WINTERS & DOYLE

[2013] FamCA 931

FAMILY COURT OF AUSTRALIA

WINTERS & DOYLE [2013] FamCA 931

FAMILY LAW – COSTS – Where the husband seeks an order for costs on an indemnity basis – where the husband seeks costs on the basis that those costs would not have been incurred had not the wife knowingly made a false allegation or statement – where the wife also seeks an order for costs – where the general position is that the parties bear their own costs – where there should be no order as to costs

FAMILY LAW – INJUNCTION – Application for injunction to restrain the wife from dealing with the former matrimonial home – where an appeal is on foot –  where the husband claims that his appeal may be rendered nugatory in the event that the wife disposes of or encumbers her interests in the former matrimonial home – where there is no principle whereby the husband is entitled to require the wife to preserve in her hands an amount that would satisfy his claim on appeal – where the husband’s application is dismissed

APPLICANT: Mr Winters

RESPONDENT: Ms Doyle

FILE NUMBER: PAC 1161 of 2011

DATE DELIVERED: 2 December 2013

PLACE DELIVERED: Sydney

PLACE HEARD: Sydney

JUDGMENT OF: Loughnan J

HEARING DATE: 22 November 2013

REPRESENTATION

COUNSEL FOR THE APPLICANT: Mr J Lloyd

SOLICITOR FOR THE APPLICANT: Paltos Briggs Family Lawyers

COUNSEL FOR THE RESPONDENT:

SOLICITOR FOR THE RESPONDENT: Mr D Holmes

Orders

1. The Applications in a Case of the husband filed 8 February 2013 and 7 November 2013 are dismissed.

2. The Application in a Case of the wife filed 8 February 2013 is dismissed.

3. There are no orders for costs.

IT IS NOTED that publication of this judgment by this Court under the pseudonym Doyle & Winters 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 SYDNEY

FILE NUMBER: PAC 1161 of 2011

Mr Winters

Applicant

And

Ms Doyle

Respondent

REASONS FOR JUDGMENT

Introduction

1. These are proceedings arising out of proceedings for parenting and property settlement orders determined by me on 11 January 2013. Each of the parties seeks an order for costs arising out of the substantive proceedings. In addition, the husband seeks an injunction restraining the wife in respect of the former matrimonial home. The respective applications are opposed.

Costs

The husband’s application

1. By his application filed 8 February 2013 the husband seeks the following costs:

   a)the costs of the substantive proceedings on an indemnity basis for the period 16 March 2011 to 2 March 2012 as agreed or failing agreement, as assessed;

   b) the costs incurred by the husband associated with the single expert Dr W in the sum of $7,700;

   c)the costs incurred by the husband associated with the appointment of an Independent Children’s Lawyer in the sum of $1,650; and

   d)the costs of the costs proceedings on an indemnity basis as agreed or failing agreement, as assessed.

2. The wording of the application and the thrust of the submissions made on behalf of the husband reveal that his costs claim is based solely on the provisions of s 117AB. In case I am wrong about that and the husband’s claim does not solely rely on that provision, I will consider the issue of costs as between the parties later in these reasons, in the context of the wife’s claim.

3. The husband claims his costs for the proceedings on an indemnity basis, for the period commencing on the date the wife filed a Notice of Child Abuse or Family Violence (16 March 2011) and concluding on the date consent orders were made ending the requirement in Court orders for the husband’s time with the children to be supervised (2 March 2012). The costs incurred by the husband for that period were $202,945[1]. Similarly, he claims the costs incurred by him for a single expert forensic psychiatrist and for an Independent Children’s Lawyer.

   [1] Paragraph 9 of the affidavit of Peter Milevski filed 8 February 2013

4. It is submitted that those costs would not have been incurred had not the wife knowingly made a false allegation or statement in the Notice.

The Law

1. Provisions of the Act were amended with effect from 7 June 2012. However, the parties agree and I am satisfied, that amendments to s 117 and 117AB only apply to proceedings commenced after that date[2]. In the context of the costs applications before me, sections 117 and 117AB of the Family Law Act 1975 (Cth) relevantly provided as follows:

   [2] Family Law Legislation Amendment (Family Violence and Other Measures) Act 2011 - Act No. 189 of 2011. Section 45 of the amending Act appears in Schedule 1 and provides: “The amendments made by items 1 to 8, 11, 13, 17 to 21, 30 to 34, 37, 38 and 40 to 43 of this Schedule apply in relation to proceedings instituted on or after the commencement.” Items 40 to 43 of schedule 1 amend s 117 and repeal s 117AB. The commencement date was 7 June 2012.

