Supreme Court New South Wales Medium Neutral Citation: Smith v Smith [2016] NSWSC 1287 Hearing dates: 9 September 2016 Decision date: 09 September 2016 Jurisdiction: Equity - Duty List Before: Stevenson J Decision: Caveat extended pursuant to s 74K Real Property Act 1900 (NSW) and proceedings transferred to Family Court of Australia Catchwords: REAL PROPERTY – caveats – whether caveat should be extended pursuant to s 74K Real Property Act 1900 (NSW) – where contract for sale entered into for sale of matrimonial home by husband without knowledge of wife – where settlement of contracts imminent – where wife and children reside at the property Legislation Cited: Family Law Act 1975 (Cth) Real Property Act 1900 (NSW) Category: Principal judgment Parties: Sharee Smith (Plaintiff) Rodney William Smith (Defendant) Representation: Counsel: P Livingstone (Plaintiff) N Ford (Defendant) Solicitors: MCW Lawyers (Plaintiff) Solari & Stock (Defendant) File Number(s): SC 2016/269225 EX TEMPORE Judgment 1. The plaintiff and the defendant are wife and husband. 2. These proceedings concern a caveat that the wife has placed on the title of the matrimonial home at Miranda. That property is registered in the husband's name. The caveatable interest is said to arise by reason of "[a] resulting trust arising from financial and non-financial contributions to the conservation and improvement" of that property. 3. The wife commenced proceedings in the Federal Circuit Court of Australia for relief under the Family Law Act 1975 (Cth). That Court was not able to deal with her application and those proceedings have now been transferred to the Family Court of Australia which, it seems, is not able to deal with any application that the wife may wish to make in the immediate future. 4. The husband served on the wife a lapsing notice under s 74J of the Real Property Act 1900 (NSW), the effect of which is that, unless I otherwise order, the caveat will lapse tomorrow. 5. By contract dated 3 August 2016 the husband has contracted to sell the property to a person he asserts to be a third party. I am told that contract is due to settle late next week. The husband did not tell the wife about the contract until after it was exchanged. 6. Mr Livingstone, who appears for the wife, has told me that the wife wishes to purchase the husband's interest in the property (she resides at the home with the children of the marriage) and wishes to seek orders under the Family Law Act to set aside the pending sale so that she might pursue that application. 7. It is not necessary nor appropriate that I express any view about that proposed application, let alone involve myself in it. 8. The matter for consideration by me is simply whether I should make an order extending the caveat. If I were to do so, that may well have the effect that the sale that the husband has effected will go off and that may well give rise to a claim by the purchaser against the husband for damages. 9. The evidence shows that the husband purchased the property in August 2006. He said he paid a deposit of $39,500 from his own savings. The documentation before me suggests that he borrowed the balance of the purchase price, some $400,000, from ING Direct. 10. The material before me suggests that loan was refinanced in November 2014 with a loan advanced to both parties by an organisation called The Shire Local Banking. That organisation advanced to the parties something in the order of $680,000 which, I am told, was used to refinance the husband's mortgage with ING and to effect renovations on the property. 11. In those circumstances I am satisfied that there is a serious question to be tried that the wife does have a caveatable interest in the property and that the balance of convenience is in favour of extending the caveat. 12. I see no alternative but to extend the caveat until further order and to then remit these proceedings to the Family Court in the hope that the parties can either resolve their differences on an interim basis or that the Family Court at some point will find time to deal with the matter. 13. The orders I make are these: 1. Upon the plaintiff giving to the Court the usual undertaking as to damages I make an order pursuant to s 74K of the Real Property Act 1900 (NSW) extending caveat number AK 644358 until further order. 2. I order that these proceedings be transferred to the Family Court of Australia. 3. I reserve all questions of costs for consideration by the Family Court of Australia. 4. I order that these orders be taken out forthwith. ********** 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. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 13 September 2016