Abad-Booton & Abad-Booton

[2008] FamCA 287

FAMILY COURT OF AUSTRALIA

ABAD-BOOTON & ABAD-BOOTON [2008] FamCA 287

FAMILY LAW  -  PROPERTY  -  interim orders -  Barro order  -  sale of two properties  -  disbursement of nett proceeds  -  history of non-disclosure by husband  -  interim spousal maintenance.

Family Law Act 1975 (Cth)

HUSBAND: Mr Abad-Booton

WIFE: Mrs Abad-Booton

FILE NUMBER: MLC 6879 of 2007

DATE DELIVERED: 11 March 2008

PLACE DELIVERED: Melbourne

PLACE HEARD: Melbourne

JUDGMENT OF: Brown J

HEARING DATE: 11 March, 2008

REPRESENTATION

COUNSEL FOR THE HUSBAND: Mr P. Renwick

SOLICITOR FOR THE HUSBAND: Kennedy Guy, DX 30301, Sunshine.

COUNSEL FOR THE WIFE: Ms M. Baczynski

SOLICITOR FOR THE WIFE: Kempsons, DX 366, Melbourne

Orders

1. That within fourteen days hereof the husband sign all documents and do all things necessary to transfer to the wife on a trust for sale the real properties situate at and known as:

   (a)… (“the [P] property”);  and

   (b)… (“the [T] property”).

1. That forthwith upon transfer to her, the wife do all things reasonably necessary to place the P property and the T property (“the properties”) on the market and to give force and effect to this order (unless the parties agree to the contrary) :

   (a)the properties shall be offered for sale by public auction by an agent agreed between the parties or, failing agreement, nominated by the President for the time being of the Real Estate Institute of Victoria;

   (b)the reserve price shall be as agreed or, failing agreement, as advised by the agent appointed pursuant the preceding sub-paragraph;

   (c)the contract of sale shall provide for settlement within 60 days, or such other period as is agreed between the parties;  and

   (d)the wife shall have the conduct of the sale. 

1. That if the husband fails or refuses to comply with the provisions of paragraph (1) hereof a registrar of this Court be appointed, pursuant to s.106A of the Family Law Act 1975, to execute all documents and do all acts in the name of the husband to give force and effect to these orders, and :

   (a)it shall be sufficient authority for a registrar to act pursuant to this order to have before him or her an affidavit, sworn by the solicitor for the wife, deposing to the delivery of transfers of land to the husband’s solicitor and a failure to return the transfers, signed, within seven days of delivery or fourteen days hereof, whichever is the longer period;  and

   (b)the husband shall be responsible for the costs of any such application. 

2. That the proceeds of sale of the P property and the T property be disbursed as follows :

   (a)first, to pay the costs, commissions and expenses of the transfers to the wife, and the sales;

   (b)second, to discharge the registered mortgages and unpaid outgoings;

   (c)third, to pay to the wife arrears of spousal maintenance pursuant to the order made herein on 6 August, 2007, computed to the date of payment;

   (d)fourth, by way of part property settlement to the wife, the sum of $20,000 to the wife to be expended in the acquisition of a motor vehicle for her use;

   (e)fifth, by way of part property settlement, the sum of $50,000 to the wife to be paid to her solicitors and disbursed to pay legal costs and disbursements incurred after this date, including but not limited to costs of filing any necessary subpoena pursuant to the orders made herein on 6 August, 2007;

   (f)sixth, the sum of $2,500 to be paid to Dr. L to enable the completion of the family report ordered herein;  and

   (g)seventh, the balance to be held in trust, in an interest bearing account in the name of the parties, by the wife’s solicitors.

1. That in the event the sum paid to the wife by way of arrears of spousal maintenance pursuant to paragraph (4)(a) hereof is in excess of the sum found to be due to her as at the date of payment, as a result of a subsequent variation or discharge of the order for spousal maintenance, then the sum overpaid shall form part of the wife’s entitlement pursuant to final property orders.

1. That subject to paragraph (5) hereof, the sum paid to the wife pursuant to paragraph (4)(a) hereof be deemed to form part of the husband’s entitlement pursuant to subsequent property orders. 

1. That the sum paid to Dr. L pursuant to paragraph (4)(f) hereof be deemed to form part of the husband’s entitlement pursuant to final property orders. 

1. That until further order each of the parties be and are hereby restrained by themselves, their servants and agents from further encumbering the T property and the P property.

