B Pty Ltd v Ungureanu [2025] NSWSC ...

Note: The form of the order is subject to the entry in the Court's records.

Note: This copy of the Court's Reasons for judgment may be subject to review to remedy minor typographical or grammatical errors (r 10.14(b) Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 10.13 Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth).

Part XIVB of the Family Law Act 1975 (Cth) makes it an offence, except in very limited circumstances, to publish an account of proceedings that identify persons, associated persons, or witnesses involved in family law proceedings.

IT IS NOTED that publication of this judgment by this Court under a pseudonym has been approved pursuant to subsection 114Q(2) of the Family Law Act 1975 (Cth).

1. The intervener, B Pty Ltd, filed an application in the proceedings, seeking orders pursuant to the Jurisdiction of Courts (Cross-vesting) Act 1987 (Cth) for the proceedings to be transferred to the Supreme Court of NSW to be heard with proceedings between the parties (and an additional party) that are pending in the Supreme Court (file number ...).
2. The proceedings pending in this court are the wife's application for property settlement orders pursuant to s 79 of the Family Law Act 1975 (Cth). The first of the orders sought by the wife is an order to sever the joint tenancies between the respondent husband and applicant wife in three real properties. The second and third orders sought are in the following terms:
   1. That in the event of the sale of any or all of the above properties as the result of proceedings commenced by way of Statement of Claim filed 14 October 2024 by [B Pty Ltd] as plaintiff in proceedings case number [...] then the nett proceeds arising from the sale of one or all of the above mentioned properties shall become as to the total of the said nett proceeds the sole property of the applicant wife to the exclusion of so much of the said proceeds as may be allocated to the respondent husband pursuant to the provisions of section 78 of the Family Law Act 1975.
   2. More particularly pursuant to section 79 of the Act the respondent husband shall transfer to the applicant wife an amount equal to 50% of any funds received by him as the result of the sale of the above mentioned properties in satisfaction of the wife's entitlement to an adjustment of property interests as between herself and the husband taking into account in the course of these proceedings those matters which are thereto and favour the applicant wife.
3. The wife also seeks orders that the parties otherwise retain the property in their respective possession (Order 5), the husband pay her costs (Order 4), and that the husband indemnify her against any costs order in the Supreme Court proceedings (Order 6).
4. The Supreme Court proceedings were brought by the intervener to recover over $3m taken by the husband from the intervener, when carrying out his employment with C Pty Ltd ("C Pty Ltd") who had been engaged to provide the intervener with accounting services. In early 2025, the intervener obtained summary judgment against the husband for around $3,324,460.00 together with interest and costs: B Pty Ltd v Ungureanu [2025] NSWSC .... In mid-2024 Parker J made freezing orders against the husband preventing him from taking steps to "in any way dispose of, deal with or diminish the value of [his] assets in Australia" up to a value of just over $3.077m.
5. There are a number of outstanding issues to be determined in the Supreme Court proceedings. The intervener claims to have an equitable proprietary interest in the husband's real properties and also seeks to recover against the wife and C Pty Ltd. C Pty Ltd has cross claimed seeking indemnities from the husband and wife. The substantive claim against the wife is that a portion of the misappropriated monies was applied for her benefit. However, the intervener does not claim a proprietary interest in the wife's real property, presumably because it is not alleged that the wife was a party to the misappropriation of monies by the husband.
6. At the hearing before me, the wife provided interlocutory orders that she sought with the husband's consent (although he did not appear) to which the intervener also consented. Those orders provided that:

(1) The joint tenancies of the husband and wife in the three properties be severed;

(2) The Husband's superannuation be split to provide almost all of the husband's superannuation to the wife; and

(3) The Application be transferred to the Supreme Court for final determination.

1. The wife's counsel was unable to explain why she could not effect a severance of the joint tenancies by notice as provided for in s 97 of the Real Property Act 1900 (NSW), which provides:

(1) Registration of a transfer by a joint tenant of the joint tenant's interest in the land that is the subject of a joint tenancy to himself or herself severs the joint tenancy.

(2) If a joint tenancy is proposed to be severed by unilateral action by one joint tenant, the Registrar-General may require the person who proposes to sever the joint tenancy to provide the Registrar-General, before recording the instrument that severs the joint tenancy, with -

(a) the names and addresses of the joint tenants or, if the addresses are unknown, evidence of the efforts made by the person to locate the addresses of the joint tenants, and

(b) a statement that the person is not aware of any limitation or restriction on his or her capacity or entitlement to sever the joint tenancy (arising, for example, from the capacity in which the person holds an estate or interest in the land concerned or from a private agreement).

