The plaintiff (Mr Van Gorp) and the defendant (Ms Davy) were once married. These proceedings are the next round in a very long series of litigation conducted across a number of courts by Mr Van Gorp against Ms Davy in relation to events which occurred during their marriage.
By statement of claim filed on 24 July 2018, Mr Van Gorp seeks:
"1 Liquidated claim $425,000 plus costs.
2 In the alternative, an order that Ms Davy sell her one-third interest in the Ellendon and King Streets Bungendore industrial properties and pay me 85% of the proceeds.
3 The costs orders made on 15 March 2015 AND 17 August 2017 in Local Court proceeding 2014/00175601 be set aside."
After Ms Davy filed her defence, Mr Van Gorp decided to amend his statement of claim. The proceedings are before me today to hear two notices of motion. The first is brought by Mr Van Gorp for leave to amend his statement of claim. The other notice of motion is brought by Ms Davy and seeks:
"1 An order staying these proceedings pursuant to s 8(7) of the Vexatious Proceedings Act 2008 (NSW).
2 An order prohibiting Sean Cornelius Van Gorp, without leave of the Court, from commencing any proceedings in New South Wales against Kate Louise Davy pursuant to s 8(7)(b) of the Vexatious Proceedings Act 2008 (NSW).
3 In the alternative to order 1 above, an order pursuant to Rule 14.28 that the Statement of Claim be struck out.
4 An order that the plaintiff pay the defendant's costs of and incidental to these proceedings as agreed or assessed."
As the argument developed this morning, Ms Davy ultimately did not press for the relief in paragraphs 1 and 2 of her motion. She pressed only for orders that the statement of claim be struck out with costs.
The parties agreed that I should first deal with Mr Van Gorp's amendment application before turning to Ms Davy's notice of motion. That is how the hearing proceeded.
Mr Van Gorp appeared for himself. Ms Davy was represented by Mr D O'Sullivan of Counsel.
To understand why the Court has decided that the amendment application should be refused, it is necessary to begin with the statement of claim. This pleads a series of events which, in summary, are that during the course of the marriage Mr Van Gorp advanced $47,742 (the "Advance") by way of distribution from his family trust to Ms Davy which she used to purchase the properties referred to in prayer 2 of the statement of claim (the "Properties") (see paragraph [2] above). The statement of claim pleads (emphasis added):
"1. As a consequence of the Defendant, Ms Davy, insisting we execute a pre-nuptual (sic) agreement to protect her wealth, we signed a Binding Financial Agreement under section 90B of the Family Law Act prior to our wedding on 15 December 2001 with the substantive effect of keeping our finances separate and excluding our assets from access by the other.
2. As a consequence of Ms Davy saying to me in June 2003 words to the effect "I know we agreed in our pre-nup to keep our finances separate, but you should do income splitting through your family trust and pay me about $50,000 each year, and pay the tax on it, and of course I'll pay it back to you later. They're really only loans. I need the money for my $80,000 share to buy factory units in Bungendore with my brother and sister", I distributed income of $47,742 from my family trust for the year ended 30 June 2003 to Ms Davey.
Particulars
(a) Van Gorp Family Trust distribution of income for the year ended 30 June 2003 to beneficiary Kate Louise Davy was $47,742.
(b) Ms Davy's income tax return for the year ended 30 June 2003 returned the income distributed to her by the Van Gorp Family Trust as assessable income received.
(c) The Van Gorp Family Trust financial statements for 30 June 2004 showed that the 2003 income of $47,742 distributed to Kate Louise Davy was paid before 30/6/03."
There is a fundamental difficulty with the statement of claim, to which I will return in considering Ms Davy's notice of motion. It is that in so far as Mr Van Gorp tells the Court that he wishes to advance an equitable claim to the Properties, the statement of claim discloses no facts, matters or circumstances that evidence any intention that he should have an equitable interest in the Properties by reason of the Advance. As the matter is pleaded, and as Mr Van Gorp explained to me on several occasions, the Advance was a loan.
