BRUNO & ESTRELLA

[2020] FamCA 1080

FAMILY COURT OF AUSTRALIA

BRUNO & ESTRELLA [2020] FamCA 1080

FAMILY LAW – PROPERTY – Application by the wife for interim property settlement – Where the wife has previously benefitted from interim property settlement orders in her favour in 2018 – Where the wife asserts the funds will primarily be utilised on outstanding and future legal fees and mortgage payments or discharge – Where the husband has had the benefit and primary control over parties’ income producing assets post‑separation – Where both parties have failed to transparently disclose all financial circumstances including legal fees but where the wife’s failure is of greater significance – Where for several months the husband has been maintaining outgoing payments relating to the former matrimonial home in which the wife and the parties’ children reside – Where the wife has not made a proper case for interim property settlement – Where justice and equity would best be served by orders for the husband to maintain all outgoings on the former matrimonial home as and when they fall due but no order as to a lump sum payment as sought by the wife.

Family Law Act 1975 (Cth) ss.79, 80(1)(h).

Strahan & Strahan (Interim Property Orders) (2011) FLC 93-466

APPLICANT: Ms Bruno

RESPONDENT: Mr Estrella

FILE NUMBER: ADC 4659 of 2015

DATE DELIVERED: 17 December 2020

PLACE DELIVERED: Adelaide

PLACE HEARD: Adelaide

JUDGMENT OF: Mead J

HEARING DATE: 26 October 2020

REPRESENTATION

COUNSEL FOR THE APPLICANT: Ms Dickson of Counsel

SOLICITOR FOR THE APPLICANT: Belchamber Legal

COUNSEL FOR THE RESPONDENT: Ms Tinning of Counsel

SOLICITOR FOR THE RESPONDENT: Norman Waterhouse Lawyers

Orders

1. That paragraphs 1, 4, 5, 6 and 7 of the wife’s application in a case filed herein on 4 March 2020 be dismissed.

2. That until further order the husband do pay and discharge all mortgage payments as and when they fall due to B Bank on account of the home loan in the joint names of the parties being loan account number …40 as well as any arrears that have accrued in respect thereof, together with all rates, taxes and household insurances arising from time to time in relation to the property at C Street, D Town, South Australia.

3. That the character of the interim order made in paragraph 2 hereof be reserved to trial.

4. That until further order the husband be restrained and an injunction is hereby granted restraining him from disposing of, encumbering or dealing in any way with the properties registered in the sole name of the husband and comprised and described in Certificates of Title Register Book Volume … Folio …, Volume … Folio … and Volume … Folio … SAVE AND EXCEPT with the written consent of the wife or an order of this Court.

5. That the wife do all such things and sign all such documents as shall be necessary to effect a discharge of Registered Caveat Number …43 lodged by the wife over the properties comprised and described in the Certificates of Title referred to in paragraph 4 hereof at the cost of the wife in all things.

6. That costs generally be reserved.

7. That the application in a case filed herein on 4 March 2020 and the response thereto filed 23 March 2020 be otherwise dismissed.

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 Bruno & Estrella 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 ADELAIDE

FILE NUMBER: ADC 4659 of 2015

Ms Bruno

Applicant

And

Mr Estrella

Respondent

REASONS FOR JUDGMENT

Introduction

1. Mr Estrella (hereinafter referred to as “the husband”) and Ms Bruno (hereinafter referred to as “the wife”) have been involved in litigation, firstly in the Federal Circuit Court and currently in the Family Court of Australia, since 2015.

2. On 26 October 2020 the matter was listed for final hearing as an over-listed matter on 28 June 2021 and, in the event the trial is not reached on that occasion, as a primary hearing on 13 September 2021.

3. On that same day the Court heard argument with respect to the wife’s application in a case filed on 4 March 2020 and the husband’s response thereto filed 23 March 2020.

4. In the wife’s application she sought the following orders:

   1)That by way of interim property settlement and on or before March 31 2020 the respondent husband pay to the C Lawyers Trust Account on behalf of the wife the sum of ONE HUNDRED AND FIFTY THOUSAND DOLLARS ($150,000).

   2)By way of interim property settlement and in addition to the payment referred to in paragraph 1 above the husband do cause to be discharged on or before March 31 2020 registered mortgage number …68 secured on the title to the former matrimonial home registered in the joint names of the parties being the whole of the land comprised and described in Certificate of Title Register Book Volume … Folio …

   OR IN THE ALTERNATIVE

   That the respondent husband

   a)On or before March 31 2020 pay to B Bank all arrears accrued in respect of the housing loan in the joint names of the parties being loan account number …40; and

   b)Pending determination of the competing applications for settlement of property pay all mortgage instalments as and when they fall due.

   3)That pending property settlement between the parties the respondent husband do pay the following outgoings in respect of the former matrimonial home:

   a)All rates and taxes;

   b)All household insurances.

