Beaumont and Gardner and Anor (No.2)
[2015] FCCA 3274
•11 December 2015
FEDERAL CIRCUIT COURT OF AUSTRALIA
| BEAUMONT & GARDNER & ANOR (No.2) | [2015] FCCA 3274 |
| Catchwords: PRACTICE AND PROCEDURE – Application to substitute legal personal representative as a party in place of deceased respondent. PRACTICE AND PROCEDURE – Transfer to Family Court – complexity of subject matter – likely length of final hearing – consideration of matters in Federal Circuit Court of Australia Act 1999 (Cth), s.39 – consideration of Rule 8.02. |
| Legislation: Family Law Act 1975 (Cth), ss.90SF, 90SG, 90SM, 90SS, 114 Federal Circuit Court of Australia Act 1999 (Cth), s.39 |
| Cases cited: Beaumont & Gardner [2013] FCCA 2282 Beaumont & Gardner & Anor [2015] FCCA 3201 Brown & Murdoch (No.3) [2014] FamCA 1005 Gee & Luxford [2015] FCCA 3217 Stanford v Stanford [2012] HCA 52; (2012) 47 Fam LR 481; FLC 93-518 |
| Applicant: | MS BEAUMONT |
| First Respondent: | MR C GARDNER |
| Second Respondent: | (OMITTED) PTY LTD |
| File Number: | SYC 5026 of 2013 |
| Judgment of: | Judge Scarlett |
| Hearing date: | 4 December 2015 |
| Date of Last Submission: | 4 December 2015 |
| Delivered at: | Sydney |
| Delivered on: | 11 December 2015 |
REPRESENTATION
| Counsel for the Applicant: | Mr Hodgson (direct brief) |
| Counsel for the First Respondent: | Ms Messner |
| Solicitors for the First Respondent: | Moylan Family Lawyers |
| Solicitor for the Second Respondent: | Mr Forster |
| Solicitors for the Second Respondent: | Forsters Solicitors |
ORDERS
UNTIL FURTHER ORDER
Mr C Gardner as the Legal Personal Representative of the late Mr M Gardner is substituted as a party under the provisions of subsection 90SM(8) of the Family Law Act 1975 with effect from 26 November 2015.
(omitted) Pty Ltd is joined as a party to the proceedings as the Second Respondent with effect from 26 November 2015.
The Applicant is to vacate from the property located at Property C, NSW no later than Saturday 30 January 2016 upon payment to her of the sum of $18,000.00 by way of interim property settlement.
The First Respondent is to pay to the Applicant the sum of $18,000.00 referred to in the immediately preceding Order immediately upon her vacating the said property referred to in the immediately preceding Order.
The First Respondent is restrained by injunction from selling, transferring or otherwise disposing of artwork by (omitted) and (omitted) formerly held in the property at Property T in the State of New South Wales.
The Application is transferred to the Family Court of Australia at the Court’s Sydney Registry under the provisions of section 39 of the Federal Circuit Court of Australia Act 1999.
All other interim Applications are dismissed.
IT IS NOTED that publication of this judgment under the pseudonym Beaumont & Gardner & Anor (No.2) is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT SYDNEY |
SYC 5026 of 2013
| MS BEAUMONT |
Applicant
And
| MR C GARDNER |
First Respondent
| (OMITTED) PTY LTD |
Second Respondent
REASONS FOR JUDGMENT
Applications in a Case
There are three Applications in a Case before the Court. I have mentioned these Applications in an earlier decision made ex tempore on 26th November 2015, when I made some procedural Orders and indicated that I was minded to transfer the substantive proceedings to the Family Court (Beaumont & Gardner & Anor[1]). I set out in that decision at paragraphs [12] to [17] why I had formed that opinion and my views have not changed. However, I indicated at paragraphs [18] and [19] that there were some interim matters which need to be decided as a matter of some urgency. My own inquiries revealed that the Family Court would not be in a position to undertake a hearing of the interim applications before 25th February next, which, I am told, would be too late.
[1] [2015] FCCA 3201
The Applications
The first Application in a Case was filed by the Applicant in the substantive proceedings, Ms Beaumont. In her Application, the Applicant first of all sought an order that Mr C Gardner, the executor of the will of the late Mr M Gardner, the original Respondent, should be included as a party to the proceedings. Counsel for the Respondent, Ms Messner, submitted that the correct form of the order should be:
Mr C Gardner as the Legal Personal Representative of the late Mr M Gardner is substituted as a party under the provisions of subsection 90SM(8) of the Family Law Act 1975.
