Laurel & Scordato [2025] FedCFamC1F 350 (29 May 2025)

(a) The wife must consent to the purchaser and the terms of sale, with the husband to keep the wife informed of all offers made prior to any obligation by the wife to sign a contract of sale;

(b) Provided that Order 1(a) hereof is complied with, the wife in her capacity as director of E Pty Ltd ACN ... as trustee of the D Trust will sign a contract of sale for the B Street property within forty-eight (48) hours of a request by the husband, at the purchase price agreed between the parties in writing;

(c) The parties will engage G Lawyers to complete the sale transaction;

(d) The parties are to co-operate in every way with each other and the solicitor in relation to the sale of the B Street property including providing joint and consistent instructions to the solicitor in relation to the contract of sale and the sale conveyancing transaction generally and ensuring that they are both ready able and willing to do all things reasonably necessary to complete the sale transaction in accordance with the terms of the contract of sale; and

(e) The proceeds of sale of the B Street property shall be paid as outlined in Order 4 hereof.

1. That if the husband is unable to sell the B Street property to a third-party purchaser as outlined in Order 1 hereof, then within seven (7) days of a request by the husband, the parties shall do all acts and things and sign all necessary documents to list the B Street property for sale, and for that purpose, the following shall apply:

(a) The property be listed with F Pty Ltd, with the wife in her capacity as director of E Pty Ltd ACNACN ... as trustee of the D Trust to sign any documents necessary to list the property for sale with F Pty Ltd within seven (7) days of a request by the husband to do so;

(b) The B Street property will be sold by way of expressions of interest with a four (4) week campaign, and the parties will accept the highest and best unconditional offer with a thirty (30) day settlement (unless otherwise agreed between the parties in writing);

(c) The parties will engage G Lawyers to complete the sale transaction;

(d) The list price of the B Street property will be such amount as is agreed between the parties in writing;

(e) The parties are to co-operate in every way with the real estate agent in relation to the marketing of the B Street property for sale including making the key readily available, allowing inspection of the B Street property at all times reasonably requested by the agent and ensuring that the B Street property is clean, neat and in good order at the time of inspection by any prospective buyer;

(f) The husband will pay to the real estate agent any sums requested for advertising or auction expenses and will be reimbursed from the proceeds of sale in respect of any funds paid;

(g) The wife will in her capacity as director of E Pty Ltd ACN ... as trustee of the D Trust will sign a contract of sale for the B Street property within forty-eight (48) hours of a request by the nominated real estate agent or the husband, provided the contract complies with Order 2(b) hereof;

(h) The parties are to co-operate in every way with each other and the solicitor in relation to the sale of the B Street property including providing joint and consistent instructions to the solicitor in relation to the contract of sale and the sale conveyancing transaction generally and ensuring that they are both readily able and willing to do all things reasonably necessary to complete the sale transaction in accordance with the terms of the contract of sale; and

(i) That the proceeds of sale of the B Street property shall be paid as outlined in Order 4 hereof.

1. That within seven (7) days of the date of these orders, the parties will do all acts and things and sign all necessary documents to list the property located at H Street, Suburb J, in the state of Queensland, more particularly described as Lot ... on Registered Plan ..., Title reference ... ("the Suburb J property") for sale, and for that purpose, the following shall apply:

(a) The property be listed with K Pty Ltd, with the husband in his capacity as director of L Street Pty Ltd as trustee of the M Trust to sign any documents necessary to list the property for sale with K Pty Ltd within seven (7) days of the date of these Orders;

(b) The Suburb J property will be sold by way of expressions of interest with a four (4) week campaign, and the parties will accept the highest and best unconditional offer with a thirty (30) day settlement (unless otherwise agreed between the parties in writing);

(c) The parties will engage G Lawyers to complete the sale transaction;

(d) The list price of the Suburb J property will be such amount as is agreed between the parties in writing;

(e) That the parties are to co-operate in every way with the real estate agent in relation to the marketing of the Suburb J property for sale including making the key readily available, allowing inspection of the Suburb J property at all times reasonably requested by the agent and ensuring that the Suburb J property is clean, neat and in good order at the time of inspection by any prospective buyer;

