AYRE & AYRE
[2018] FamCAFC 93
•23 May 2018
FAMILY COURT OF AUSTRALIA
| AYRE & AYRE | [2018] FamCAFC 93 |
| FAMILY LAW – APPEAL – PROPERTY – Where the appellant asserts that the trial judge “mixed up” the properties the subject of the property settlement application resulting in the parties each retaining a property they had not sought to keep – Where in the event that the trial judge determined that the parties were to retain specific properties not in accordance with their submissions he should have provided the parties with an opportunity to address him on that proposal – Where that was not done and it therefore adds weight to the argument that the trial judge simply mixed up the properties – Where the respondent argued that the liberty to apply given by the trial judge was the way this difficulty could have been addressed – Where the liberty to apply only permitted the parties to address the machinery provisions of the trial judge’s order and not to seek to have any of the substantive provisions of that order altered – Where the trial judge did not err in finding that the appellant retained cash monies at the time of separation – Where there is merit in three of the grounds of appeal – Appeal allowed – Discretion re-exercised – Distribution of the properties reversed and the amount to be paid to the respondent by the appellant recalculated. FAMILY LAW – COSTS – Where no order for costs was sought by the appellant in the event that the appeal was successful – Where both parties sought costs certificates – Where the appeal is allowed on a question of law and each party is to bear their own costs – Costs certificates granted to the parties. |
| Family Law Act 1975 (Cth) Federal Proceedings (Costs) Act 1981 (Cth) ss 6 and 9 |
| Bennett and Bennett (1991) FLC 92-191 Lenova & Lenova [2011] FamCAFC 114 Ravasini and Ravasini (1983) FLC 91-312 |
| APPELLANT: | Mr Ayre |
| RESPONDENT: | Ms Ayre |
| FILE NUMBER: | LNC | 591 | of | 2016 |
| APPEAL NUMBER: | SOA | 56 | of | 2017 |
| DATE DELIVERED: | 23 May 2018 |
| PLACE DELIVERED: | Adelaide |
| PLACE HEARD: | Adelaide with video to Launceston |
| JUDGMENT OF: | Strickland J |
| HEARING DATE: | 27 February 2018 |
| LOWER COURT JURISDICTION: | Federal Circuit Court of Australia |
| LOWER COURT JUDGMENT DATE: | 11 July 2017 |
| LOWER COURT MNC: | [2017] FCCA 1457 |
REPRESENTATION
| COUNSEL FOR THE APPELLANT: | Mr Tresize |
| SOLICITOR FOR THE APPELLANT: | Dobson Mitchell Allport |
| COUNSEL FOR THE RESPONDENT: | Mr Verney |
| SOLICITOR FOR THE RESPONDENT: | Matthew Verney Lawyers |
Orders
The appeal be allowed.
Paragraph (1)(a) of the order made on 11 July 2017 be varied to provide that within 28 days of the date of these orders the husband pay to the wife a lump sum of $48,619.
Paragraph (1)(b)(i) of the said order be varied to provide that within 28 days of the date of these orders the husband transfer to or vest in the wife all his right, title and interest in the property situate at Property B in Tasmania.
Paragraph (2)(a)(i) of the said order be varied to provide that contemporaneously with the payment required pursuant to paragraph (1)(a) of the order made on 11 July 2017 as varied herein the wife transfer to and/or vest in the husband all her right, title and interest in the property situate at Property A in Tasmania.
Each party bear their own costs.
The appellant husband is granted a costs certificate pursuant to the provisions of s 9 of the Federal Proceedings (Costs) Act 1981 (Cth), being a certificate that, in the opinion of the Court, it would be appropriate for the Attorney-General to authorise a payment under that Act to the appellant husband in respect of the costs incurred by him in relation to the appeal.
The respondent wife is granted a costs certificate pursuant to the provisions of s 6 of the Federal Proceedings (Costs) Act 1981 (Cth), being a certificate that, in the opinion of the Court, it would be appropriate for the Attorney-General to authorise a payment under that Act to the respondent wife in respect of the costs incurred by her in relation to the appeal.
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 Ayre & Ayre 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).
| IN THE APPELLATE JURISDICTION OF THE FAMILY COURT OF AUSTRALIA AT ADELAIDE |
Appeal Number: SOA56 of 2017
File Number: LNC 591 of 2016
| Mr Ayre |
Appellant
And
| Ms Ayre |
Respondent
REASONS FOR JUDGMENT
Introduction
By Notice of Appeal filed on 3 August 2017 Mr Ayre (“the husband”) appeals against orders for property settlement made by Judge McGuire on 11 July 2017. Ms Ayre (“the wife”) opposes the appeal.
Relevantly, his Honour ordered that the husband pay to the wife the sum of $84,241, transfer to the wife his interest in Property A with the wife retaining her superannuation entitlement, and that the wife transfer to the husband her interest in Property B.
The appeal
The primary issue in the appeal was whether in the orders that his Honour made, he mixed up the properties.
