Abdou and Ahmed
[2017] FamCA 1085
•21 December 2017
FAMILY COURT OF AUSTRALIA
| ABDOU & AHMED | [2017] FamCA 1085 |
| FAMILY LAW – SPOUSAL MAINTENANCE – Where the wife seeks that the husband pay her urgent spousal maintenance under section 77 of the Family Law Act – Where the husband proposes orders for him to pay the wife spousal maintenance in a lesser amount than sought by the wife – Where there is significant dispute between the parties as to the asset pool – Where parenting proceedings are also on foot – Where the wife is unemployed – Where the parties each have the care of one child of the relationship – Where the father is employed and owns a business – Where the wife is unable to support herself – Where the husband has the capacity to pay maintenance – Where the wife is in immediate need of financial assistance – Where the husband currently pays the wife spousal maintenance – Where the expenses claimed by the wife are excessive – Where the husband currently pays the mortgage and outgoings on the former matrimonial home – Where the husband currently pays the education expenses for the children – Where it is appropriate that the husband continue to pay these expenses – Orders made. |
| Family Law Act 1975 (Cth) ss 72, 77 |
| Curnow and Curnow (Unreported, Family Court of Australia, Full Court, 28 April 1997) | ||
| APPLICANT: | Ms Abdou | |
| RESPONDENT: | Mr Ahmed |
| FILE NUMBER: | PAC | 5203 | of | 2017 |
| DATE DELIVERED: | 21 December 2017 |
| PLACE DELIVERED: | Parramatta |
| PLACE HEARD: | Parramatta |
| JUDGMENT OF: | Hannam J |
| HEARING DATE: | 13 and 17 November 2017 |
REPRESENTATION
| COUNSEL FOR THE APPLICANT: | Mr Givney |
| SOLICITOR FOR THE APPLICANT: | Veritas Law Firm |
| COUNSEL FOR THE RESPONDENT: | Ms Kennedy |
| SOLICITOR FOR THE RESPONDENT: | Withstand Lawyers |
Orders
That commencing on the first Monday after the making of these Orders the Husband to pay to the Wife the sum of $715 per week in spousal maintenance with such sum to be paid by way of direct deposit to a bank account nominated by the Wife in writing.
That the husband to do all acts and things to cause the mortgage repayments, statutory outgoings, insurance and utility charges for the property known as and situate at D Street Suburb H to be paid as and when they fall due.
That the husband pay all expenses associated with the education of the parties’ children, B born … 2003 and C born … 2012.
Note: The form of the order is subject to the entry of the order in the Court’s records.
IT IS NOTED that publication of this judgment by this Court under the pseudonym Abdou & Ahmed has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
Note: This copy of the Court’s Reasons for Judgment may be subject to review to remedy minor typographical or grammatical errors (r 17.02A(b) of the Family Law Rules 2004 (Cth)), or to record a variation to the order pursuant to r 17.02 Family Law Rules 2004 (Cth).
| FAMILY COURT OF AUSTRALIA AT PARRAMATTA |
FILE NUMBER: PAC 5203 of 2017
| MrAbdou |
Applicant
And
| Mr Ahmed |
Respondent
REASONS FOR JUDGMENT
Introduction
The parties’ 16 year marriage has broken down and they are engaged in property and parenting proceedings.
The applicant wife seeks various interim property orders including that the husband pay her $77,000 in lump sum and $2,000 per week in periodic spousal maintenance on an urgent basis under section 77 of the Family Law Act 1975 (Cth) (“the Act”).
The husband substantially opposes the orders as sought by the wife and seeks various alternate interim property orders including that he pay the wife $715 per week in spousal maintenance.
Following interim hearing on 17 November 2017 I reserved judgment as to the wife’s application for urgent spousal maintenance only.
Background
The husband who is 47 and the wife who is 41 began living together in 2001 following their marriage in Country E which was arranged by their families.
The mother had lived in Country E with her family but migrated to Australia following the parties’ marriage. At that time, the wife was not working and the husband was a working and studying. Neither party had any assets of significance at the time of their marriage.
The parties lived in a property owned by the husband’s parents following their marriage.
In 2002 the husband purchased a pharmacy business, which was subsequently sold in circumstances that are not yet clear.
The parties’ first child, B, was born in 2003.
In 2004 the parties purchased a property in Suburb H where they lived until 2008.
In 2008 the parties purchased a second property in Suburb H (“the former matrimonial home”) in which they resided until separation in 2017.
In 2010 the husband purchased a commercial property in Suburb F.
The parties’ second child, C, was born in 2012.
In 2012 the parties purchased a second property in Suburb F which they subsequently demolished and built a business centre from which the husband commenced working the time of separation in 2017.