(f) The husband will pay to the estate agent any sums requested for advertising or auction expenses and will be reimbursed from the proceeds of sale in respect of any funds paid;

(g) The husband in his capacity as director of L Street Pty Ltd as trustee of the M Trust will sign a contract of sale for the Suburb J property within forty-eight (48) hours of a request by the nominated real estate agent, provided the contract complies with Order 3(b) hereof;

(h) The parties are to co-operate in every way with each other and the solicitor in relation to the sale of the Suburb J property including providing joint and consistent instructions to the solicitor in relation to the contract of sale and the sale conveyancing transaction generally and ensuring that they are both readily able and willing to do all things reasonably necessary to complete the sale transaction in accordance with the terms of the contract of sale;

(i) The proceeds of sale of the Suburb J property shall be paid as outlined in Order 4 hereof.

1. That the proceeds of sale for the B Street property and the Suburb J property shall be paid in the following manner and priority:

(a) Payment of any agent's commission and advertising or other expenses in respect of each property, if any, payable on the sale of each property;

(b) Payment of the legal costs and outlays relating to the sale of each property;

(c) Any capital gains tax estimated on the sale of the B Street property and Suburb J property to be set aside in a bank account nominated by the husband;

(d) To discharge the amount of $4,800,000 towards the National Australia Bank loan, towards the loan numbers are required by the National Australia Bank to renew the National Australia Bank loan (if National Australia Bank do not provide a direction as to where to pay the funds, then to discharge account number ...36 and the remainder to be paid to account number ...13);

(e) Payment of any expenses to be reimbursed under the preceding paragraphs 4(f) and/or 5(f) if required; and

(f) The remainder to be paid to the National Australia Bank drawn down account ...35.

1. That the Respondent shall meet the Applicant's costs of this Application.

1. That these proceedings be adjourned for Case Management Hearing before the Honourable Justice Jarrett at 9.30am on 16 July 2025 in the Federal Circuit and Family Court of Australia (Division 1) at Brisbane.

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

1. In the midst of contested parenting and property proceedings between the husband, Mr Laurel (aged 61 years) and the wife, Ms Scordato (aged 43 years), an Application in a Proceeding filed 14 February 2025 comes before the Court for determination.
2. By way of background, the parties were married in 2017; have one child aged seven years and separated in December 2023. The proceedings were transferred to Division 1 on 13 March 2025, having been commenced in Division 2 in February 2024.
3. The Application in a Proceeding was listed for hearing before me on 24 March 2025 when Mr Kearney of Senior Counsel appeared for the Applicant husband and Mr Alexander of Counsel appeared for the wife.

1. The husband, as identified in his case outline filed 17 March 2025, relies upon:

(a) the Application in a Proceeding filed 14 February 2025;

(b) the husband's affidavit filed 14 February 2025;

(c) affidavit of Ms N filed 14 February 2025; and

(d) the reply affidavit of the husband filed 17 March 2025;

1. In circumstances where I was not satisfied the wife was prejudiced by the husband relying on his reply affidavit, he was permitted to do so.
2. The wife did not file a case outline but relied upon her Response to an Application in a Proceeding and affidavit both filed 13 March 2025.
3. I heard oral submissions from both Counsel.

1. In essence, the orders sought by the husband are that:

(a) the husband be at liberty to sell the property at B Street, Town C ("the B Street property") registered in the name of E Pty Ltd as Trustee of the D Trust to a third-party purchaser provided the purchase price is $4,250,000 or higher. Initially, the property could be sold "without listing the property for sale with a real estate agent", but if not sold then the husband proposes that the property be listed with F Pty Ltd for sale; and

(b) the parties list the property at H Street, Suburb J ("the Suburb J property") registered in the name of L Street Pty Ltd as Trustee of the M Trust with K Pty Ltd, by way of expressions of interest with a four-week campaign.

1. The proceeds of any sales are to be used, after payment of legal expenses, commissions and allowance for any estimated capital gains taxation to:

(a) discharge the amount of $4,800,000 towards liabilities owed to the National Australia Bank ("NAB") as "required by the Bank"; and

(b) the remainder to be paid to a NAB draw down account.