   117  Costs
   (1) Subject to subsection (2), subsection 70NFB(1) and sections 117AA, 117AB, 117AC and 118, each party to proceedings under this Act shall bear his or her own costs.
   (2)  If, in proceedings under this Act, the court is of opinion that there are circumstances that justify it in doing so, the court may, subject to subsections (2A), (4) and (5) and the applicable Rules of Court, make such order as to costs and security for costs, whether by way of interlocutory order or otherwise, as the court considers just.
   (2A)  In considering what order (if any) should be made under subsection (2), the court shall have regard to:

   (a)  the financial circumstances of each of the parties to the proceedings;
   (b)  whether any party to the proceedings is in receipt of assistance by way of legal aid and, if so, the terms of the grant of that assistance to that party;
   (c)  the conduct of the parties to the proceedings in relation to the proceedings including, without limiting the generality of the foregoing, the conduct of the parties in relation to pleadings, particulars, discovery, inspection, directions to answer questions, admissions of facts, production of documents and similar matters;
   (d)  whether the proceedings were necessitated by the failure of a party to the proceedings to comply with previous orders of the court;
   (e)  whether any party to the proceedings has been wholly unsuccessful in the proceedings;
   (f)  whether either party to the proceedings has made an offer in writing to the other party to the proceedings to settle the proceedings and the terms of any such offer; and
   (g)  such other matters as the court considers relevant.

   117AB  Costs where false allegation or statement made
   117AB(1) [Application of section] This section applies if:
   (a) proceedings under this Act are brought before a court; and
   (b) the court is satisfied that a party to the proceedings knowingly made a false allegation or statement in the proceedings
   117AB(2) [Court must order some or all of the costs of another party] The court must order that party to pay some or all of the costs of another party, or other parties, to the proceedings.

2. Therefore, if s 117AB applies a costs order must be made. Otherwise, the general position is that parties bear their own costs but if circumstances justify it the Court may make such order as it considers just.

Discussion

1. It is convenient to first consider whether s 117AB is invoked in these proceedings.

2. The parties’ advocates agreed that Prantage & Prantage [2013] FamCAFC 105 is relevant authority, among other things, for the application of s 117AB.

3. In Prantage the Full Court, Thackray & Ryan JJ, in this respect with whom Murphy J agreed, considered that the terms of s 117AB are satisfied when a party makes a false assertion which they know is unsupported by any evidence and that would include any allegation which is made knowingly, or without belief in its truth, or recklessly, careless whether it be true or false. I will not repeat here the discussion in the judgment leading up to that conclusion. I do not recall the solicitor for the mother cavilling with that proposition.

4. In the context of these proceedings, it is the husband’s case that the wife made the allegations in a Notice of Abuse, knowing they were false or recklessly or carelessly as to whether they were true or false.

5. It is important to record that as the cases were argued at the substantive hearing, there was no proposal that the time of either parent with the children should be supervised. That meant it was not necessary for me to make findings about the detail of all of the allegations.

6. The wife filed a Notice of Child Abuse or Family Violence on 16 March 2011. The Notice contained the following allegations:

At paragraph 6 of the Notice the wife described the acts or omissions that she alleged constituted abuse as follows:

“1.The Father has disclosed that he has sexually abused his younger sister when she was a child.”

1. At paragraph 8 of the Notice the wife identified the affidavit containing evidence of that allegation as her affidavit filed 16 March 2011 at paragraphs 9, 12 & 23.

2. The topics addressed in those paragraphs are:

   9.a conversation between the parties in about 2003 when the wife says the husband told her that when his sister Ms Q Winters was a baby, he touched her on the vagina.

   12.a conversation between the parties in about December 2002 when the wife says the husband told her that when they were kids, he and his brother tickled their sister Ms DC Winters until she wet herself.

   23.a disclosure made to the wife on 24 February 2011 by her mother’s cousin that on Boxing Day 2003 she saw the husband touching his sister on the breasts and pushing himself up against her while in the maternal grandparents pool.

3. Of those paragraphs, only paragraph 9 would seem to fall within the wording of the allegation. I addressed this issue at paragraphs 33, 97 & 98 of my reasons for judgment.