It is a hornbook proposition that, without more, the mere advancing of a loan to someone to purchase a property does not give the lender an equitable interest in the property.
Against that background, the question becomes whether the proposed amendments will cure the difficulty I have identified. They do not.
The amendments which Mr Van Gorp wishes to make set out in greater detail facts concerning a binding financial agreement dated 11 December 2001 pursuant to s 90B of the Family Law Act 1975 (Cth) (the "BFA") which he and Ms Davy entered into. He wishes to rely on the BFA, ultimately, to advance this amended paragraph (emphasis added):
"11. It was an implied term of the BFA with which we complied, that we maintain our individual wealth and assets without access to the other's wealth, assets or income, and keep each party's financial affairs, other than normal shared household expenditures, entirely separate from the other's financial affairs, such that any money paid from one to the other for other than household costs was in the nature of a loan.
Particulars
The term is implied by Recitals I to R and Terms 1 to 15 of the BFA and law. I issued Ms Davy with a credit card on my account solely for household use."
Completely contrary to any possible case in equity, it is significant that the implied term which Mr Van Gorp wishes to advance in relation to the BFA makes it quite clear that the Advance falls within the description of "any money paid from one to the other for other than household costs is in the nature of a loan". It therefore presents a case in contract but does not set out any facts that could justify an equitable claim to the Properties.
It is for that reason that Mr O'Sullivan submits that the amendment is fruitless because it does not and cannot advance a cause of action of the kind which Mr Van Gorp says he wants to make. In accordance with well recognised principles, that is in and of itself a sufficient reason for the Court not to grant leave for the amendment to be made because the amendment is futile. I accept that submission and will not grant leave for the amendment.
It is then necessary to consider Ms Davy's application that the (unamended) statement of claim be struck out. In that context, Mr Van Gorp did seek to persuade the Court that he should be given another opportunity to re-plead his statement of claim in the light of the comments I have made about the absence of any pleading that would substantiate a claim in equity.
That course was opposed by Mr O'Sullivan on the basis that there was nothing that apparently could be incorporated in the pleading that would give rise to an equitable claim. Mr O'Sullivan submitted that Mr Van Gorp had had his chance to make an amendment and that, unless he was able to persuade the Court that a further attempted amendment could have any utility, Mr Van Gorp should not be given another chance.
I asked Mr Van Gorp to explain to me what he proposed in the nature of further amendments. He indicated from the Bar table that he would rely upon conversations that he allegedly had with Ms Davy after she had purchased the Properties to the effect that, as they drove past the Properties, she said to him that his money was safe because she had spent it on the Properties. That seemed to be the extent of the matters upon which Mr Van Gorp wanted to rely. A pleading which added those facts would suffer from the same vice as the current statement of claim. Statements made after the purchase of the properties to the effect alleged by Mr Van Gorp would not disclose a serious question to be tried or an arguable case that Mr Van Gorp has an equitable interest in the Properties. For that reason I declined Mr Van Gorp's application to be given leave to attempt to amend his statement of claim again.
Ms Davy's motion that the statement of claim be struck relied on Part 14 r 14.28 of the Uniform Civil Procedure Rules 2005 (NSW):
"14.28 Circumstances in which court may strike out pleadings
(1) The court may at any stage of the proceedings order that the whole or
any part of a pleading be struck out if the pleading:
(a) discloses no reasonable cause of action or defence or other case
appropriate to the nature of the pleading, or
(b) has a tendency to cause prejudice, embarrassment or delay in the
proceedings, or
(c) is otherwise an abuse of the process of the court.
(2) The court may receive evidence on the hearing of an application for an
order under subrule (1)."
It will be apparent from what I have said in paragraphs [8] and [9] above that I accept Mr O'Sullivan's submission that the statement of claim does not disclose a cause of action that Mr Van Gorp has an equitable interest in the Properties. However, that conclusion only disposes of paragraph 2 of the relief sought in the statement of claim. It is necessary to consider the other two prayers for relief.
