The effect of the Family Court Order
123 With the making of a court order such as the Family Court Order, there are two roll-over consequences. The first is that if the roll-over has taken place, no tax is paid by the transferor and the transferee inherits or acquires the cost base of the assets as they were historically when held by the transferor. In this way, tax is deferred until the next disposition of the family asset. The underlying policy is apparently that the transfers of assets arising on a marital breakdown, as on a transfer of assets in other circumstances such as death, are not the occasion for exigibility. In both those instances, there is not the sale for purpose of making a gain, but rather in this instance, necessary compliance with a court order. There is no doubt in this instance that there was a transfer of shares in purported compliance of a court order.
124 Nothing in the provision requires that the court order be valid or efficacious, but rather, requires the making of an order in such a manner that an order with a minor defect, but the substance and effect of which is nonetheless clear, would still be an order which satisfies the requirements of s 126-15. The fact that the Family Court Order is a consent order has no bearing on whether the Family Court Order is such an order for the purpose of s 126-15: see Kinch v Walcott [1929] AC 482 (at 493), where the Privy Council noted that a consent order was as effective as any other order of the court and binding on the parties unless it is set aside in proceedings duly constituted for that purpose. Moreover, for present purposes, there is no occasion to inquire into the legal or factual correctness of the orders: see Coshott v Woollahra Municipal Council [2008] NSWCA 176 per Handley J.
125 It is a requirement of the section that the CGT event must happen 'because of' the relevant order and I find that was expressly so here. It is clear on the facts that the transfer would not have occurred were it not for the Family Court Order and did occur 'because of' the Family Court Order. As noted by Lockhart J (at 321-322) in Human Rights and Equal Opportunity Commission v Mount Isa Mines Pty Ltd (1993) 46 FCR 301, this expression simply implies a relationship of cause and effect. The section does not use a more confining expression such as 'pursuant to the specific terms of the order'. Rather, it seeks to rely upon broader and less technical concepts inherent in a mere cause and effect relationship. Inquiry is not invited beyond the conclusion that a transfer occurs as a result of a court order in a commonsense cause and effect sense. Further inquiry as to whether there is exact compliance with the precise terms of the court order is not stipulated or implied in the section.
126 There is also a fourth requirement under s 126-15 that the event must 'involve' a transferor, which for s 126-15 includes a trustee, and a transferee who is a spouse or a former spouse of another individual. The case for the applicants is that, if the transferee must be the spouse or a former spouse, it was the former wife, Ms Ellison, who was the transferee of the shares. So s 126-15 extends the roll-over consequences of s 126-5 where the trigger event involves a company or trustee as transferor and a spouse or former spouse because of an order. What those consequences are is determined by the operative provision s 102-5 which spells out that assessable income includes net capital gain, if any, for the income year. The effect of the provision is that a taxpayer aggregates capital gains and capital losses. Division 103, which in turn is part of Ch 3, Specialist Liability Rules, and Pt 3-1, Capital Gains and Losses-General Topics, sets out some general rules that apply to the provisions dealing with capital gains and capital losses. At s 103-10, it is provided that Pt 3-1, in which s 103 is contained, applies to the taxpayer as if the taxpayer had received money or other property if it had been applied for the taxpayer's benefit, including by discharging all or part of a debt owed by the taxpayer, or as the taxpayer directs. So the Part applies where moneys are received for the benefit of a taxpayer in accordance with directions given.
127 Division 104 spells out CGT events. Specifically, the relevant CGT event is contained under Div 104-A, Disposals, and s 104-10, disposal of a CGT asset: CGT Event A1. By subs (1), it is provided that CGT event A1 happens if you dispose of a CGT asset. By subs (2) it is made clear that you dispose of a CGT asset if a change of ownership occurs from 'you' to another entity, whether because of some act or event or by operation of law. However, a change of ownership does not occur if 'you' stop being the legal owner of the asset, but continue to be its beneficial owner. There is no doubt in the present circumstances the disposal was by operation of law and the debate arises around the words 'however, a change of ownership does not occur if you stop being the legal owner of the asset but continue to be its beneficial owner'. The respondents' position is that this event cannot take place unless there is a change in both the legal and beneficial ownership of the asset.
128 In my view, this is not necessarily so. It is certainly not what is expressly provided for in the section. Rather, the section turns on the expression 'a change of ownership'. It is true that in the second sentence there is express reference to the concept of a legal owner and beneficial owner.