4. Whatever might be said about this matter, it could not be said to fall within the scope of s 117AB. It was an agreed fact before me that the conversation referred to in paragraph 9 took place. The parties disagreed about which of the husband’s sisters he had referred to. Unremarkably, there were competing versions of a conversation in 2003 about events in about 1990. The wife did not concede that her evidence was wrong and I could not make a finding on the issue. It cannot now be said that the allegation was made by the wife knowing it was false or recklessly or carelessly as to whether it was true or false.

At paragraph 10 of the Notice the wife described the acts or omissions that she alleged constituted a risk abuse as follows:

“1.The Father exposes himself in the presence of the children, walking around the home naked and touching his penis in the presence of the children.

2.The father has tried to masturbate in the children’s bedroom in the presence and within the hearing of the children.

3.The children, in particular C is at risk of sexual abuse in the case of the Father who may be unable to control his actions and behaviour.”

1. At paragraph 12 of the Notice the wife identified paragraphs 21, 22, & 23 of the affidavit as containing evidence of those allegations.

2. The topics addressed in those paragraphs are:

   21.the wife says that on 20 July 2010 she asked the father to leave their bedroom because he was masturbating and she found him masturbating in the children’s bedroom and they had an argument.

   22.the father walking around the house naked and playing with his penis in front of the children.

   23.a disclosure made to the wife on 24 February 2011 by her mother’s cousin that on Boxing Day 2003 she saw the husband touching his sister on the breasts and pushing himself up against her while in the maternal grandparents pool.

3. I addressed these issues at paragraphs 16 – 28, 33, 97 – 114, 146 - 150, 186 & 189 of my reasons for judgment.

4. In relation to the wife’s evidence at paragraphs 21 and 22 I did not find that the wife knowingly made false allegations or that she made them recklessly or carelessly as to whether they were true or false. The fact of the father masturbating was an agreed fact. I did not make findings about the other aspects of the wife’s evidence in those paragraphs. I do not have a record of the wife resiling from her evidence.

5. I understood that the issue dealt with at paragraph 23 of the wife’s affidavit was the gravamen of the husband’s argument for costs. I particularly addressed that matter at 16 - 28 & 99 - 112 of the reasons for judgment. Again, I did not find that the wife made the allegation, knowing it was false or recklessly or carelessly as to whether it was true or false. Starting at paragraph 106 of my reasons, I said:

   106.Although no longer pressed, the first thing to say is that it is not possible to make a finding or inference against the husband in respect of the events at the pool party in 2003. The only witnesses to suggest any impropriety have resiled from their testimony. Those directly involved categorically deny the allegations, albeit that there are problems of lack of independence, poor memory and recollections being refreshed. There were several other adults at the party, including the wife and the wife’s parents and they observed nothing untoward.

   107.Next, compared to the serious nature of the other allegations in the case (for example, of rape), it is difficult to see why the revelations about the pool party assumed such significance in the mind of the wife, let alone in her case. Particularly so, when the wife did not at any time during the marriage or since, observe any similar impropriety by the husband towards their children.

   108.This, at worst, ambiguous event was said to be the catalyst for the wife’s earlier conviction that the husband must be supervised. No adequate explanation was given for that fact and it simply makes no sense.

   109.Senior counsel for the husband invited the Court to find that the wife embarked upon an improperly based course to limit the husband’s time with the children. It was submitted that her allegation about the incident in the pool was a story concocted by her and her family in an attempt to exclude the husband from the children’s lives. 

   110.In support of this submission, senior counsel for the husband noted that the wife continued to allow the children to have unsupervised time with the husband after she knew about the pool incident. Further, on 15 February 2011, the wife’s solicitors sent a letter to the husband outlining their instructions. Importantly, that letter made no complaint about the children’s safety with the husband. The letter dated 15 February 2011 was not in evidence but no objection was made to that submission. The wife made her first complaint to the Department of Community Services on 23 February 2011 and made the second complaint on 27 February 2011. The matters complained about on those dates would have been known to the wife at the time the letter was written on 15 February 2011. It was submitted that that those allegations constituted “a wicked lie”. 

   111.Finally, having heard the cross-examination of Ms KK and Ms LL in February 2012, the wife proposed and implemented a resumption of unsupervised time with the husband. The outcome is that the wife does not harbour concerns for the children in the husband’s care, arising out of the 2003 incident, or otherwise.

