Reported Decision : [1999] 154 FLR 228 [1999] 25 Fam LR 476 New South Wales Supreme Court CITATION : Damberg v Damberg [1999] NSWSC 1208 CURRENT JURISDICTION : Equity FILE NUMBER(S) : 4736/99; 4737/99 HEARING DATE(S) : 7 December 1999 JUDGMENT DATE : 7 December 1999 4736/99 Nicole Damberg (P) Wilfried Damberg (D1) Bruenhild Damberg (D2) PARTIES : 4737/99 Oliver Damberg (P) Wilfried Damberg (D1) Bruenhild Damberg (D2) JUDGMENT OF : Austin J COUNSEL : G Casey (Sol) (P) M A Bradford (D) SOLICITORS : Garden & Montgomerie (P) Wilson Fardell & Moore (D) CATCHWORDS : PRACTICE AND PROCEDURE - property claims cross-vested to Family Court of Australia - ineffective judgment of Family Court in light of Re Wakim - procedure for application to Supreme Court for order for costs and for enforcement of Family Court's orders - requirements of Federal Courts (State Jurisdiction) Act 1999 (NSW) Family Law Act 1975 (Cth) s 79 ACTS CITED : Federal Courts (State Jurisdiction) Act 1999 (NSW), ss 3, 4, 6, 7, 10, 11 Jurisdiction of Courts (Cross-vesting) Act 1987 (NSW) Supreme Court Rules, Pt 77, 139, 140, 141 CASES CITED : Re Wakim (1999) 163 ALR 270 DECISION : Summonses for declarations of right dismissed with no order for costs THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION AUSTIN J TUESDAY 7 DECEMBER 1999 4736/99 - NICOLE DAMBERG v WILFRIED DAMBERG & BRUENHILD DAMBERG 4737/99 - OLIVER DAMBERG v WILFREID DAMBERG & BRUENHILD DAMBERG & 1 OR JUDGMENT (Ex tempore; revised 9 December 1999) 1 HIS HONOUR: These are two applications by summons for equivalent relief on equivalent evidence. The plaintiff in proceedings No. 4736/99 is Nicole Damberg and the plaintiff in proceedings No. 4737/99 is Oliver Damberg. They are the adult children of the defendants Wilfried and Bruenhild Damberg. The relief which is sought is a declaration pursuant to ss 10 and 11 of the Federal Courts (State Jurisdiction) Act 1999 (NSW) ('the Act') that an ineffective judgment of the Family Court of Australia made by Purdy J on 4 June 1999, which purported to enter judgment in favour of the two plaintiffs before me, is a valid judgment of Supreme Court of New South Wales. 2 At the hearing today the plaintiffs sought final relief in terms of the summonses and the defendants opposed that relief on two grounds. First, the defendants said that a declaration in the terms sought was inappropriate; and secondly, they said that any application for relief under the Act should be brought in proceedings in the Common Law Division of this Court No 12244/99. 3 The issues before me arose out of a judgment of Purdy J in the Family Court of Australia delivered on 4 June 1999 as a final judgment after a 15 day hearing. The case before his Honour involved claims by the two plaintiffs against their parents ('the children's claims') and also an allocation between the defendant parents pursuant to s 79 of the Family Law Act 1975 (Cth) of the property remaining after determination of the children's claims. 4 The children's claims asserted some complicated factual circumstances dealt with in his Honour's judgment, but essentially they are property claims with which this Court has jurisdiction to deal. The claims fall within the definition of 'State matter' in s 3 of the Act because they relate (inter alia) to property in New South Wales, and this Court has jurisdiction to deal with them by reason of the law of this State. The claims were cross-vested to the Family Court by orders of this Court so they could be heard and determined together with the claims of the husband and wife for an allocation of property under s 79. 5 The decision of the High Court of Australia in Re Wakim (1999) 163 ALR 270 was handed down after Purdy J delivered his judgment. The parties before me proceed on the view, which appears ex facie to be correct, that Re Wakim has the consequence that the Family Court did not have jurisdiction to make orders with respect to the children's claims. It has not been contended before me that the Family Court had any accrued jurisdiction to deal with those claims in conjunction with the s 79 claim. I was informed from the bar table that Purdy J has subsequently made an order falling within the definition of 'relevant order' in s 11(1) of the Act, though I have no direct evidence of this. I was also informed from the bar table that appeals have been lodged to the Court of Appeal of this Court and the Full Court of the Family Court of Australia with respect to Purdy J's judgment, the former appeal relating to the children's claims and the latter appeal relating to the s 79 claim. 6 The plaintiffs wish to obtain two further kinds of relief. First, they say that in consequence of Purdy J's judgment they are entitled to an order for costs and they seek to pursue that entitlement against their father but not against their mother. For that purpose they have instituted the proceedings in the Common Law Division of this Court to which I have referred, namely No. 12244/99. Secondly, the plaintiffs wish to put themselves in a position to enforce Purdy J's judgment, subject of course to any stay related to the appeals. It was in pursuit of the latter purpose that the proceedings now before me were instituted. 