The first of these is a liquidated claim of $425,000 plus costs. It is not necessary for me to provide any details as to how that figure is arrived at, save to say that it represents the result of a series of calculations which Mr Van Gorp has made based on the Advance and what he says is now the value of his alleged interest in the Properties. In so far as the assertion of a liquidated claim relying on equitable principles is concerned, for the reasons I have already given the statement of claim does not support that prayer for relief.
There is also the possibility that the claim pleaded in the statement of claim could support a claim in contract giving rise to a liquidated claim based on the Advance. The difficulty for Mr Van Gorp is that the claim in contract based on the Advance has been fully litigated adversely to Mr Van Gorp.
The evidence discloses that Mr Van Gorp originally filed proceedings in the Local Court in 2014 relying, in essence, on the same facts which he now seeks to rely on in the present statement of claim. The parties in those initial Local Court proceedings are the same as the parties in the proceedings before this Court.
In March 2015, the initial proceedings in the Local Court were disposed of by orders made by consent that there be a verdict for Ms Davy and that Mr Van Gorp was to pay her costs on a solicitor/client basis as agreed or assessed.
In November 2015, Mr Van Gorp filed a second set of Local Court proceedings relying on the same facts. In February 2016 that second set of proceedings was struck out by a magistrate because the matter had been determined by the consent orders in the first set of proceedings.
On 2 February 2017, Fagan J in this Court gave an ex tempore judgment dismissing a summons filed by Mr Van Gorp seeking leave to appeal from both sets of proceedings in the Local Court.
On 6 July 2017, the Court of Appeal in Van Gorp v Davy [2017] NSWCA 167 dismissed a summons filed by Mr Van Gorp seeking leave to appeal from the decision of Fagan J.
It is clear from the history which I have recited in the preceding paragraphs that there is now no basis on which Mr Van Gorp would be entitled to re-agitate a claim in contract based on the Advance. If the statement of claim could support such a contractual case, the history to which I have referred makes it clear that the statement of claim is an abuse of process.
The third head of relief sought in the statement of claim relates to costs orders made in the first of the two sets of Local Court proceedings. There is nothing in the statement of claim which refers in terms to those costs orders. It goes without saying that the only way in which those costs orders could be changed by this Court would be by an appeal. That possibility has already been exhausted in what has occurred in the proceedings referred to in paragraphs [24] and [25] above.
Mr Van Gorp candidly explained to me that he had included the third prayer for relief on the basis that he felt that "as a matter of justice" if he otherwise succeeded in relation to his claim concerning the Advance, then those costs orders should be set aside. While his feelings in the matter may be understandable, there is nothing in the statement of claim that discloses any basis on which the Court could make the orders sought in prayer 3 of the statement of claim, even if Mr Van Gorp was otherwise successful.
For those reasons, the Court will accede to Ms Davy's application that the statement of claim be struck out as failing to disclose any reasonable cause of action and as an abuse of process.
I conclude by recording that I raised with Mr Van Gorp the desirability of him obtaining legal advice in relation to the issues which he now wishes to litigate. While, by any means, that was not said as an invitation or encouragement to Mr Van Gorp to commence fresh proceedings, nevertheless it was acknowledged by Mr O'Sullivan, and is the case, that there is nothing to stop Mr Van Gorp commencing fresh proceedings if he is so advised. That is a matter for him. Undoubtedly, were he to do so, a plethora of limitation and other issues would be raised.
The orders of the Court are as follows:
1. The plaintiff's notice of motion filed 18 September 2018 is dismissed.
2. The plaintiff is to a pay the defendant's costs of the notice of motion referred to in order 1.
3. The statement of claim is struck out pursuant to Uniform Civil Procedure Rules r 14.28.
4. The plaintiff is to pay the defendant's costs of and incidental to these proceedings (including, for the avoidance of doubt, the defendant's costs of her notice of motion filed 4 September 2018).
[2]
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Decision last updated: 28 September 2018