Bianchi & Bianchi [2025] FedCFamC1F 789 (7 November 2025)

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 the pseudonym Bianchi & Bianchi has been approved pursuant to subsection 114Q(2) of the Family Law Act 1975 (Cth).

1. These reasons relate to competing applications to bifurcate certain aspects of the proceedings pending before the Court.
2. The substantive proceedings before the Court concern the question of property settlement as and between parties to a marriage. The relationship between the parties was of some 17 years duration and produced three now adult children.
3. Frustratingly, the financial proceedings have been before the Court for over six years, with very little progress; despite the Court's best efforts. The delays in meaningfully progressing the proceedings are as a result of a range of issues involving third parties. Unquestionably however, all of the parties to the proceedings bear some responsibility for the inordinate and unacceptable elongation of the proceedings.
4. In essence the third party issues are:

(a) The wife invites the Court to make a declaration that the husband's mother holds her interest in real property situate at E Street, Suburb F ("the Suburb F property") on trust for the husband;

(b) The wife invites the Court to make a declaration that the husband and the wife are the beneficial owners of a two third interest in the following:

(i) Two parcels of real property situate at Property 1 and 2 at H Street, Town J; and

(ii) The company Bianchi of D Pty Ltd; and

(c) The husband's brother has made a claim for unpaid wages, superannuation, interest and unpaid rent in relation to the company Bianchi of D Pty Ltd; and

(d) The husband's brother as one of the directors of Bianchi of D Pty Ltd, is pursuing a claim against the husband and the wife to recover funds he alleges were taken without proper accounting from Bianchi of D Pty Ltd.

1. Each the husband, the husband's brother and the husband's mother ask the Court to bifurcate the third party issues, such that they are heard and disposed of by the Court prior to any hearing of the husband and wife's competing claims for property adjustment pursuant to s 79 of the Family Law Act 1975 (Cth) ("the Act"). The husband and the husband's brother ask the Court to bifurcate all of the third party issues, whereas the husband's mother asks the Court to separately hear the claims relating to the third and fourth respondents, and thereafter that the issues relating to her progress to a mediation.
2. For the reasons which follow, all of the third party issues shall be bifurcated and listed for trial separate to and preliminary to the determination of the husband and wife's completing claims for settlement of property.

1. Before discussing the background of the proceedings, it is necessary to understand who each of the parties to the substantive proceedings are.
2. The applicant is the wife and the respondent is the husband. They shall be referred to as the "wife" and the "husband" throughout these reasons.
3. The second respondent (Ms C Bianchi) is the husband's mother. She shall be referred to as the "husband's mother" throughout these reasons. She is however the applicant in the present interlocutory proceedings.
4. The third respondent (Mr Bianchi) is the husband's brother. He shall be referred to as the "husband's brother" throughout these reasons.
5. The fourth respondent is the company "[Bianchi of D Pty Ltd]" and shall be referred to as "the company" throughout these reasons. The company's involvement in these proceedings is being undertaken by the husband's brother in his capacity as one of the directors of the company. In relation to the company, the agreed facts appear to be:

(a) The husband and the husband's brother are the two directors and only shareholders, each holding an equal number of shares in the company.

(b) The company operated a function and reception centre business known as "[Bianchi of D Pty Ltd]" from premises held across two separate titles at Property 1 and 2 at H Street, Town J in the state of South Australia. Each the husband and the husband's brother hold their respective half interest in each of these properties as tenants in common.

(c) Property 1 at H Street was purchased by the husband and the husband's brother in approximately 1988 and was the premises used to operate a restaurant run by the husband, the husband's brother and their parents via a company known as M Pty Ltd.

(d) Property 2 at H Street was purchased by the husband and the husband's brother in approximately 1996.

1. The agreed facts regarding the husband and the wife are as follows:

(a) They met in approximately 1994 and began cohabiting in approximately 1995.

(b) They married in 2000.

(c) There are three now adult children of the marriage, Ms N born 2001, Ms Y born 2003 and Mr X born 2007.

(d) They physically separated on 27 May 2019, when the wife vacated the former matrimonial home situate at O Street, Suburb P and took up rental accommodation. The wife asserts that she and the husband lived separately under the same roof from approximately 5 August 2017 until physical separation.

1. At the commencement of the husband and the wife's relationship, the husband, the husband's parents and the husband's brother were engaged in operating a business then known as M Pty Ltd, from the premises at Property 1 at H Street. The husband says that shortly after the parties began living together, the wife also began to work in M Pty Ltd.
2. The husband asserts that when the parties began cohabiting (at a property in Suburb Q with his parents), he had the following assets and liabilities:[1]

(a) my legal interest in the Suburb Q property;

(b) a 50% interest in Property 1 at H Street, Town J;

(c) a 50% interest in M Pty Ltd;

(d) Motor Vehicle 1;

(e) Motor Vehicle 2 (purchased for $13,500 for me by my parents); and

(f) some savings.

1. It is an agreed fact that when the parties began cohabiting the wife held no assets of significance.
2. The parties have bought and sold a number of residential properties over the course of their relationship, culminating in them owning a residential property on O Street at Suburb P at the time of separation, in which the husband continues to reside.
3. At the time of separation, the husband and the wife agree that the assets and liabilities in which they held a legal interest comprised the following (with the values ascribed by each of them at that time set out below):

1. In addition to the same, there is a significant dispute between the husband and the wife and subsequently the wife and the third parties as to historical transactions regarding the husband's parent's former home at Suburb Q and the Suburb F property.
2. The Suburb F property was purchased by the husband's parents and the husband's brother in approximately 1985. Each the husband's mother and the husband's brother hold an equal share in the Suburb F property as tenants in common. The husband's brother, and latterly his partner, have always resided in the Suburb F property.
3. So far as the Suburb Q property is concerned, it is an agreed position that:

(a) The property was that located at T Street, Suburb Q.