(3) The Registrar-General may require the person who proposes to sever a joint tenancy to provide additional information concerning -

(a) other persons who may be affected by the severance of the joint tenancy, and

(b) any limitation or restriction on the capacity or entitlement of the person to sever the joint tenancy, and

(c) any other matter that the Registrar-General considers appropriate.

(4) The Registrar-General may require any information provided for the purposes of this section to be provided by statutory declaration or verified in a way approved by the Registrar-General.

(5) The Registrar-General must give notice of the lodgment of a dealing for registration or recording that may sever a joint tenancy to all joint tenants in the joint tenancy (other than any joint tenant who executed the dealing, or on whose behalf the dealing was executed). Section 12A (2) and (3) applies to and with respect to a notice given under this section.

(6) Despite subsection (5), the Registrar-General is not required to give notice of the lodgment of a dealing for registration or recording that may sever a joint tenancy to a joint tenant in any of the following circumstances -

(a) if the proposed severance is to arise from the recording of a court order made in proceedings to which the joint tenant is a party,

(b) if the proposed severance is to arise from the registration of a transfer pursuant to a writ in respect of an interest of any of the joint tenants,

(c) if the dealing concerned is witnessed by the joint tenant and the dealing indicates that the joint tenancy is to be severed,

(d) if the dealing is accompanied by a written acknowledgment by the joint tenant that he or she has received legal advice as to the effects of the severance of the joint tenancy,

(e) if the proposed severance is to arise out of registration following an application under section 90.

1. Counsel made submissions to the effect that his solicitor had told him of difficulties in dealing with PEXA, who it was alleged had demanded a court order. No evidence of the interactions with PEXA was placed before the court. Counsel was unable to articulate what reason or explanation was given by PEXA. I am not persuaded that the wife's difficulties with PEXA provide a basis for making the order, at least without evidence or explanation of the reason for the difficulty.
2. The husband's consent to an order severing the joint tenancies is a dealing with the real property interests which is a prima facie breach of the orders of Parker J in mid-2025.
3. The wife deposes to a desire to transfer her share of the real property to the children, which would potentially place it beyond the reach of the intervener and C Pty Ltd. If the severance of the tenancies is done by Notice pursuant to the Real Property Act and it has any impact upon the rights of the intervener or the cross-claimant in the Supreme Court, it can be subject to challenge as a potential fraud on creditors, which may not be open if the severance is by way of a court order. If the severance is to be ordered by consent, it is appropriate to make the orders in the Supreme Court where all of the potentially affected parties are parties to the proceedings and where the existing freezing order can be altered if need be.
4. At this stage of the proceedings, I therefore decline to make the order severing the joint tenancies.
5. The husband and wife seek an order splitting almost the entirety of the husband's superannuation to the wife (approximately $68,000). It is well accepted that power to make property settlement orders pursuant to s 79 of the Family Law Act may only be exercised once see Hickey & Hickey and the Attorney General for the Commonwealth of Australia (Intervener) [2003] FamCA 314; (2003) FLC 93-147 at [48]. This does not prevent the making of interim or partial property settlement orders dealing with property of the parties, however, as the final order must be just and equitable, any interim or partial settlement order potentially limits the options open to the court when making the final determination. In this case there is a real possibility that there will only be a very modest pool of assets other than superannuation. If the wife has already received the husband's superannuation, this may weigh against her receiving a larger share of the other assets (if any) available for settlement.
6. Counsel made submissions, unsupported by any affidavit evidence, that the real purpose of the superannuation splitting order was to enable the wife to then seek permission to withdraw some of the superannuation under the hardship provisions. Counsel was unable to identify the provisions, any guidelines, or any maximum amount that may be withdrawn. There was no evidence to support these propositions. It was then put from the bar table that there are school fees to be paid, however there was no evidence in the material about this issue.
7. I am not persuaded to make interim or partial property settlement orders by way of the superannuation split sought on the material currently before the court.
8. Section 5(4) of the Jurisdiction of Courts (Cross-vesting) Act provides power for the court to cross-vest the proceedings to the Supreme Court of NSW. The section provides that:

(a) a proceeding (in this subsection referred to as the relevant proceeding) is pending in the Federal Court or the Federal Circuit and Family Court of Australia (Division 1) (in this subsection referred to as the first court); and

(b) it appears to the first court that:

(i) the relevant proceeding arises out of, or is related to, another proceeding pending in the Supreme Court of a State or Territory and it is more appropriate that the relevant proceeding be determined by that Supreme Court;

(A) whether, in the opinion of the first court, the relevant proceeding or a substantial part of it would have been incapable of being instituted in that court, apart from this Act and any law of the Australian Capital Territory or the Northern Territory relating to cross‑vesting of jurisdiction; and

(B) whether, in the opinion of the first court, the relevant proceeding or a substantial part of it would have been capable of being instituted in the Supreme Court of a State or Territory, apart from this Act and any law of a State or Territory relating to cross‑vesting of jurisdiction; and

(C) the extent to which, in the opinion of the first court, the matters for determination in the relevant proceeding are matters arising under or involving questions as to the application, interpretation or validity of a law of the State or Territory referred to in sub‑subparagraph (B) and not within the jurisdiction of the first court apart from this Act and any law of the Australian Capital Territory or the Northern Territory relating to cross‑vesting of jurisdiction; and

(D) the interests of justice;

it is more appropriate that the relevant proceeding be determined by that Supreme Court; or

(iii) it is otherwise in the interests of justice that the relevant proceeding be determined by the Supreme Court of a State or Territory;

the first court shall transfer the relevant proceeding to that Supreme Court.

1. The law is well summarised in Valceski v Valceski [2007] NSWSC 440; (2007) 70 NSWLR 36. In Valceski, equity proceedings between the spouses and extended family members were transferred to the Family Court to be determined with the property settlement proceeds as they formed part of the same justiciable controversy. The equity proceedings were a smaller part of the larger controversy between the husband and wife and commenced after the property settlement proceedings.
2. Both the Supreme Court proceedings and the property settlement proceedings in the present matter will, in large part, focus upon the tracing of funds that have resulted in the husband and wife's interests in the real properties. The issues are summarised by the wife in her affidavit where she says:
   1. The Intervenor further asserted that the Tainted Funds were applied by [Mr Ungureanu] in acquiring and/ or improving the NSW Properties being three parcels of real estate particulars of which are set out hereunder

34a [D Street, Suburb E], NSW [...] being the land comprised in Folio Identifier [...].

34b [F1 Street, Suburb G], NSW [...] being the land comprised in Folio Identifier [...].

34c [F2 Street, Suburb G], NSW [...] being the land comprised in Folio Identifier [...]

1. The Intervenor asserts that the NSW Properties are substantially properties in respect of which the Intervenor is entitled to a Declaration that they have been acquired by monies misappropriated by [Mr Ungureanu] when acting as the Intervenor's accountant.

Funds used to acquire the NSW Properties

1. I do not concede that the three parcels of real estate have been acquired wholly from the Tainted Funds but rather from the following:

36a Savings accrued by [Mr Ungureanu] and I throughout the earlier years of our marriage.

36b From gift monies we received for our wedding in [Country H] and our welcome to Australia from [Country H] as a married couple.

36c Monies generated by [Mr Ungureanu] from his employment which were wholly legitimate and untainted by fraud until he commenced employment with the Intervenor as an Accountant.

36d From the sale of a vacant block of land in [J Street, Suburb E] which [Mr Ungureanu] and I purchased from our own savings. On or about 15 September 2021 [Mr Ungureanu] and I received instalments of $369,258.60 and $52,435.47, respectively.

36e From a gift in the sum $300,000 given to us by my mother-in-law, as evidenced by Annexure "A" above.

36f From income received by myself from artefacts made by me which I sold to friends and others with whom I came into contact.

36g From monies received by me as a result of my status as the mother of three children which made it possible for me to contribute to the payment of loans secured by mortgage over the NSW Properties.

36h From our own resources.

36i Loans advanced to [Mr Ungureanu] and I by National Australia Bank ("NAB")...

1. I state that income received by me from all sources was applied by me (other than income spent on living expenses) in order to make mortgage payments to the NAB, and avoid our defaulting in making the monthly mortgage payments.