At trial the husband sought that he retain Property A, and either the wife retain Property B, or that property be sold. For the wife’s part, she did not want either property, and sought that the husband retain them, or that they be sold.
This primary issue is the subject of grounds of appeal 1.1 and 1.2, and what is described as Ground 4 in the summaries of argument of the parties, but which is in fact Ground 1.5 in the Notice of Appeal.
As to the other grounds of appeal, what is described as Ground 2 in the summaries of argument of the parties, but which is in fact Ground 1.3 in the Notice of Appeal, was abandoned during the hearing of the appeal, and what is described as Ground 3 in the summaries of argument of the parties, but which is in fact Ground 1.4 in the Notice of Appeal, although not abandoned, was not pursued with any vigour. I will say more about that ground later in these reasons.
Grounds of appeal 1.1, 1.2 and 4 (Ground 1.5 in the Notice of Appeal)
Ground 1.1 – the trial Judge erred in making an order for the transfer of the property known as Property A in Tasmania to the [wife] in circumstances where he was told that the [husband] wanted to retain the property and the [wife] did not.
Ground 1.2 – the trial Judge erred in making an order for the transfer of the property known as Property B in Tasmania to the [husband] in circumstances where he was told that neither party wanted that property and both had agreed to sell it.
Ground 4 – The trial Judge erred in failing to provide [sic] or any adequate reasons for paragraphs 1 – 4 above.
In her Amended Initiating Application filed on 19 May 2017, the wife sought orders, inter alia, providing for her to transfer her interest in Property B to the husband, or that it be sold, and for her to transfer her interest in Property A to the husband.
In the husband’s Response filed on 13 February 2017, the husband sought orders to the effect that he have Property B and Property A be sold.
In her case summary document filed on 29 May 2017, the wife sought orders that the husband retain the two properties. In his case summary document filed on 2 June 2017, the husband continued to seek the orders set out in his Response.
At the commencement of the trial before his Honour, the wife confirmed her position as to the properties, and specifically told his Honour that she did not want to retain Property B (Transcript 7.6.17, page 7 lines 21 – 22).
For the husband’s part, by reference to an aide memoir provided to his Honour, he then sought orders that Property B be sold and that he retain Property A. Importantly, that result was not challenged by the wife during the trial, and indeed, was supported by her.
The relevant paragraphs of his Honour’s reasons in relation to this issue are as follows:
44.… I also take into account the value and content of the property pool and note that the husband will be retaining one home whilst the other property is to be sold and hence the wife will need to re-establish herself in accommodation.
45.In all those circumstances, I am of the view that an adjustment to the wife of 7.5% of the property pool is just and equitable noting such a percentage to be only some $57,000 in dollar terms.
46.Consequently, after consideration of the contributions in section 75(2) factors, I am satisfied that the property pool as set out above should be adjusted as to 57.5% to the wife and 42.5% to the husband. I calculate therefore that the wife will have an entitlement of $437,516 and the husband $323,381 in dollar terms.
47.The husband will retain the [Property B] property ($215,000), his [Japanese] motor vehicle ($22,000), cash-at-hand ($80,000), bank account ($13,000), superannuation ($56,000), tools ($5,000) and tractor/containers ($16,600) being a total of $407,000 and I calculate he would therefore make a cash payment to the wife of $84,241.
48.I note that the husband seeks orders for the sale of many of the assets as set out above. The wife does not appear to object or to want to retain those items. I note, however, the husband’s attitude generally to these proceedings and cannot be confident that he will be co-operative in any sale process. As such, I propose to order the transfer of the remaining assets to the wife whereupon she will be free to dispose of them or retain them at her discretion. I will, however, give the parties liberty to apply in respect of these Orders as I have not heard them specifically as to such transfer orders.
Pausing at [44], that is consistent with what the parties were wanting, namely the husband retaining one home and the other being sold. Further, although the properties are not identified there, given the last part of that paragraph, it is plain that the property to be sold was Property B, given that that was where the wife was living.
However, that outcome is not reflected in [47], and with respect to his Honour, why the husband is to retain Property B, and the wife is to have Property A is not explained in [48], or anywhere else in his Honour’s reasons.
It is perhaps understandable that his Honour would be concerned about the husband cooperating in any sale, given his conduct in and around the proceedings, but that does not explain why the husband should not retain Property A. That highlights the claim of a lack of reasons as raised by the husband in Ground 4 (Ground 1.5 in the Notice of Appeal).
Plainly, if his Honour made a deliberate decision that the husband should retain Property B and not Property A, his Honour should have provided the parties with the opportunity to address him on that proposal. His Honour did not do that, and that adds weight to the argument that his Honour simply mixed up the properties.
The wife attempted to argue before this Court that this difficulty was able to be addressed by the husband (or the wife for that matter) taking advantage of the liberty to apply given by his Honour, and referred to in [48], and that that was what his Honour intended.
However, all that liberty to apply could permit was addressing the machinery provisions of his Honour’s order, and could not permit the parties to seek to have any of the substantive provisions of that order altered (Ravasini and Ravasini (1983) FLC 91-312; Lenova & Lenova [2011] FamCAFC 114).