(b) It was the family home of the husband and the parental family, with the husband's parents, the husband and his siblings residing in the Suburb Q property, as did ultimately the husband with the wife in the initial stages of their cohabitation.

(c) The Suburb Q property was sold in January 2009.

1. In relation to the Suburb Q and the Suburb F properties, when the wife commenced these proceedings, she asserted:

(a) On 31 March 2004, the husband transferred his interest in the Suburb Q property to his mother, on the basis of an agreement that the husband's mother's interest in the Suburb F property would be transferred to the husband as a "swap" in circumstances where the husband's mother's interest in the Suburb F property and the husband's interest in the Suburb Q property were considered to be comparable at that time, with an undisclosed written agreement drawn to this effect.

(b) When the husband's mother sold the Suburb Q property in 2009 (following the death of the husband's father in 1999), she retained the entire proceeds of sale, and applied those funds to purchasing her current home, a unit in Charles Street, Adelaide.

(c) The transfer of the husband's mother's interest in the Suburb F property to the husband never occurred.

(d) It is the wife's case that given the promises and agreement made regarding the husband's transfer of his interest in the Suburb Q property to the husband's mother, the husband's mother now holds her interest in the Suburb F property on trust for the husband.

1. When the husband first went on oath in these proceedings he deposed:[2]

(a) When the Suburb Q property was purchased in 1985 (for approximately $153,000) it was registered in his sole name.

(b) His parents contributed $120,000 to the purchase of the Suburb Q property, but did not have sufficient funds to complete the purchase.

(c) He took out borrowings with U Bank in the amount of $38,000 to complete the purchase and obtained a first homeowners grant

(d) His parents paid for improvements to the Suburb Q property together with the payment of the mortgage instalments and ultimately the repayment of the mortgage with funds crystallised from the sale of land held by the husband's mother in Italy.

(e) There was significant family discontent that the husband held the legal title of the Suburb Q property, and ultimately the husband's parents took legal advice and registered a caveat over the Suburb Q property.

(f) The husband did not take separate legal advice and proposed a resolution to his parents that they transfer their interest in the Suburb F property to him.

(g) Following the death of the husband's father:

(i) The husband in 2004 transferred his interest in the Suburb Q property to his mother;

(ii) The husband's mother unhappily agreed to transfer her interest in the Suburb F property to the husband, and whilst there were no formal documents signed, those documents were prepared so as to formalise the same; and

(iii) The transfer of the husband's mother's interest in the Suburb F property was never effected.

(h) Whilst the husband acknowledges he has never been transferred an interest in the Suburb F property, and that he has proffered his "interest" in the same in finance applications for time to time, he otherwise denies that he has any interest whatsoever in the Suburb F property.

1. The husband's mother and the husband's brother both deny that the husband has any interest in the Suburb F property as he has made no contributions "financially or otherwise". They mutually assert that the husband's brother has paid all outgoings for the Suburb F property, including discharging the mortgage, insurance premiums, rates and taxes, together with paying the costs of various improvements.

1. The wife, the husband and the husband's brother are in dispute as to matters relating to the company; albeit that there appears to be some commonality in the position between the husband and the husband's brother as against that of the wife.
2. What is at least agreed, is that following the separation of the husband and the wife in 2019, the company ceased trading. The husband asserted that covid restrictions negatively impacted the business,[3]however the husband's brother now says that forward bookings have commenced.[4]
3. Any plain reading of the filed material establishes that much of the facts asserted by each of the parties in relation to the company and the business operated by the company, are diametrically opposed.
4. As earlier identified:

(a) The wife invites the Court to make a declaration that the husband and the wife are the beneficial owners of a two third interest in each of the properties at Property 1 and 2 at H Street together with the company, as against the legal ownership of each of the real properties and the company being effectively held in equal shares between the husband and the husband's brother.

(b) The husband's brother has made a claim for unpaid wages, superannuation and interest against the company, together with a claim of unpaid rent in relation to the H Street properties; and

(c) The husband's brother on behalf of Bianchi of D Pty Ltd is pursuing a claim against the husband and the wife to recover funds he alleges were taken by each of them without proper accounting from Bianchi of D Pty Ltd.

(a) The husband has always been the managing director of the company,[5] and that he has manipulated the company accounts to provide benefits to his family members, including his mother, the husband's brother and another brother named Mr V.[6]

(b) The husband's brother did not ever "formally" work for the company, despite being a director and shareholder.[7]

(c) The husband's brother received a "directors fee", together with additional benefits "including the provision of some wine and food", but he was never paid a wage as "there has never been any employment arrangement with him".[8]

(d) The husband's brother assisted with the "function business", helping out behind the bar, setting up and cleaning up on weekends on an "as needed" basis.[9]

(e) There was never any suggestion that the husband's brother ought be paid a wage or receive "any other benefits of employment".[10]

(f) The husband determined to pay down borrowings for the property at Property 1 at H Street, ahead of paying "market wages" to each the husband and wife and the husband's brother.[11]

(g) The closure of the function and reception centre business operated by the company following the breakdown of the marriage was calculated, and designed to reduce the value of the assets available for division between the husband and the wife, as is the claim of the husband's brother for unpaid wages and entitlements.[12]

1. In his initial affidavit filed in these proceedings on 1 November 2019 the husband asserted:

(a) That he worked full time in M Pty Ltd from it's creation and thereafter in the restaurant and function business operated by the company. He says that he has been renumerated for this work.