129 However, what the statute did expressly prescribe is that the event is not triggered if you continue to be the beneficial owner. It is certainly clear that the statute expressly recognises that for its purposes, there will be no change of ownership if the taxpayer ceases being the legal owner, but continues to be its beneficial owner. This tends to emphasise the importance of beneficial ownership. If the effect of the Family Court Order was to give beneficial ownership to Ms Ellison, the question is whether the transfer of the beneficial ownership was also sufficient, a concept not apparently expressly catered for, one way or another, in specific terms in the statutory provisions.
130 The applicants' position is that this is important because the CGT Rules are all directed to dealings in beneficial ownership. While they may also concern dealings in legal ownership, where beneficial ownership also moves, unless the legal ownership also moves the beneficial ownership, there will not be a CGT event.
131 An example reflecting this is s 106-50, dealing with absolutely entitled beneficiaries, which provides that if the taxpayer is absolutely entitled to a CGT asset as against the trustee of a trust (disregarding any legal disability), Pt 3-1 and Pt 3-3 apply to an act done by the trustee in relation to the asset as if the taxpayer had done the act.
132 The 1997 Act pays close regard to CGT events involving trusts, which would tend to demonstrate that Pt 3-1 is focussed on dispositions of beneficial ownership, rather than legal ownership. This, it is said, is expressly reflected again in the second sentence to s 104-10(2).
133 The focus on the beneficial interest is arguably consistent with recognition that the person who enjoys the fruits of the property should be the person liable as the taxpayer if tax is payable.
134 The various CGT events involving trusts attract liability only in circumstances of beneficial ownership. So for example, s 104-55, creating a trust over a CGT asset by a declaration or settlement, does not apply by virtue of the exceptions specified in subs (5).
135 The focus in this and other trust CGT events, including CGT event E5 and E9, make it clear that the CGT event does not 'happen' if the taxpayer remains the beneficial owner. In the circumstances of CGT events concerning trusts, the focus again is on beneficial ownership.
136 There is support for the position advanced for the applicants, namely, that in the present circumstances equitable ownership of the shares appears on the authorities to have been acquired by Ms Ellison as a result of the terms of the Family Court Order. In Jones, orders had been made pursuant to s 79 of the Family Law Act in December 2003 and on the following day the husband became bankrupt. During the next month, the wife and the trustee in bankruptcy became registered owners of the land which had been transferred pursuant to the court orders. In February, the husband executed a deed transferring the whole of his interest in the land to the former wife. The terms of the order were similar to those in the current proceedings. Moore J, in the Full Court, noted that central to the reasoning of the primary judge had been the judgment of the Full Court in Mateo.
137 In Jones, Moore J (with whom Hill J and Allsop J (as his Honour then was) agreed) said (at [14]):
The members of the Full Court in Mateo did conclude that when an order (of the type presently under consideration) is made under s 79 ordering that a person presently holding a legal interest in the property transfer that interest to another person, a beneficial interest is thereby vested in the other person. Wilcox J described the order as vesting an equitable interest (at [62]) and Merkel J as transferring an equitable estate or interest (at [136]). Branson J expressed her conclusion in qualified terms (at [102]) when she spoke of it being "probably implicit in the terms of the order that the interest of the parties to the marriage in the [property] were altered by operation of the order" (emphasis added) vesting in the wife all the husband's beneficial interest in the property. It appears Branson J viewed that as the preferable construction of the order and its affect. In any event the views of a majority were clear and an equitable interest was, by the order, transferred. A trust was created for the benefit of the other person.
(emphasis added)
138 Allsop J (as the Chief Justice then was) also noted the following (at [20]):
Section 79 of the Family Law Act 1975 (Cth) deals, as the High Court said in Mullane v Mullane (1983) 158 CLR 436 at 445, with orders which work an alteration of the legal or equitable interests in parties or either of them. Thus, an express and immediate vesting order could be made. There was nothing to suggest in the reasons for judgment of Coleman J in the Family Court (or of the Family Court in Mateo, as far as can be gleaned from the judgment of the Full Court in Mateo) that any suspension of effect of the orders made was intended. It would perhaps have been clearer if the immediately dispositive effect of the orders here had been identified expressly. Nevertheless, the orders here, though not expressly dispositive, made as they were against the background of s 79 and in light of the reasoning in Mateo, should be taken to have the effect found by the primary judge.
(emphasis added)
139 Applying Jones and Mateo, in my view, as a result of the Family Court Order Ms Ellison became the equitable or 'beneficial owner', to use the expression appearing in CGT event A1, of the MIN Shares.