7 The Act, which commenced on 9 July 1999, contains provisions which are relevant to the above circumstances. Section 4(1) defines 'ineffective judgment' as follows: 'A reference in this Act to an ineffective judgment is a reference to a judgment of a federal court in a State matter given or recorded, before the commencement of this section, in the purported exercise of jurisdiction purporting to have been conferred on the federal court by a relevant State Act.' The word 'judgment' is defined in s 3 to include a judgment, decree or order, whether final or interlocutory. Purdy J's judgment of 4 June 1999, so far as it relates to the children's claims, is a judgment of a federal court in a State matter given before the commencement of the Act on 9 July 1999, in the purported exercise of jurisdiction purporting to have been conferred by a relevant State Act, namely the Jurisdiction of Courts (Cross-vesting) Act 1987 (NSW). It follow that Purdy J's judgment is an 'ineffective judgment' within s 4(1) of the Act. 8 That being so, s 6 declares that the rights and liabilities of all persons are the same as if Purdy J's ineffective judgment had been a valid judgment of the Supreme Court in a Division constituted by a judge of this Court. By s 7 a right or liability conferred by s 6 is exercisable or enforceable as if it were a right or liability conferred by a judge of the Supreme Court. By s 10 the Supreme Court is empowered to vary, revoke, set aside, revive or suspend a right or liability conferred by s 6. The group of provisions which I have just described applies whenever there is an 'ineffective judgment' as defined. The Act contemplates, therefore, that remedial consequences flow under it in respect of certain prior judgments of federal courts which are invalid in consequence of Re Wakim . Those consequences do not flow on the basis that the Act validates the ineffective judgment; they flow on the basis that the ineffective judgment is treated as a judgment of the Supreme Court. 9 Section 11 of the Act is directed to a different though overlapping situation. It applies in a case where there is a 'relevant order'. That expression is defined in s 11(1). Approximately speaking, a relevant order is an order of a federal court, whether made before or after the commencement of the Act on 9 July 1999, acknowledging in some way that it does not have jurisdiction to hear and determine a proceeding which is before it relating to a State matter. Where a relevant order has been made, s 11(2) empowers a party to the federal court proceeding to apply to the Supreme Court for an order that the proceeding be treated as a proceeding of the Supreme Court. Section 11 obviously has potential application in a case where there is a proceeding in a federal court such as the Family Court of Australia which has not yet proceeded to judgment of any kind. It also has potential application in a case where a judgment, interlocutory or final, has been delivered and orders have been made in the federal court, but some additional relief is sought and the federal court determines that it lacks jurisdiction to grant the additional relief. Thus, if a final judgment in a federal court proceeding has been delivered but the federal court has not made an order with respect to costs, s 11 is potentially available to permit the party seeking costs to obtain an order of the Supreme Court that the proceeding be treated as a proceeding of the Supreme Court, and then to seek an order for costs in the Supreme Court. Proceedings for that purpose are brought by summons under Pt 77 r 141 of the Supreme Court Rules. 10 However, s 11 is not the only vehicle by which rights which have been at issue in a federal court proceeding may be asserted or defended in the Supreme Court. Section 7 expressly contemplates the enforcement of the rights established by s 6 with respect to an ineffective judgment. Those rights, according to s 7, are enforceable as if they were conferred by a judgment of the Supreme Court. It follows that the procedural machinery of the Supreme Court should be made available for enforcement of those rights. In fact, it is made available under Pt 77 r 139 of the Supreme Court Rules. 11 Equally, s 10 of the Act, by conferring on the Supreme Court the power to alter the rights conferred by s 6 as if they were rights conferred by the Supreme Court, implies that the procedural machinery of the Supreme Court should be made available so that such an alteration may occur in a proper case. Consequently, Pt 77 r 140 of the Supreme Court Rules provides for an application for an order under s 10. 12 There are, in summary, three provisions of the Act which create bases for relief in the Supreme Court, namely ss 11(2), 7 and 10. Section 11(2) is available where there is 'a relevant order', whether or not there is an 'ineffective judgment'. Sections 7 and 10 are available where there is an 'ineffective judgment', whether or not there is a relevant order. 13 The summonses in the two cases before me seek declarations pursuant to ss 10 and 11 of the Act. It appears to me that a declaration pursuant to s 10 is inappropriate here, since the plaintiffs do not wish to obtain an order of the Supreme Court altering rights or liabilities flowing from the ineffective judgment of Purdy J. Instead they seek to put themselves in a position to enforce Purdy J's judgment. As far as s 11 is concerned, the appropriate relief would be an order that the proceeding in the Family Court be treated as a proceeding of the Supreme Court, rather than relief by way of declaration of right. Consequently, in my opinion, the prayer for relief in the summons is inaccurately framed. 14 In my opinion, a declaration could be made in an appropriate case with respect to the rights conferred by s 6 or the enforceability of those rights under s 7, but in accordance with well-established principles a declaration of right should not be made unless there is a genuine dispute which is not merely hypothetical. In the present case the defendants acknowledge that the judgment of Purdy J with respect to the children's claims is an 'ineffective judgment', and that under s 6 the rights and liabilities of all persons are declared to be the same as if Purdy J's judgment had been a valid judgment of the Supreme Court. Therefore, there is no dispute which needs to be resolved by declaration of right. 