(b) That the husband's brother originally worked in M Pty Ltd, working nights and on weekends, around his full time teaching work. The husband says that his brother was not renumerated for this work, but that the mortgage was paid down during this period,[13] and that "in a sense he is owed 30 years of wages".[14] The husband says that his brother was paid "directors fees" and that he has otherwise contributed to improvements and major renovation costs to the premises.[15] The husband acknowledges that his brother's contributions were not "accurately recorded or recorded at all", but was aware that his brother was undertaking a "forensic exercise in that regard".[16]

1. The husband's brother when he first filed an affidavit in these proceedings (on 31 January 2020), despite not being a party to the proceedings at that stage, asserted:

(a) The company (then known as M Pty Ltd) and a partnership between himself and the husband were both established by the husband's brother and the husband in approximately 1988.

(b) That his "primary employment" since 1988 had been in the restaurant and function centre business operated by the company, working approximately 40 hours per week,[17] with the husband working approximately 20 hours per week[18] and the wife working for approximately 8 hours per week.[19]

(c) Since 1985 he has also been employed casually in the teaching industry, averaging between five to eight shifts per fortnight.[20]

(d) The property at Property 1 at H Street was purchased by the husband and the husband's brother in August 1988 for $115,000. The husband's parents paid a deposit (in an unspecified amount), with the brothers' jointly borrowing funds from the bank to complete the purchase.[21]

(e) Major renovations were carried out to the Property 1 at H Street property in 2001/2002 with the brothers' jointly borrowing funds to fund the same and the husband's brother contributing approximately $50,000 from his own savings.[22]

(f) The property at Property 2 at H Street was purchased by the brothers in September 1996, for $88,725, with the husband's brother contributing $68,800 of his own funds to the purchase and "the company" paying the balance.[23]

(g) A new cottage was built at Property 2 at H Street with the husband, the wife and their children living rent free in the same for a period of approximately 9 years, over the protestations of the husband's brother that they pay rent.

(h) The husband and the wife were paid wages from the company, together with the husband receiving "partner drawings" comprised of regular monthly payments and "other lump sum partner drawings".[24] The husband's brother did not approve these arrangement or payments,[25] and he was kept out of the same.[26]

(i) The husband's brother has not ever been paid a wage. He has however received "partner drawings" paid in irregular monthly instalments between February 2013 and December 2019.[27]

(j) The husband and the husband's brother had come to an agreement that the financial "imbalances" between them would be resolved in time, with the husband's brother coming to believe that the same would occur if the business operated by the company and/or the H Street properties were sold.

1. It is the case of the husband's brother that the husband and the wife lived lavishly and well beyond their means, including overseas and interstate holidays, the purchase of luxury cars (including Motor Vehicle 5), sending their children to private schools, and purchasing expensive residential properties for their family to live in. Implicit in these assertions is that the husband's brother considers that the husband and the wife funded their excessive and lavish lifestyle from company funds to his exclusion and detriment.
2. When he filed a Defence in these proceedings on 8 November 2024 the husband's brother:

(a) did not agree with the wife's declaratory claim regarding the Suburb F property;[28]

(b) did not agree with the wife's declaratory claim regarding the two real properties at Property 1 and 2 at H Street and the company;[29]

(c) asserted that as a result of two separate expert forensic accounting reports he had obtained, the husbands interest in the company and partnership, as at 30 June 2021, was valued at $653,773, and his interest in the same was valued at $1,052,969;[30]

(d) quantified:

(i) his unpaid wages and entitlement claim at between $507,346.75 and $829,191.75, together with unpaid superannuation entitlements of between $50,000 and $461,978.16;

(ii) the unpaid rent claim at $392,160; and

(iii) the total amounts repayable by the husband and wife inclusive of interest to the company at $2,477,870.08.[31]

1. The substantive proceedings were commenced by the wife in the Federal Circuit Court of Australia (as it was then known) on 3 July 2019, with the husband filing a Response to Initiating Application on 13 August 2019.
2. When she commenced these proceedings, the wife named the husband's mother as a party to the proceedings, in light of the declaratory order that she sought regarding the Suburb F property.
3. In addition, the husband's brother was also named as a party to the proceedings. This was because the wife sought an anti-suit injunction to restrain the husband's brother from bringing proceedings against the company in respect of unpaid wages or superannuation without leave of the Court. This order however was not pressed by the wife at the first hearing in these proceedings on 13 August 2019, with the Court presented with a consent position of the parties to enable both the husband and the husband's brother 28 days to file responding documents. The husband's brother did not comply with this order and was granted an extension of time to file documents until 9 December 2019. Whilst the husband's brother ultimately complied with that order by filing responding documents on 31 January 2020 (some six months after the proceedings had been commenced by the wife), the wife's application for an anti-suit injunction against the husband's brother was still not pressed, with the parties ultimately on 24 February 2020 advising the Court that they would be participating in mediation to resolve the proceedings.
4. The proceedings returned before the Court repeatedly across 2020, 2021 and early 2022 with the Court variously being told that the mediation had not taken place for a range of reasons, including the parties awaiting valuations. Across that period, it is apparent that the wife did not ask the Court to hear her application for an anti-suit injunction against the husband's brother.
5. The company was subsequently joined to the proceedings, on the application of the wife and pursuant to orders made on 4 February 2022.
6. In early 2022, the husband's brother commenced proceedings in the Supreme Court of South Australia, naming the husband, the wife and the company as respondents. The husband's brother sought an order in those proceedings, that he be given leave to commence proceedings pursuant to s 237 of the Corporations Act 2001 (Cth) to bring an action on behalf of the company.
7. On 6 July 2022, on the application of the wife, the proceedings then pending in the Federal Circuit and Family Court of Australia, Division 2 ("Division 2"), were transferred to the Federal Circuit and Family Court of Australia, Division 1 ("Division 1").
8. By orders made in March 2023, on the application of the wife, the proceedings in the Supreme Court commenced by the husband's brother, were transferred to this Court.[32]
9. Throughout the currency of these proceedings, at various times, each of the parties have failed to comply with orders made by the Court, including orders for valuations and the particularisation of their respective claims. As already discussed, the parties prevaricated and failed to participate in mediation until 24 January 2022, despite the orders of 13 August 2019 directing them to do so within 60 days and their repeated assurances to the Court over that time that they mutually wished to participate in alternate dispute resolution and that they would do so. Thereafter, the wife took over two years to fully comply with orders first made on 4 February 2022 to particularise all of her claims against each of the third parties, finally doing so fulsomely on 14 June 2024.
10. In addition, each of the parties have each changed their legal representation on more than one occasion; with the wife now represented by three different solicitors, the husband now represented by three different solicitors, the husband's brother represented by five different solicitors, and the husband's mother represented by two different solicitors. In that context, the husband, the husband's brother and the husband's mother have at various times been unrepresented in these proceedings. Each time one or more of the parties have been unrepresented, the proceedings have been delayed to facilitate new solicitors being instructed.
11. The summary of these events highlights that the conduct of each of the parties, at various times throughout the litigation, has been less than diligent. As a result, significant Court time has been wasted, and of significance there has been little progress of the proceedings beyond the embryonic formulation of some, but not all, of the parties respective claims and cross claims.
12. The parties' costs in these proceedings are of concern to the Court, with their most recent respective cost notices filed in these proceedings identifying:

(a) The wife's current costs paid and owing (including counsel fees) total $160,270;[33]

(b) The husband's current costs paid and owing (including counsel fees), including those paid to his previous legal representatives total $217,861;[34]

(c) The costs of the husband's brother, paid and owing (including counsel fees) total $56,347;[35] and

(d) The costs of the husband's mother paid and owing (including counsel fees) total $35,013.[36]

1. It is not clear from the cost notices of the wife, the husband's brother and the husband's mother whether the costs they have each paid to their previous legal representatives have been included.

1. On 14 August 2025 the husband's mother filed an Application in a Proceeding in which she sought the following orders:
   1. That the claim relating to [Bianchi of D Pty Ltd] and the Third Respondent as more specifically particularised in the following documents filed in the within proceedings ("the Claim over [Bianchi of D Pty Ltd]"):
      1. Paragraphs 22 to 44 of the Particulars of Claim filed by the Applicant on 14 June 2024 headed "Claim over [Bianchi of D Pty Ltd]"
      2. Paragraphs 22 to 45 of the Particulars of Defence of the Third Respondent filed 8 November 2024 headed "Claim over [Bianchi of D Pty Ltd]"

be bifurcated and listed for final hearing and determination prior to the remaining proceedings including paragraph 1 of the Applicant's Amended Initiating Application filed 8 March 2024.

1. That within 45 days of judgment being delivered in relation to the Claim over [Bianchi of D Pty Ltd] as referred to in paragraph 1 herein, the Applicant wife, First Respondent husband and Second Respondent attend an informal settlement conference with properly instructed Counsel in relation to the remaining extant applications.

2. That within 60 days of judgment being delivered in relation to the Claim over [Bianchi of D Pty Ltd] as referred to in paragraph 1 herein, the remaining extant applications be listed for a Trial listing hearing (formerly a First Day hearing).

Security for costs

1. In the event that the proceedings are not bifurcated and the Claim over [Bianchi of D Pty Ltd] continues in the within proceedings that the Applicant Wife do pay the sum of $165,500 to court by way of security for the costs of the Second Respondent.

2. In the alternative to paragraph 4 herein, in the event that proceedings regarding the Claim over [Bianchi of D Pty Ltd] is bifurcated and heard prior to proceedings including those regarding the Second Respondent that the Applicant Wife do pay the sum of $68,500 to court by way of security for costs for the Second Respondent.

Discharge of injunction

1. That the injunction in paragraph 6 of the orders of 1 November 2019 restraining the Second Respondent from dealing with her interest in the [Suburb F] property be discharged.
2. That paragraph 1 of the Amended Application in a Proceeding against the Second Respondent be stayed pending compliance by the applicant with orders 4 and/or 5 of the within Application in a Proceeding.
3. That the Second Respondent have liberty to file a further affidavit with respect to Orders 4, 5 and 6 herein.
4. That this application be specially returnable to the Trial Listing Hearing known as First Day Hearing ) listed on 18 August 2025 at 2.15pm.
5. That the Applicant Wife do pay the costs of the Second Respondent incidental to the within Application in a Proceeding.

1. Also on 14 August 2025, the wife filed an Application in a Proceeding in which she sought the following orders:
   1. That an order for costs against the First and Third Respondents is made pursuant to rule 10.26(2)(c) of the Federal Circuit and Family Court of Australia (Family Law) Rules 2021(Cth) for failing to comply with order 4 of the Orders of this Honourable Court dated 2 July 2025.
   2. That the First and Third Respondents be ordered to comply with order 4 of the Orders of this Honourable Court dated 2 July 2025.
   3. That this Application in a proceeding be specially returnable before the Court at the hearing on 18 August 2025 at 2:15pm.
   4. Such further or other orders as this Honourable Court deems fit.
2. At the hearing on 18 August 2025, the wife's Application in a Proceeding was dismissed by consent.
3. By orders made on 18 August 2025 all of the extant interlocutory applications, together with the husband's brother's application in the Supreme Court proceedings for leave to bring proceedings in the name of the company against the husband and the wife (transferred to this Court by order of March 2023) were listed for interim defended hearing across two days commencing 27 October 2025.
4. The husband filed a Response to the Application in a Proceeding filed by the husband's mother, on 12 September 2025 (in accordance with Order 6 made 18 August 2025). By that document, the following orders were sought:

1. That the proceedings be bifurcated and proceed on the following basis:

(a) Firstly, the following issues to be heard at one time: > > > (i) The Fourth Respondent's (Derivative Application) against the Applicant and First Respondent; > > > > (ii) Any Application by the Third Respondent in respect of unpaid wages, superannuation, interest against the Fourth Respondent; > > > > (iii) Any application by the Applicant against the Third Respondent seeking to alter the First Respondent's, and Third Respondent's title in [Property 1 and 2 at H Street, Town J]; > > > > (iv) Any application by the Applicant seeking to alter the shareholding of the First Respondent's and Third Respondent's interest in the shareholding of the Fourth Respondent;and, > > > > (v) Any application by the Applicant to vary the interest of the Second Respondent in the property located at [E Street, Suburb F];. > > (b) Secondly, the residual s. 79 application as between the Applicant and the First Respondent.

2. Such further or other orders as this Honourable Court deems fit.

1. The husband's brother filed a Response to the Application in a Proceeding filed by the husband's mother, on 15 September 2025 (in accordance with Order 6 made 18 August 2025) confirming his agreement to paragraphs 1 to 10 (inclusive) of that application. Additionally, the following orders were sought by the husband's brother:
   1. Costs

The Third Respondent also seeks an order that the Applicant [referring to the wife] pay the Third Respondent's costs of and incidental to this application.

1. The wife filed a Response to the Application in a Proceeding filed by the husband's mother, on 15 September 2025 (in accordance with Order 6 made 18 August 2025). By that document, the following orders were sought:
   1. The Application in a proceeding dated 14 August 2025 be dismissed.
   2. The Second Respondent pay the Applicant's [referring to the wife's] costs of the Application.
2. The wife and the husband complied with orders for the filing of their respective Outlines of Case for the hearing on 27 October 2025 (Order 9 made 18 August 2025).
3. The husband's brother filed his Outline of Case late on 22 October 2025. Whilst no leave was sought by him to rely on the same (as required by r 1.34 of the Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth)), no objection was taken by the other parties to that document being before the Court. Accordingly, leave is granted nunc pro tunc for the the husband's brother to rely on his Outline filed 22 October 2025.
4. The husband's mother did not comply whatsoever with the order for her to file written submissions (Order 8 made 18 August 2025). Moreover, in advance of the hearing and on 16 October 2025 her solicitors filed a Notice of Withdrawal.
5. At the hearing on 27 October 2025 the wife, the husband and the husband's brother confirmed that the husband and the husband's brother had reached agreement which effectively resolved the application which had first commenced in the Supreme Court in early 2022, to allow the husband's brother to bring a claim in the name of the company against the husband and the wife. Accordingly, an order was made dismissing the application for leave, together with orders for the husband's brother and the company to file Points of Claim together with any affidavit in support in relation to that claim and the husband and the wife to thereafter file any Defence and any affidavit in support.
6. In addition, at the hearing on 27 October 2025, the husband's mother was unrepresented. Whilst a hearing loop was provided to the husband's mother to assist her to hear the proceedings, and one of her daughters was permitted to sit at the bar table to assist her, the Court became concerned as to her communication and level of understanding, and as a consequence her capacity. Put simply, the husband's mother was unable to make any coherent submissions beyond mono-syllabic words. As a result, the Court determined that it would proceed to only hear the bifurcation applications made by the husband's mother, the husband and the husband's brother, without any submissions made by the husband's mother. The Court otherwise determined it appropriate to adjourn the balance of the husband's mother's Application in a Proceeding filed on 15 August 2025 to a hearing on 19 November 2025.

1. There is no doubt that the Court has the power to order that part of a proceeding be dealt with separately (Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) ("the Rules"), r 1.06).
2. The power to determine separate issues is a procedural step that may be invoked as part of the overall case management of proceedings as a means of achieving the overarching purpose of the Rules, to "facilitate the just resolution of disputes according to law and as quickly, inexpensively and efficiently as possible" (r 1.04 of the Rules).
3. Relevantly, the Rules provide:

10.10 Application for separate decision

(1) A party may apply for a decision on any issue, if the decision may:

(a) dispose of all or part of the proceeding; or

(b) make a trial unnecessary; or

(c) make a trial substantially shorter; or

(d) save substantial costs.

10.11 Orders that may be made under this Part

(1) On an application under this Part, the court may:

(a) dismiss any part of the proceeding; or

(b) decide an issue; or

(c) make a final order on any issue; or

(d) order a hearing about an issue or fact; or

(e) with the consent of the parties, order arbitration about the proceeding or a part of the proceeding.

1. In Tsiang & Wu [2021] FamCA 482 (at [23]), Altobelli J cited with approval the following passage from Southwell v Bennett [2010] NSWSC 1372 (wherein analogous rules exist to separately determine a question in the Uniform Civil Procedure Rules 2005 (NSW)). The relevant principles to be applied were identified as follows:

[15] I take the principles that apply in determining whether to make an order for the separate determination of a question under the rule to be:

(a) The rule speaks of "questions" and not "issues" and does not differentiate between questions of fact, or law, or partly of fact and partly of law.

(b) The judicial determination of a "question" must involve a conclusive, or final, decision based on concrete and established, or agreed, facts, for the purpose of quelling a controversy between the parties: Bass v Permanent Trustee Co Ltd [1999] HCA 9 ; (1999) 198 CLR 334, at [45] and [51].

