for costs is $3700 – which is calculated pursuant to a cost agreement. Costs are opposed by the unsuccessful wife and, indeed, if I was to determine that there should be an order for costs then it is argued by the wife that they should be reserved.
In my view, there is a justifiable reason for making an order for costs here. That order is that the orders made by Thornton J on 3 October are quite clear. Whilst I concede Mr Lipshutz’s point that there is a provision for liberty to apply, it is interesting that that liberty to apply was only exercised at what might be facetiously described as the 11^th hour. The wife could have brought this application – to prevent what has now occurred – some days ago.
It seems to me that there is a justification, therefore, to depart from the principle. For the purposes of s 117(2A), it would be hard for me to find that the parties are impecunious having regard to the fact that each of them has an interest in the property that is being sold for in excess of a million dollars.
There are no issues in this case in relation to Legal Aid or the failure to comply with orders. But it seems to me that the most important issue here is that the husband has had to take this step expeditiously having regard to the fact that the purchasers have made their position very clear.
On that basis, I propose to make an order for costs. In my view, it would not be appropriate for the Court to make an order for indemnity costs in this case because, as the Full Court said in Prantage & Prantage [2012] FamCAFC 84, the case in which indemnity costs can be ordered has to be unusual or there has to be circumstances as set out in previous authorities to justify such a departure from the principle that each party would normally pay costs on scale.

I certify that the preceding twenty-one (21) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Cronin delivered on 26 November 2014.

Associate:

Date: 22 December 2014