140 Of course the position for the respondents is that the CGT event must involve disposal of both legal and beneficial ownership. As is made clear from the Full Court decision of Kent v Vessel "Maria Luisa" (No 2) (2003) 130 FCR 12, there are forms of ownership of assets in equity such that the concept of a beneficial owner can be contrasted with a person who has a lesser equitable interest such as a mere equity. In Kent v Vessel "Maria Luisa" (No 2), the issue was whether someone who individually owned all of the units in a unit trust, which in turn owned the ship, was the owner for the purposes of the Acts Interpretation Act 1991 (Cth). In the joint judgment of Tamberlin and Hely JJ (at [61]) their Honours said:
The word "owner" cannot be given any general description. But ordinarily the incidents of ownership of a chattel include the right to make physical use of the chattel, the right to the income from it, the power of management, and the right of alienation: Lawson & Rudden, at p 8. In the Iron Shortland (at 544) Sheppard J quoted from the decision of the Singapore Court of Appeal in The Ohm Mariana; Ex Peony [1993] 2 SLR 698 that the term "owner" means any person who is vested with such ownership as to have the right to sell, dispose of or alienate the ship, and that a beneficial owner of the ship comes within that term. See also to similar effect The Permina 3001 [1979] 1 Lloyd's Rep 327 at 329.
141 Their Honours made clear that ownership, whether legal or equitable, involves something greater than beneficial interest. At [66] their Honours said:
Ownership, whether legal or equitable, therefore involves something greater than beneficial interest. Equitable ownership of property is commensurate with the right to relief in a Court of Equity: In Will of MacGregor; Trustees, Executors and Agency Co Ltd v Acting Commissioner of Taxation (Cth) (1917) 23 CLR 576 at 583; Meagher, Heydon and Leeming, Meagher, Gummow & Lehane's Equity Doctrines & Remedies (4th ed, 2002) at [4-120]. If a person has contractual rights in relation to a ship which, if performed will result in the person becoming the owner of the ship, then the person will be regarded as the equitable owner of the ship provided that specific performance of the contract would be decreed: KLDE Pty Ltd v Commissioner of Stamp Duties (Qld) (1984) 155 CLR 288. Thus entitlement to a vesting order or equivalent relief would be necessary before AFE could be regarded as the equitable owner of the ship as at the relevant date: Stern v McArthur (1988) 165 CLR 489; Chan v Cresdon Pty Ltd (1989) 168 CLR 242. But that does not mean that AFE does not have an interest in the trust property, including the ship, which equity would protect regardless of whether AFE could be called the equitable owner.
(emphasis added)
142 As noted in Lysaght v Edwards (1876) 2 Ch D 499, a right to specific performance to compel the transfer of an asset can be equated with beneficial ownership. In this instance, Ms Ellison had a more substantive right than a right to obtain an order for specific performance. She already had an order of the Family Court for the transfer of the shares within seven days.
143 In my view, the Family Court Order vested beneficial ownership in Ms Ellison, which in turn satisfied the change of ownership concept in CGT event A1. It might be anticipated that s 104-10(2) would be drafted differently in circumstances where express reference is made to the expressions 'beneficial owner' and 'legal owner' in the second sentence which emphasises that a change of legal ownership alone would not trigger CGT event A1 without a change in beneficial ownership. The fact that the provision did not specify that a change of beneficial ownership without a change in legal ownership would not trigger CGT event A1, taken in context, is consistent with the notion that CGT event A1 would be triggered where there was a change of beneficial ownership. I am not persuaded that there is anything in the description of CGT event A1 which would limit it to cases only of both legal and beneficial ownership change. That the key is the change in beneficial ownership is supported by the text and substance of the provisions which have been examined.
144 In my view, this would also appear to be consistent with the legislative purpose because, were it otherwise, whenever there was disposition of equitable ownership without legal ownership, not expressly directed by one of the CGT events, such as E1, there would be no liability for CGT. So, for example, in the case of a constructive trust (eg, Baumgartner v Baumgartner (1987) 164 CLR 137) CGT would be wholly avoided. So also in other cases of constructive trust (see, for example, Chang v Registrar of Titles (1976) 137 CLR 177 (at 185)). That this would be intended seems unlikely.