(c) The rule permits the court to hear and determine the separate question at any point before, at, or after, any trial or further trial in the proceedings, rather than only as a preliminary question.

(d) Whether such an order should be made is a matter for the court's discretion, which discretion must be exercised judicially, but cannot otherwise be fettered: Dunstan v Simmie & Co Pty Ltd [1978] VicRp 62; [1978] VR 669, at 670; Idoport Pty Ltd v National Australia Bank Ltd [2000] NSWSC 1215 at [7].

(e) As a general rule, the discretionary power to order separate determination of a question should be approached with caution: Perre v Apand Pty Ltd [1999] HCA 36 ; (1999) 198 CLR 180 at [436], per Callinan J; Tepko Pty Ltd v Water Board [2001] HCA 19 ; (2001) 206 CLR 1, at [168]-[170] per Kirby and Callinan JJ: Commonwealth Bank v Clune [2008] NSWSC 1125 at [6], per Johnson J; Bailey and Bailey v Director-General Department of Energy Climate Change and Water [2010] NSWSC 979 at [4] per Studdert AJ.

(f) In exercising its discretion, the overriding purpose of the Civil Procedure Act 2005, namely the just, quick and cheap resolution of the real issues in the proceedings (s 56) must be given effect.

(g) Generally, all questions of fact and law should be determined at the one time: Tallglen Pty Ltd v Pay TV Holdings Pty Ltd (1996) 22 ACSR 130 at 141-42; SPI Spirits (Cyprus) Ltd v Diageo Australia Ltd [2006] FCA 14. If the court is to depart from that position, the party seeking the separate determination of a question must satisfy the court that it would be "just and convenient" for that order to be made: Reading Australia Pty Ltd v Australian Mutual Provident Society [1999] FCA 718 at [8]-[9], see also Energy Australia v Australian Energy Ltd [2001] FCA 1049.

(h) While it may appear attractive, superficially, to order the trial of a separate question, experience often shows that it will not be so, for example, because of the complications that can arise in relation to appeals, or to overlapping factual issues, or to questions of credit, if the same witnesses have to give evidence in relation to a question that is separated and those questions that are not: I_doport Pty Ltd v National Australia Bank Ltd_ [2000] NSWSC 1215 at [7(6)] per Einstein J.; Owners Corporation Sp 70672 v Trustees of Roman Catholic Church [2010] NSWSC 946 at [16] per Ball J.

(i) The experience of courts suggests that the separation of proceedings often does not result in the quicker and cheaper resolution of proceedings, but often has the reverse effect. It sometimes happens that it turns out to be productive of the disadvantages of delay, extra expense, appeals and uncertainty of outcome which it is intended to avoid: Idoport Pty Ltd v National Australia Bank Ltd; Tepko Pty Ltd v The Water Board at [168].

(j) Before a question is to be separately determined, it must be possible to clearly see that it will facilitate the quicker and cheaper resolution of the proceedings: Tallglen v Pay TV Pty Ltd at 142, per Giles CJ in Comm D; Parramatta Stadium Trust v Civil and Civic Pty Ltd; Century Medical v THLD (NSWSC, 27 August 1996, unreported).

(k) Where findings as to the credit of a witness is, or of witnesses are, or may be, involved in the consideration of the evidence relevant to the question, it is inappropriate to order a separate trial: ABB v Freight Rail [1999] NSWSC 1037.

(l) Often, a separate question is heard on the basis of:

(i) agreed statements of fact;

(ii) a narrow point to be determined; and

(iii) a hearing that is able to be conducted within a short time (or a short time relative to the total length if the hearing of the separate question were not to be dealt with).

(m) Factors that tend to support the making of an order, include that the separate determination of the question may:

(i) contribute to the saving of time and cost by substantially narrowing the issues for trial, or even lead to disposal of the proceedings: Tallglen v Pay TV Holdings;

(ii) contribute to the settlement of the litigation (CBS Productions Pty Ltd v O'Neill (1985) 1 NSWLR 602 per Kirby P at 607).

(n) It may be appropriate to determine a separate question, even if it will not resolve all the issues, provided that there is a strong prospect that the parties will agree upon the result when the core of the dispute has been decided, or if the decision will obviate unnecessary and expensive hearings of other questions: City of Swan v Lehman Brothers Australia Ltd [2009] FCA 784 ; (2009) 73 ACSR 86 at [27] per Rares J. The determination of the one question should enable a sensible reassessment of litigation risks, which is generally likely to encourage some form of settlement discussions.

(o) Relevantly, one factor that may tell against the making of an order would be where there is likely to be a significant overlap between the evidence adduced on the hearing of the separate question and at trial - possibly involving the calling of the same witnesses at both stages of the hearing of the proceeding: Reading Australia Pty Ltd v Australian Mutual Provident Society at [8]. There is always a risk of inconsistent findings arising from determination of separate questions.

(p) Whilst the decision is ultimately one for the court to determine, it will have regard to the attitude of the parties: TVW Enterprises Ltd v Duffy (Federal Court of Australia, 28 March 1985, unreported) Toohey J.

(q) It is a relevant consideration to weigh the time likely to be taken in the hearing of a separate question and the availability of hearing dates for that purpose, against the time and expense of a substantive hearing and the length of time likely to elapse before such a hearing will take place: TVW Enterprises Ltd v Duffy at pp 4-5.

(r) Each case will have its own dynamics that dictate the relative importance of various factors to be considered in exercising the discretion conferred.

(s) It is necessary that there be precision, both in formulating the question, and in specifying the facts upon which it is to be decided: Jacobson v Ross [1995] VicRp 24; [1995] 1 VR 337 at 341.

