Wilson v Hamilton [1999] NSWSC 80

New South Wales Supreme Court CITATION : Wilson v Hamilton [1999] NSWSC 80 CURRENT JURISDICTION : Equity Division FILE NUMBER(S) : 3998/98 HEARING DATE(S) : 5 February 1999 JUDGMENT DATE : 5 February 1999

PARTIES : Clifford Arthur Wilson (Plaintiff) Jann Mary Hamilton (Defendant) JUDGMENT OF : Young J

COUNSEL : Plaintiff: G Roberts Defendant: R Lovas SOLICITORS : Plaintiff: Maguire & McInerney Defendant: Fabiani CATCHWORDS : Family Law [105]; De Facto relations; Application for extension of time to make application; Principles; Application granted; De Facto Relationships Act, s 18(2) De Facto Relationships Act 1984 (NSW) s 18 ACTS CITED : Conveyancing Act 1919 (NSW) s 66G Family Law Act 1975 (Cth) s 44(4) DECISION : See para 31

THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION

YOUNG, J

FRIDAY 5 FEBRUARY 1999

3998/98 - CLIFFORD ARTHUR WILSON V JANN MARY HAMILTON

JUDGMENT 1 HIS HONOUR : This is an application by motion by the defendant for leave to commence proceedings under the De Facto Relationships Act 1984 out of time. 2 The parties were in a de facto relationship between 1980 and February 1994 when the defendant left the relationship in Nowra and moved to a home owned by the parties jointly at Canley Heights. 3 The parties have three children, the youngest of whom was born in 1990 and who lives with the defendant. 4 The defendant saw various people, qualified and unqualified, about the problems of the end of her de facto relationship and was involved in a mediation conference in the Family Court at Parramatta in July 1996. A second mediation conference had been arranged for 19 August 1996 but was cancelled by the plaintiff, he says because he could not see any real possibility of the parties reaching any agreement. 5 The defendant instructed her present solicitor in July 1996. 6 The plaintiff had made an offer to the defendant on 22 November 1996 which she rejected through her present solicitor. That solicitor made a counter-offer by letter of 5 December 1996 which did not receive any formal reaction until 5 May 1998 when a further offer was made by the plaintiff, though there had been some intermittent discussions between the parties in the meantime. The letter of 5 May 1998 refers to the end of the de facto relationship and lists the assets of that relationship. 7 On 21 September 1998 the plaintiff issued a summons for orders for sale under s 66G of the Conveyancing Act 1919 in respect of the home at Canley Heights. This is a home in which at least the defendant and the youngest child of the relationship have been living since 1994, though no rent has been paid in respect of that occupation. The matter came before Master McLaughlin in December 1998 and the learned Master by consent made an order under s 66G for the appointment of trustees for sale, but stayed the order until today so that the current notice of motion could be heard. 8 Section 18 of the De Facto Relationships Act requires an application to be made before the expiration of two years from the cessation of cohabitation, which would mean that the application in the instant case should have been made no later than March 1996. 9 However, s 18 (2) enables the court: "...where the court is satisfied, having regard to such matters as it considers relevant, that greater hardship would be caused to the applicant if that leave were not granted than would be caused to the respondent if that leave were granted" to grant leave to a de facto partner to apply out of time. 10 There has been consideration in the authorities as to the approach of the court to applications under this section. It now appears fairly clear that there is a two-stage approach. First, the court has to consider the statutory precondition of greater hardship being caused to the potential applicant, and then has to consider the general discretionary factors that occur in almost all applications to extend time: see Beavan v Fallshaw (1992) 15 Fam LR 686 and a case in Victoria on an identically worded provision decided by Gillard J in the Supreme Court of Victoria Harris v Harris (1997) 22 Fam LR 263. The report of the decision of Gillard J is a good illustration of how one goes about the two-stage process. 11 The first stage, therefore, is to consider whether the applicant defendant will suffer hardship by the time not being extended, which would exceed the hardship being suffered by the plaintiff if it were extended. 12 The cases under s 18 and comparable provisions in our State say that guidance is to be found in the decisions decided under s 44(4) of the Family Law Act 1975. In those cases it is clear that hardship in the current sense cannot be constituted merely because the claim might be successful; see Re Whitford (1979) 4 Fam LR 754. 13 However, in any particular case the loss of a possible verdict in an action in all the circumstances in which the applicant finds his or herself may constitute hardship. 14 It should be noted that in s 44 of the Family Law Act the court has to consider hardship not only to the applicant but also to any child. In the instant statute it is only the hardship to the applicant that must be considered, so that I cannot take directly into account the fact that the youngest daughter is still only 8 years old and is living in the house, and that she may be detrimentally affected if the house is sold under the s 66G order. 15 However, it does seem to me that when evaluating the hardship of the defendant applicant one takes into account that she is primarily concerned with the housing of that child and so the defendant's hardship can be affected by the circumstances of her youngest daughter. 16 The cases show that it is necessary if one is considering whether the loss of the chance of litigation is a contributing factor to the hardship of the applicant to make a prima facie assessment of the prospects of success. The authorities show that one does not try the application, but one looks at the facts as disclosed in the affidavits to see whether there is a real chance of substantial success. 