145 The applicants draw on two decisions to support the contention that beneficial ownership will suffice. The first of those cases is a Full Court decision and, with respect, not particularly supportive to the applicants' position. In Taras Nominees Pty Ltd v Federal Commissioner of Taxation (2015) 228 FCR 418, the Full Court (Perram, Robertson and Pagone JJ) (at [10]) said:
10 The reasons for concluding that CGT event E1 happened also require the conclusion that CGT event A1 happened. Event A1 occurred because there was a change of ownership by transfer of the Taras land from Taras to the trustee. The event would not have occurred if Taras continued to be the beneficial owner of the land but the analysis above also requires the conclusion that Taras was no longer the sole beneficial owner of the Taras land upon its transfer to the trustee for it to be held upon the terms of the trust deed and the joint venture agreement. Her Honour correctly concluded at [138]:
"Prior to 20 August 1998, Taras had ownership of the Taras land and it disposed of that land, for the purposes of s 104-10, when it transferred the land to the Land Trustee. There was a disposal of the Taras land for these purposes because the combined effect of the JVA, the Trust Deed and the transfer was that Taras ceased to be the owner of the Taras land and became an equitable tenant in common with the other beneficiaries under the trust, namely, SDA and the Marpine Trustee. In so concluding, I adopt the reasoning of Batt JA in Victoria Gardens (Court of Appeal), which is discussed at [103]-[115] above. For the reasons stated above, Booth v Ellard does not support Taras' submission that it retained beneficial ownership in the Taras land: see [124]-[128] above."
The combined effect of the trust deed and the joint venture agreement was that upon transfer of the land by Taras to the trustee, Taras ceased to be the only beneficial owner of the land. Its interest was thereafter made "subject to" the rights of the other beneficiaries to the land. Taras became, as her Honour held at [138], an equitable tenant in common of the Taras land with the other beneficiaries under the trust.
146 The applicants rely upon these passages because of the emphasis on the significance of beneficial ownership, but it must be noted that in that case there was a transfer of beneficial ownership as well as legal ownership to the trustee. When the various owners of contiguous parcels of land decided to sell their land to a trustee, he would then develop the enlarged land. That transaction was held by the Full Court to be taxable either as CGT event E1, a settlement of a trust, or CGT event A1.
147 Another case contains a much more direct indication of the significance of beneficial ownership, when considering this part of the tax legislation. In Brooks v Commissioner of Taxation (Cth) (2000) 100 FCR 117, the Full Court (Hill, RD Nicholson and Sundberg JJ) were considering a circumstance in which the taxpayers were the vendors in an investment property under a contract for sale of land. The purchasers did not complete the purchase and the taxpayers terminated the contract for breach. A deposit paid by the purchasers to the taxpayers was forfeited. The taxpayers then applied to the Administrative Appeals Tribunal to review an objection decision made by the Commissioner against them in respect of the forfeited deposit. The Tribunal stated a special case for determination of questions of law by the Court on the basis that a contention was made that the decision of the Full Court in Commissioner of Taxation v Guy (1996) 67 FCR 68 was plainly wrong. The Full Court declined to follow Guy in its application of s 160ZZC(12) of the 1936 Act, in the course of which the Court said (at [13]):
The key concepts of acquisition and disposal are defined, or expanded upon in s 160M of the Act. It is not necessary here to consider whether s 160M contains a conclusive code of what constitutes acquisition and disposal. That it does was conceded by counsel for the Commissioner. What s 160M(1) makes clear is that both words are not to be given a narrow interpretation. Anything which involves a change in the beneficial ownership of an asset is treated as a disposal and as giving rise to an acquisition. Further, it is irrelevant how that change in ownership is brought about: s 160M(2), whether it be by a transaction, by an instrument, by operation of law, by the doing of some act or thing, or the occurrence of an event. Section 160M(3) expands upon the circumstances that are to be taken to give rise to a change in ownership. Relevant to the facts of the present case is par (b) which provides that a change shall be taken to have occurred in ownership of an asset by:
"(b) in the case of an asset being a debt, a chose in action or any other right, or an interest or right in or over property - the cancellation, release, discharge, satisfaction, surrender, forfeiture, expiry or abandonment, at law or in equity, of the asset."
(emphasis added)
148 The key words in that paragraph are that '[a]nything which involves a change in the beneficial ownership of an asset is treated as a disposal and as giving rise to an acquisition'. The relevant words in s 160M(1) of the 1936 Act, 'subject to this Part, where a change has occurred in the ownership of an asset, the change shall be deemed to have effected the disposal of the asset by the person who owned it immediately before the change and an acquisition by the person who owned it immediately after', reflect the terminology used in CGT event A1.