I believe that submission to be correct and indicated that I would make an order in that form. As the Order has not yet been taken out, I propose to make that Order immediately with effect from 26th November 2015.
The Application in a Case contained seven other proposed orders, but Counsel for the Applicant, Mr Hodgson, told the Court that he was moving on proposed orders 2, 3 and 4 only. Those proposed orders state:
2. That pending further order that[2] Mr C Gardner in his capacity as a director of (omitted) Pty Ltd be restrained as follows:
(a)from appointing any further director or directors of (omitted) Pty Ltd;
(b)from doing any act or thing or causing (omitted) Pty Ltd to take any steps or action to interfere with the Applicant’s occupation, possession or quiet enjoyment of the property situated at Property C.
3. That pending further order that Mr C Gardner in his capacity as the Executor of the Estate of the late Mr M Gardner be restrained from selling, disposing of, distributing, encumbering or in any way dealing with the property of such Estate without first giving the Applicant twenty-eight (28) days notice of any intention to do so prior to effecting such intention.
4. That within seven (7) days, Mr C Gardner in his capacity as the Executor of the Estate of the late Mr M Gardner cause a lump sum of $50,000.00 to be paid to the Applicant, the categorisation of such payment to be determined by the Trial Judge at the final hearing of these proceedings.
[2] sic
The Application is supported by an affidavit sworn (or affirmed) on 19th November 2015 and a Financial Statement.
The second Application in a Case was filed on 25th November 2015 by (omitted) Pty Ltd, which company is the sole trustee of the (omitted) Pty Ltd Superannuation Fund. That Application is supported by:
a)An affidavit of Mr C Gardner affirmed 24th November 2015; and
b)An affidavit of Mr T affirmed 24th November 2015.
The Application in a Case seeks the following orders:
1. That (omitted) Pty Ltd intervene in the proceedings.
2. An order that the applicant vacate from the property located at Property C, NSW no later than 2 January 2016;
3. That the applicant pay the company’s costs.
Neither the Applicant nor the Respondent opposed the application for (omitted) Pty Ltd to intervene in the proceedings. I indicated that I would make the order and join (omitted) Pty Ltd the Second Respondent. As the Order has not yet been taken out, I propose to make that Order immediately with effect from 26th November 2015.
Mr Forster, solicitor, who appeared for (omitted) Pty Ltd, told the Court that he sought to amend proposed order 2 so as to read:
An order that the applicant vacate from the property located at Property C, NSW no later than 2 January 2016.
The third Application in a Case was filed by the Estate of the First Respondent on 26th November 2015, supported by an affidavit of Paddy James Moylan, solicitor, sworn or affirmed on 26th November 2015.
This Application seeks an order:
That these proceedings (file number SYC 5026 of 2013) be transferred to the Family Court of Australia.
I have previously stated that I considered that the proceedings should be transferred to the Family Court once these interim issues had been decided, and I adhere to that view.
Background
The Applicant commenced these proceedings by means of an Initiating Application filed on 29th August 2013. In that Application, the Applicant sought final orders that:
a)The Respondent should transfer to her the property at Property C, New South Wales, the title to which was held by (omitted) Pty Ltd;
b)The Respondent should pay to her the sum of $1,000.00 per week as maintenance;
c)The Respondent should make available to her a number of items of personalty in a list from (a) to (ee), including artworks by (omitted) and (omitted).
The Applicant also sought interim orders that:
a)The Respondent should be restrained from selling, disposing, encumbering or otherwise dealing with his interest in the property at Property T;
b)The Respondent as director of (omitted) Pty Ltd should be restrained from selling, disposing, encumbering or otherwise dealing with the property at Property C;
c)The Applicant be granted exclusive occupation of Property C;
d)The Respondent be restrained from entering upon the property at Property C;
e)The Respondent pay by way of interim maintenance to the Applicant the sum of $1,000.00 per week;
f)The Respondent pay by way of urgent maintenance under s.90SG of the Family Law Act a lump sum of $50,000.00; and
g)The Respondent be restrained from molesting, harassing, intimidating or in any way interfering with the Applicant.
