Yifrach & Yifrach
[2023] FedCFamC1F 149
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 1)
Yifrach & Yifrach [2023] FedCFamC1F 149
File number(s): SYC 6265 of 2018 Judgment of: CAMPTON J Date of judgment: 15 March 2023 Catchwords: FAMILY LAW – PRACTICE AND PROCEDURE – Chronic non-compliance with the trial directions and orders of the Court – Where the Court sought submissions as to why the substantive applications of each party ought not be struck out – Where neither party has taken up the opportunities and mechanisms made available to them to progress their litigation – Orders made for the automatic striking out of each party’s substantive application upon future non-compliance with trial directions. Legislation: Family Law Act 1975 (Cth) s 79, 92
Federal Circuit and Family Court of Australia Act 2021 (Cth) ss 67, 68, 69
Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) Pt 3.5, r 1.04, 15.13
Cases cited: Aon Risk Services Australia Ltd v Australian National University (2009) 239 CLR 175; [2009] HCA 27 Division: Division 1 First Instance Number of paragraphs: 41 Date of last submission/s: 17 February 2023 Place: Sydney Counsel for the Applicant: Mr Stapleton Solicitor for the Applicant: Keypoint Law Solicitor for the Respondent: Equium Lawyers Counsel for the Intervener: Mr Raffell Solicitor for the Intervener: HWL Ebsworth Lawyers ORDERS
SYC 6265 of 2018 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)
BETWEEN: MS YIFRACH
Applicant
AND: MR YIFRACH
Respondent
COMMISSIONER OF TAXATION
Intervener
order made by:
CAMPTON J
DATE OF ORDER:
15 March 2023
THE COURT ORDERS THAT:
Material to be filed for trial
1.The time for each of the husband and wife to comply with Order 6 made 23 September 2022 be extended to 14 April 2023.
2.Orders 10 – 20, and Orders 28 – 35 made 23 September 2022 are otherwise confirmed.
3.That the time for the Commissioner of Taxation to comply with Order 4 made on 15 February 2023 be extended to 14 April 2023.
4.By no later than 5 May 2023, should they so elect, the Commissioner of Taxation shall file and serve any further affidavit in response to the material of the husband and wife, including any updating evidence.
Expert evidence
5.To the extent that they have not already done so, the time for the husband and wife to complete the process identified in Orders 21 to 26 inclusive made 23 September 2022 be extended to 14 April 2023.
6.In the event any dispute remains as to the obtaining of single expert evidence after the completion of the process identified in Orders 21 to 26 inclusive made 23 September 2023, by no later than 21 April 2023, each of the husband and wife shall exercise the liberty to relist the matter afforded by Orders 10 and 11 made o 23 September 2023, by:
(a)Filing and serving an Application in a Proceeding identifying with precision the orders they seek;
(b)Filing and serving a single affidavit of no more than 10 pages in support of the orders sought; and
(c)Notifying my chambers by email of the filing of the Application in a Proceeding.
AND IT IS NOTED that the parties should expect that the matter will be relisted expeditiously for judicial determination of any such outstanding dispute.
Updated balance sheet
7.On or before 16 June 2023 the parties are to confer and file an updated joint draft balance sheet, reflecting all assets, liabilities, superannuation interests and financial resources of the parties, together with their asserted values (including, if available, the single expert valuations if available and agreed), and including a footnote to explain any controversies that may exist.
Automatic striking out upon non-compliance
8.In the event the wife fails to comply with any of the above orders her Amended Initiating Application filed 12 October 2022 (and any other extant application of the wife) is struck out, and the husband, provided he has complied with all of the above orders will be at liberty to apply to have his Amended Response to and Initiating Application filed 26 October 2022 determined on an undefended basis.
9.For the purpose of Order 8 above, within 7 days of the asserted default, the husband shall file an Application in a Proceeding and any affidavit in support thereof as to his Amended Response to and Initiating Application filed 26 October 2022 proceeding undefended.
10.In the event the husband fails to comply with any of the above orders, his Amended Response to and Initiating Application filed 26 October 2022 (and any other extant application of the husband) is struck out and the wife, provided she has complied with all of the above orders, will be at liberty to apply to have her Amended Initiating Application filed 12 October 2022 determined on an undefended basis.