1. That until further order the parties do all things reasonably necessary to ensure that :

   (a)rental received in respect of the P property be paid to the mortgage account in respect of that property;  and

   (b)rental received in respect of the property situated and known as D be paid to the mortgage account in respect of that property. 

1. That until further order the wife be responsible for the payment of all outgoings (including mortgage payments) in respect of the property situated and known as D, and payments made pursuant to this order be characterised by the trial judge.

1. That the husband pay towards the costs of the wife of this day the sum of $2,000, such sum to be paid within two months hereof. 

1. That the husband’s application to discharge the order for urgent spousal maintenance made herein on 6 August, 2007 and the wife’s application for continuing interim spousal maintenance be listed for hearing before the senior registrar only after the husband has complied with paragraph (13) hereof.

1. That the husband file and serve an affidavit deposing to his compliance with paragraph (14) of the orders made herein on 6 August, 2007 and without limiting the generality of the affidavit, it set out with specificity :

   (a)a list of documents which have been provided pursuant to the order;

   (b)a list of documents referred to in the order which have not been provided because they do not exist, and any necessary explanation;  and

   (c)a list of documents referred to in the order which are not in his possession or control, or cannot be obtained by him after reasonable endeavour, and any necessary explanations and attempts to obtain the documents or copies of the documents. 

1. That all extant applications for interim orders be dismissed, save :

   (a)the wife’s application for continuing interim maintenance;  and

   (b)the husband’s application to discharge the urgent spousal maintenance order made herein on 6 August, 2007. 

1. That the reasons for judgment this day be transcribed and that copies be made available to the parties.

1. That pursuant to Rule 19.50 of the Family Law Rules 2004 this matter reasonably required the attendance of counsel and a solicitor appearing as counsel.

IT IS NOTED that publication of this judgment under the pseudonym Abad-Booton& Abad-Booton is approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).

FAMILY COURT OF AUSTRALIA AT MELBOURNE

FILE NUMBER: MLC 6879 of 2007

MR ABAD-BOOTON

Husband

And

MRS ABAD-BOOTON

Wife

REASONS FOR JUDGMENT

1. The parties have been involved in litigation in this court since the wife filed an initiating application on 19 June 2007 in which she sought both final and interim parenting and spousal maintenance orders.  There may be a disagreement as to the date of their initial separation, the wife dating it in March 2007 and the husband in April 2007.  Some time after that they attempted a reconciliation, and were together from November 2007 for one or two months.  They do not agree on the circumstances in which they reconciled or the duration of that attempt.  They do agree that their marriage is now over. 

1. The parties have two children;  S was born in December 2002 and H born in June 2004. 

1. Today’s hearing was fixed by a registrar, who directed the filing of an amended application and response by specified dates.  Neither party complied with that order.  The husband filed an amended response on 27 February and the wife filed an amended application on 28 February.  Sensibly, no-one has made anything of that late filing and I dispense with compliance with the original order.

1. In her amended application filed 28 February 2008, the wife sought that two pieces of real property be transferred to her on a trust for sale.  From the nett proceeds, after deduction of the costs of sale and the discharge of mortgages, she sought that the following sums be paid.  First, the sum necessary to discharge all arrears of spousal maintenance pursuant to an order of 6 August 2007.  Second, the sum necessary to discharge arrears of child support owed by the husband.  Third, the sum necessary to pay outstanding costs orders in favour of the wife.  Fourth, the sum of $20,000 to the wife, to enable her to purchase a car.  Fifth, the sum of $50,000 to the wife, to discharge debts to her family arising from loans to enable her to service mortgage payments and maintain one of the real properties.  Sixth, the sum of $50,000 by way of a Barro order.  She sought that the balance be invested in an interest bearing account with her solicitors, in trust for the parties.

1. In his amended response (filed the previous day) the husband sought that two real properties be sold.  One was also the subject of the wife’s application for sale.  He sought that the nett proceeds be held in an interest bearing account, in trust for both.  He also sought that the order for urgent spousal maintenance, made on 6 August 2007, be discharged.

1. There are three real properties in issue.  One is the former matrimonial home in T, registered in the name of the husband.  The second is a flat in D, registered in the name of the wife.  The third is a flat in P, registered in the name of the husband. 

1. The wife relied on an affidavit and financial statement sworn by her and filed on 28 February 2008.  The husband relied on an affidavit and financial statement sworn by him and filed on 27 February 2008.  He also relied on an affidavit I allowed him to file, over objection, today.  I add that the affidavit filed with leave today added little to the sum of evidence before the court.  In it the husband did respond to a number of allegations raised in the wife's material, but many of those allegations go to the personal conduct of the parties and are not relevant to the applications before me today.