The parties separated under one roof in August 2017 before the husband left the former matrimonial home in September 2017. The wife, with at least one (and at times both) of the children, has remained living in the former matrimonial home since this date. The wife and the parties’ second child currently reside in the former matrimonial home. The husband and the parties’ first child currently reside with the husband’s parents.
On 17 October 2017 the wife filed an Initiating Application seeking orders as to property settlement only. On that date the wife was granted a short notice listing in relation to the interim property orders she was seeking.
On 9 November 2017 the husband filed a Response to the wife’s Initiating Application seeking both parenting and property orders.
On that date the parties appeared before a Registrar and an order was made for the parties to attend on a Family Consultant for the purposes of the production of a Children and Parents Issues Assessment (“CaPIA”). Further orders were made for the parties to attend a Case Assessment Conference and for the matter to be listed for interim hearing in the judicial duty list in regards to the application of the wife for urgent spousal maintenance and interim property orders.
On 13 November 2017 the matter came before me in the judicial duty list for interim hearing and was adjourned on a not reached basis to 17 November 2017.
Following interim hearing on 17 November 2017 judgment was reserved in respect to the wife’s application for urgent spousal maintenance.
Matters in dispute
The parties are in significant dispute as to the asset pool for distribution and the financial and non-financial contributions of each party, the employment status of each of the parties throughout their marriage and the nature of each parent’s involvement in the care of the children.
Parenting proceedings are currently ongoing and the future residence of and care arrangements for the parties’ two children are in dispute.
The parties, either separately or jointly, own four properties including a centre from which the husband operates his business. All properties were acquired during the parties’ relationship. None have undergone expert valuation and all are encumbered to some extent. There are also monies controlled by the husband from the prior sale of a share portfolio and a pharmacy business, jewellery owned by the parties and various debts which are likely to be sought to be treated as joint liabilities. The total value of the asset pool is unclear.
Against this background I now consider the particular orders sought by the wife.
Urgent spousal maintenance
The wife seeks that the husband pay $77,000 in a lump sum and $2,000 per week by way of urgent spousal maintenance.
The husband does not oppose paying the wife spousal maintenance but seeks alternate orders that he pay her $715 per week in period maintenance and continue to meet all mortgage repayments on the former family home in which the wife lives with the parties’ younger child.
The wife’s application is made under section 77 of the Act which is as follows:
Urgent spousal maintenance cases
Where, in proceedings with respect to the maintenance of a party to a marriage, it appears to the court that the party is in immediate need of financial assistance, but it is not practicable in the circumstances to determine immediately what order, if any, should be made, the court may order the payment, pending the disposal of the proceedings, of such periodic sum or other sums as the court considers reasonable.
The nature of an application under this section was recently confirmed by the High Court in Hall & Hall[1] at [7]:
It was established at an early stage in the history of the Family Court that the power to make an interim order under s74 (1) is separate and distinct from the power to make an urgent order that is separately conferred by s77. Section 77 allows the Court to “order the payment, pending the disposal of the proceedings, of such periodic sum or other sums as the court considers reasonable” if a two – part condition is met. First, it must appear to the court that a party to the marriage “is in immediate need of financial assistance”. Second, it must be “not practicable in the circumstances to determine immediately what order, if any, should be made”.
[1] [2016] HCA 23; (2016) 332 ALR1.
It is clear from the terms of the section itself that such payment may be ordered where it is not practicable in the circumstances to determine what order, if any, should be made and that the party “appears” in immediate need of financial assistance.
When considering an application under s77 if this need “appears” to the court to exist, the court may order that payment in a sum “as the court considers reasonable”.
Although orders for urgent spousal maintenance are in the nature of stop-gap orders, they are not only available where the claimant is virtually destitute. There must however, be some scrutiny of the wife’s claim that she is in immediate need of financial assistance and to determine a sum that may be considered reasonable. In scrutinising the wife’s claim under section 77 of the Act, some consideration of the matters in section 72 of the Act is necessary.
Immediate need of financial assistance
The capacity of the wife to support herself
It is the wife’s contention that the husband controls the entirety of the parties’ financial assets and resources and she is unable to support herself adequately.
The wife has the care of the parties’ youngest child who is five years old. The husband has the care of the parties’ 14 year old child.
It is common ground that the wife has worked in the past but is not currently working and is earning no income. It is unlikely she will find work in the near future and she cannot resume her previous employment, working for businesses owned by the husband and his family, due to the acrimony between the parties and the ongoing litigation.
In Part N of her Financial Statement filed 17 October 2017 the wife deposes to having weekly expenses totalling $4,071, $1,575 for the children and $1,260 for herself. The remaining $1,236 is not attributed to either herself or the children specifically.
In defence of her stated expenses the wife submits that prior to separation the parties enjoyed an expensive lifestyle that included both a housekeeper and a nanny being employed by the family, first class and business class travel and holidays and the children attending elite private schools.