11.For the purpose of Order 10 above, within 7 days of the asserted default, the wife shall file an Application in a Proceeding and any affidavit in support thereof as to her Amended Initiating Application filed 12 October 2022 proceeding undefended.
12.In the event that both the husband and wife fail to comply with any of the above orders, each of the wife’s Amended Initiating Application filed 12 October 2022 and the husband’s Amended Response to and Initiating Application filed 26 October 2022 are struck out.
AND IT IS NOTED that upon either party filing an Application in a Proceeding pursuant to Order 8 and Order 10 above, the Court anticipates relisting the matter expeditiously for the potential allocation of undefended hearing dates.
Future listing
13.The proceedings are listed for further case management and the potential allocation of trial dates at 11.00 am on 30 June 2023, in person in the Sydney Registry.
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 the pseudonym Yifrach & Yifrach has been approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
REASONS FOR JUDGMENT
CAMPTON J:
These proceedings as to property settlement were commenced by Ms Yifrach (“the wife”) on 29 September 2018 by filing an Initiating Application in what was then the Family Court of Australia. Mr Yifrach (“the husband”) filed his Response to an Initiating Application on 21 March 2019. They husband and wife have been provided numerous opportunities to progress their litigation since that time, and have not. As will be recorded, they each have a record of serial non-compliance with orders and directions of this Court, which left them underprepared for the trial event listed to commence on 17 April 2023. That trial event has now been vacated because of the under preparedness of the husband and the wife.
On 3 February 2023, the Sydney Registry of the Federal Circuit and Family Court of Australia received an email from the Commissioner for Taxation (“the Commissioner”) requesting access to the court file for the proceedings pursuant to r 15.13 of the Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) (“the Rules”). The Commissioner then filed an Application in a Proceeding seeking leave to intervene in the proceedings pursuant to s 92 of the Family Law Act 1975 (Cth).
On 15 February 2023, the proceedings came before me for trial management. An order was made by consent for the Commissioner to intervene in the proceedings. For the sake of clarity, to the extent that these reasons refer to “the parties”, that reference is to the husband and wife and not the Commissioner. Any criticism as to the unsatisfactory conduct of the parties in these proceedings is not directed to the Commissioner.
On at least two occasions, the husband and wife have been put on notice of the power of the Court to dismiss proceedings in whole or in part in circumstances of non-compliance with its orders. On 15 February 2023, following the vacation of the trial dates, the parties were directed to make submissions as to why the Court should not do just that in the circumstances of their conduct in the litigation to date. These reasons for judgment determine that question.
PROCEDURAL HISTORY
Since the proceedings were commenced four years and five months ago, the parties have consumed ten case management/directions hearings, four interlocutory hearings, and a two-day Conciliation Conference. The orders and directions made after each of these events record a chronic history of each of the parties failing or neglecting to comply with the Court’s orders and directions and the Rules, each party contending in broad and summary terms fault laying at the feet of the other and longstanding disclosure failures by the other (notwithstanding a significant volume of orders being made to rectify that process).
The failure of the husband and wife to progress the litigation over the close to four year period until early 2022 was characterised by an inability, even with the benefit of their legal representatives, to:
(a)Collaboratively prepare a draft joint balance sheet identifying the property, liabilities, superannuation and financial resources as contended by them; and
(b)Prepare the matter to permit a financial conciliation conference with a registrar to be conducted.
The proceedings came into my docket in April 2022 and have been managed by me since that time. It was first listed before me for case management on 11 May 2022. On that date, orders were made for each of the husband and wife to file a financial questionnaire, for the wife to file any single expert evidence as to valuation by way of affidavit and for the parties to produce and file a joint balance sheet setting out the assets, liabilities, superannuation interests and financial resources of the husband and wife. Importantly, the following notations were made:
B.Each party has been advised that in the event they fail to comply with these directions and the Rules of Court, consideration may be given to the striking out of their substantive Initiating Application and Response to Initiating Application such that in that event the other party may proceed to seek final relief on an undefended basis.