1. It is the mutual case of the husband, the husband's brother and the company that all of the claims relating to the strangers to the marriage be bifurcated and heard separately and preliminary to the Court hearing the husband and the wife's competing claims for property adjustment pursuant to s 79 of the Act.
2. Whilst the husband's mother was not heard on the application, the Court understands from her filed material on this topic, that she is concerned at the costs she will incur if she is required to endure a lengthy trial involving the balance of the claims pending before the Court. She says that she is unable to afford her legal costs and that any costs she were to incur regarding the aspects of the proceedings which do not concern her, would be entirely wasted from her perspective. She asserts that the issues relating to the Suburb F property are discrete and can be dealt with separately.
3. Of some significance the husband's brother submits that it is desirable for the Court to separately hear and determine all of the claims made by him personally and the competing claims in relation to the company, in circumstances where if the claims that he and/or the company are pursuing are made out, there would be not only no matrimonial assets left to divide between the husband and the wife, but rather significant debt.
4. The husband's brother arrives at this position by assessing that the matrimonial property pool as asserted by the parties totals some $1,800,000, as against the quantum sought by him against the husband and/or the company set out in his Defence filed 8 November 2024 as summarised at paragraph 32(d) herein.
5. The husband supports the mutual bifurcation application made by his brother, the company and his mother, and proposes that all of these issues be tried together, but separate to the competing s 79 claims of the husband and the wife.
6. The wife resists the bifurcation application mutually pursued by the husband, his family members and the company. In essence she asserts that:

(a) The starting premise of the Court is that all claims pending before the Court be heard and determined together.

(b) The costs and delays to any final resolution of the proceedings if there is to be a bifurcation of claims, given the length of time that the proceedings have already been before the court, are inordinate and not warranted.

(c) There is a real likelihood that credit findings will be made in these proceedings, and if any of the claims were to be separately determined, then there is a real prospect that the s 79 proceedings would need to be heard by a different judge, thus increasing the parties' costs and further delaying the proceedings.

1. Whilst the Court has a broad discretion in determining whether to separately determine certain aspects of the pending proceedings, it is equally accepted that in the vast majority of cases it would be preferable to hear all of the claims pending before the Court simultaneously.
2. Here, the imperative of determining all of the extant applications is alluring given the length of time the proceedings have been before the Court, and the significant costs incurred by the parties.
3. Given the history of the litigation, and whilst not a concluded view, the Court apprehends that there has to date been various degrees of brinkmanship deployed by each of the parties, all of which appears to have impacted and delayed the trajectory of the litigation together with concomitant cost implications.
4. The eleventh hour agreement on the eve of the present hearing between the husband and the husband's brother to allow the husband's brother to pursue litigation in the name of the company, when this topic has been live since 2022, also raises more questions than it resolves. Importantly, this three year delay means that aside from those matters deposed to by each of the parties in these proceedings, and the draft Statement of Claim filed in the Supreme Court,[37] the substantive claim to be brought by the company against the husband and the wife has yet to be formally formulated.
5. At the time of the transfer of the proceedings from the Supreme Court of South Australia, Kimber J considered that there was a sufficient overlap of issues to be ventilated in the foreshadowed Supreme Court proceedings as the s 79 proceedings in this jurisdiction,[38] but also that the claims then pending and foreshadowed in that jurisdiction would likely delay the progression of the s 79 proceedings if they were to proceed separately.[39]
6. It is not without some significant irony that:

(a) The transfer of the foreshadowed claims then pending in the Supreme Court in 2022 have significantly delayed the progression of the proceedings in this Court; and

(b) This Court is now being asked to separately hear and determine as a first phase, all of the claims concerning the company, which is the very circumstance that would have prevailed had the proceedings the husband's brother sought leave to commence, remained in the Supreme Court.

1. It is also not lost on the Court that any final hearing in these proceedings will be lengthy. It is apparent however that the complexity and requisite court time at trial will be disproportionately consumed by the issues relating to the third parties; much as those issues have disproportionately consumed and stagnated the progression of the s 79 claims of the husband and the wife. The parties appear to mutually agree that any trial hearing of the third party claims will require no less than 10 days (but possibly up to 20 days), as against no more than three to four days for the husband and the wife to ventilate their respective s 79 claims.
2. The wife's raises significant concerns over the possible future delays in finalising the entirety of the proceedings in the event that any separate issues were to be determined, arising as a consequence of any credit findings made by the Court in the first phase of any bifurcated proceedings. It is the wife's position that not only are there likely to be credit findings made, but that if that were to occur, then there is a very real prospect that the party whose credit has been maligned will seek to disqualify that same judicial officer from hearing the balance of the proceedings on the basis of an apprehension of bias. Whilst it is accepted that this difficulty may well present itself if there were to be any separate determination of issues, the Court however is confident that these concerns can be ameliorated (if the apprehended bias application is made), with a relatively swift listing of the balance of the proceedings to another judicial officer.
3. The wife additionally and understandably is concerned by any delays that would be occasioned if there were to be an appeal following the first tranche of the proceedings, if there were to be a bifurcation.
4. The principal concern of the Court however arises from the compelling submission advanced on behalf of the husband's brother and the company; namely that the Court may not be required to determine the s 79 claim if the husband's brother and/or the company are successful in their respective claims.
5. The reason that this submission is so compelling lies in an understanding of the approach that the Court must take when determining the competing s 79 claims made by the husband and the wife. To that end:

(a) It has long been accepted that once the Court is satisfied that it is just and equitable to make an order adjusting the parties legal and equitable interests in property,[40] the process the Court embarks upon involves the consideration of four separate steps,[41] which despite the recent amendments to the Act remain apposite:

(i) Firstly, the identification of the parties legal and equitable interests in property, their liabilities and financial resources;[42]

(ii) Secondly, a consideration of the parties contributions;[43]

(iii) Thirdly, considerations relating to current and future circumstances;[44] and

(iv) Finally, to consider the effect of the above and resolve what order is just and equitable in all the circumstances.