The Respondent filed a Response on 30th October 2013, seeking final orders that the parties should retain sole legal and beneficial ownership of all items of property currently in their possession or control.
The Response also sought interim orders that:
a)The Applicant should vacate the property at Property C, procure the removal of her daughter, Ms E, from the property and give vacant possession within seven days;
b)The Respondent as director of (omitted) Pty Ltd would do all things necessary to sell the Property C property by public auction; and
c)The net proceeds of sale would be applied as to the sum of $100,000.00 to the Respondent by way of partial property settlement; and
d)The balance would be held in an interest bearing account operated by the Respondent’s solicitors.
On 2nd December 2013 an interim hearing took place and on 17th December I handed down a decision (Beaumont & Gardner[3]), making the following Orders until further order:
[3] [2013] FCCA 2282
(1)The Respondent, his servants, agents or otherwise howsoever pending the final determination of these proceedings or further Order is restrained from interfering with the Applicant’s continued exclusive occupancy of the property situate and known as Property C in the State of New South Wales.
(2)The Respondent, his servants, agents or otherwise howsoever pending the final determination of these proceedings or further Order is restrained from doing any act or thing or causing any act or thing to be done which has the purpose or effect of transferring, assigning, mortgaging, encumbering, charging or otherwise dealing with his interest in the said property at Property C.
(3)The Respondent pending final determination of these proceedings or further Order is to pay the following outgoings in relation to the said property at Property C as and when they fall due:
(a) Mortgage payments if any;
(b) Council rates;
(c) Insurances;
(d) Body corporate levies;
(e) Water rates; and
(f) Electricity and gas charges.
(4)The Respondent, his servants or agents is and are restrained from entering upon the property at Property C without the express invitation of the Applicant.
(5)The Respondent is to pay to the Applicant by way of urgent maintenance under the provisions of section 90SG of the Family Law Act 1975 the sum of $12,500.00 within seven (7) days of the date of this Order.
(6)The Respondent is to pay to the Applicant by way of interim maintenance under the provisions of section 90SE of the Family Law Act 1975 the sum of $500.00 per week payable fortnightly in advance, the first payment to be made within seven (7) days of the date of this Order.
(7) All other interim applications are dismissed.
The parties attended a Conciliation Conference with a Registrar on 13th January 2014 but the matter did not settle.
The final hearing commenced on 5th August 2015. It was originally listed for three days, but was adjourned part-heard on the afternoon of the second day whilst the Applicant was still in cross-examination. It became clear that she was in no fit state to continue to give evidence. She attended a doctor that evening and a medical certificate was produced the following morning.
The proceedings were adjourned to continue on 4th, 26th and 27th November 2015.
Unfortunately, the Respondent died on 23rd September 2015.
Evidence and Submissions
The Applicant relied on her affidavit of 19th November 2015.
In her affidavit, the applicant deposed that:
a)She no longer receives interim maintenance payments in the sum of $500.00 per week under the Order made on 17th December 2013 as a consequence of the death of the Respondent;
b)The last payment she received was an amount of $2,166.66 on 15th September 2015;
c)She became aware that the contents of the property at Property T in which the Respondent resided had been removed;
d)On or around 3rd November 2015 a document entitled “Notice of Cessation of Licence” signed by Mr Forster, the solicitor for (omitted) Pty Ltd, was left at her front door;
e)The document required her to vacate the premises within 28 days;
f)On 4th November 2015 Probate was granted to Mr C Gardner, the Respondent’s brother, in respect of the Respondent’s will;
g)The Applicant is concerned that Mr C Gardner will take steps to interfere with her occupation of the property at Property C and exclude her from living there;
h)The Applicant stated that she has nowhere else to live and is not in a financial position to be able to afford to rent alternative accommodation;
i)The Applicant has not been in outside employment for some ten years;
j)The Applicant is 56 years of age and does not have the capacity for gainful employment as a consequence of her lack of qualifications, absence from the workforce and health issues;
k)Her only source of income is her Newstart Allowance of $495.70 per fortnight;
l)She has a number of liabilities;
m)Since the hearing was adjourned on 6th August 2015 the Applicant has been consulting Dr I, a psychiatrist, on a fortnightly basis;
n)A report from Dr I dated 18th November 2015 is annexed to the Applicant’s affidavit;
o)In his report Dr I expresses the opinion that the Applicant “has developed symptoms of a major depressive disorder with anxious distress within the context of the relationship breakdown leading to significant financial and interpersonal stress, increasing isolation and uncertainty about the future”;
p)She is also attending upon a psychologist, Dr R.[4]
[4] Affidavit of Ms Beaumont 19.11.2015 at [3]-[18]
(omitted) Pty Ltd relied on the following affidavits:
a)The affidavit of Mr C Gardner affirmed 24th November 2015;and
b)The affidavit of Mr T affirmed 24th November 2015.