149 The Commissioner accepts that the Full Court authority in Brooks is against the Commissioner's submission, but says that it is a Full Court authority in the context of the predecessor to s 104-10(2), namely, s 160M(1) of the 1936 Act. There is no textual change in the words which would require any difference in the meaning. The Commissioner makes the point that in Brooks the Full Court provided no reasoning for the introduction of the word 'beneficial'. The Commissioner also makes the point that it was not an issue in Brooks whether or not the simple change of beneficial ownership was enough for a disposition in terms of s 160M(1).
150 It may be that the Full Court did not explain why the word 'beneficial' was used. But certainly there is an explanation in this proceeding and that explanation together with the Full Court's observations in Brooks is, at the very least, persuasive, if not binding. The Commissioner also points to [17], which is in the following terms:
Prima facie, therefore, where a taxpayer owning land enters into a contract to sell that land, at the time the contract is entered into, that taxpayer creates a right in the purchaser to have the contract performed upon payment of the consideration under that contract. The vendor under the contract is thus treated as having disposed of this right, being a right which the taxpayer is deemed to have owned immediately prior to the creation of it. Conversely, the purchaser is deemed to have acquired the right pursuant to the disposition.
151 The Commissioner proposed that the Full Court was implying that there was a CGT event by virtue of the creation of an interest immediately upon entry into the contract, rather than being a disposal at the point of completion. Similarly, the Commissioner suggests that the following passage at [61] indicates that the Full Court was looking more at the question of forfeiture of the deposit, rather than looking discretely at the question of when a disposal might occur. The Full Court acknowledged that a purchase of land is not completed until the purchase money is paid and an executed transfer handed over:
The dictionary meaning of "prospective" quoted (the quotation is from the Macquarie Dictionary (2nd ed, 1991)) is "potential, likely expected". The first meaning given in that dictionary is not inconsistent with that quoted by the Full Court, which was "in the future". But the meaning of the phrase "prospective purchase" falls to be determined, not merely by reference to the word "prospective", but by reference to the complete phrase and in particular the word "purchase". No doubt it is correct to refer to a precontract contract as a contract prior in time to a purchase in the future and thus as a prospective purchase. However, the real question is whether it is correct or incorrect to refer to a contract which calls for completion in the future as a prospective purchase. We do not find the same difficulty as the Full Court in Guy did. A purchase of land is not completed until the purchase money is paid and an executed transfer handed over. That is when the sale actually takes place. Until completion, it is not inaccurate to treat the purchase as being in the future. Once the purchase money is paid the payer becomes a bona fide purchaser for value, but not before.
152 In the present arguments, the respondents have also relied upon the wording which appears in an example and Note 1 under s 104-10(3) to support an argument that they say demonstrates that CGT event A1 is concerned only with dispositions of both legal and equitable ownership. In my view, this may make too much of the Note. What is unknown from the description in the Note is whether, at the time the contract failed, only the deposit had been paid. If it is only a deposit that has been paid, the suggestion from Lysaght v Edwards is that the purchaser does not have full equitable ownership for the land, but rather, sufficient equity in order to support an action for specific performance: see Tanwar Enterprises Pty Ltd v Cauchi (2003) 217 CLR 315 (at [53]). So if Note 1 is intended to illustrate a circumstance in which merely a deposit has been paid, then it would be accurate because beneficial ownership did not change. But if it should be read in some other way, then it would not be particularly helpful and perhaps not correct. The fact that an example given in legislation may be unhelpful or inaccurate is of no moment to construing the legislation as is evident from the discussion in the decision of Brooks (at [65]-[66]).
153 The way in which the Family Court Order is crafted is that Sandini is required to do all acts and things necessary to transfer the shares within seven days to Ms Ellison. In my view, this gave Ms Ellison an absolute right vested in possession to be owner of the shares within seven days. This flows from the discussion in Jones referred to above. In those circumstances there is no equitable interest retained in that number of shares by Sandini. All that Sandini can own in that number of shares is the bare legal title.
154 From a practical perspective, this is demonstrated by the fact that the only activity remaining at the time of the making of the Family Court Order was execution of the Share Transfer Form and presentation of it to MIN so that MIN could amend the Register in favour of the transferee. These steps involved changes to the legal, rather than the equitable title. None of those remaining steps enlarged in any sense the already absolute beneficial ownership of the shares held by Ms Ellison upon the making of the Family Court Order.