17 That is a problem in the instant case. On the evidence before the court at the moment the defendant has no money. If the s 66G provision is followed she will receive half the net proceeds of about $60,000, which would be inadequate to buy another house. If, however, she is able to get a higher percentage than 50 percent because her known financial contribution to the relationship can be taken into account, she says there is a possibility that she may be able to buy out her former husband. On the facts and figures this appears to be a very slim possibility. 18 However, it is true that with a de facto relationship of 14 years producing three children if the application were allowed to proceed it is, on the facts that I have at the moment, more likely than not that it would succeed for a greater amount of money than what the defendant would obtain under the ordinary procedures of Common Law or Equity. 19 On the other hand, if the application under the De Facto Relationships Act was not permitted to proceed the defendant would still not be completely lost because she would have rights in Equity to show that she did contribute more than half to the purchase price. At the moment it would appear that this is not a very strong case, but it is early days yet. 20 Generally speaking, on the material before me I do think that the defendant has shown some hardship in that she currently is living in the house rent free, the children are living with her, she has no funds available to her, other than what flows through maintenance orders or the pension or supporting parents benefits, and if she were not permitted to mount the present proceedings she would be deprived of the chance, perhaps not a good chance, but certainly a chance of being able to remain in the premises by buying out her husband in due course. 21 On the other side one must consider the plaintiff's hardship. He says he is in financial difficulties with his business. He has had this asset, being a half interest in the Canley Heights property, for which he is receiving no benefit by way of occupation fee or otherwise, and if the de facto relationship proceedings are permitted to continue there could be quite considerable delay, which would mount to his detriment. 22 In my view the hardship of the defendant exceeds the hardship of the plaintiff, so that I can move to the second part of the exercise of discretion. 23 It is normal, but not imperative, that the applicant show some real reason for the delay. With great imagination Mr Lovas of counsel for the defendant put up five possible reasons why there was a delay in this case; namely, (1) Ignorance of legal rights; (2) Fears for the defendant's safety if she sued the plaintiff; (3) Ongoing negotiations on the basis that there was a claim; (4) The defendant's impecuniosity; and (5) Time taken in concern for her sister who was very ill. 24 I find it very hard to accept the claim of ignorance. The defendant was advised both by lay women who were involved in this sort of case day in day out for years, and had conferences with solicitors. Indeed she would seem to imply that her present solicitor never told her about time limits and it is significant that the present solicitor has not filed any evidence. 25 Although there is no contrary material, the plaintiff, of course, cannot see into the defendant's mind or know what she did with her solicitors, and so it is necessary if a case of ignorance is pleaded to have some confirmation before a judge will be able to cast away his suspicion. If the main ground were ignorance I would not accept it. 26 I do, however, consider that the third point made is one which is a very strong reason to explain the delay on behalf of the defendant. The only claim that the defendant had was a claim under the De Facto Relationships Act. The plaintiff permitted the defendant to continue to live in the home at Canley Heights. There were desultory negotiations between 1996 and 1998 over what the defendant should receive as a result of the wash-up of the relationship and, indeed, even in 1998 the plaintiff's solicitor is talking in terms of the settlement of the property interests following the end of the de facto relationship. 27 Nobody ever wants to go to court both because it is unpleasant and expensive, so where there are negotiations taking place, where the parties know or ought to have known that the time limit is up, there is a very strong factor to say that no-one is prejudiced by extending the time. Moreover, it does not appear that there is any forensic prejudice to either party by the delay. It may be on either or both sides there has been the loss of some documents, but that will even itself out and otherwise the witnesses are still available. 28 I am concerned that permitting this application will permit delays and that may detrimentally affect the plaintiff, but on the other hand to some extent making sure this litigation does not drag on is a matter which his solicitors can control. 29 I am more concerned that at the end of the day the defendant may receive very much the same as she would under a s 66G order. However, Mr Lovas says I should not speculate about that because it may well be that the fact that the plaintiff has sold the Queensland property, which if an application were made earlier would have been the source of an award to the defendant, may very well lead to the court awarding the defendant a greater share than 50 percent in the Canley Heights property. 30 I was tempted for a while to make conditions on the order that if the defendant did not obtain more than she got under the s 66G order she should pay the costs of the proceedings. However, on consideration I think it is probably better to forecast that as a possibility, but leave that to the Judge or Master who hears the actual case. 31 Accordingly, after a full consideration of the factors involved I think it is appropriate that I do extend the time. So that I make order 1 in the notice of motion of 10 December 1998. The cross-claim is to be filed no later than 1 March 1999. I stay the order under s 66G made by the Master until further order. I stand the matter over to the Registrar's list for mention on 1 March 1999 at 9.30 am. I reserve the costs of the motion.