ARMINGTON & ARMINGTON - [2019] FCCA 1233

FEDERAL CIRCUIT COURT OF AUSTRALIA

ARMINGTON & ARMINGTON

[2019] FCCA 1233

Catchwords:
FAMILY LAW – Application for entities to be joined to proceedings – application granted – entities restrained from operating otherwise than in the ordinary course of business.

FAMILY LAW – Interim contested property proceedings – Spousal Maintenance – weight given to s.75(2) factors – Wife has not been in employment since separation – Wife seeks to maintain lifestyle with allowance significantly above that of child support assessment –Husband argued lack of financial capacity to pay – spousal maintenance granted on six month basis while Wife finds employment.

Legislation:

Corporations Act 2001 (Cth), ss.440D, 471B

Evidence Act 1995 (Cth), s.140
Family Law Act 1975 (Cth), ss.72, 74, 75, 78, 79, 80, 106B, 114

Federal Circuit Court Rules 2001 (Cth), rr.9.04, 11.01)(1), 11.02(2), 15.08(2)(a), 15.09, 15.12
Federal Circuit Court of Australia Act 1999 (Cth), ss.3, 42

Cases cited:

American Cynamid (No.1) v Ethicon Ltd [1975] AC 396; [1975] All ER 504
Australian Broadcasting Corp v O’Neill (2006) 227 CLR 57
Bevan & Bevan (1995) FLC 92-600
Blueseas Investments Pty Ltd v Mitchell and McGillivray (1999) FLC 92-856
Janko & Janko (No.2) [2018] FamCA 353
Jones v Dunkel (1959) 101 CLR 298
Yunghanns & Yunghanns (1999) FLC 92-836

Applicant:

MS ARMINGTON

Respondent:

MR ARMINGTON

File Number:

MLC 1627 of 2016

Judgment of:

Her Honour Judge C. E. Kirton QC

Hearing dates:

4, 5, 6 March 2019

Date of Last Submission:

6 March 2019

Delivered at:

Melbourne

Delivered on:

13 May 2019

REPRESENTATION

Counsel for the Applicant:

Mr Werner

Solicitors for the Applicant:

Taussig Cherrie Fildes

Counsel for the Respondent:

Mr Robinson

Solicitors for the Respondent:

Self-represented

Counsel for Proposed Respondents:

Mr Snyder

ORDERS

Pursuant to r.11.02(2) of the Federal Circuit Court Rules 2001 (Cth) the following be joined as Respondents to this proceeding:
(a)Company A (ACN …), as Second Respondent;
(b)COMPANY B (Pty Ltd (ACN …), as Third Respondent;
(c)Company C Pty Ltd (ACN …) in its own capacity and as trustee for the Armington Family Trust, as Fourth Respondent.
Until further order, and subject to sub-paragraph (2)(d) of this order, each of:
(a)The Husband;
(b)The Second Respondent; and
(c)The Third Respondent;
are hereby restrained by themselves, their servants and/or agents from:
(i)Transferring, disposing, alienating or encumbering or dealing with in any manner whatsoever any interest or shareholding they have in any corporate interest or trust, without the Wife’s prior written consent;
(ii)Transferring any share standing in their name or in the name of any partnership, trust or company over which they have control;
(iii)Dealing with, transferring, disposing, alienating or encumbering any matrimonial assets of whatsoever nature;
(iv)Amending and/or altering the terms of any trust deed;
(v)Exercising any power of appointment or any other power under any deed of trust;
(vi)Acting in any way to diminish the value of the matrimonial assets; and
(vii)Doing any act or thing which may affect the Husband’s interest and/or shareholding, held directly or indirectly including but not limited to the following companies:
A.AACN ……

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading ARMINGTON & ARMINGTON

Details

AGLC: Armington and Armington [2019] FCCA 1233
Case: [2019] FCCA 1233
Decision Date: 13 May 2019

CaseChat Overview and Summary

In the Federal Circuit Court of Australia, Her Honour Judge C. E. Kirton QC heard an application by the Wife seeking to join several entities to the proceedings and for interim spousal maintenance. The Husband contested the financial capacity to pay the requested spousal maintenance. The Wife sought to maintain a lifestyle significantly above the assessed child support amount, having not been employed since the parties' separation.

The court was required to determine whether to grant the application to join Company A, Company B, and Company C (in its own capacity and as trustee for the Armington Family Trust) as respondents to the proceedings. Additionally, the court had to consider the Wife's claim for interim spousal maintenance, weighing the relevant factors under section 75(2) of the Family Law Act 1975 (Cth) against the Husband's argument of financial incapacity.