   4)That the respondent husband be restrained and an injunction is hereby granted restraining him from warning or attempting to discharge Registered Caveat Number …43 lodged by the wife over Certificates of Title Register Book Volume … Folio …, Volume … Folio … and Volume … Folio … all registered in his sole name.

   5)That the husband forthwith disclose the details of his dealings with Certificate of Title Register Book Volume … Folio … registered in his sole name.

   6)Such further or other order as to the Court may seem fit.

   7)That this matter be heard urgently.

   8)That the respondent husband do pay the costs of the applicant wife of and incidental to this application.

5. In the husband’s response to that application filed on 23 March 2020 he sought the following orders:

   1)That the wife’s Application in a Case filed on 4 March 2020 be dismissed.

   2)That the wife pay the costs of the husband of and incidental to this application.

   3)Such further or other order as the Court may deem fit.

Wife’s evidence

1. The wife filed an affidavit and financial statement in support of her application on 4 March 2020.  In her financial statement she deposed to:

   ·being a hospitality worker/student;

   ·working casually at the E Business;

   ·being self-employed under the business name F Business;

   ·total average weekly income of $846;

   ·total personal expenditure of $1,521;

   ·total of property owned by her of $436,388;

   ·gross value of superannuation of $55,000;

   ·total liabilities of $133,134.

2. In Part N of the financial statement she deposed to average weekly expenses for herself and the children Y and X in the sum of $903.

3. The wife deposed in her affidavit to:

   ·being a qualified hospitality worker working part-time at E Business;

   ·studying fulltime to improve her employment prospects;

   ·the husband being a farmer;

   ·the husband, the husband’s brother and their cousin by marriage running a mixed farming enterprise called Estrella Company;

   ·being 50 years of age and the husband 52 years of age;

   ·the parties’ period of cohabitation being 17 years;

   ·having two children Y then aged 17 years (Y turned 18 years in … 2020), and X then aged 14 years;

   ·having a son Z from a previous relationship;

   ·residing in the former matrimonial home with Y and X;

   ·proceedings having been pending since December 2015;

   ·various issues regarding parenting matters not relevant to this application;

   ·being in dire financial circumstances;

   ·being party to a Hardship Agreement with B Bank, to not having an obligation to pay instalments until 31 March 2020 and thereafter the instalments being $1,000 per month which she does not have the capacity to pay;

   ·her weekly expenses still exceeding her weekly income by $550 during the period of the Hardship Agreement, to that deficit increasing to $625 per week upon the cessation of the Hardship Agreement;

   ·being employed on a casual basis and being contracted through her business;

   ·billing the employer $36 per hour;

   ·studying at TAFE in anticipation of teaching in hospitality;

   ·TAFE commitments consisting of 16 hours in Adelaide per week, 7 to 8 hours in travel and an expectation of 20 hours per week home study;

   ·earning approximately $400 during a “good week” through F Business;

   ·the husband’s 2018 taxable income being $100,873 and his 2019 asserted income $52,998;

   ·her 2018 taxable income being $4,369 and her 2019 provisional taxable income being $8,556;

   ·meeting expenses including everyday living costs and extraordinary expenses by way of using credit cards which have both been expended to their limit of $25,000 and $10,000 respectively;

   ·her concern that the bank may foreclose on the mortgage;

   ·having borrowed from each of the children for expenses including towards X’s overseas exchange school trip and also borrowing from friends to purchase a second-hand vehicle for Y at a cost of $7,000 and $9,000 for the payment of bills;

   ·having been unable to pay for legal work performed since July 2018;

   ·owing in excess of $65,000 to her solicitor together with a debt to Counsel in the sum of $10,078 and ongoing fees with respect to work in progress;

   ·having been advised by her solicitors that they will not represent her at trial without security for payment of fees;

   ·the estimate of fees being $40,000 plus GST;

   ·the estimated value of the gross asset pool at 4 March 2020 being approximately $4.8 million without updated valuations;

   ·the liabilities totalling approximately $263,134;

   ·becoming aware that one of the farming properties registered in the sole name of the husband had been the subject of an application for division without any advice from the husband to her with respect to that issue;

   ·the husband controlling the vast majority of the parties assets since separation;

   ·the husband residing in the principal homestead on properties farmed by Estrella Company and accordingly having available to him rent free accommodation as well as the farm paying all of the utilities, insurances, motor vehicle and fuel expenses and most of the household meat consumption for the husband;

   ·a history of the farming enterprise;

   ·a rejection of the husband’s position of being a “mere employee” of Estrella Snrs, the partnership between his mother and his late father;

   ·to the $80,000 retained by the wife at separation, removed from the wife’s possession by the husband and paid into the husband’s solicitors’ trust account and thereafter released to the wife by order of the Court, having been paid into the trust account of her solicitor save as to the sum of $12,781.05;