The husband argues that the parties’ lifestyle was not as lavish as the wife contends. Regardless of the specific standard of living enjoyed by the parties prior to separation, the Full Court in In the Marriage ofBevan[2] stated that a court is not bound by a principle that an applicant is entitled to the same standard of living as was enjoyed prior to separation whenever the respondent is able to pay.
[2] (1995) FLC 92-600; (1993) 19 Fam LR 35.
It is the husband’s contention that the wife has no urgent need for financial assistance that is not already being met by him.
In his affidavit filed 8 November 2017 the husband deposes to currently paying the mortgage and utility bills for the former matrimonial home, in which the wife currently resides and meeting all expenses associated with the children’s schooling.
In his Financial Statement filed 9 November 2017 the husband deposes to paying $715 per week to the wife in spousal maintenance and suggests that the wife has access to a credit card linked to their accounts. The wife does not acknowledge that the husband provides her with any maintenance in her Financial Statement and it is unclear whether the payments made by the husband to the wife on a regular basis in recent months comprise formal maintenance payments. Regardless of the nature of the payments, in making them the husband must be taken to acknowledge that the wife is not currently able to support herself.
For the foregoing reasons it is clear in my view that the wife does not, at this time, have the capacity to support herself and is in immediate need of financial assistance.
The husband’s capacity to pay
Even after the wife has established an inability to support herself adequately the husband’s liability to pay also depends upon being “reasonably able” to pay.
The husband’s capacity to pay is considered on income, property, financial resources and earning capacity. Capacity to pay is assessed by determining the respondent’s “surplus” after paying his necessary commitments.
In Curnow and Curnow[3] Ellis J said:
In my judgment, a party is only liable to maintain the other party to the extent that the first-mentioned party is reasonably able to do so. In determining whether a party is reasonably able to support or contribute to the support of another party, one should have regard to the income of the first-mentioned party and then the unavoidable, non-discretionary expenses of that party, including his or her reasonable living expenses. After that exercise, one can consider the amount, if any, from which the first party may be able to contribute to the maintenance of the other party.
[3] Unreported, Family Court of Australia, Full Court, 28 April 1997.
In his Financial Statement the husband deposes to earning $7,280 per week which comprises his salary of $3,000, $720 rent from the parties’ tenanted property in Suburb H and $3,500 income from his business. He further deposes to living with his parents, brother and sister who earn a total of $8,400 per week.
The husband deposes to his weekly expenses totalling $10,510 per week although his expenses detailed in his Financial Statement total substantially less than this amount.
The husband is currently working in his own business. While there have been short periods during which the husband did not work for various reasons, there is no dispute that the husband has been employed for the majority of the parties’ marriage and is unlikely to cease working in the near future.
The husband currently pays the wife $715 in spousal maintenance per week, although this appears to be an informal arrangement unilaterally made by him.
The husband, in his Response filed 9 November 2017, seeks an order on an interim basis that he pay the wife $715 per week in spousal maintenance. In seeking such an order the husband must be taken to acknowledge that he has the capacity to pay spousal maintenance.
Appropriate orders in the circumstances
Some of the expenses deposed to by the wife in Part N of her Financial Statement are quite extraordinary such as $500 per week in housekeeping and child minding expenses in circumstances where the wife is not working and has the care of one, now school aged child. The wife also deposes to spending $300 per week in entertainment costs and $300 per week for holidays for herself and spending another $760 per week for entertainment and holidays for the children. She further deposes to spending $180 per week on hairdressing and toiletries and $175 per week on clothing and shoes.
It is submitted on behalf of the husband that if the wife’s clothing, entertainment and holiday expenses are each taken to be $100 per week (instead of $175, $300 and $300 respectively) then the wife’s expenditure for herself alone each week is not much more than $715, which the husband is already paying her in maintenance.
Taking the wife’s stated financial needs at their highest, $1,260 per week, the husband’s current maintenance payments to the wife cover more than half her weekly expenses. As stated previously in these Reasons I am of the view that the wife’s stated expenditure is excessive and it is not reasonable for the wife to be maintained to the same standard as she was prior to separation. Additionally, the husband is paying the mortgage on the property in which the mother lives, the mother only has one of the parties’ children in her care and the husband is paying the education expenses for both children.
Given these circumstances, in my view the wife is not in immediate need of financial assistance beyond the financial support currently being provided by the husband.
It is appropriate that the husband continue to pay the mortgage for the former matrimonial home, the education expenses for the children and $715 per week in spousal maintenance.
In order to formalise this arrangement, to ensure the wife’s financial needs are met, orders will be made as set out at the forefront of this Judgment.
I certify that the preceding fifty-five (55) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Hannam delivered on 21 December 2017.
Legal Associate:
Date: 21 December 2017
Key Legal Topics
Areas of Law
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Family Law
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Equity & Trusts
Legal Concepts
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Remedies
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Injunction
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Fiduciary Duty
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