Mr C Gardner deposed that:
a)He is the executor of the Respondent’s will to whom Probate was granted on 3rd November 2015;
b)He became the sole director of (omitted) Pty Ltd on 4th November 2015, which company is the sole trustee of the (omitted) Pty Ltd Superannuation Fund and is the registered proprietor of the unit at Property C, which is the only asset of the fund;
c)The fund currently owes the Australian Taxation Office the sum of $31,804.00 with interest accruing on a daily basis at the default rate of 9.14% for the December quarter;
d)Mr Gardner is concerned that the fund may be a non-complying fund, basing that opinion on the expert report of Mr N, of (omitted), Forensic Accountants, dated 27th July 2015;
e)Mr N expressed the view that:
Ms Beaumont residing in the Property C property on a rent free basis breaches a number of sections of the SIS[5] Act including:
i. It does not meet the sole purpose test of providing retirement benefits to members (section 62 of SIS Act).
ii. Must not be lived in by a fund member or any fund members’ related parties (Section 62, 71 and 109 of SIS Act).
iii. Must not be rented by a fund member or any fund members’ related parties (Section 62, 71 and 109 of SIS Act).
f)A consequence of the above breaches are that the ATO could deem the fund to be a non-complying fund which would have the effect that the fund would have to pay the top marginal tax rate of 47% on the market value of its assets;
g)In order to meet his obligations as the director of the company that is the trustee of the fund, Mr Gardner considers that he has no other obligation than causing the fund to comply with its legal obligations, which requires him to cause the Applicant to be evicted from the unit; and
h)He also has an obligation to wind up the fund within 6 months of the date of the Respondent’s death, and for this to occur the property will have to be sold, which cannot be done whilst it is occupied by the Applicant.[6]
[5] Superannuation Industry (Supervision) Act 1993 (Cth)
[6] Affidavit of Mr C Gardner 24.11.2015 at [1]-[9]
Mr Gardner was cross-examined by Mr Hodgson of Counsel for the Applicant.
In his affidavit of 24th November 2015 Mr T deposed that he is a Certified Public Accountant and the accountant for (omitted) Pty Ltd. The fund currently owes the ATO the amount of $31,804.00 with interest and there are no assets in the fund to pay the outstanding tax.
Mr T deposed that:
8.Due to the breaches that the fund has with the SIS Act, it is not able to be certified by an auditor as complying with the Act. This is the reason why the fund came under the notice of the ATO…
9.Upon the death of the fund’s sole member, the trustee has the obligation to wind-up the fund and make a distribution of the benefits within 6 months. If the trustee fails to do this, the trustee and/or its director may also be subject to penalties pursuant to the SIS Act and its Regulations.
10.The longer it takes for the fund to remedy its breaches of the SIS Act the more likely it is that it will be assessed by the ATO as a non-compliant fund. It is therefore in the best interest of the fund for Ms Beaumont to vacate from the unit and that the unit be sold as soon as possible.[7]
[7] Affidavit of Mr T 24.11.2015 at [8]-[10]
The Respondent’s Estate relied on the affidavit of Paddy James Moylan, solicitor, of 26th November 2015, in which he expressed the view that the further hearing of the substantive Application will require at least five days of hearing time. I have already canvassed the matters raised by Mr Moylan in his affidavit in the earlier decision at [4]-[14].
The Estate also relied on the affidavits of:
a)Mr C Gardner sworn 2nd December 2015;
b)Mr N affirmed 29th July 2015; and
c)Mr T affirmed 24th November 2015.
In his affidavit of 2nd December, Mr Gardner referred to his obligation under Regulation 6.21 of the Superannuation Industry (Supervision) Regulations 1994 (Cth) that says at (1):
Subject to subregulation (3), a member’s benefits in a regulated superannuation fund must be cashed as soon as practicable after the member dies.