Her Honour granted the application to join the entities as respondents and imposed significant interim restraining orders against the Husband and the newly joined respondents. These orders prevented the disposal, alienation, or encumbrance of any interests in corporate or trust assets, or matrimonial assets generally, and restricted actions that could diminish the value of those assets, unless acting in the ordinary course of business with the Wife's written consent. Regarding spousal maintenance, the court found that the Wife had established a need for interim support to enable her to find employment. The court ordered the Husband to pay interim spousal maintenance for a period of six months, along with rent and private health insurance for the Wife, and to cover specific child-related expenses, including private school fees, excursions, uniforms, sports costs, and all medical and dental expenses for the children.

Orders

Orders of the court

Pursuant to r.11.02(2) of the Federal Circuit Court Rules 2001 (Cth) the following be joined as Respondents to this proceeding:

(a) Company A (ACN …), as Second Respondent;

(b) COMPANY B (Pty Ltd (ACN …), as Third Respondent;

Until further order, and subject to sub-paragraph (2)(d) of this order, each of:

(a) The Husband;

(b) The Second Respondent; and

are hereby restrained by themselves, their servants and/or agents from:

(i) Transferring, disposing, alienating or encumbering or dealing with in any manner whatsoever any interest or shareholding they have in any corporate interest or trust, without the Wife’s prior written consent;

(ii) Transferring any share standing in their name or in the name of any partnership, trust or company over which they have control;

(iii) Dealing with, transferring, disposing, alienating or encumbering any matrimonial assets of whatsoever nature;

(iv) Amending and/or altering the terms of any trust deed;

(v) Exercising any power of appointment or any other power under any deed of trust;

(vi) Acting in any way to diminish the value of the matrimonial assets; and

(vii) Doing any act or thing which may affect the Husband’s interest and/or shareholding, held directly or indirectly including but not limited to the following companies:

A. AACN … PTY LTD (formerly Company D Pty Ltd (ACN …);

B. AACN … PTY LTD (formerly Company E Pty Ltd (ACN …);

C. Company F Trust;

D. Company G;

E. Armington Pty Ltd;

F. AACN … Pty Ltd (formerly known as Company H Pty Ltd) t/a Company H;

G. Company J Pty Ltd;

H. Company K Pty Ltd as trustee for the Company F Trust;

I. Armington Pty Ltd as trustee for the Mr Armington Family Trust;

J. Company L Pty Ltd as trustee for the Company L Trust;

K. AACN … PTY LTD (formerly known as Company K Group Pty Ltd);

L. Company K Holdings Pty Ltd;

M. AACN … PTY LTD (formerly Company K Holdings Pty Ltd) (ACN …).

N. Company M Pty Ltd;

O. Company N Pty Ltd;

P. Company O;

Q. Company P Pty Ltd.

(d) Otherwise than in the ordinary course of business and save and except with the written consent of the Wife, with any request for consent to be upon not less than 21 days’ notice in writing to the Wife.

Until further order the Husband pay or cause to be paid:

(a) To the Wife by way of interim spousal maintenance as and from Monday 13 May 2019 and each Monday thereafter for a period of six months:

(i) The sum of $1,219 per week less any amount actually paid each week pursuant to any administrative assessment for child support by the Husband to the Wife (excluding arrears);

(ii) The sum of $1,000 per week in relation to the Wife’s rent, with the payments to commence as and from Monday 13 May and for a period of six months thereafter.

(iii) The Wife’s private health insurance at the current level of cover.

(e) By way of non-periodic child support for each of the children [X], born … 2001 and [Y], born … 2004 (Children):

(i) All costs associated with the Children’s attendance at their current private schools including but not limited to:

a. All tuition, registration and attendance fees together with school levies and contributions to school funds;

b. All costs associated with school excursions, trips and camps;

c. All costs associated with school uniforms, school equipment and other requirements for attending school;

d. All costs associated with sports including sports uniforms, sport shoes, fees, tuition fees and lessons whether organised through the school or externally to the school; and

(ii) One Hundred percent of all medical expenses for the Children including but not limited to:

a. All private health insurance (including extras);

a. All gap expenses not covered by health insurance or Medicare;

b. All out of pocket costs of any dental, optical, orthodontic treatment or allied health professional services for the Children.

(f) All vet costs associated with the Children’s dogs.

All payments to the Wife pursuant to Orders 3 shall be paid by the Husband by direct debit to such bank account as the Wife may nominate from time to time in writing.

The Husband do all such things and sign all such documents as are necessary to have any school accounts placed in his name so that the invoices are forwarded directly to the Husband.

The Husband within seven days of being requested to do so by the Wife, reimburse the Wife any expenses paid by the Wife in relation to Orders 3(b) and (c), which would otherwise be payable by the Husband pursuant to these orders, upon the Wife providing to the Husband a copy of the invoice or proof of payment of the invoice, with such reimbursement to be made by direct debit into the Wife’s nominated bank account.

AND THE COURT NOTES THAT:

A. For the purposes of Order 3, the current assessment of Child Support payable by the Husband to the Wife, dated 1 March 2019 is $629.07 a week.

Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

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