Ye & Cai (No 7)
[2022] FedCFamC1F 949
•5 December 2022
Federal Circuit and Family Court of Australia
(DIVISION 1)
Ye & Cai (No 7) [2022] FedCFamC1F 949
File number: CAC 1379 of 2021 Judgment of: GILL J Date of judgment: 5 December 2022 Catchwords: FAMILY LAW – PRACTICE AND PROCEDURE – Necessary parties – Application to join parties resident in Country B – Service of documents overseas – Overseas parties appearing but resistant to joinder and to proceedings in Australia dealing with their interests in Country B – Real property located in Country B – Relief based on court determining rights to real property located overseas – The Mocambique Rule – No jurisdiction. Legislation: Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) Part 2.7 rr 3.01, 3.03 Cases cited: British South Africa Co v Companhia de Moçambique [1893] AC 602 Division: Division 1 First Instance Number of paragraphs: 32 Date of hearing: 30 November 2022 Place: Canberra Solicitor for the Applicant: Mr Zhao, Brightstone Legal Solicitor for the First Respondent: Ms Khan, MIC Lawyers Solicitor for the Second Respondent: Litigant in person ORDERS
CAC 1379 of 2021 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)
BETWEEN: MR CAI
Applicant
AND: MS YE
First Respondent
MS ZEXI
Second Respondent
order made by:
GILL J
DATE OF ORDER:
5 DECEMBER 2022
THE COURT ORDERS THAT:
1.The Application in a Proceedings filed by the husband on 12 July 2022 is dismissed.
2.The husband’s application to join Ms F and Mr E to the proceedings is refused.
3.The husband’s application that certain interests held by Ms F in L Street, City G, and Mr E in K Property, J Village, City G, be transferred to the wife, is refused.
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).
Section 121 of the Family Law Act 1975 (Cth) makes it an offence, except in very limited circumstances, to publish 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 a pseudonym Ye & Cai has been approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
REASONS FOR JUDGMENT
GILL J:
Introduction
The parties to this matter are Mr Cai, the applicant husband, Ms Ye, the respondent wife, and Ms Zexi, the second respondent (mother of the applicant father). The parties married in 2017.
The central issue to be resolved by this judgment is whether the parents of the wife, Ms F (the wife’s mother) and Mr E (the wife’s father), should be joined to the proceedings, and then whether injunctive orders should be made to compel the transfer of interests from them in the below described properties to the wife. Related to that second issue is one of timing, and whether the relief should be considered on an interlocutory basis, or be reserved to the final substantive determination.
Those issues arise due to the recent transfers of the wife’s one third interests in properties at K Property, J Village, City G to Mr Ye and L Street, City G to Ms F.
These transfers have been made, despite injunctions made on 29 July 2021 in the Federal Circuit Court (as it was then known) that prohibited the wife from divesting herself of such interests without the leave of the court or written consent of the husband.
The wife explains and asserts that her parents, following the breakdown of her relationship, revoked their gifts of the shares in the properties and demanded that she remove her name from the properties. She asserted that under Country B law they could sue her to take off her name, and accordingly, she chose to do so voluntarily. To facilitate this, the wife signed an authority permitting her mother to deal with the properties.
The wife accepts that her interest in the K property was transferred in July 2021 (it presently being unclear whether this predated the injunction), when her parents revoked her name from the title of the property.[1] The wife also appears to assert that the gift of the L Street property, has likewise been revoked.
[1] Tender Bundle page 220.
Essentially, the husband seeks on an interlocutory basis the reversal of these transfers. Alternatively, he seeks final relief against the wife’s parents, described by him as “in the form of debt” or a declaratory relief of a resulting trust, presumably in relation to the one third shares of the two properties. He then seeks interlocutory relief preventing further dealings with the one third interests. The orders sought by the husband are included as an annexure at the end of this judgment.
The wife’s parents oppose this court dealing with their interests in the properties at all.
Material Relied Upon
Applicant father
The father relies upon the following document:
(1)Affidavit of Mr Cai filed 31 October 2022.
Respondent mother
The mother relies upon the following document:
(1)Affidavit of Ms Ye filed 28 October 2022.
Second Respondent
The second respondent relies upon the following document:
(1)Affidavit of Ms Zexi filed 19 October 2022.
Joinder, overseas service and jurisdiction
The husband’s application raises issues in relation to the joinder of the wife’s parents, the requirements of service overseas in pursuit of the joinder, and the jurisdiction of this court to deal with issues relating to the overseas located properties.
Rule 3.01 of the Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) (“the Rules”) deals with necessary parties to proceedings, and provides that:
3.01 Necessary parties
A person whose rights may be directly affected by an issue in a proceeding, and whose participation as a party is necessary for the court to determine all issues in dispute in the proceeding, must be included as a party to the proceeding.
Example: If a party seeks an order of a kind referred to in section 90AE or 90AF of the Family Law Act, a third party who will be bound by the order must be joined as a respondent to the proceeding.
The husband seeks relief in a form to compel the wife’s parents to divest themselves of interests in real property held in Country B. It follows that their rights are directly affected by the proceedings, and that, if such relief falls within the jurisdiction of the court, they are necessary parties.
