H v M[2005] QDC 283

[2005] QDC 283

DISTRICT COURT

CIVIL JURISDICTION

JUDGE ROBIN QC

No BD 2891 of 2005

BRISBANE

DATE 23/08/2005

ORDER

HIS HONOUR:  This has been a difficult application or pair of applications for the Court to resolve.  That is often the case when litigation occurs between ordinary citizens who may be even worse off than the average member of the community; there is an imperative to try to achieve justice according to law without imposing onerous costs burdens which can be particularly concerning.

The applicant is seeking an order under section 38(1) of the Property Law Act 1974 for appointment of trustees on the statutory trust for sale of a residential property of which the parties (he and the respondent) are joint tenants. 

The respondent's affidavit tells me that she is part Aboriginal, the applicant part Maori.  They have five children together whose ages range from 11 to 16.  The younger two live with the respondent.  The others with the applicant although it is said that the oldest is pretty well independent and may not really be in that category. 

The respondent says she is 41, the applicant 37.  He runs a business which I understand to be in the concreting field.  The respondent says she has, in the past, assisted the applicant in his business and other businesses and says that she is without skills to qualify her for employment at the moment.  It will be convenient to refer to them as the husband and the wife from time to time to preserve confidentiality.

The mortgagee of the property is an entity associated with ATSIC.  The mortgage debt is of the order of $117,000 which has been essentially unchanged since the outset with the applicant meeting mortgage repayments.  Fortunately, the value of the property has increased.  The wife suggests it is about $200,000, the husband somewhere in the range of $220,000 to $240,000.  He brings his application against a background of being pursued by the revenue authorities in respect of his personal tax and business activity statement liabilities aggregating approximately $91,000. 

He also says he has a child support liability of approximately $17,600 which presumably relates to the children the respondent cares for.  I am told from the Bar table that it would seem to be the case that he and the children with him reside in rented accommodation.  The respondent resides in the jointly owned property.  Although she is not receiving child support payments, she, as it seems to me, has been enjoying the more favourable circumstances since the parties separated.

Her affidavit filed on the 15th of August is more informative about financial matters.  She has a motor vehicle, furniture in the home which she says would be worth no more than $4,000.  She is supported by Government benefits, it would seem, and free of any obligation to pay rent.  It seems that the applicant pays other amounts for the upkeep of the property as well.

Her affidavit contains unfavourable material about the applicant - alleging domestic violence against him, a conviction for producing drugs for which he was imprisoned and deficiencies in his parenting of the children who live with him.

Her affidavit is in support not only of an application under section 286 of the Property Law Act 1974 but also for leave under section 288(1)(b).  Even on the wife's own material she is too late in applying, having regard to the two year time limit in subsection (1)(a).

Her application filed as an "originating application" on the same date as her affidavit but in the file in which the applicant's section 38 application was filed on the 4th of August 2005 is plainly made as a sensible enough response to his.

The parties' relationship according to her came to an end on Mothers Day 2003.  She deposes that she wasn't aware of the two year limitation period applying to her.  It is a bar to her application unless the leave referred to is given.  Section 282(2) provides that the Court may give leave only if it is satisfied hardship would result to the applicant or a child of the de facto spouses if leave were not given.

It is not possible today to resolve the issue of hardship.  The parties straitened circumstances suggest that both of them may be surviving in circumstances of hardship even without some reverse in their circumstances following from the making of a court order. 

It's not enough, it seems to me, that the respondent would self evidently suffer hardship if forced out of her home.  The matter has to be looked at in all of the circumstances, the leading authority in this area of the law being Whitford v. Whitford [1979] FLC 90-61278:  (1979) 4 Family Law Reports 754.  There is a quotation by Judge Robertson in paragraph 6 of his reasons in J v. S [2002] QDC 222 of a passage in a judgment of Lindenmayer J in Neocleous [1993] FLC 92-377; 16 Family Law Reports 577 at paragraph 12:

"The meaning of the word 'hardship' in section 44(4) has been the subject of some discussion in earlier cases decided under the section but the generally accepted meaning now is 'a substantial detriment', see Whitford.  However, it is clear from many cases that 'hardship' is a relative term and that there is no absolute measure of it.  What amounts to a substantial detriment depends on the circumstances of each particular case.  While the existence of a reasonable claim to relief under section 79 is obviously a necessary ingredient of hardship it has been held that the mere loss of the right to litigate that claim is not itself hardship."

The Property Law Act contains provisions corresponding to those mentioned by Lindenmayer J.  What Judge Robertson did in the end was adjourn the plaintiff's application for leave to apply to a date to be fixed, to be heard at the time of the trial of her claim pursuant to section 283 of the Property Law Act. 

