Wong v Wong
[2015] NSWSC 22
•3 February 2015
|
New South Wales |
Case Name: | Wong v Wong |
Medium Neutral Citation: | [2015] NSWSC 22 |
Hearing Date(s): | 03 February 2015 |
Decision Date: | 3 February 2015 |
Jurisdiction: | Equity Division |
Before: | McDougall J |
Decision: | Freezing order extended. |
Catchwords: | PROCEDURE – civil - judgments and orders - freezing orders - whether freezing order should be extended - where District Court proceedings on foot - where defendant unlikely to satisfy judgment debt if unsuccessful in District Court proceedings - where defendant of the view he has no ownership interest in properties legally held in his name - whether basis to fear frustration of enforcement of any judgment plaintiff might recover in District Court. |
Legislation Cited: | Family Law Act 1975 (Cth) |
Category: | Procedural and other rulings |
Parties: | Georges Kam Wong (Plaintiff) |
Representation: | Counsel: |
File Number(s): | 2014/370625 |
JUDGMENT – (EX TEMPORE REVISED 3 FEBRUARY 2015)
RE APPLICATION TO EXTEND A FREEZING ORDER
HIS HONOUR: This is an application to extend a freezing order that was made initially on 18 December 2014 and which has since been extended. For convenience, and without in any way intending to be patronising or condescending, I shall refer to the plaintiff as "Georges", the first defendant as "Martin" and the third defendant (Martin's wife) as "Martina". The second defendant is the Registrar General. The Registrar-General has filed a submitting appearance. There is no need further to mention the second defendant.
In District Court proceedings 2014/188003, Georges asserts that Martin unlawfully assaulted him on 21 December 2012. The substantive injury complained of by Georges is a broken femur, alleged to have happened because Martin "kicked and stomped on" Georges' left leg. The District Court proceedings are fixed for trial on 30 June 2015.
In this Court, Georges claimed a freezing order, limited to $240,000 in aid of his prospective rights in the District Court proceedings. The application is made pursuant to UCPR r 25.14. Clearly, it is authorised by that rule.
The evidence discloses that Martin is the proprietor of two properties at Seven Hills. The title search of each property discloses no relevant encumbrance. However, Martin says, each of the properties is beneficially the property of Martina. That beneficial entitlement is said to arise from what is described as a "prenuptial agreement" made between them on 26 September 2012. It will be observed that this date is approximately three months before the date of the alleged assault.
The evidence of fear of dissipation is in substance that whenever Martin has been asked to indicate what his assets are, he has not included in them the two Seven Hills properties. That, combined with the belated disclosure of the alleged prenuptial agreement, is said to ground the fear that, absent any order, the properties may be dealt with in some way which would have the effect of frustrating enforcement of any judgment that Georges might obtain against Martin.
Taking Martin's evidence at face value (and, since very properly there was no application to cross-examine, I must do so), it would appear that his belief as to his proprietary entitlements was based on the view that, by reason of the asserted prenuptial agreement, he had no ownership interest in the two Seven Hills properties. That belief is incorrect. Martin is the registered proprietor of each of the properties. Whether or not he holds that registered interest on trust for Martina depends on the proper construction of the asserted prenuptial agreement and on the operation of relevant provisions of the Family Law Act 1975 (Cth).
As I understand it, it will be submitted for Martin that even if the asserted prenuptial agreement is not effective for the purposes of the Family Law Act, it may nonetheless take effect as a declaration of trust in favour of Martina. It is not necessary to consider the merits of that submission, for reasons which I hope will become apparent in a moment.
Martina has given no undertaking in relation to her assets. On her case (and on Martin's case), those assets include the beneficial interest in the Seven Hills properties. Martin has offered an undertaking in respect of assets over which he holds an "ownership interest". However, as has been made clear both in correspondence and in submissions, Martin does not regard any such undertaking as extending to his legal interest as proprietor of the Seven Hills properties. Thus, the efficacy of the proposed undertaking is at best questionable.
There is some evidence of the value of Georges' claim. That is based on the evidence of his solicitor, Ms Hunter. She says (with detailed reasons) that a conservative estimate of the claim (including, damages, interest and costs) is $240,000. Submissions were made in particular as to the quantification of the costs, intended to demonstrate that they were grossly overstated. I do not think that the Court is in a position to reach a decision on this. All I can say, from all too long experience in the courts, is that estimates of costs tend to be conservative rather than otherwise. But in any event, bearing in mind what might be called the "tolerances" in the various components of Ms Hunter's estimate, I do not think that any over-allowance for recoverable costs is likely to be of such magnitude as to impeach in any substantial way the overall assessment of $240,000 to which I have referred. It has been made clear that Georges seeks no restraint beyond that sum.
