Ph: (07) 5591 5900

Menu

Close Nav

BLOG

Derek Legal Blog

Author: Derek Legal

Tags

Derek Legal Blog

Court Intervention in the Sale of Matrimonial Home

REASONS FOR JUDGMENT

Introduction

1. These reasons for judgment explain why orders have been made refusing an interim application made by the applicant husband for an injunction to restrain completion of a contract of sale relating to the parties’ former matrimonial home in M Street, Suburb N (M Street, Suburb N property).
2. In substance, I have concluded that the applicant has not demonstrated he has a sufficiently arguable case for the grant of an injunction and that the balance of convenience does not favour such relief.  It is fundamental to the law that legally binding and concluded contracts should be upheld and enforced according to their terms.  In Tanwar Enterprises Pty Ltd v Cauchi,[1] Gleeson CJ, McHugh, Gummow, Hayne and Heydon JJ confirmed that while an enforceable contact of sale is on foot, a breach or threatened breach by the vendor will be restrained.  By extension, the court will strive to uphold the parties’ contract.  In the present case, there is nothing in the conduct of the vendor or the purchaser which supports a conclusion that completion of the contract should be restrained.  The applicant’s conduct does not support a contrary conclusion.

Consideration

41. From the applicant’s perspective the only issue arising for consideration before me was whether an injunction should be granted to restrain completion of the sale of the M Street, Suburb N property.  From the respondent’s perspective, she sought orders to facilitate completion of the sale, contending that the applicant had secured an urgent hearing of the application in circumstances where he had not disclosed, as the evidence now shows, that he had, in substance and effect, consented to the sale. 
42. Understandably, the respondent relied upon those considerations, including non-disclosure of material facts, as powerful factors which would militate against the grant of relief.
43. While the applicant contends that he wishes to purchase the property, his desire to do so is to be seen in the context that it was originally jointly owned by the parties and (at least on his case), some twelve months after separation he transferred his interest in that property to the respondent.  In addition, the evidence demonstrates he has been actively informed of, and consented to, many of the steps which culminated in the sale.  I am quite prepared to treat the letters sent by his former solicitor recording his instructions as having been sent with his knowledge and approval.[2]
44. While the applicant has asserted he now wishes to purchase the property, I am satisfied that the applicant consented to the sale and was aware of the negotiations which ultimately culminated in execution of the contract.  In addition, the position of third parties must be considered.  Having entered into and executed a contract for the sale of the property, the purchaser now has an equitable interest in the M Street, Suburb N property.  The court is not free to disregard that interest, particularly where the evidence indicates the purchaser fully intends to complete the contract: Ascot Investments Pty Ltd v Harper.[3]  Despite fair warning given to the applicant, no steps have been taken to join the purchaser to the proceeding in order that his interest might be represented.  Viewed in isolation or cumulatively, those factors also militate in favour of the conclusion that the court cannot grant the relief sought.
45. For the foregoing reasons, I am not satisfied that the applicant has demonstrated that he has a sufficiently arguable case to support his claim for an injunction.  It remains to consider the balance of convenience.
46. In addition, while the applicant maintains that he has the ability to purchase the property, I am less than satisfied he is able to do so.  There is substance in the respondent’s submissions that, the applicant and his former lawyers have, for some time, made vague, unparticularised and incomplete assertions respecting his ability to finance a purchase.  Moreover, on the evidence of the respondent (supported by the parties’ long-term accountant), there is very real reason to conclude that neither party has the ability to purchase the property for $950,000.  The lodging of a loan application on 9 April 2020 does not advance the matter.
47. For those reasons, the application should be refused.  The respondent is entitled to substantially the relief sought.  I have made such orders as I consider are required to address the position at present.

Conclusion 

48. While the applicant supports the making of orders for mediation, from my review of the matter, it would be premature for mediation to occur.  More preparation is required for mediation to be of any particular use at this stage.  There is some evidence that the parties also have other litigation to address in relation to one or more of their corporate entities.  In addition, some forensic accounting, which the applicant seeks to undertake, may need to be undertaken.  At a point the parties will and should recognise that there may not be as much to dispute as they had first thought.  They would be well advised not to diminish their asset pool by pursuing avenues which are not of any particular use.
49. I note the respondent’s evidence that supports a conclusion she will have incurred costs exceeding $25,000 as a result of the matters described above.  There may be considerable force in the submission that the applicant should bear those costs or a part of them.  Given the urgent circumstances in which the application was made, it is necessary to reserve those costs until a more fulsome investigation of the facts has been undertaken. 
50. Should it be necessary for the respondent to seek further relief from the court in order to achieve completion of the sale without further objection or interference by the applicant, it may be entirely appropriate for orders to be made, including orders dealing with the question of costs.

Posted in: Derek Legal Blog at 17 June 20

Copyright All Rights Reserved © 2013.