In the present circumstances it's not a claim under part 19 of the Act that complicates the situation; rather it's the applicant's section 38 claim.  Traditionally there was no defence to an application by a co-owner under section 38 except in very special circumstances and typically the existence of some agreement or equivalent that there ought not to be a sale; pleas that the market was depressed and the like were of no avail.

Mr Rosen, for the wife, suggests that there's now something of a practice that where there is an application on foot, or even possible, under part 19, the court will not make an order under section 38 until the other one is determined.  The interaction of the two applications is obvious.  He referred to a decision of Mullins J.  Recourse to her Honour's reasons reveals no comments being made on the subject.  Mr Rosen confirms that her Honour's concern was mentioned in the course of argument.  I have located another decision of her Honour in which quite "well heeled" parties agreed that their issues ought to be resolved in the part 19 application rather than in the earlier filed section 38 application.

My approach is that here, where the wife has no right to make an application, and may not obtain leave, the making of orders under section 38 ought not to be delayed.  However, I have decided that the actual entering into any contract of sale by the trustees ought to be deferred for a short time to enable the fate of the application for leave under section 288(1)(b) to be ascertained.  There is really no material from either of the parties bearing on hardship issues so it is impossible for the Court to decide that today.

The other complicated feature of the circumstances is that according to the husband in his affidavit the parties' relationship came to an end on the 13th of April 1999.  It is clear from his affidavit that he makes a point of adducing that information to allay concerns that the court might have that there could be something arising out of part 19 to complicate his application under section 38.  This bespeaks some awareness by his legal advisers of the approach attributed to Mullins J.  Accepting that such an approach is correct, it is taking things a step further to apply it where leave is yet to be obtained for a late application.

It seems to me that if the husband is right about the date when the relationship terminated, that would tend to make it more difficult for the Court to give the wife the leave which she seeks.  The parties' affidavits go into no detail in support of their assertions about the date of the end of the relationship.  That is something which ought to be determined expeditiously as well.

My inquiries reveal that a day in civil sittings can be made available to the parties to resolve that last matter, indeed the section 288 issue, on the 16th of September.  Mr Rosen has a minor difficulty in the form of a first mention date of a matter in the Cleveland Magistrates Court.  He indicates he may be ale to get an agent to attend to that.

With the assistance of him and Mr York some fairly refined orders have been devised.  In summary, on the section 38 application, trustees are appointed.  In the interests of saving costs of bringing in outside trustees, those to be appointed are Mr York and Mr Rosen, subject to the latter's filing a consent.  The original proposal was for the principal of Mr York's firm to be the trustee with him.  There is an appearance of possible conflict of interest unless the solicitors from both sides are involved and Mr Speakman will become involved only in the event that Mr Rosen has not filed his consent to act before the end of the business week. 

The trustees are directed not to enter into any contract of sale before the 23rd of September 2005 although the court intends and contemplates that arrangements will be put in place towards a sale.  It is a matter for the trustees' judgment whether it is appropriate to incur any significant costs in that regard.  Under the liberty to apply included in that order the situation can be reviewed at or after the hearing on the 16th of September when it is known (hopefully) whether or not there is to be a part 19 application. 

On the wife's application, the court adjourns the application for leave to the 16th of September when there will also be argued the issue about the date when the parties' de facto relationship ended.  Advantage has been taken of the pretrial procedures set out in practice direction number 5 of 2004 to incorporate a timetable for exchanging of information about the parties' financial situations and disclosure of documents and the like.  The making of those directions does not import that there is an application under section 286 or any other part of part 19 other than section 288(1)(b) on foot.

I am grateful to Mr  Rosen and Mr York for their assistance.  I ought perhaps to record that the court has considerable sympathy with the husband in this situation.  He has been trying through solicitors since around October last year to obtain resolution of "de facto" property matters without making much progress.  On the other side dissatisfaction is expressed with the extent of his disclosure of his assets, there being suspicion harboured, it seems, that he may have more than he's revealed.  More details are desired of figures which he has given which represent a kind of "bottom line".

Correspondence between the solicitors has been going in both directions without there being any resolution.

This particular application was foreshadowed by letter as long ago as the 14th of February 2005.  It seems to me extremely generous notice.  I can understand why it is that the husband and his advisors have determined to bring matters to a head in the way that has happened.  The respondent can hardly say that she has been taken by surprise.

In each of the applications there is an order in terms of the initialled draft.  It does not contain any reference to mediation or any kind of dispute resolution.  This may well be the kind of situation in which there is room for the parties to try something along those lines.  There is insufficient time before the 16th of February to justify the Court making orders about it.