1. The issues between the spouses and the other parties will require a determination of the proprietary interests of the husband, and in particular whether those interests differ from the registered titles held by the husband. To the extent that the intervener establishes equitable proprietary interests, that part of the husband's property will no longer be property of the parties for the purpose of s 79 of the Family Law Act.
2. As the existing judgment against the husband is for a sum greater than his half interest in the net equity in the three real properties, there is likely to be a dispute between the intervener and C Pty Ltd on the one hand and the wife on the other as to whether the wife is able to obtain orders settling part of the husband's property upon her pursuant to s 79, even though this would effectively give her priority over the creditors. The court has a discretion to make such orders provided consideration is given to the interests of the creditors: see s 79(5)(m) of the Family Law Act. The circumstances leading to the debt and any findings as to the benefits received by the spouses as a result of the misappropriation of funds will be important considerations when exercising the discretion pursuant to s 79 of the Family Law Act. As a result, it is likely that the intervener and C Pty Ltd will participate in the property settlement proceedings if any judgment against the wife is not greater than her potential property settlement entitlements pursuant to s 79 of the Family Law Act.
3. As identified in Valceski at paragraphs [52] - [59], the matters relevant to the exercise of the discretion pursuant to s 79 are far broader than the issues that will arise between the parties in the Supreme Court proceedings. Section 79 requires consideration of the parties financial and non-financial contributions as identified in s 79(4), and the list of other factors set out in s 79(5). However, in this case these other issues do not appear to be the subject of any real dispute: the wife has been a homemaker and had three children, she was not able to work whilst caring of the children and will continue as the primary carer of the children into the future. The child support issues are determined under the Child Support (Assessment) Act 1989 (Cth) and are the subject of an administrative assessment. In short, whilst the property settlement proceedings require consideration of numerous additional issues, it appears that on a practical level the issues that do not directly involve the other parties are unlikely to consume any significant trial time.
4. I turn to addressing the matters listed in s 5(4) of the Jurisdiction of Courts (Cross-vesting) Act:

(1) The property settlement proceedings are pending the Federal Circuit and Family Court of Australia (Division 1).

(2) The property settlement proceedings are related to the proceedings in the Supreme Court as those proceedings will determine the real property interests of the husband, the debts of the parties to the intervener and C Pty Ltd and will traverse many of the facts and circumstances likely to be significant when considering whether property settlement orders should be made that may reduce the amount the other parties can recover from the husband.

(3) The property settlement proceedings were able to be instituted in this court without reliance on the Jurisdiction of Courts (Cross-vesting) Act. The property settlement proceedings could not have been instituted in the Supreme Court apart from reliance on the Jurisdiction of Courts (Cross-vesting) Act. The matters pending in the Supreme Court were not within the original jurisdiction of the Federal Circuit and Family Court of Australia (Division 1) at the time they were commenced.

(4) The interests of justice require consideration of the various matters discussed above. The parties do not suggest that there are any geographical issues, not that there would be relevant differences in the time until hearing between the two courts. On a practical level the property settlement issues must be determined after the civil claim (whether in the same judgment or separate proceedings). The factual basis of the two disputes has a significant overlap. Unlike the facts in Valceski's Case, the parties seek to have both disputes heard together. The alternative is for the family law dispute to await determination of the Supreme Court proceedings. However, it is likely that the other parties will have to participate in the family law proceedings. I cannot make orders uplifting the Supreme Court dispute to this court (even if that were an appropriate course), and thus the only court that is able to hear the whole of the controversy is the Supreme Court, if orders to cross-vest the proceedings in this court to the Supreme Court are made. The matrimonial dispute did not trigger the Supreme Court proceedings, nor do issues in the Supreme Court arise from dealings with the extended family. In this sense the controversy does not arise as part of the broader matrimonial dispute. Rather, the likely contests between the wife and the other parties draw those parties into the matrimonial dispute. Importantly, there does not appear to be any opposition by the husband to the wife's claim in the family law dispute - supporting the argument that the family law dispute will be largely a dispute between the wife and the other parties. The interests of justice favour the property settlement proceedings being determined by the Supreme Court together with the claims of the other parties to save the intervener and C Pty Ltd from having to participate in two proceedings in separate courts.

1. In the circumstances of this case, it is appropriate to transfer the property settlement proceedings to the Supreme Court.

I certify that the preceding twenty-two (22) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Riethmuller.