1. Before me the wife has maintained the application made in the amended application filed on 28 February.  She seeks that the former matrimonial home and the P flat be sold and the proceeds disbursed in the way I have described.  The husband now joins in the application that those two properties be sold, but asks for the proceeds to be retained in trust, pending further order, save that a sum of $2,500 be paid to Dr L to allow her to prepare a family report.  He maintains his application for the discharge of the urgent spousal maintenance order.

1. The husband was earlier ordered to pay $2,500 for the preparation of a family report.  Dr. L is available, but will not schedule interviews until the fee is paid.  It remains unpaid and the husband now seeks that it come from the proceeds of sale of the real properties.  From the wife's perspective, that is not a priority.  The evidence about the children is contested but concerning and it may be in their best interests to allow funds to be used in this way.  That need not undermine the existing order, as the sum could be adjusted against the husband when final orders are made. 

1. I move briefly to the litigation history, insofar as it is relevant.  The matter was before Cronin J on 5 July, 2007.  Injunctions were made, restraining dealings with the P flat and the former matrimonial home, being the two properties held in the husband's name.  On 6 August, 2007 I made the order (to which I have referred) for urgent spousal maintenance of $300 per week.  Orders made that day required full financial disclosure and set out with particularity documents which were to be provided by the husband by 24 August 2007.  I also gave the wife leave to issue subpoena directed to a large number of entities.  At that time I adjourned the applications for interim orders to 16 October, and adjourned the application for spousal maintenance to the senior registrar's list on 11 September 2007.

1. When the matter came before the senior registrar on 11 September, 2007 he noted the obligation of the husband to comply with the orders of 6 August and that there had been no compliance with the orders for discovery.  The husband was given an extension of time to 18 September.  The matter came back before the court on 13 November;  discovery had still not been provided.  A further extension was granted to 26 November.  On 13 November, the husband was ordered to pay arrears of spousal maintenance accrued to that date, to comply with the order for spousal maintenance, and to pay the family report writer's costs.

1. The matter was back at court on 10 December 2007.  On that day the wife was represented, but not present.  The independent children's lawyer was at court.  The file notes that the court was advised the parties were attempting some form of reconciliation and sought an adjournment.  That was granted. 

1. After the reconciliation failed, the parties resumed the litigation.  On 4 February 2007 Registrar Kaur adjourned the applications for hearing before me, reserving the wife's costs and the independent children's lawyer's costs. 

1. Before me there is a dispute as to the extent of the husband's compliance (if any) with a number of orders relating to the financial applications.  It is the wife's case that he has failed to comply with orders for payment of urgent spousal maintenance, child support and the payment to Dr L.  Further, until this morning, the husband made not the slightest attempt to comply with the order for discovery.

1. It was not until this morning that any documents were provided by the husband.  The husband's new solicitor has done everything he could to give relevant documentation to the wife’s lawyers this morning, but many items remain outstanding and there was little time for inspection. 

1. I have been told a number of CBA bank statements were provided this morning, to inspect.  I cannot say whether copies were available.  Only one tax return was provided to counsel for the husband, and it could not be made available to counsel for the wife.  It is put that tax returns have been prepared by the husband for the 2005 and 2007 years, but they were not made available to his counsel today.  An assessment to 30 June 2007 shows, I am advised, a taxable income of $37,013;  that assessment is dated 18 February 2008.  Some documents relating to borrowings secured by mortgage, and some credit card documents for the period 13 March 2006 to 15 January 2008, were produced.

1. Through his counsel it is put that the husband has not been able to obtain any other credit card records.  It is also put that he has no copy of the relevant trust deed, and would have to “go back to his family” to get it.  Given the husband's evidence of the interlinking of his affairs with his family, it is risible to suggest that he is not able to provide a copy of the trust deed.  The husband should realise that if he fails to comply with orders for disclosure, a court will not be cautious in making adverse financial findings against him and he may well be required to pay the costs the wife incurs to obtain his documents. 

1. The husband’s evidence is that he paid spousal maintenance for two months, until October 2007, and child support until October 2007.  He conceded making no payments of maintenance and child support since early October 2007 when, he deposed, he became unemployed. 