C.The parties ought be aware that on or after the adjourned date a direction will be made that each party will file and serve an undertaking as to disclosure in accordance with r 6.6 of the Federal Circuit and Family Court of Australia Rules.
The husband and wife did not comply with the orders made on 11 May 2022 in that they did not prepare and file a joint balance sheet. When the matter came before me again on 14 July 2022, the following orders were made:
1.In circumstances where the parties have failed to comply with Order 1 made on 11 May 2022 and specifically as to the preparation of a joint balance sheet pursuant to Orders 4(a), (b), (c) and (d) as made 11 May 2022 I:
(a)Extend the time for the parties to complete a joint balance sheet to close of business on 25 July 2022.
(b)The husband to cause such balance sheet prepared in accordance with the said orders to be filed on behalf of the parties on the court portal.
2.In the event the parties fail or neglect to comply with Order 1, the Court will give consideration to striking out the originating process for relief filed by the party found to be in default of the above order
The husband and wife purportedly filed a joint balance sheet on 25 July 2022. It recorded:
(a)The wife’s contention that the value of the net superannuation and non-superannuation of she and the husband was not known, with only 10 of the 86 items on the balance sheet having been attributed a value by her; and
(b)The husband’s contention he and the wife had assets in the range of $24,941,742, liabilities of some $406,660,787, and interests in superannuation in the range of $18,000.
The “joint” document contained significant disparities in respect of the identities of assets and liabilities, their values, and various differing references and explanatory notes. Some of the values of real properties were dated from 2019.
The husband and wife took part in a Conciliation Conference before a judicial registrar on 16 August 2022, which was adjourned and continued on 9 September 2022. The matter did not compromise.
The parties attended the Sydney Registry as directed in person for the purpose of case management on 23 September 2022. As noted in the orders made on that date, the Court at that time remained of the view that there had been “significant failures” on the part of each party to comply with the provisions of the Federal Circuit and Family Court of Australia Act 2021 (Cth) (“the FCFCOA Act”) in their conduct of the litigation, and in their compliance with r 1.04 of the Rules. In circumstances where the Court has been criticised as to its failure to facilitate the just resolution of disputes of litigants as quickly, inexpensively and efficiently as possible, it took a leap of faith on the assurances of the parties by way of their legal representatives and listed the substantive property proceedings for trial for four days, to commence on 17 April 2023. A number of orders were made on that day as to the filing of both lay and expert evidence, and the completion of other pre-trial processes. Those trial directions included:
4.On or before 12 October 2022 the applicant wife is to file and serve any Amending Initiating Application setting out with particularity the final orders sought.
5.On or before 26 October 2022 the respondent husband is to file and serve any Amending Response to an Initiating Application setting out with particularity the final orders sought.
6.On or before 20 January 2023 each of the parties are to file and serve:-
(a)an updating Financial Statement;
(b)a single, consolidated trial affidavit relevant to their case;
(c)a single, affidavit of each other witness they intend to rely upon at trial;
(d)an updated undertaking as to disclosure in accordance with r 6.06 of [the Rules]; …
7.Except as already provided by these orders, the parties will not be permitted to file any further affidavits and may not rely upon any past affidavits at trial without the leave of the Court.
8.The time for the applicant wife to comply with orders of 11 May and 14 July 2022 by way of making entries to the joint balance sheet filed 25 July 2022 be extended until 19 October 2022 such that the wife cause the updated version of the joint balance sheet to be filed and served on or before that day.
9.On or before 17 March 2023 the applicant wife shall serve upon the respondent husband any further update of the joint draft balance sheet filed pursuant to Order 8 hereof to include:
(a)all assets, liabilities, superannuation interest and financial resources suggested to be relevant and to include values as alleged by each party:
(b)The respondent husband shall then within 7 days of receipt of that draft updated balance sheet make any additions to the balance sheet as required to reflect his contra allegations and any values that are agreed (if applicable);
(c)Wheresoever controversy exists as to the inclusion of an item or the value of an item a footnote shall be appended by each party to explain the controversy;
(d)Upon completion of any Single Expert Valuation, the balance sheet shall be amended to reflect determined/agreed values; and
(e)A final, settled version of the updated joint balance sheet shall be filed and served by no later than 17 April 2023.
