Injunction issued – property settlement suspended
Summary – Father successful in preventing dissipation of property settlement funds after final property settlement orders where Mother has relocated herself and the children overseas contrary to final parenting orders
- The balance of convenience is an issue to be considered as to whether an injunction is proper or just and reasonable. It amounts to an assessment as to the prejudice one way or the other. It was submitted on behalf of the father that if the money was disbursed to the mother, it would be gone and that might render any substantive application nugatory. Much then depends upon what to make of the mother’s counsel’s statement that the mother would not return to Australia but if the overseas court ordered the return of the children, she would consider her position. Examining the reasons of Stevenson J, there is no indication of any other assets that the mother has and as such, it is conceivable that her current absence from Australia (and her refusal to immediately return) must mean that any entitlement to the proceeds of sale of the house would have to be sent to her beyond jurisdiction. By an injunction, the only inconvenience to the mother would be that the funds are quarantined for the time pending trial. It is hard to see how that is inconvenient to her bearing in mind that a whole year has gone by without her having access to those funds and yet she managed to take two children overseas and has somehow supported them.
- Counsel for the mother submitted that even if the mother was in defiance of this court’s orders, she still had to support the children. There is no merit in that argument because she could return them to Australia and they would have the benefit of being cared for by the father under the existing orders. It is worthy of note that in addition to Stevenson J finding that the father was an appropriate parent, there is no current allegation of any sort relating to impropriety against him made by the mother. All of the “defence” to the recovery proceedings in Country I relates to financial problems in Australia.
- There is no argument here that jurisdiction is available to the Court. The power in the Act to make the interlocutory restraining orders lies in s 114(3) given that there are now extant proceedings to set aside the property orders and on the matters to which I have referred, there is a prima facie case and the balance of convenience supports protection of the assets (see Cardile v LED Builders Pty Ltd (1999) 198 CLR 380).
- The purpose of that power is to prevent the abuse or frustration of the processes of the Court (Jackson and Sterling Industries Limited  HCA 23; (1987) 162 CLR 612 at 617, 623 and Australian Broadcasting Corporation v Lenah Game Meats Pty Ltd (2001) 185 ALR 1 at ). That same point has been canvassed under the consideration about balance of convenience above.
- Asset preservation type orders should not be lightly made and I am satisfied here that there is a justification for the order which has limited inconvenience for the mother but may render the father’s application nugatory if not made.
- The next issue however concerned the extent of the order. As can be seen, the father sought to restrain the disposal of settlement proceeds indefinitely. The dilemma is that the solicitors for the mother obtained a charge over the mother’s entitlement and accordingly lodged a caveat. Their position (which may have conflicted with the mother’s interests) was that they would not withdraw the caveat without being paid in full and that may very well have thwarted the settlement and the sale. The father conceded that the sale was important and agreed to an order that the mother’s solicitors could be paid. Against that however is the prospect that if the orders are set aside in the future, the mother’s entitlement will not have been as the orders currently stand and the solicitors may have to disgorge money that does not belong to the mother but retained by them towards their costs.
- To overcome various problems, it was agreed for the purposes of this application that the sum of $110,000 be quarantined. As I understand the father’s position, that agreement is not a concession that the solicitors are entitled to the whole of the money they are taking at settlement. The same solicitors are also the conveyancing lawyers and as such, trustees of any money received at settlement on behalf of both parties. Counsel did not oppose an injunction (for their protection) being made against the solicitors from disposing of those quarantined funds on instructions of the mother who should also be restrained from giving such instructions.
- The father also sought an order for security of costs in the alternative in the sum of $80,000. Because the mother may still be successful in Country I or indeed in Australia if she returns to prosecute her parenting application filed in March 2016, I consider it inappropriate to make a security for costs order. Such applications still need to establish circumstances to justify a departure from
s 117 of the Act and I am not in a position to make any such finding at this stage because of the matters just mentioned.
- A similar position must be said of the father’s application that the court order that the costs of the proceedings be paid by the mother. Of the various applications in 2016, some had no orders for costs made and others were reserved. I do not know why that occurred. The same applies in respect of an appeal which the mother abandoned. The costs associated with proceedings outside of Australia do not seem to me to fit within s 117. I dismissed that part of the application.
- The father also sought child support stay orders but the application had not been served on the agency and it was sought that I adjourn that part of the application until a return date in February when I will conduct a directions hearing to set the substantive proceedings down for trial.
- There is also an application for Watchlist orders. The children are not in Australia and if returned, the provisions of the September order will mean that the children will be in the father’s absolute care to the exclusion of the mother. The basis for a Watchlist order is not obvious.
- The only other matter related to costs of this application and it was agreed that that would wait until the return date.