Mr Gardner deposed that the applicant has been on notice since 17th December 2013 that her stay in the Property C unit was only to be a temporary one, noting that this Court had made statements to that effect at paragraphs [30] and [31] of the decision handed down on that day. He also deposed that he will not be considering any distributions to beneficiaries from the Estate until after the (omitted) Superannuation Fund has been cashed out and the funds available to the Estate:
My reason for this is that I will not be able to have any clarity as to the net value of the Estate until this has occurred.[8]
[8] Affidavit of Mr C Gardner 2.12.2015 at [35]
Mr Hodgson submitted for the Applicant that the Australian Taxation Office has carried out an audit and gave a positive result in October 2014. The only evidence to the contrary comes, belatedly, from the accountant, Mr T. He queried whether the Applicant actually fell within the definition of a “related party” in s. 10 of the Superannuation Industry (Supervision) Act 1993 (Cth), as she is not a relative but an ex de facto partner.
It was submitted that the position has changed now that the Respondent has died and the Applicant’s claim has gone up. She should continue to reside in the property until the matter is resolved on a final basis. He stressed the fact that the Applicant is under the care of a psychiatrist and has been diagnosed with a major depressive disorder. She is on a Newstart allowance of $275.00 per week and is unable to support herself adequately. She is borrowing $200.00 per week from her brother to meet her expenses.
Mr Hodgson attacked the amount of $15,000.00 offered by the Respondents to the applicant upon her vacation of the premises as “a laughable sum” which would only last the Applicant about 30 weeks. His submission was that the Applicant should remain in the property and be paid an amount on a weekly or monthly or other periodic basis.
For the Estate of the Respondent, Ms Messner of Counsel submitted that the substitution of Mr C Gardner for Mr M Gardner as a party to the proceedings under s. 90SM(8) of the Family Law Act 1975 enables the property settlement proceedings to be continued but it does not enable the continuation of any other proceedings such as spousal maintenance.
It was submitted that the Applicant’s continued occupation of the property is creating serious problems for (omitted) Pty Ltd because her occupation is preventing the company from selling the property to address the issues of compliance with the Superannuation Industry (Supervision) Act 1993 and the Superannuation Industry (Supervision) Regulations 1994 (Cth) as well as payment of debts owing to the Australian Taxation Office.
Ms Messner referred the Court to the decision of the Family Court in Brown & Murdoch (No.3)[9] where Cronin J held that the wife in that case could not seek an order that the executors of the will of her late husband transfer to her three personalized number plates, as those items were the property of the husband’s superannuation fund.
[9] [2014] FamCA 1005
It was submitted that the Applicant has at no stage sought a superannuation splitting order and she has never been a member of the Respondent’s self-managed superannuation fund. Whilst she seeks a final order that the Property C property should be transferred to her, the property represents more than 60% of the value of the assets which is more than the applicant can reasonably be expected to receive at a final hearing, even allowing for a significant s.90SF(3) adjustment in her favour.
Ms Messner submitted that any argument that an injunction is necessary to preserve the property that the Applicant seeks to acquire when the acquisition is not within the range of possible orders is misconceived, particularly when balanced against the serious penalties and potential loss and dissipation of assets available for division. The Applicant’s continued occupation of the Property C property is an impediment that is restraining the Respondent executor from properly discharging his legal obligation to the Estate.
Further, Mr C Gardner has stated in his affidavit of 2nd December 2015 that he will not make any distribution to the beneficiaries without giving 28 days’ notice to the Applicant.
Ms Messner further submitted that the Respondent consented on a pragmatic basis to pay the Applicant the sum of $15,00.00 by way of interim property order and that there was no other category in which to place the payment. There is no power for the Court to make an order for spousal maintenance.
The Court was referred to the decision of the High Court in Stanford v Stanford[10] in support of the proposition that the Applicant’s claim requires a final hearing and that at an interim level the Court is not in a position to make the necessary findings under section 90SM(8)(b).
[10] [2012] HCA 52; (2012) 47 Fam LR 481; FLC 93-518
The Applicant seeks certain items of personalty from the Property T property and it was put to the Court that Mr C Gardner undertook not to dispose of the (omitted) artwork and the (omitted) artwork pending the finalisation of the property proceedings. Upon inquiry from the Bench, Ms Messner obtained instructions to consent to an injunction to that effect.