Further orders were made prescribing the mechanisms for obtaining updated single expert opinions as to the value of real properties and to value their interests in corporate and trust structures, including that each party do all things to ensure the single expert engaged be instructed on or before 28 October 2022. Each of the husband and wife were granted a capacity to restore the proceedings on the following terms:
Liberty to Re-List
10.Either party has liberty to apply to relist the proceedings on short notice in the event of issues arising in relation to preparation for trial by way of email request to my chambers and in the event of such relisting the party requesting the relisting shall append to the email, copied to all parties, a minute of order sought on the relisting for mention.
11.In the event that either party becomes aware of any matter that would prevent the proceedings commencing on the first date allocated or continuing to conclusion on the last date allocated, that party is to forthwith restore the proceedings to the list on 48 hours’ notice to the Court and to each other party.
The wife filed her Amended Initiating Application on 12 October 2022, and the husband filed a Response on 26 October 2022, in compliance with the trial directions. A notation was made when the matter next came before me on 30 November 2022 that:
A.Each of the parties have complied with Orders 4 and 5 as made 23 September 2022, whereby the wife seeks adjustive orders so as to receive 60 per cent of the property of the parties and the husband seeks adjustive orders where by the wife retain 4 items of real property contending that such adjustment will permit the wife to achieve in the range of 60 to 65 per cent of the property of the parties.
By the case management hearing on 30 November 2022:
(a)The wife had purportedly filed a joint balance sheet, to which the husband had no input. The husband and wife disagreed as to which of them were responsible for the failure to comply with Orders 8 and 9 made on 23 September 2022;
(b)Although the parties had identified a single expert witness to value their real properties, and a single expert witness to value their interests in corporate and trust structures, they had not complied with the balance of the orders prescribing the mechanism for instructing those experts (being Orders 21, 22, 23, 25 and 26 made on 23 September 2022).
On that date orders were made once again putting the husband and wife on notice that:
2.The parties are directed to confer with their legal representatives in person on or before 8 December 2022 for the purposes of completing the processes identified in Orders 21 to 26 inclusive as made 23 September 2022 and in the event of any issue as to the retaining or instructing of a single or number of other experts pursuant to the orders and the rules remain outstanding at the conclusion of such conference the parties are directed to exercise the liberty contained in Order 10 as made 23 September 2022.
3.The proceedings are listed for further trial management before me in person, with the parties being required to attend at Court at 9.30am on 15 February 2023.
4.In the event either party fails or neglects to comply with Order 6 of 23 September 2022 or the orders made today, they ought to be in a position to make submissions on 15 February 2023 as to why their substantive relief by way of the Initiating Application or Response thereto ought not be struck out and the other party ought not proceed to seek s 79 relief on an undefended basis.
At the case management hearing on 3 February 2023 each of the wife and the husband advised that, notwithstanding extensive trial directions having been made some four months earlier, and the proceedings being on foot for some four and a half years, they were not prepared for the trial listed over four days to commence before Schonell J on 17 April 2023. They each had not filed a Financial Statement, updated Undertaking as to Disclosure, nor a single affidavit to be relied upon at trial. In those circumstances, as recorded earlier in these reasons, the Court had no choice but to vacate the trial dates. Consequently, an order was made as follows:
6.Each of the husband and the wife are directed to file and serve on or before close of business on Friday, 17 February 2023, written submissions of no greater than four pages as to why, as part of the active case management of these proceedings, the Court ought not to strike out the Initiating Application of the wife or amendment thereto and Response to that Initiating Application of the husband or amendment thereto…
STRIKING OUT THE INITIATING APPLICATION AND RESPONSE
Each of the husband and wife filed written submissions directed to this issue on 17 February 2023. They each opposed the striking out of their own application before this Court. The wife additionally relied upon an affidavit sworn and filed on 14 February 2023.
The crux of the wife’s written submissions was that her personal circumstances in conjunction with the stress of the litigation has rendered her unable to properly discharge her obligations in these proceedings. Those personal circumstances were said to be:
(a)The rapid decline in the health of and then death of her father;
(b)The fact of her being the carer for her mother, who has been diagnosed with a health condition; and
(c)Her own mental health challenges, including that she lives with diagnoses of depression and anxiety.