   112.Nothing can be inferred adverse to the husband from this issue. The wife’s treatment of the allegations is puzzling and supports a concern that she might be eager in the future to accept and promote criticism of the husband’s parenting capacity.

6. I did not make the finding asked of me by the husband’s counsel. In an exchange with learned senior counsel for the husband in relation to this costs issue I recall us coming to an accommodation to the effect that I am bound on this point by the findings made or not made in the reasons for judgment in the substantive proceedings. On reflection I think that is not right. In my view I could now make a finding that I did not make in those reasons, as to whether the wife made the “pool” allegation falsely or not caring whether it was true or false. Of course I would need to be very careful about drawing conclusions long after the trial about evidence presented at the trial.

7. That said, in my view the finding required by s 117AB is not available here. Firstly, this was not the wife’s allegation. She could have queried it, she could have rejected it, but it was not something she invented.

8. I said what I said in the passages quoted above but in my view that is not enough for present purposes. The judgment deals at some length with the sexual abuse of the wife as a child. Can it now be said that it was unreasonable for a person with that history and with the experience of somewhat disinhibited behaviour by the husband and his seemingly insensitive approach to negotiations about the sexual relations with her, to assume the worst of the husband because of the information volunteered by her mother’s cousin? Minds might differ about this issue but I did not find that the wife pursued the allegation knowing it to be wrong or with indifference to whether it was right or wrong and I make no such finding now.

At paragraph 14 of the Notice the wife described the acts or omissions that she alleged constituted family violence as follows:

“1.The Father has sexually abused his younger sister when she was a child.

2.The father has sexually abused the Mother during the marriage.”

1. At paragraph 16 of the Notice the wife identified paragraphs 9, 12, 15 & 16 of the affidavit as containing evidence of those allegations.

2. The topics addressed in those paragraphs are:

   9.a conversation between the parties in about 2003 when the wife says the husband told her that when his sister Ms Q Winters was a baby, he touched her on the vagina.

   12.a conversation between the parties in about December 2002 when the wife says the husband told her that when they were kids, he and his brother ticked their sister Ms DC until she wet herself.

   15.the husband pressing the wife for sexual intercourse when she opposed it, the wife being pregnant, heavily bleeding and having experienced an earlier miscarriage.

   16.the wife’s allegations that the husband raped her on several occasions.

3. I have referred to paragraph 9 earlier in these reasons. I do not recall addressing the evidence at paragraph 12 in my reasons for judgment. Paragraphs 15 & 16 were dealt with in paragraphs 115 – 131 of the reasons for judgment. The first thing to say is that these allegations were not necessarily the basis for the wife seeking supervision of the father’s time with the children. The wife did not resile from them and I did not find that they were untrue. In my view there is no basis for finding that the wife pursued the allegations at paragraph 14 of the Notice, knowing them to be wrong or with indifference to whether they were right or wrong.

At paragraph 18 of the Notice the wife described the acts or omissions that she alleged constituted a risk of family violence as follows:

“1.The Father has sexually abused his younger sister when she was a child.

2.The Father has sexually abused the Mother during the marriage.

3.The Father has exposed himself, walking around the home naked and touching his penis in the presence of the children.

4.The Father has attempted to masturbate in the children’s bedroom in the presence and within the hearing of the children.

5.The children, in particular C is at risk of sexual abuse in the case of the Father who may be unable to control his actions and behaviour.”

1. At paragraph 20 of the Notice the wife identified paragraphs 9, 12, 15, 16, 21, 22 & 23 of the affidavit as containing evidence of those allegations. I have already referred to the evidence in those paragraphs and the treatment of those issues by me.

1. There is no basis for finding that the wife pursued the allegations at paragraph 18 of the Notice, knowing them to be wrong or with indifference to whether they were right or wrong.

2. It follows that I do not find that s 117AB applies in this case. It is unnecessary therefore to consider the other issues raised by the husband’s application, being the basis for calculating his costs and the estimate provided. In the latter regard the estimate included costs associated with the financial aspects of the proceedings. I recall that there was a concession that the claim was exaggerated to that extent. In the circumstances, no problem arises.