1. By her Response, the wife seeks that the husband's Application in a Proceeding be dismissed.

1. The submissions (being a combination of those contained in the case outline filed by the husband and the supplementary oral submissions of Mr Kearney SC are, inter alia:

(a) subject to single expert reports being received, the husband says he estimates the O Group entities (including the two properties referred to in his Application) having a value of approximately $33,217,563 (nett);

(b) the total cross collateralised borrowings of the Group with NAB amount to $20,069,254;

(c) the O Group does not currently meet the "income coverage ratio" ("ICR"), which requires a minimum of 1.5 times net rental income, as a condition necessary to renew the loans;

(d) the NAB has requested details of the strategy to improve the ICR and meet renewal covenants, by way of either sole of property or improvement in rental income, or both;

(e) in circumstances where the husband says he is unable to significantly improve rental income, a sale of the two properties and payment of $4,800,000 to the NAB will, he says, increase the ICR to above 1.5 times;

(f) the husband asserts that the NAB required a "strategy" by 31 March 2025 - in the absence of which the NAB may choose to take actions, adverse to the overall interests of the O Group - including forced sale of some properties;

(g) the wife complains about the husband failing to make full and timely disclosure about ongoing business interests, including offers in respect of the B Street property. Furthermore, the wife has not yet articulated the specifics of the final orders she seeks, noting her Response filed 22 March 2024 did not seek to retain either of the two properties the subject of this Application;

(h) without the wife's consent, an order is needed to sell the B Street property because it is in the name of a trust controlled by the wife. However, where no restraint has been imposed upon the husband (nor is any injunction sought by the wife), the husband can sell the Suburb J property under his control; and

(i) to the extent the wife does not trust the husband (or at least is suspicious of his intentions), the form of order sought would not permit a sale of the B Street property at an "undervalue". The wife has been aware, from lawyers' correspondence since January 2025, of the husband's desire to sell the B Street property, but did not indicate, as she now does, a desire to retain it.

1. The oral submissions of the wife are, inter alia:

(a) last year the husband sold a property at Suburb Q to his adult son, Mr P, in circumstances where the wife does not accept Mr P could afford to do so. This has raised suspicions in the wife about the bona fides of the transaction;

(b) the wife was aware of a neighbour offering to purchase the B Street property in September 2024 for $4,700,000 (increased to $4,900,000) against an initial single expert valuation by R Valuers of $4,250,000;

(c) as a result of approval by the local authority for a neighbouring property in B Street, further negotiations between the husband and the neighbour "[...]" continued at least until January 2025. The wife deposes to the husband not disclosing the nature of these negotiations until a letter from the husband's solicitors dated 30 January 2025 (referring to an offer of $4,400,000);

(d) the wife complains, at paragraph 28 of her affidavit, that the husband gave no disclosure of:

(i) any internal NAB policy in relation to tainted sources;

(ii) the prior offers made in relation to the B Street property;

(iii) all correspondence from the NAB; and

(iv) no basis for an urgent response by her (by 6 February 2025).

(e) by 14 February 2025, the husband, through his solicitors, claimed the wife was continuing to "stall" the sale of the B Street property and then filed his Application in a Proceeding;

(f) the wife is not satisfied there is a need or any urgency to sell the two properties and states that as the husband controls "the billing, loans and inter-entity loans", then if there is a requirement to address the NAB loan serviceability, that there would be a mechanism to do so that does not require the sale of any of "our real properties"; and

(g) if the husband wished to generate capital to meet some of the bank's demands, then his balance sheet (being Annexure "ML-1" to his reply affidavit) identifies motor vehicles valued at $284,000 and aircraft valued by the husband at $1,540,000 that could be sold. The husband says he wishes to retain all those items.