(b) Here there is not merely a dispute as to whether an asset or a liability is to be included as an item on the balance sheet for division between the spouses, but rather, there is a very real and significant dispute as to whether the liabilities of the husband and/or the wife to the company (jointly and/or severally), and/or the liability of the company to the husband's brother are such that they would obliterate the value of any assets the husband and the wife hold, such that the husband and the wife are left with very significant debt.

(c) The real issue in this regard is that if that were to be the case, it is highly likely that in taking steps to enforce any judgment debt, together with any resultant orders for costs, the husband's brother and/or the company would likely take steps to liquidate, either cooperatively, or through bankruptcy proceedings, the assets of the husband and the wife.

(d) If either of these outcomes eventuated, not only would there be no assets for the husband and the wife to divide, but importantly if there were to be bankruptcy proceedings, there would be significant consequences and limitations on the husband and the wife's respective standing to pursue their respective s 79 claims, not to mention the utility of doing so.

(e) In addition, and because the husband is a director of the company, it is not clear what if any consequences may flow to him as a result of any breach of his fiduciary duties.

1. So far as the wife's claim regarding the Suburb F property, it is apparent that the husband's mother is likely to be a witness in relation to both that claim, and those relating to the company, given the history of the creation of the restaurant business.
2. Whilst the decision is finely balanced, and not without some very significant reservations given the parties' self inflicted delays to date, the Court finds some merit in separately determining all of the third party claims ahead of any determination of the s 79 claims of the husband and the wife.
3. Orders shall be made at the already scheduled hearing on 19 November 2025, allocating trial dates, with the trial directions to be made after hearing from the parties in relation to the same.
4. Given the history of the proceedings to date, all of the parties are on notice that the Court will not hesitate to invoke the powers provided in r 10.27 of the Rules should the Court hold the view that any of the parties in the future are in default of orders of the Court, their obligations created by the Rules and or that they are not prosecuting these proceedings with due diligence.

1. For all of these reasons, those orders appearing at the commencement of these reasons are made.

I certify that the preceding eighty-three (83) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Kari.

[1] Husband's affidavit filed 1 November 2019, paragraph 18.

[2] Husband's affidavit filed 1 November 2019.

[3] Husband's affidavit filed 4 May 2021, paragraph 13.

[4] Husband's brother's Defence filed 8 November 2024, paragraph 25.

[5] Wife's Points of Claim filed 14 June 2024, paragraph 28.

[6] Wife's Points of Claim filed 14 June 2024, paragraph 29.

[7] Wife's affidavit filed 3 July 2019, paragraph 67.

[8] Wife's affidavit filed 3 July 2019, paragraph 68.

[9] Wife's affidavit filed 3 July 2019, paragraph 70.

[10] Wife's affidavit filed 3 July 2019, paragraph 71.

[11] Wife's Points of Claim filed 14 June 2024, paragraph 31.

[12] Wife's Points of Claim filed 14 June 2024, paragraph 26.

[13] Husband's affidavit filed 1 November 2019, paragraph 15.

[14] Husband's affidavit filed 1 November 2019, paragraph 27.

[15] Husband's affidavit filed 1 November 2019, paragraph 29.

[16] Husband's affidavit filed 1 November 2019, paragraph 30.

[17] Husband's brother's affidavit filed 31 January 2020, paragraph 6.

[18] Husband's brother's affidavit filed 31 January 2020, paragraph 28.

[19] Husband's brother's affidavit filed 31 January 2020, paragraph 29.

[20] Husband's brother's affidavit filed 31 January 2020, paragraph 7.

[21] Husband's brother's affidavit filed 31 January 2020, paragraph 18.

[22] Husband's brother's affidavit filed 31 January 2020, paragraph 18.

[23] Husband's brother's affidavit filed 31 January 2020, paragraph 20.

[24] Husband's brother's affidavit filed 31 January 2020, paragraph 30.

[25] Husband's brother's affidavit filed 31 January 2020, paragraph 34.

[26] Husband's brother's affidavit filed 31 January 2020, paragraph 35.

[27] Husband's brother's affidavit filed 31 January 2020, paragraph 32.

[28] Husband's brother's Defence filed 8 November 2024, paragraph B(a).

[29] Husband's brother's Defence filed 8 November 2024, paragraphs B(b)-(c).

[30] Husband's brother's Defence filed 8 November 2024, paragraph B(d).

[31] Husband's brother's Defence filed 8 November 2024, paragraph B(e).

[32] In the Matter of SC Pty Ltd (A Pseudonym) [2023] SASC 26.

[33] Wife's cost notice filed 27 October 2025.

[34] Husband's cost notice filed 25 October 2025.

[35] Husband's brother's cost notice filed 26 October 2025.

[36] Husband's mother's cost notice filed 18 August 2025.

[37] Annexure "[MRW1]" to the Affidavit of [Mr W] filed on behalf of the wife on 7 February 2024.

[38] In the Matter of SC Pty Ltd (A Pseudonym) [2023] SASC 26, paragraphs 30-32.

[39] In the Matter of SC Pty Ltd (A Pseudonym) [2023] SASC 26, paragraph 28.

[40] Stanford & Stanford [2012] HCA 52.

[41] Hickey & Hickey [2003] FamCA 395

[42] Family Law Act 1975 (Cth), s 79(3).

[43] Family Law Act 1975 (Cth), s 79(4).

[44] Family Law Act 1975 (Cth), s 79(5).