3. As this was the foundation of the husband’s main costs application, it will be dismissed.

4. The husband also sought to recover the costs incurred by him associated with the representation of the children and with the appointment of the single expert. These matters can be shortly addressed. There is no basis for the order sought by the husband. The suggestion is that the wife exaggerated her allegations against the husband and without those allegations it would not have been necessary to appoint an ICL or to obtain the opinion evidence of a forensic psychiatrist. I reject both propositions. There were a number of features of these proceedings which warranted both appointments and to the extent that they were raised by the wife, those features were neither withdrawn by the wife on or before the date of the orders of 2 March 2012 nor were they rejected by me.

5. There will be no order for the wife to pay the husband’s costs.

The wife’s application

1. By her application in a case filed 8 February 2013 the wife seeks that the husband pay her costs of the substantive proceedings and of an interim parenting application which was filed on 22 September 2011.

2. As to the application of s 117,In Jensen v Jensen (1982) FLC 91-263; (1982) 8 Fam LR 594, Nygh J noted:

   Sub-section (2) goes on to say that if the court is of the opinion in a particular case that there are circumstances that justify it in doing so, it may make such order as to costs as it sees fit. The effect of these provisions has been considered by the High Court in Penfold v Penfold (1980) 5 Fam LR 579. It is clear that sub-s (1) introduces a general rule that there shall be no order as to costs in proceedings under this Act. However, the High Court in Penfold v Penfold has made it quite clear that the court has a wide discretion in awarding costs and that it is not necessary for there to be established special circumstances before an order for costs can be made, nor indeed is it necessary for the court to give any reasons at all for making an order as to costs.

3. I turn to the provisions of s 117(2A).

4. As to the financial circumstances of the parties, I refer to the findings made by me in the substantive proceedings. The husband deposes as at 10 October 2013 that he has assets worth $43,739 and a superannuation interest which he puts at $172,442 as at 30 June 2013. The husband expected to reduce his liabilities by about $12,000 from the proceeds of sale of some shares. If I understand his evidence correctly that would reduce his liabilities to about $130,677.

5. The husband earns $2,275 per week in wages and receives $20 per week by way of Family Assistance. He spends $2,625 per week. He expects to have dental expenses of the order of $7,000 in the near future.

6. The wife receives $656 per week from tutoring and Centrelink payments. That does not include child support from the father, which she says is variable. The assessed rate is $272.25 per week and at October 2013 there were arrears of $8,323. She spends $1,005 per week. The wife puts her assets at $1,118,753 and says she owes her parents $741,613, representing advances for living expense, legal fees, rent and the discharged mortgage debt on the Suburb E property.

7. Neither party has a grant of legal aid.

8. As to the conduct of the parties in the proceedings, the only issue raised in relation to this matter was the fact of the husband’s prosecution of an unsuccessful interim parenting application. In the pantheon of family litigation these proceedings represent a very bitter contest and unfortunately, the overall cost of the proceedings bears no sensible relationship to the matters at issue. Some of that can probably be traced to issues that arose between the parties during their marriage. In my view it is not possible to sheet that outcome home to only one of the parties.

9. Neither party was wholly unsuccessful except insofar as the husband brought and prosecuted an interim application for parenting orders following the release of the report of the single expert. The recommendations of the expert supported the orders sought by the husband in the interim application. The father was not to know that they would not be taken up on a final basis. That said, he should have been advised that parenting decisions are left to the Court and although experts are invariably the source of important evidence, their recommendations are not always adopted. That interim parenting application failed. However, at the same time there were also some financial issues addressed.

10. Otherwise there were competing parenting and property settlement proceedings and as is usually the case, neither party’s application was dismissed. Neither party was wholly unsuccessful.

11. There was a written offer of settlement. It is the wife’s case that the husband imprudently rejected the wife’s proposals contained in a letter dated 17 May 2012. The husband argues that the proposals were subject to certain matters that could not be ascertained at the time the offers were made. There is something in that argument.

12. The letter from the wife’s solicitors contained two proposals, one which would compromise both parenting and property proceedings and the second, related only to property settlement. The settlement proposal in relation to parenting was for the parties to have equal shared parental responsibility save for the wife to have sole responsibility in relation to education and medical treatment. The children would live with the wife and have time with the father including alternate weekends and one overnight each intervening week and half the school holidays. The orders ultimately made had only medical matters reserved to the wife alone and provided for one less overnight each fortnight, with the father.

13. As to the financial proposals, the husband would probably have been better off if he had accepted either proposal. That said the circumstances at trial were different from those when the letter was sent. To the extent that the treatment of paid legal fees were different, they being largely excluded from the proposals, the offers may have been seen as unclear. However, as was argued on behalf of the wife, if the husband was unsure, he could have made enquiries of the wife’s lawyers, rather than do nothing.