Each of the above factors, the wife contended, meant that she “simply [has] not been in an emotional and mental state to finalise [her] trial affidavit”. I do not accept that contention. Since the outset of these proceedings, the wife has been represented by very experienced legal practitioners, including by counsel on at least the last four occasions when the matter has come before me. It is not the case that the wife was not capable of giving adequate instructions to those legal representatives. Even if that were the case, no application was made by or on behalf of the wife for the appointment of a litigation guardian to manage and conduct the proceedings for her pursuant to Pt 3.5 of the Rules. At no time between when the wife’s father’s health started to deteriorate and him being admitted into hospital (which she said was in late 2022) did the wife put the Court on notice as to her personal circumstances purportedly impacting her capacity to file her trial material. She did not seek an extension of time to file her material. She did not seek to exercise the liberty given to each party to relist the matter pursuant to Orders 10 and 11 made on 23 September 2022. Considering that the wife did not avail herself of any of the mechanisms made available to litigants whose capacity to engage in litigation is affected by their personal circumstances, by way of the Rules or my orders, I reject her submission that “it would cause her a grave injustice to strike out and/or dismiss her claim because of the lateness of her evidence”.
The wife further identified a cascading series of events which she said impacted the parties’ capacity to obtain the necessary expert evidence and her own capacity to “prosecute her claim”. Those were said to be:
(a)That the parties’ solicitors have been “unable to resolve how the single expert evidence… is to be prepared”. The wife in her affidavit filed on 14 February 2023 gave extensive evidence of the correspondence having passed between herself and the husband via their solicitors in which they purportedly negotiated the terms of their instructions to be provided to the single expert witnesses. Those negotiations were not fruitful.
(b)That a receiver has been appointed on behalf of the mortgagee of B Pty Ltd, but that there has been insufficient evidence provided by the receiver to enable the parties and the Court to determine the underlying value of that company. She foresaw (on the husband’s representations) that there would be further receivers appointed in respect of other entities controlled by the husband. Hence it was the wife’s contention that she required “orders compelling the receivers to either join the proceedings or provide financial information”.
(c)That the Commissioner has joined the proceedings so as to recover debts owing by the husband and wife to the Australian Taxation Office (“the ATO”).
As recorded above, a suite of prescriptive orders have been made in these proceedings to ensure the process of obtaining the necessary expert evidence occurred swiftly. By way of Order 2 made on 30 November 2023, the husband and wife were specifically directed to exercise the liberty afforded to them to relist the matter in the event they has any issue as to the retaining or instructing of the experts. That obligation was plain and unequivocal. So too was the mandatory obligation for either party to relist the matter in the event they became aware of a matter which might prevent the final hearing from commencing on the first date allocated created by way of Order 11 made on 23 September 2022. Notwithstanding the wife’s submission that “the outcome of the [parties’ negotiations] is a likely need for the question to be adjudicated”, she did not seek to relist the proceedings for such adjudication and hence did not discharge her obligations under the order. No explanation was given for that neglect. I reject the inability of the parties’ to resolve their dispute relating to expert evidence as a circumstance justifying their non-compliance with the trial directions.
For similar reasons, to the extent that the wife suggested that either the fact of a receiver being appointed on behalf of the mortgagee of B Pty Ltd or the Commissioner intervening in the proceedings explained or justified her non-compliance in this matter, I reject that suggestion. Neither of those matters ought to have affected the wife’s ability to file her evidence. As recorded at [2]–[3] of these reasons, the Commissioner only engaged in these proceedings after the husband and wife’s trial material was due pursuant to Order 6 made 23 September 2022. If the involvement of receivers or of the Commissioner affects the relief the wife seeks as part of the s 79 determination, it is open for her to seek leave to amend that relief. She has not done so.
It was the husband’s submission that throughout the proceedings, he has “to the best of his ability given the complexity of the financial arrangements, attempted to use efficiently the judicial and administrative resources available”. I do not accept the premise of that contention, being that the husband and wife’s financial arrangements are so complex as to warrant non-compliance with orders and directions.