1. The husband has been employed in family businesses all his life.  These are mainly automotive business;  there are also references to restaurant businesses.  During the marriage, the wife, too, worked in businesses owned by his family, on occasions.  His evidence now is that his family is unwilling to provide any further financial support.  I note that in the first affidavit filed in these proceedings he deposed that they were not prepared to provide further financial support for him, “whilst these proceedings continue”.

1. This evidence is contradicted by his own evidence that as recently as November 2007 he asked his brother for $20,000 and was given that sum.  On his evidence, he spent part of that money on a holiday in Queensland.  He bought clothes for the wife, gave her cash and spent the balance on what could be called recreational and discretionary expenditure.  The wife does not concede the sums allegedly expended on her but on the husband's own account, he frittered away $20,000, despite his financial position being so parlous that he has not been able to pay a cent towards the former matrimonial home mortgage since April 2007.

1. The car or cars that were previously provided for the wife by the husband's family have been retrieved.  Her evidence is that she is now without a car;  the husband's evidence is that she had the use of a car provided by her mother, at least until the parties went to Queensland, in November 2007.  I cannot determine that dispute now.

1. An intervention order was made against the husband, on application of the wife.  The wife alleges it has been breached a number of times.  A good deal of the evidence goes to harassment that each attributes to the other.  It appears to be a situation of high conflict.  It would be surprising if this is not impacting adversely on the parties’ children who are very young;  they will be effected by parental tension but are also exposed to parental conflict. 

Former matrimonial home

1. I start with the former matrimonial home.  The wife asserts the property has a value of $500,000.  The husband asserts a value of $330,000.  On a date close to the first separation, being 2 March 2007, the mortgage stood at $262,724.  It is a Viridian line of credit with the National Bank.   The wife's evidence was that at 10 July, 2007 it was $250,000.  The line of credit stood at 30 January 2008 at $276,008.  The wife's evidence was that at separation on 14 March, 2008 it was $210,000, a significantly lower figure than the husband asserted at 2 March, 2008.

1. Movement in the mortgage account can be ascertained by the production of documents.  Until that is done, the court cannot determine the sum outstanding at separation. 

1. The husband's evidence is of making a payment to the mortgage in March 2007 and another in April 2007;  he has paid nothing since.  His evidence is that NAB is threatening to foreclose.  The wife's evidence is of being forced out of the house by the husband's harassment of her.  She has been living with her parents during the week and there is evidence that various utilities at the house, including gas and electricity, are unpaid or disconnected.  The wife produced a bill for services to the property which, rather than being addressed to the husband under his name, was addressed to SN.  That may be explored in due course but it does not take the matter further today.

1. Both parties seek that this property be sold and I will make an order for its sale. 

P property

1. In relation to P property, the wife asserts that the property has a value of $500,000;  the husband takes the view it may be a lower figure.  The mortgage to the National Bank at 20 July 2007 was, according to the wife, some $250,000.  The husband's assertion, and it is no higher than an assertion, is that the mortgage on P property is tied in with borrowings on four other properties owned by what he referred to as "the brothers", and that the full sum secured is some $949,861.  It is put that if that property is sold, the whole of the proceeds will be taken to discharge secured borrowings.  The only evidence in support of this proposition is an undated letter which refers to collateral securities.

1. As noted earlier, the husband was given leave to rely on an affidavit filed only today.  Notwithstanding that late evidence, it was not until the case resumed after lunch today that his counsel advised the court of recent instructions from the husband that the P property has been placed on the market.  The husband was in court for the whole of the morning’s hearing, while debate raged about the property.  He was not shy of attracting his counsel's attention in the course of the debate;  I observed that on a number of occasions.  But nothing was said then about a vital matter.  No information is forthcoming about the name of the agent for the sale, the date the property was placed on the market, the terms of sale, a reserve price or any other details.

1. The husband now joins in the application for the sale of this property.

D property

1. The husband originally sought the sale of the D property.  His position now is that if the wife wants to retain that property he will not press for its sale so long as she is responsible for the shortfall of rental income against mortgage payments and outgoings. 

1. According to the wife, the D property has a value of some $400,000 and the mortgage is some $380,000.  The monthly repayments are $2,700.  It is leased and the rent is some $1,600 per month.  There is a dispute as to whether the rental payments were going into the mortgage or not, when the husband’s family was controlling the property.  The immediate shortfall is $1,100 per month but the actual shortfall must be higher, once other outgoings, rates and maintenance are taken into account. 