14. In my view the general position should apply and there should be no order as to costs. The wife is in a stronger capital position than the husband. The husband has a greater income, albeit more than fully committed. The greater parenting and financial load in respect of the children will fall to the wife. There were material differences between the wife’s proposals and the ultimate parenting orders. There were some imponderables in the financial proposals but the husband would probably have been better off, had he accepted the stand alone proposal.

Conclusion under Section 117

1. The general position is that parties bear their own costs. Section 117(2) provides that if there are circumstances justifying an order for costs the resultant order is to be just. Those decisions are made by reference to section 117(2A). On balance there should be no order as to costs.

INJUNCTION

1. By his Application in a Case filed 7 November 2013 the husband seeks an injunction restraining the wife from dealing with the former matrimonial home. The Application is opposed by the wife. 

2. Pending the determination of the Application the position has been preserved by the wife giving an undertaking to the Court in terms of the order sought at paragraph 2 of the Application in a Case expressed to be pending judgment in this Application or the passage of four months whichever is the earlier.

3. It is the husband’s Application that his claims both in relation to costs and also in relation to the appeal on foot maybe rendered nugatory in the event that the wife disposes of or encumbers her interests in the property which is the former matrimonial home at D Street, Suburb E. I have determined that there will be no order for costs and therefore that basis for an injunction falls away.

4. The husband has lodged an appeal seeking among other orders, that the wife pay him $335,032.

5. The husband notes that the wife’s evidence is that she has assets of a bit over $1,118,000 and that she has a debt to her parents of $741,613.

6. The wife discloses an income of $656 per week from tutoring and Centrelink payments and a Child Support entitlement of $272.25 per week which is in arrears. She discloses weekly liabilities of $1,005.

7. The husband notes that a development application has been submitted in relation to the Suburb E property and on 16 October this year that development application was approved. The development application is for the construction of a larger residence on the property and it is the wife’s evidence that it is intended that the new structure will house herself, the children and her parents.

8. The husband also notes that it is the wife’s evidence that construction is planned to commence soon and that her parents will funds the construction costs and that she would transfer the Suburb E property to them.

9. The husband gives evidence that his solicitors wrote to the wife’s solicitors on 21 October 2013 seeking an undertaking that she would not enter into a contract for sale of the property whereby she transferred her interest in the property or encumbered the property pending the determination of the appeal and the costs proceedings. It is the husband’s evidence that no response has been received from the wife’s lawyers to the correspondence of 21 October 2013 and that evidence is contained in the husband’s Affidavit which was sworn on 4 November 2013.

10. It is the husband’s evidence, and it is not challenged, that as at the date of the Affidavit and I understand it continues to be the case at the date of the hearing before me, the Suburb E property was registered in the wife’s sole name and that it was encumbered. 

11. It appears from the evidence of the wife and that of her father that the mortgage that I recorded in relation to the Suburb E property was paid out by the wife’s father subsequent to the final hearing. It is asserted by the wife and by her father that the wife’s father continues to provide financial support to the wife. The circumstances are that the wife has in her name a property that is not formally encumbered and which I found had a value in the order of $1,100,000.The debts that I recorded were owed by the wife for the purpose of the substantive judgment added up to more than $700,000 and they included a mortgage to a bank and a debt including monies advanced for the purposes of legal fees to her father.

12. The concern of the husband is that under the arrangements proposed by the wife and her father what is presently in effect an equity of more than $350,000 will be diminished by the transfer of the title of the Suburb E property to the wife’s father. That will occur under the arrangements made between the wife and her father because the father will hold the entire beneficial ownership of the Suburb E property and will only account to his daughter for the value of her equity in the property after deducting her existing debt to him, together with the ongoing debt created by his advances towards her living expenses and other payments. In his affidavit sworn 21 November 2013 the wife’s father gives evidence about an agreement, presumably between him, his wife, Jill and their daughter, the wife in these proceedings, as follows:

    13.It was agreed that the money required to develop [D Street] would be provided by Jill and me on condition that the title of [D Street] was transferred to us. Then, on the sale of [2 D Street] we would pay [Ms Doyle] the sum equivalent to the equity in D Street minus any further monies paid by me on [Ms Doyle] and the children’s behalf between now and the conclusion of the all pending Court matters.