This matter was referred for allocation to the Major Complex Financial Proceedings List (“the MCFP list”) by way of my orders made on 14 July 2022, being a list specifically established to meet the case management needs of matters involving complex disputes including serious allegations of non-disclosure, serious disputes in relation to valuations or other expert reports, and substantial assets held through trust or corporate entities (see FCFCOA Major Complex Financial Proceedings List Practice Direction, 30 September 2021). There is nothing unusual about the issues in these proceedings that would not ordinarily be dealt with as part of the MCFP list. I do not accept the submissions that fell from the respondent’s perception of his and the wife’s financial arrangements as complex, including that the balance sheet “highlights this complexity” (which, in my view is explained by the husband and wife failing to properly engage in the expert evidence process as recorded above).
In a similar vein to the wife, the husband contended that he suffers “increasing stress” arising from his “dire financial situation”, which is aggravated by his underlying neurological condition, which has impaired “his capacity to conduct business and to live a normal life”. For the reasons given above pertaining to the wife’s not dissimilar contention, I reject that submission as justifying the husband’s non-compliance. He has the benefit of experienced legal representatives in these proceedings. He has not sought to appoint a litigation guardian. He did not put either the Court or the wife on notice of his contended inability to conduct the proceedings efficiently.
Each party contended that striking out their substantive applications would deny them the opportunity to prosecute their claims according to law. That is not correct as a matter of law. I reject that submission. In such circumstances, either party would be at liberty to commence fresh proceedings. That said, they would be required to restart the litigation “at square one”. This would be of little prejudice to them in reality save as to starting again from the bottom of the list of matters seeking the judicial and administrative resources of the Court. It would be, in my view, commensurate with their own application of effort and conduct in efficiently prosecuting their own litigation.
CONCLUSION
This Court is regulated by the mandates contained in s 67 of the FCFCOA Act, which is in the following terms:
67 Overarching purpose of family law practice and procedure provisions
(1)The overarching purpose of the family law practice and procedure provisions is to facilitate the just resolution of disputes:
(a) according to law; and
(b) as quickly, inexpensively and efficiently as possible.
Note 1: See also paragraphs 5(a) and (b).
Note 2: The Federal Circuit and Family Court of Australia (Division 1) must give effect to principles in the Family Law Act 1975 when exercising jurisdiction in relation to proceedings under that Act.
(2)Without limiting subsection (1), the overarching purpose includes the following objectives:
(a)the just determination of all proceedings before the Federal Circuit and Family Court of Australia (Division 1);
(b)the efficient use of the judicial and administrative resources available for the purposes of the Court;
(c)the efficient disposal of the Court’s overall caseload;
(d)the disposal of all proceedings in a timely manner;
(e)the resolution of disputes at a cost that is proportionate to the importance and complexity of the matters in dispute.
…
Section 67 of the reiterates and elaborates on the overarching purpose of the family law practice and procedure. It imposes a duty to promote the overarching purpose in applying the Rules. Section 68 obliges parties to act consistently with this overarching purpose.
Complementing the obligations created by the FCFCOA Act, r 1.04 of the Rules provides:
1.04 Overarching purpose
(1)The overarching purpose of these Rules, as provided by section 67 of the Federal Circuit and Family Court Act, is to facilitate the just resolution of disputes according to law and as quickly, inexpensively and efficiently as possible.
Note 1:These Rules must be interpreted and applied, and any power conferred or duty imposed by them must be exercised or carried out, in the way that best promotes the overarching purpose (see subsection 67(3) of the Federal Circuit and Family Court Act).
Note 2:See sections 190 and 191 of the Federal Circuit and Family Court Act in relation to the overarching purpose of the Rules of the Federal Circuit and Family Court (Division 2). See also the Federal Circuit and Family Court of Australia (Division 2) (Family Law) Rules 2021 which applies these Rules with modifications.
2)Parties to family law proceedings must conduct the proceeding (including negotiations for settlement of the dispute to which the proceeding relates) in a way that is consistent with the overarching purpose.
Note: See subsection 68(1) of the Federal Circuit and Family Court Act.