1. The wife's evidence is of borrowing from her family in order to meet the mortgage repayments;  her evidence is that some $14,000 of the $50,000 she has borrowed from her family to date has been used for this purpose.  She deposed to signing documents at various times to refinance and use the equity in this property.  If that property is to be retained at this stage, rather than sold as initially sought by the husband, she will have to accept responsibility for outgoings on the property until further.  A trial judge can determine ultimate responsibility in due course.

Conduct of the sales

1. I have no hesitation in finding that the wife should have the conduct of the sales.  The husband's failure to comply with orders for discovery is breathtaking.  His present solicitor has only recently been instructed and made a valiant attempt to put evidence before the court today but to date there was an utter refusal to engage with orders prior to that time.  I have no confidence in the husband's preparedness to implement an order for sale, to seek the best possible price or to facilitate the sale.  In relation to the former matrimonial home there is the additional factor that the wife has possession of that property and lives there with the children on occasions;  the simple reality is that an agent will have to deal with her in relation to inspections and the like.

Disposition of funds

1. I do not propose to order that only registered mortgages be discharged and the balance held in trust for the parties.  From the proceeds of sale will come the arrears of spousal maintenance to date, to be paid to the wife.  Child support is in the hands of the Child Support Agency and arrears will not come from this source at this time.  A successful departure application could alter the arrears;  in my view, it would be premature to make that order.

1. $20,000 will be paid to the wife, to be used for the acquisition of a car.  That is a part property payment.  She can acquire a car but must realise that $20,000 goes on her side of the ledger.

1. I do not propose to allow funds to be used to repay the debt allegedly due to the wife’s parents.  The evidence is insufficient at this time.    

1. The wife’s application for a Barro order is not supported by evidence in proper form;  for example, there is no evidence from a solicitor relating to the work to be done, and its cost.  According to the wife's material, she owes $33,000 to her former lawyers.  The overwhelming inference is that the wife is inevitably going to have to obtain evidence as to the husband’s financial affairs by the use of subpoenas.  That is an expensive proposition.  I am satisfied she should be paid a further $20,000 by way of part-property settlement to be disbursed by her solicitors in respect of subsequent legal expenses, including but not limited to subpoenaing documents referred to in my orders of 6 August, 2007.  Again, that will be taken into account in the trial. 

1. Orders will be structured to ensure the wife does not end up paying half of the arrears of spousal maintenance.

1. Orders will provide for the payment of $2,500 to Dr. L and to give effect to the order of 13 November 2007, that will be debited against the husband's entitlement. 

1. There is simply not enough evidence before me today to make - even on the papers - an intelligent assessment as to whether the existing spousal maintenance order should be discharged, varied or remain in force. 

1. Both the applications for continuing spousal maintenance and the application to discharge the existing order remain before the court.  The urgent interim order was made after a hearing on the papers and the court did its best to arrange for a full hearing.  In my judgment, it would be a waste of the parties’ money to list the matter again before the registrar when there is no material which would enable him to make an informed decision.  I am satisfied the urgent spousal maintenance order should remain in force.  The applications relating to that will be listed for hearing on application to the assistant to the senior registrar on the husband swearing an affidavit certifying to his compliance with paragraph (14) of the orders made on 6 August 2007. 

1. The applications will be otherwise dismissed, save paragraph 5 of the amended response of 27 February 2008. 

1. Until further order, rental received in respect of the P property is to be paid into the mortgage account, as shall rental in respect of the D property.

Costs

1. The wife seeks an order that the husband pay her costs.  I have detailed the history of this matter and the court's attempt to get material before it which would enable it to have a full interim hearing of the spousal maintenance applications.  Through the diligence of the solicitor for the husband, a lot of material was provided this morning, but there is still a deal of material which he needs to acquire, and then to provide to the wife.  The wife has not been completely successful in her application today but she has been successful in important areas, including the payment of various sums from the proceeds of sale of the two properties.  I have read the material of each parties’ evidence of their alleged financial positions.  The husband's evidence is of not being in paid work, evidence that will be tested in due course.  In my view, the evidence supports a finding that the husband should contribute $2,000 towards the wife's costs of today, to be paid within two months.  I do not propose to order that the figure be paid from the nett proceeds of sale.  That fund should not be used as a running account.  There may be other enforcement options. 

I certify that the preceding
43 paragraphs
are a true copy of the reasons for
judgment herein of the
Honourable Justice Brown AM.

Dated the           day of            2008.

…………………………………………
Associate.