    14.At the present time, and based on a current value of [D Street] of $1,100,000, after deducting the monies owed to me, the sum payable to [Ms Doyle] as per the agreement referred to in the above paragraphs would be approximately $346,725.

13. First as to the Court’s power to grant an injunction, this matter was not extensively argued before me. As a general proposition my jurisdiction in relation to the parties’ property was exhausted by the final orders. The remaining possible heads of power would seem to be the power to take action under the slip rule; the power to grant a stay, the power to make machinery orders and the power in respect of costs.

14. On the dismissal of the costs applications, of the available heads of jurisdiction, the only relevant power is that to order a stay. It seems to me that the husband’s application is of the same nature as an application for a stay. He seeks that the Court interfere with the rights remaining with the wife, after the conclusion of property settlement. In this instance it is too late to seek a stay as the property is now in the wife’s sole name.

15. The reason for the application is that, if the husband is successful on appeal he may be unable to readily recover the resultant award. On that basis, for present purposes I will assume that I have power to grant the order sought.

16. There is a power to grant an interlocutory order or injunction in any case in which it appears to the court to be just or convenient to do so and either unconditionally or upon such terms and conditions as the court considers appropriate[3].

    [3] Section 114(3)

17. For those reasons, I take it that in considering whether it would be just or convenient to grant an injunction I should refer to the principles in relation to granting stays. In Jackson & Balen [2009] FamCAFC 131 the Full Court (at [28]) set out the principles applicable to an application for stay as follows:

    28.The principles to be applied in hearing a stay application pending an appeal are well settled (see Federal Commissioner of Taxation v Myer Emporium Ltd [No. 1] (1986) 160 CLR 220 at 222; Alexander v Cambridge Credit CorporationLtd (1985) 2 NSWLR 685; Jennings Construction Ltd v Burgundy Royale Investments Pty Ltd (1986) 161 CLR 681). Those authorities stress the discretionary nature of the application which should be determined on its merits. Principles relevant to this matter include the following:

    ·       the onus to establish a proper basis for the stay is on the applicant for the stay. However it is not necessary for the applicant to demonstrate any “special” or “exceptional” circumstances;

    ·       a person who has obtained a judgment is entitled to the benefit of that judgment;

    ·       a person who has obtained a judgment is entitled to presume the judgment is correct;

    ·       the mere filing of an appeal is insufficient to grant a stay;

    ·       the application must be bona fides;

    ·       a stay may be granted on terms that are fair to all parties - this may involve a court weighing the balance of convenience and the competing rights of the parties;

    ·       a weighing of the risk that an appeal may be rendered nugatory if a stay is  not granted – this will be a substantial factor in determining whether it will be appropriate to grant a stay; and

    ·       some preliminary assessment of the strength of the proposed appeal – whether the appellant has an arguable case.

18. It needs to be remembered that the husband is not entitled to security for his claim on appeal.

19. It was not suggested to me that the application was not bona fides.

20. As to the balance of convenience: The application involves the tension between the husband’s ability to readily enforce a judgment for as much as $335,032 on his successful appeal and the ability of the wife to get on with her living arrangements, in particular for the wife and her parents to commence the work associated with reaccommodating themselves and the parties’ children. Beyond the bare assertions and the obvious implications, there is no relevant evidence on those considerations.

21. The wife is entitled to the benefit of the judgment, which would allow her re-accommodation plans to be implemented. Neither she, nor her father identify any detriment that would accrue if the project is delayed. On the other hand there is no current need for an injunction. The wife currently has an equity in the former matrimonial home that would meet the husband’s claim on appeal, subject to costs, at its highest.

22. There is potential for the plan proposed by the wife and her father to make it more difficult for the husband to recover the entire amount of a judgment following a successful appeal. Whether that situation arises or not depends on a number of factors. First, the appeal would need to succeed. In that event, it would be necessary to know the ultimate award, whether on a re-exercise by the Full Court or upon a new hearing. Next, it will depend on the extent of the advances made by the wife’s father to the wife and, linked with that, the period of time before the appeal is heard.