For (omitted) Pty Ltd, Mr Forster submitted that Order 2 sought by the Applicant should be directed to (omitted) Pty Ltd and not to Mr C Gardner personally. He submitted that there had been a massive change in the proceedings that goes right to the heart of this proceeding.
Mr Forster referred the Court to the requirement under reg. 6.21 of the Superannuation Industry (Supervision) Regulations 1994 to cash the member’s benefits as soon as practicable after the member dies. There is also a need to pay the amount of $31,8104.00 to the Australian Taxation Office as soon as possible. The Estate itself should be administered within 12 months.
It was submitted that the Applicant’s status with respect to the Property C unit was as an expired licensee, because there had been an order of the Court permitting her to stay there. It was submitted that a month’s notice to vacate was considered reasonable but it was extended to take the time past Christmas. It was conceded that it is open to the Court to consider a longer period.
Finally, Mr Forster addressed the question of the proposed payment to the Applicant of a sum of $15,000.00. He agreed that an order should be made that the Executor should pay that amount as (omitted) Pty Ltd does not have the funds to do so.
The Future Progress of the Matter
It is quite clear that the future progress of the substantive Application should be in the Family Court. Mr Hodgson submitted that it was an unusual step to transfer a part heard matter, but in my view the situation has changed substantially as a result of the death of the Respondent, Mr Gardner. The case has become more complex, in my view.
The fact is that the proceedings had not progressed very far, as the Applicant was still in cross-examination on the afternoon of the second day when the matter had to be adjourned. Even if the Applicant had been in a fit state to continue giving evidence the following morning, the likely outcome would have been that the Respondent’s case would not have started and at least another three days hearing time would have been required.
However, the death of the Respondent has meant that Applications have been made to substitute Mr C Gardner as a party and to join (omitted) Pty Ltd. No fewer than three mentions have taken place as a result of this change, on 4th, 16th and 27th November, and an interim hearing which occupied most of 4th December.
I am still of the view that Mr Moylan’s estimate in his affidavit that another five hearing days will be required is not far off the mark. Consequently, the proper course to take is to abort the hearing in this Court and transfer the final hearing to the Family Court. The parties may wish to rely on the transcript of the proceedings before me on 5th and 6th August.
As it appears likely that the proceedings will take a week to hear, this matter falls within the protocol between the Federal Circuit Court and the Family Court, which requires that more complex matters, particularly those that are likely to take more than four days to hear, should more properly be dealt with by the Family Court.
I have considered the matters set out I s.39(4) of the Federal Circuit Court Act 1999 (Cth), including whether the resources of this court are sufficient to hear and determine the proceeding and the interests of the administration of justice. I have also so considered the matters in Rule 8.02 at sub-rule (4).
It is likely that the proceeding will be heard and determined at less cost and more convenience to the parties than if the proceedings were not transferred.
I commented recently in Gee & Luxford[11] that it is a significant matter that the resources of the Federal Circuit Court, especially in Sydney, are over-stretched at present, with one judicial vacancy in the Sydney Registry that has remained unfilled for over ten months now. Final hearing dates are extending well into 2017 and the Court does not have the resources to deal with cases that will take more than four days to hear.
[11] [2015] FCCA 3217
I propose to transfer the proceeding to the Sydney Registry of the Family Court of Australia under the provisions of s.39 of the Federal Circuit Court of Australia Act 1999.
The Unit at Property C
The Applicant is currently living in the home unit at Property C, and has been so living since the proceedings commenced. Orders were made on 17th December 2013 that permitted to remain living there until further order. Since that time she has lived there rent-free.
However, the situation has changed. The Respondent has died. The title to the Property C property is in the name of (omitted) Pty Ltd and the company now requires her to vacate the premises so that the unit can be sold.
The unit at Property C is the sole asset in the superannuation fund, and the benefit of the late Mr M Gardner, the only member of the superannuation fund, must, by virtue of reg. 6.21 of the Superannuation Industry (Supervision) Regulations 1994, be cashed up as soon as practicable after the member dies. This cannot happen whilst the Applicant remains in occupation of the unit. In addition, (omitted) Pty Ltd does not have the funds to pay an outstanding tax debt of $31,804.00.