15 If the plaintiffs wish to enforce the rights conferred on them by s 6, they may proceed by summons under s 7 and Pt 77 r 139 seeking the enforcement relief which they wish to obtain. Obviously an application under those provisions would be premature if no enforcement relief were in contemplation. 16 In my opinion, therefore, the relief sought in the summons ought not to be granted in its present form. The question arises whether, if the plaintiffs were to make an application, I should allow an amendment to the summons to permit them to seek relief consistent with these reasons for judgment. In my opinion I ought not to do so. This is because of the undesirability of this Court taking steps which would encourage or permit multiplicity of proceedings. 17 As I have mentioned, there is a proceeding in the Common Law Division of this Court at the present time. The parties to that proceeding are the same as the parties in the two sets of proceedings before me when taken together. The relief sought is an order that the first defendant (the father) pay the children's costs of the Family Law proceedings. I am not sure of the basis upon which this Court has jurisdiction to make the order sought in the Common Law proceedings, nor (if it does) whether it would ever be appropriate for this Court to exercise its discretion to award costs consequent upon a judgment in another court. I say no more about that. But it does seem to me that a litigant in proceedings in a federal court in which an ineffective judgment has been given which did not deal with costs, is able to apply by summons under Pt 77 r 141 for an order under s 11(2) of the Act that the proceeding in the federal court be treated as a proceeding in the Supreme Court of New South Wales, provided that (i) a 'relevant order' has been made in the federal court; and (ii) the proceeding relates to a State matter of New South Wales. 18 I am less sure whether it would be possible to apply directly for an order for costs under Pt 77 r 139 in reliance on the contention that such an order relates to the enforcement of rights under s 7. But in any event an application under s 11(2) could be accompanied by a consequential application for an order for costs on the assumption that the order under s 11(2) is first made. 19 Thus the Act provides a mechanism for a person in the position of the present plaintiffs to move the proceedings in the federal court forward by seeking an order for costs in this Court, provided that the requirements of the Act are satisfied. If the requirements of the Act are satisfied it will incidentally follow that there will be a proceeding of an appropriate kind in this Court so that in future, should it be necessary to seek enforcement, enforcement will be available in that proceeding. That is to say, if an order is made in the Common Law proceeding that the Family Court proceeding be treated as a proceeding of this Court, then an appropriate application for enforcement of Purdy J's orders can be made in the Common Law proceeding, whether or not the Court in that proceeding makes the order for costs. Bringing all relevant applications in the Common Law proceeding would avoid multiplicity of actions. 20 I note that under Pt 77 r 139-141 of the Supreme Court Rules it is contemplated that a proceeding under the Act will be brought in the Division to which the federal court proceeding would have been assigned had it been commenced in this Court. That may suggest that in the normal course an order with respect to Family Court proceedings would be sought by application to the Equity Division rather than the Common Law Division. However, since there is an existing proceeding in the Common Law Division it seems to me that if an application were to be made in the Common Law proceeding for leave to file an amended summons seeking relief under the Act, considerations of convenience would justify waiver of that part of the Rule. 21 In my opinion, therefore, the present two summonses should be dismissed and the plaintiffs in the present proceedings should consider whether to seek leave to amend the Common Law proceedings in the manner outlined. 22 On the question of costs, counsel for the defendants submit forcefully that there is no basis here for departing from the normal rule that costs should follow the event. In the very special circumstances of this case I disagree. It appears not only that there has been considerable confusion with respect to the procedural operation of the Act, but the legal representatives of the plaintiffs have framed their proceedings after discussions with staff of this Court. I have delivered full reasons for judgment notwithstanding that the matter has arisen in a very busy duty list, precisely because of the lack of clarity in this area and in the hope of saving future litigants from the confusion which operated in this case. I believe the appropriate result is that I should make no order for costs in respect of the two proceedings which are before me today. 23 I order that the summons in each of proceeding No. 4736 of 1999 and proceeding No. 4737 of 1999 be dismissed with no order as to costs. * * * * * * * * * * Last Modified: 12/13/1999 DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. 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