…
These sections of the FCFCOA Act and Rules should be read together. They require that the Court must in all proceedings before it achieve the overarching purpose. This includes the efficient use of the judicial and administrative resources available for the purposes of the Court’s business, the efficient disposal of the Court’s overall caseload and the disposal of proceedings in a timely manner at a cost that is proportionate to the importance and complexity of the matters in dispute.
Section 69 of the FCFCOA Act creates a capacity of the Court in its promotion of its overarching purpose (as identified) to dismiss proceedings in whole or in part, or to strike out any Initiating Application or Response to an Initiating Application in circumstances where parties have failed or neglected to comply with its directions. It also permits the Court to make any other such order as to the practice and procedure to be followed by parties to proceedings as it thinks appropriate.
As was identified by the wife in submissions, the High Court in Aon Risk Services Australia Ltd v Australian National University (2009) 239 CLR 175 (“Aon Risk”) recorded authority for courts to take into account case management principles when exercising discretion in procedural applications, even to the prejudice of a party to the preceding. While the High Court has provided guidance to courts in applying their own varied procedures it is ultimately a matter for each court, working within its legislative mandate and rules, to adopt its own case management principles.
It cannot be lost and it has been reinforced to each of these parties that it is important that courts play their part in ensuring the efficient disposition of litigation. This in turn affects all other litigants and the public’s interest in the efficient use of the Court’s resources. So that it is clear, parties to a proceeding in this forum are not entitled to consume an unlimited amount of public resources in pursuit of their own interests.
Case management is not an end in itself. The goal of case management is the creation of justice and efficient outcomes for parties, other litigants, and the community at large.
In this case the parties have been given the opportunity again and again to prepare their case for trial. Their litigation has not advanced. Nothing is changing. Each time the matter has come back before the Court their issues are broadly the same, their dynamics are the same, and it may be that it reaches a stage where the Court no longer has a role to play in the regulation or adjustment of these parties’ financial circumstances. The resources of this court are not limitless. There are many other families in crisis who need the services and assistance of this Court. That said, I am eager to achieve a resolution of this matter so that these parties do not continue to consume this Court’s resources indefinitely into the future.
So that it is clear and unequivocal, the chronic failures of the husband and wife to comply with orders and the rules of the Court will not be tolerated. During the course of case management hearings, I identified to the parties that directions made are the expectations of the Court to ensure the prompt disposition of proceedings. It is inconsistent, as identified in these reasons, for parties merely to ignore orders and directions of the Court and the obligations placed upon them by way of the legislation but expect that the Court will continue to devote resources to the resolution of their dispute. It is further inappropriate for parties to treat the directions and orders of the Court more as suggestions or guidelines. As was indicated to the parties, directions and orders are not the pilot code.
THE PATH FORWARD
The Commissioner has broadly established on the evidence filed to date that the money sought to be recovered by way of outstanding tax liabilities of the wife is to the value of $7,642,753, and of the husband is to the value of $4,660,877.
Having regard to these reasons, the Commissioner may wish to review continuing as a party to these proceedings and pursue enforcement avenues by way of federal and state legislation elsewhere so as to efficiently recover the funds owed by the parties to the Commonwealth. Should the Commissioner elect to continue pursuing recovery in this forum, albeit that they have confirmed they are in a position to proceed to trial having filed a comprehensive affidavit on 14 February 2023, the Commissioner shall be afforded an opportunity to file a Response to the Initiating Application of the wife, to respond to the evidence of the husband and wife and to update their evidence as required.
For all of the above reasons, I am minded to give the parties one final opportunity to comply with the orders of the Court and ensure this matter is ready to proceed to trial. If they do not, orders will be made striking out the substantive application of a party in default, immediately upon such default (this self-executing order shall not apply to the Commissioner). An order will be made requiring the party not in default of the orders to file an Application in a Proceeding seeking the matter be listed for undefended hearing, so as to proactively bring to a conclusion the proceedings. If both the husband and wife are in default, each of their substantive applications will be struck out. In that circumstance, depending on the position taken by the Commissioner, the proceedings may be struck out.
Accordingly, orders will be made as set out at the forefront of these reasons.
I certify that the preceding forty-one (41) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Campton. Associate:
Dated: 14 February 2023
1
0