It will not do for this process to be delayed until the final hearing of the Applicant’s property application in the Family Court. That hearing may be a year or more away.
It is also significant that Mr C Gardner, as Executor of the Will of the late Mr M Gardner, will not be able to wind up the estate until the Property C property is sold and the member’s benefit in fund is cashed. The Executor wishes to wind up the estate within twelve months. It has been the law for many years that an Executor should finalise the estate within twelve months from the date of grant of probate. The traditional term was “the executor’s year”.
Again, Mr Gardner’s task will be stymied by the Applicant’s continual occupation of the Property C property.
It is hardly likely that the Applicant could expect to retain the Property C as a result of the final hearing of her property Application. The Property C property constitutes approximately 60% of the asset pool and it is submitted on behalf of the Respondents that whatever claim the Applicant may have will be unlikely to come anywhere near that percentage. As Ms Messner of Counsel submitted:
The de facto relationship was one of only 7 years, and there are no children of the relationship.[12]
[12] Submissions page 7
The requirement that the Applicant should vacate the property so that it may be sold can hardly be unexpected. The Applicant has been on notice of the likelihood of this eventuality for almost the last two years. As I held in the 2013 decision:
It would appear that the Applicant will be unable to live in the property permanently, as her substantive property claim would be unlikely to result in her receiving the property or its equivalent in value, even on the most generous of calculations. However, the parties are to attend a conciliation conference on 13 January 2014, and it would cause the Applicant hardship to have to relocate before the conference, when the parties would hopefully enter into sensible negotiations to resolve the financial issues between them.[13]
[13] [2013] FCCA 2282 at [30]
Those words should have made it clear that the orders permitting the Applicant to remain in the property for the time being were essentially of a temporary nature. Regrettably, the parties were unable to resolve the financial issues between them at the conciliation conference.
Even though I commented at paragraph [31] of the decision that the late Mr Gardner had been aware since 26th October 2012 that the occupation of the property by the Applicant’s daughter was in contravention of the Superannuation Industry (Supervision) Act 1993, I went on to warn the Applicant that:
She needs to be aware that she will not be able to reside in the unit definitely, as it may well need to be sold.[14]
[14] [2013] FCCA 2282 at [31]
As it is, the Applicant has remained in occupation of the property free of rent or other charges for a considerably longer time than was originally contemplated. However, matters have been brought to a head by the untimely death of the late Mr Gardner, and the Applicant must now take steps to vacate the premises.
I am not satisfied that it is appropriate to require the Applicant to vacate the property on 2nd January, which is less than a month away and the day after New Year’s Day. That requirement may well impose some hardship on the Applicant. She will need to make arrangements for other accommodation, which may not be available at such short notice. I propose to allow the Applicant another four weeks after that date, so that she will be required to vacate the premises by Saturday 30th January 2016.
Interim Property Settlement
The Respondents propose that the Applicant should receive a lump sum of $15,000.00 by way of an interim property settlement upon her vacating the premises. Mr Hodgson of Counsel has dismissed that amount as “laughable”, as it would only last the Applicant about 30 weeks, presumably if she were to spend that amount at the rate of $500.00 per week. His client seeks the amount of $50,000.00.
The sum that is offered is not intended to be by way of spousal maintenance. There is no jurisdiction to make an order for spousal maintenance. It is intended as an interim property order. It cannot be anything else.
In my view, the sum of $50,000.00 sought by the Applicant is not justified. I note that she sought that amount by way of urgent lump sum maintenance in 2013, although this cannot be a maintenance payment of any sort.
It would appear that the Applicant will have to pay removal expenses and quite possibly enter into a bond to secure rental accommodation. She will also have legal expenses to meet as a result of these proceedings.
I consider that the amount of $18,000.00 would be an appropriate figure to be paid to the Applicant by way of interim property settlement upon her vacation of the Property C property. I am satisfied that in all the circumstances it is just and equitable to order the Executor to pay the sum of $18,000.00 to the Applicant by way of interim property settlement.
Artworks
The Applicant has made a claim for two artworks by (omitted) and (omitted). I propose to make an injunctive Order until further Order restraining the Executor from disposing of those artworks until the proceedings are finalised.
I certify that the preceding seventy-five (75) paragraphs are a true copy of the reasons for judgment of Judge Scarlett
Associate:
Date: 11 December 2015
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