23. Lending some support to the husband’s claim is the obvious lack of commerciality in the arrangements between the wife and her father. At paragraph 17 of his affidavit the wife’s father indicates that to date he had not charged his daughter interest in relation to various advances he had made. He goes on to say that he has decided that he will or does seek interest in his daughter’s loan. He then goes on to identify the current interest as $37,041 and he notes that it would reduce the notional equity of the wife, which he puts at $346,725, down to $309,684. There is no evidence of any formality in the change of the agreement between the wife’s father and the wife. On the face of the deposition, the lender has unilaterally and retrospectively imported a condition of interest into his agreement with the borrower. That gives rise to a concern that the transfer of title to the wife’s father could arbitrarily diminish the capital that would be available to the wife to meet the claims of the husband. The damage is likely to be incremental but given the evidence of the wife’s father, there could be no guarantee of that fact.

24. Arguing against the husband’s claim, but for the arrangement proposed between the wife and her father, there is no suggestion that the wife will have any capital sum available to meet the husband’s claim on appeal. All her funds are tied up in the Suburb E property.

25. The husband provides no evidence as to the likely hearing date of his appeal or the attempts he has made to expedite the hearing of the appeal or the potential delay before the result of a fresh hearing would be known.

26. There is a risk but no evidence that the husband’s appeal would be rendered nugatory if an injunction is not granted.

27. In terms of the strength of the appeal, I should make some brief reference to the grounds of appeal. It needs to be remembered that the decision at first instance is presumed to be correct.

28. By the first ground it seems to be contended that I misunderstood the orders sought by the husband. I do not have the records to allow that matter to be checked. It is not an inherently unlikely point.

29. The second ground “has been abandoned and taken up in Ground one”.

30. Ground three is framed as a failure to have regard to evidence as to the husband’s taxable income during and since the marriage and to the use of those funds. Without revisiting all of the documents it is difficult to assess the strength of this ground. I dealt with the treatment of paid legal fees from paragraph 238, noting at 239 that the husband’s costs advice letters did not, as they were required to, identify the source of the funds applied to his costs. From 246 I noted the generalised evidence of the husband about the use of a CBA Offset account, including for the payment of his legal fees. However, that was not the subject of an add-back.

1. Ground four argues that there was a double counting of paid legal fees to the extent of $74,000. Again that will be true or not. It is not an inherently unmeritorious argument.

2. Ground five goes to a finding outside the range of discretion and in any event that there is an insufficiency of reasons. The first element is always a difficult matter to argue and its success may depend on the Full Court’s view about other matters. The extent of what was agreed to be a disparity favouring the wife in the parties’ contributions was discussed by me from paragraph 289. Unless the foundation of that reasoning is flawed, this would not seem to be the strongest aspect of the husband’s challenge.

3. Ground six goes to what is described as “section 75(2) adjustments”. The complaint seems to be that the allowance was very small. I am not quite sure what is meant by this complaint.

4. Ground seven goes to the overall outcome and an argument that the orders were not just and equitable. It may be that this is an overall complaint about particular findings.

5. Ground eight seems to relate to the parenting proceedings and I am not sure of its relevance for present purposes.

6. The appeal does not appear to be frivolous or entirely without merit. However, the background facts do not support a finding that even if he is successful in respect of all the elements of his challenge, the husband could succeed in his claim on appeal. On the evidence available to me, the order he seeks would presumably leave the wife with no liquid assets and a splitting order in relation to his superannuation, based on an amount of $50,000. As he has advanced in his “Appellant’s Summary of Argument” about his own situation, there might be some resistance in having the Court on a re-exercise or after a fresh hearing, leave the wife in that position.

7. Therefore, in my view it is unlikely, even if he succeeds in his appeal in relation to property settlement orders, that the husband will achieve an order requiring the wife to pay him as much as $335,032.

8. Therefore the  likelihood is that the wife will have access to funds or assets to meet the possible outcome on appeal.

Conclusion

1. Weighing those matters, in my view an injunction is not justified. It does not follow that even if there were errors made at first instance, the appeal will succeed. If the appeal succeeds, it may not succeed on all grounds. Even if the appeal succeeds on some or all grounds, in my view, as presently advised, the husband is unlikely to achieve the outcome sought in his Notice of Appeal. In any event there is no principle whereby the husband is entitled to require the wife to preserve in her hands an asset that would satisfy his claim on appeal, in case he is fully successful. The husband must demonstrate the need for an injunction and he has failed to do so.

2. The husband’s application will be dismissed.

I certify that the preceding eighty nine (89) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Loughnan delivered on 2 December 2013.

Associate

Date:  2 December 2013