It has been urged strongly for Martin and Martina that there is no present threat of dissipation. That is so. Equally, there is no evidence of any present intention to deal with the properties, implementation of which might be thwarted by a continuation of the freezing order. It appears to be common ground (Martina being a Chinese national) that Martin would not be able to transfer the legal interest in the properties to her unless and until she obtains permanent residency in this country. However, it appears equally to be common ground that it would be open to Martin, should he wish, to sell the properties and to transfer the proceeds of sale to her.
Georges has disclosed only minimal assets: said to be of the order of $5,000. If there were any evidence that profitable exploitation of the ownership interest in the Seven Hills properties might be thwarted by reason of the continuation of the freezing order, the paucity of Georges’ assets would be a powerful discretionary reason tending against the extension of the orders. However, as I have noted, there is no evidence of any such intention to exploit.
The hearing in the District Court will occur within the next four months or so. Presumably, absent settlement, it will proceed to judgment. Thus, an extension of the freezing order until the delivery of judgment in the District Court proceedings, or until the further order of this Court on the basis that the order be reviewed once judgment is given in the District Court, is not likely to have the effect of tying the properties up unreasonably or excessively.
In addition, the order that was made limits the ability of Martin and Martina to deal with the properties so as to preserve only the amount of $240,000. Such evidence as there is of the value of the properties suggests that they may be worth between them about a million dollars, with each of them being worth of the order of $500,000. If that were so, it would be open to Martin (for example) to sell one of the properties and to retain the other, without being in breach of the order.
I acknowledge the force of the submissions that the evidence of a threat to dissipate is limited. However, to a very large extent, that seems to me to reflect what appears to be the fixed view of Martin that he has no ownership interest in the two properties. Since for the reasons I have given, that view must be incorrect, it seems to me that the importance of this factor is diminished. To put it another way, if Martin were to be given to understand that as legal proprietor of the properties he could deal with them subject to whatever rights (if any) Martina may have under the asserted prenuptial agreement, his stated position would not be inconsistent with such a dealing: including by way of sale or mortgage.
In circumstances where: a hearing date for the substantive claim has been allocated and the proceedings are likely to be resolved relatively quickly; there is no proposed exploitation of the properties; and Martin and Martina have declined to offer any satisfactory form of undertaking; and bearing in mind (as was rightly submitted for Martin and Martina) the need to be very careful indeed in interfering with the exercise of proprietary rights, I think that a case has been made for the extension, with relatively minor modifications, of the freezing order.
I come to that view because it does not seem to me to be at all unlikely that Georges will succeed in the District Court proceedings. There is a corroborative witness. There is also apparently medical evidence to the effect that the injury that he suffered (the breaking of his left femur) was unlikely to have been caused simply by falling over (which is Martin's version of the encounter) but, rather, is more likely to have been due to a "high impact" blow which in substance is consistent with Georges' account.
In short, looking at the evidence to the extent that I have been able to do so, it seems to me that the case for Georges is, on the balance of probabilities, one which has at least reasonable prospects of success.
If the case succeeds, then on Georges' evidence it will be one of an unprovoked and unjustified assault. It is not at all unlikely that damages of the magnitude of those assessed by Georges' solicitor might be awarded. Equally, it is clear that if Martin is able to put the two properties beyond Georges' reach, it would be extremely unlikely that any judgment in favour of Georges could be satisfied.
In those circumstances I will order that the freezing order granted on 18 December 2014 and extended from time to time thereafter be further extended until the further order of this Court, with the following variations:
(1) In order 5(a), before the words "you must not", the words "without giving 14 days’ prior written notice to the plaintiff's solicitors" should be inserted.
(2) In order 5(a), after the words "you must not", the words "transfer or" should be inserted.
(3) The order should be made to continue up until the further order of this Court.
As I have said, it is my expectation that the District Court proceedings will be disposed of, one way or the other, relatively quickly. If however there is to be some delay in that, the parties - in particular Martin and Martina - are free to approach this Court on three days' notice or on such other notice as the Court in all the circumstances may allow.
Finally, and to accommodate the need to bring these proceedings to an end one way or the other, rather than stand the matter over generally it is appropriate to stand it over to a fixed time later in the year. If by then the District Court proceedings have been disposed of, the parties may avail themselves of the liberty to apply. Equally, if the proceedings have not been disposed of and the parties wish to avoid the expense of a mention, they may make application in chambers.
Accordingly, I adjourn the further hearing of the proceedings in this Court for directions on Monday, 2 November 2015.
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