The husband has sought the joinder by filing an Application in Proceedings on 12 July 2022.
Pursuant to Rule 3.06, the wife was directed to notify her parents of the proceedings, and the application that they be included as parties, steps that she apparently undertook.
As the husband’s application post-dated the first appearance in court, pursuant to Rule 3.03(4) the husband required leave to add the wife’s parents, leave that he initially did not seek. At the hearing date of 30 November 2022, the husband amended the orders sought to pursue such leave, followed by substantive orders being pursued against the wife’s parents.
Rule 3.03(5) requires that, in pursuit of such leave, that the husband take the following steps in relation to the application:
3.03 Adding a party
…
(5) A party who relies on subrule (4) must:
(a) file:
(i) an Application in a Proceeding; and
(ii)an affidavit setting out the facts relied on to support the addition of the proposed new party, including a statement of the proposed new party’s relationship (if any) to the other parties; and
(b) serve on the proposed new party:
(i) a copy of the Application in a Proceeding; and
(ii) the affidavit referred to in subparagraph (a)(ii); and
(iii)any other relevant document filed in the proceeding; and
(c) serve on the other parties:
(i) a copy of the Application in a Proceeding; and
(ii) the affidavit referred to in subparagraph (a)(ii).
The husband has not identified steps that have been taken pursuant to Rule 3.03(5)(b) to serve the wife’s parents.
Non-service raises significant issues, given that both the wife’s parents and the properties, which are the subject of the proposed orders, are located in Country B.
Part 2.7 of the Rules deals with the service of documents overseas.
No step has been identified that is consistent with the requirements set out Part 2.7.
However, in response to being placed on notice by the wife in accordance with the previous orders, the wife’s father and mother attended the proceedings on 30 November 2022 by telephone link. It was apparent from their attendance and their representations on that attendance that:
(1)They are aware of the proceedings in Australia;
(2)They understand that the proceedings concern an application to cause them to transfer one third interests in the 201 and 401 properties to the wife;
(3)They oppose being joined to the proceedings on the basis that they are in Country B, as are the properties; and
(4)They contest the parties having rights in respect of the properties and any such relief being given.
Accordingly, the husband’s applications for joinder and for substantive relief occur in a context where he has not effected service upon the wife’s parents, they resist joinder and they have not submitted to the jurisdiction of the court.
The husband neither identified nor addressed his failure to comply with the Rules in relation to joinder or service. This is fatal to his application. However, the application does not need to be determined on this basis, but rather in relation to a more fundamental issue of jurisdiction.
The wife’s parents’ resistance to joinder raised more fundamental issues as to the jurisdiction of this court to entertain the husband’s application in relation to the Country B properties at all, particularly where the wife’s parents are also located in Country B.
The issue raised by the wife’s parents was the location of the real property interests in Country B, and the lack of entitlement of the husband and wife to those properties.
While it was not contentious that the wife previously held a proprietary interest in both properties that is now held by her parents, the parent’s entitlement to her previous interest, and their capacity to revoke the gifts of property, is contentious, and necessary to resolve in order to justify any transfer as pursued by the husband.
While, as a general proposition, this court is empowered to make orders in personam requiring a party to take steps in relation to real property located overseas, including to make orders that such a party divest themselves of or transfer an interest in such property, there is no jurisdiction in respect of title to, or possession of land located overseas, pursuant to the Moçambique rule.[2]
[2]British South Africa Co v Companhia de Moçambique [1893] AC 602.
While the parents of the wife did not name the rule, the parents’ opposition to joinder identified the principles therein.
The husband’s claim requires the resolution of the wife’s parents’ rights to the properties, a resolution that this court cannot give.
CONCLUSION
Accordingly, the husband’s application should be refused, both to join the wife’s parents and to compel them to relinquish one third interests in the properties to the wife.
I certify that the preceding thirty-two (32) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Gill. Associate:
Dated: 5 December 2022
Annexure
Orders Sought by applicant father
1.Leave is granted for the following individuals to be added as parties to the proceedings.
(a)Mr E, being the Wife’s father; and
(b)Ms F, being the Wife’s mother.
2.Upon leave being granted pursuant to Order 1, and within 28 days of these Orders:
(a)Mr E, Ms F and the Wife are to do all things necessary to cause 1/3 interests in the property located at L Street to be transferred to the Wife; and
(b)Mr E, Ms F and the Wife are to do all things necessary to cause 1/3 interests in the property located at K Property, J Village to be transferred to the Wife.
3.Upon the parties’ compliance with Order 2, the Wife shall within 7 days of the transfer being effected, produce to the Husband evidence of the transfer of the properties set out in Orders 2(a) and 2(b) and evidence of her updated ownership of the said properties.
4.Upon the Wife’s compliance with Order 3, the proceedings against Mr E and Ms F are dismissed with no orders as to costs.
5.Liberty is granted for Mr E and Ms F to make further applications to the Court.
6.Within 28 days of these Orders, the parties to file and serve undertakings as to disclosures.
7.The matter be listed before the Court for readiness and compliance check on a date that is to be fixed by the Registry.
8.Cost of the application is reserved.
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