In these circumstances, his Honour plainly erred in ordering that the husband retain Property B, and the wife retain Property A, and thus Grounds 1.1 and 1.2 must succeed. Alternatively, there is an absence of reasons as to why his Honour made the order that he did in relation to the properties, and that too sounds in appealable error (Bennett and Bennett (1991) FLC 92-191).
Ground 3 (Ground 1.4 in the Notice of Appeal)
The trial Judge erred in finding that the [husband] had retained cash of $80,000.00 at the time of the parties’ separation and then including that sum in the pool of assets at the time of the trial as cash against then still in the hands of the [husband].
I have read the written submissions of the husband in relation to this ground, and in the absence of any further oral submissions, I am not persuaded that his Honour erred in finding that the husband retained cash of $80,000 at the time of the parties’ separation. There is no merit in this ground of appeal.
Conclusion
Having found merit in Grounds 1.1 and 1.2, and 4 (Ground 1.5 in the Notice of Appeal), the appeal must be allowed.
Outcome
The options for this Court are to remit the proceedings to the Federal Circuit Court of Australia to be reheard by a judge other than Judge McGuire, or to look to re-exercise the discretion.
This issue was canvassed at the hearing of the appeal.
The husband sought that the latter approach be adopted, and the disposition of the two properties be reversed, with the husband retaining Property A, and the wife retaining Property B, and a consequent adjustment to the amount to be paid by the husband to the wife.
The wife supported that outcome. However, I raised the issue of whether evidence was needed as to the ability of the husband to pay the wife the substituted amount that would be required. If that was necessary then both counsel agreed that that evidence would be controversial given the findings that his Honour made as to the husband’s credit. His Honour found the husband to be a dishonest witness, and indeed, the husband admitted that he had perjured himself in his affidavits, and in his evidence (at [29]).
In the event that that evidence would be controversial, it was agreed that given this Court would not be able to conduct a hearing to determine the accuracy or otherwise of that further evidence, this Court could not re-exercise the discretion if that evidence was sought to be adduced.
However, having reflected on this issue, I do not consider it necessary to receive that further evidence, in order to be able to re-exercise the discretion.
A query as to the husband’s ability to meet the payment to the wife does not necessarily arise because in fact the amount to be paid by the husband will be less than his Honour ordered, given that Property A is valued at less than Property B.
His Honour ordered the husband to pay to the wife the sum of $84,241 within 28 days, and I note that there was no default provision in that order in the event of a failure by the husband to comply with the same. His Honour, correctly in my view, proceeded on the basis that despite his dishonesty in his evidence, the husband had the wherewithal to pay that amount in that time period, given the assets that he would retain. That position does not change if this Court re- exercises the discretion by reversing the distribution of the two properties and reducing the amount to be paid by the husband.
I pause to note that, during the hearing of the appeal, it was mistakenly thought that the outcome proposed would increase the payment to be made by the husband, but in fact with the husband retaining the lesser valued property, the amount to be paid is obviously less.
Importantly, in that respect, neither party sought on a re-exercise of the discretion, to introduce evidence as to any change in the valuation of either of the two properties, or indeed, to provide any evidence of any different figures for any of the other assets.
That is understandable given that if that was sought to be done, then there would be no doubt that the proceedings would have to be remitted for rehearing. The parties have already been through a trial, and it is always preferable, if at all possible when an appeal succeeds, to avoid a new trial given all the consequent expense, inevitable delay, the uncertainty of the ultimate outcome, and generally the burden of conducting more litigation.
Thus, I am persuaded to re-exercise the discretion by reversing the distribution of the two properties and recalculating the amount to be paid to the wife on the basis of the evidence that was before the trial judge.
That recalculation is as follows.
His Honour found that the property pool was valued at $760,897, and on the basis of a 57.5 per cent / 42.5 per cent division in favour of the wife, the wife was entitled to assets valued at $437,516 and the husband $323,381.
With the husband to retain Property A at $180,000 instead of Property B at $215,000, applying the calculations of his Honour in [47], and allowing for that change, the husband will retain assets valued at $372,000 (as opposed to $407,000), and thus the payment to the wife becomes $48,619 instead of $84,241.
The only question arising from this approach is whether the wife should have Property B for her to either retain or sell at her option, or whether that property should be ordered to be sold with the wife receiving the proceeds of sale.
I have determined that the former should be the case for the reasons that his Honour correctly identified in [48], namely, that his Honour could not be confident that the husband would cooperate in any sale process, and thus it is preferable to transfer the husband’s interest in that property to the wife and she can then decide what she wants to do with it.
Costs
In the event that the appeal was successful, no order for costs was sought by the husband, and both parties sought costs certificates.
I consider that that is the appropriate outcome given the appeal is being allowed on a question of law, namely a lack of reasons by the trial judge, and each party is to bear their own costs.
I certify that the preceding forty (40) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Strickland delivered on 23 May 2018.
Associate:
Date: 23 May 2018