155 The analysis in Mateo by Wilcox J, after discussing a decision of Craven v Official Trustee in Bankruptcy (unreported, Supreme Court of New South Wales, per Needham AJ, 26 July 1991), is pertinent (at [57]):
Craven provides support for the view, advanced by counsel for the respondents, that the effect of a transfer order under s 79 of the Family Law Act is to vest in the beneficiary of the order an equitable estate in the property interest that is the subject of the order. If that is so, what remains, after the order, in the hands of the person who is bound to effect the transfer is a bare legal interest, the market value of which must be nil. It would follow that a transfer giving effect to such an order could never be void against the trustee of the transferor's bankrupt estate; the market value of the property (nil) would never be greater than the consideration given for the transfer (also nil).
156 Wilcox J continued (at [62]):
On this analysis, in the present case there were two vesting events; but only the second of them was a "transfer of property by a person who later becomes a bankrupt". The first event took place on 22 June 2000, when the Family Court made orders requiring, amongst other things, Mr Mateo to transfer to his wife all his right, title and interest in the home. The effect of that order was to vest in Mrs Mateo an equitable interest in the one-half legal estate that continued to be held by Mr Mateo, but which, thereafter, had only a nominal market value. The second event was the transfer of the legal estate that was effected by the registration of a transfer document on or about 10 August 2000.
(emphasis added)
157 As indicated above, similarly in this instance, there were two vesting events. The first was the vesting beneficial ownership by reason of the Family Court Order and then the second event by which the transfer of the legal estate and the beneficial estate was made to the family trust. The first event is sufficient for CGT purposes.
158 In the judgment of Branson J in Mateo, her Honour's approach on that aspect of the matter gave rise to a similar conclusion when her Honour said (at [102]):
Secondly, s 79 of the Family Law Act authorises the making of an order "altering the interests of the parties in … property". That is, the section is concerned to empower the Family Court directly to alter the interests of the parties to a marriage in property, not merely to make an order requiring the parties or one of them to take steps which will result in their property interests being altered. An alteration of the interests of the parties to a marriage in property by court order does not, in my view, constitute "[a] transfer of property by a person … to another person" within the meaning of s 121(1) of the Act (Kizon v Palmer (1997) 72 FCR 409 at 430-431; 142 ALR 488 at 505-506 per Lindgren J with whom Jenkinson and Kiefel JJ agreed). Turning to the actual order made by the Family Court in this case (see [83] above), it seems to me that it is probably implicit in the terms of the order that the interests of the parties to the marriage in their matrimonial home were altered by operation of the order. That is, that the order itself vested in the wife all of the husband's beneficial interest in the matrimonial home (see Harris v Walker (1969) 14 FLR 167). On this view of the order, the transfer which par 1 of the order required the husband to effect was necessary only to perfect the wife's interest by the transfer to her of the husband's legal interest in the matrimonial home. The transfer of the husband's beneficial interest in the matrimonial home to the wife was not on this view "[a] transfer of property by a person who later becomes a bankrupt" within the meaning of s 121(1) of the Act; it was a transfer of property by court order.
(emphasis added)
159 Merkel J reached a similar conclusion when his Honour said (at [127]-[130]):
127 At the outset it is appropriate to identify certain features of an order under s 79 of the Family Law Act. First, the order is a final order, subject to the limited jurisdiction to set aside or vary such an order by appeal or under s 79A of the Family Law Act: see Mullane v Mullane (1983) 158 CLR 436 at 442-443. The order may also be set aside on the ground of jurisdictional error in an application for prerogative relief under s 75(v) of the Constitution.
128 Secondly, a court order settling property between husband and wife, including a requirement that there be a transfer of one party's interest to the other, has generally been regarded as vesting in the transferee an equitable estate or interest in the property pending the transfer of the legal estate or interest: see Harris v Walker (1968) 14 FLR 167 at 176.
129 In Mullane at 445 the Court stated:
" … s 79 on its proper construction refers only to orders which work an alteration of the legal or equitable interests in the property of the parties or either of them. An interest in property is a right of a proprietary nature, not a mere personal right"
130 In Craven v Official Trustee in Bankruptcy (unreported, Supreme Court, NSW, Needham AJ, No 2712 of 1991, 26 July 1991) Needham AJ, in reliance on Mullane, concluded that an order altering property interests under s 79 "creates an equitable interest in the land which could be enforced just as a contract of sale could be enforced".
(emphasis added)
160 Those consistent observations by members of the Full Court lead to a conclusion which binds me to the effect that Family Court orders under s 79 of the Family Court Act transfer full beneficial ownership on the making of the order. It is clear that, as at 21 September, Ms Ellison could have compelled the transfer of the shares because she was armed with the Family Court Order.