1. The Court is invited to exercise its discretion to make orders relying on s 114 of the Family Law Act 1975 (Cth) ("the Act"), which provides that the Court has the power to order or grant such injunction as it considers proper, whether by interlocutory order or otherwise, if it is just and convenient to do so, and either unconditionally or upon such terms and conditions as the Court considers appropriate.
2. When exercising a discretion to grant an injunction, it is appropriate to take into account the balance of convenience and any prejudice that may flow to a party.
3. In this case, Mr Alexander conceded that in respect of the Suburb J property, the husband could sell it. He would, of course, be required to account for his actions in so doing and the funds. Where the husband comes to the Court with an Application that prescribes a process, I see no reason to review the process. I note that the husband seeks at proposed order 5(d) that the list price will be as agreed and failing agreement "as nominated by the real estate agent". Whilst I appreciate that the husband wishes to avoid further conflict over price (or unnecessary applications), in my view an order that a list price be agreed between the parties is the appropriate parameter. I will make order 5 but delete the words "and failing agreement, the list price will be as nominated by the real estate agent".
4. The dispute now therefore relates to any possible sale of the B Street property. In respect of this issue:

(a) It is not clear why the legal interest in the property was vested in a trust controlled by the wife. I have not been provided with a copy of the trust deed, however it is reasonable to infer that the wife has fiduciary duties to those entitled under the Trust to benefit. She has clearly permitted the property to be offered as security. The wife does not indicate in her affidavit any concerns about possible breach of her fiduciary duties if a sale is effected;

(b) I am not satisfied, on the evidence offered by the husband, that the NAB is on the cusp of taking some precipitous action to force a sale of properties. However, although Mr Alexander says there is no urgency and at best, the application by the husband is "premature", I do not regard it as necessary to establish "urgency". The husband says he has, in one form or another, been fielding offers from the interested neighbour since September 2024. The order he proposes does not have a guaranteed quick result;

(c) I am prepared to accept the husband's evidence that his business decision is that it is better to seek to sell a property (in which interest has been expressed) which is not tenanted and therefore not helping the serviceability of the loans;

(d) Nowhere in the wife's affidavit does she advance a proposition that she wishes to retain the B Street property in the alteration of interests' outcome. Her Response filed 22 March 2024 makes no such claim; and

(e) I agree with Mr Alexander that the mere fact that a sale of the property, with its proceeds being used to defray some of the bank debt, cannot be said to put at risk the ultimate likely outcome for the wife, is not the question. It of course can be if the sale was to reduce the available pool, but that is not the case here.

1. In my ultimate analysis, I have come to the conclusion that what lies at the heart of the wife's objections and concerns is that she has no confidence that the husband will keep her informed of the transaction properly; or may do some deal with a yet named third party that is not what it might appear to be. These suspicions, she says, arise from at least the transaction with Mr P in respect of the Suburb Q property; and her claims that the husband has either not disclosed or not disclosed in a timely manner, the various offers already received (and rejected) in respect of the B Street property and the full extent of the negotiations with the NAB. It seems the market value (despite valuation evidence) might be a moving amount, if the nature of the various offers are any indication.

1. People tend to amass a sizeable property pool or significant wealth by acting commercially and prudently. Naturally, when a relationship breaks down, levels of trust are diminished.
2. However, the wife concedes in her material that it is the husband who has been the person who has managed the business investments and strategies. Provided the wife is kept informed, and in the absence of any evidence to demonstrate that he has acted inappropriately or with an intention to adversely affect the wife, keeping the bank at bay is an appropriate strategy.
3. I regard it as proper however that the wife have some oversight in respect of the sale of the B Street property as she is the legal owner (as Trustee), and the husband must accept she has a legitimate legal interest in the property - apart from any claims under the Family Law Act 1975 (Cth). Accordingly, whilst the husband seeks to provide a "bottom line" figure of $4,250,000 for a sale price, I am not prepared to adopt that figure. I accept that by not doing so, the husband may assert that this could cause new applications to be brought. However, if for example, now that an order has been made for a sale process, the wife is found to be unreasonably acting to prevent a sale, a costs order becomes a real likelihood.
4. For those reasons, I find the orders at the commencement of these Reasons are proper which include some small variations on the orders proposed by the husband.

I certify that the preceding twenty-one (21) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Baumann.