   ·the balance being applied to payment of accumulated invoices for legal fees and disbursements;

   ·paying a further $3,861 in disbursements in October 2018 for valuations and mediation fees;

   ·receiving a further payment from the husband in the sum of $4,574 by way of costs arising from the order for the release of the $80,000 to her;

   ·having received $2,000 of those funds from her solicitors’ trust account with the balance being applied to unpaid legal fees;

   ·the funds paid to her being utilised to pay arrears of school fees for X to enable him to participate in an exchange trip to an Asian country;

   ·being unlikely to be able to remain in the former matrimonial home with the children pending trial unless she is successful in her application for the husband to pay out the mortgage or pay mortgage instalments in full;

   ·becoming unrepresented for the purposes of the trial unless awarded funds with which to fund the trial;

   ·intending to apply the sum of approximately $100,000 of the $150,000 she is seeking by way of interim property settlement to her legal fees;

   ·the husband having the ability to sell a parcel of land to raise funds necessary to pay the sum sought or secure a line of credit on the titles in his sole name;

   ·having lodged a caveat over the land registered in the sole name of the husband to prevent the disposal of same pending trial; and

   ·seeking the orders set out in her application in a case to place her in a position to meet ongoing living expenses and provide a reasonable standard of living for the children whilst preparing the matter for trial.

Husband’s evidence

1. In the husband’s financial statement filed 23 March 2020 he deposed to:

   ·total average weekly income of $1,812;

   ·expenditure for the same period of $1,601;

   ·total value of property owned by him being $1,873,691;

   ·superannuation with a gross value of $161,811;

   ·liabilities in the sum of $1,339,605;

   ·his current occupation being a farmer; and

   ·being employed by Estrella Company.

2. Included in the liabilities deposed to by the husband was a loan referred to in Part K, paragraph 50 of the financial statement described as “Loan for H property” being a personal loan in the sum of $1,260,262.  That liability claimed by the husband is a liability to his mother which is disputed by the wife and of significance in the dispute between the parties.

3. He also deposed in Part N to his average weekly expenses for the children and for himself being $765 of which only $70 is ascribed to the children being X’s school fees.

4. In paragraphs 1 to 28 of his affidavit filed on 23 March 2020 he deposed to:

   ·being opposed to the orders sought by the wife;

   ·the wife having remained in the former matrimonial home at C Street, D Town post-separation;

   ·a consent order made 29 February 2016 providing for him to pay into the B Bank mortgage account the sum of $330 per month;

   ·having paid $16,730 in compliance with that order from February 2016 to March 2020;

   ·the wife contributing only $12,970.46 during the same period;

   ·arrears accruing in respect of the house mortgage as a result of the wife’s failure to pay her share of the mortgage payments;

   ·the wife having had bank accounts and/or term deposits in the sum of $150,000 which she failed to disclose to the Court in her financial statement filed 24 February 2016;

   ·those sums being in addition to the $80,000 cash retained by the wife which likewise were not disclosed by the wife in her financial statement;

   ·an order of 10 May 2018 requiring payment to the wife’s solicitors’ trust account of the $80,000 cash savings by way of interim property settlement;

   ·the wife having travelled extensively overseas post-separation;

   ·the parties’ assets at separation totalling $2,381,351 and liabilities at separation totalling $1,334,424 including the loan on the H property;

   ·receiving by way of inheritance from his late father’s estate:

   oan amount equal to his father’s interests in the part of Estrella Company;

   oa 50 per cent share of his father’s share of the partnership of Estrella Snrs; and

   ointerests in four parcels of real estate,

   ·to not being entitled nor becoming a member of either of the partnerships Estrella Company or Estrella Snrs;

   ·various further valuations being undertaken in agreement with the wife relating to:

   oplant and equipment and livestock which values were included in the calculation of his interest in the Estrella Company partnership; and

   oupdated valuations being obtained with respect to the former matrimonial home and the H property;

   ·the wife having failed to provide full and proper discovery in respect to bank accounts operated by her in the period 2013 to 2016 inclusive;

   ·having no interest in the ongoing family farming enterprises;

   ·having commenced employment as a farm worker in July 1988 and continuing in that occupation until 2000;

   ·recommencing employment as a farm worker in July 2019;

   ·being employed between 2000 and 2019 on wages by the partnership Estrella Company as well as share farming in the business operated by the partnership Estrella Snrs;

   ·the wife often being engaged during the marriage and post-separation in hospitality work;

   ·the wife agisting livestock on the former matrimonial home property post‑separation but not disclosing any details as to the arrangements or income she derives; and

   ·the farming properties inherited by him being farmed by Estrella Company and to his wage including, in part, a rent in respect of the land owned by him but used by the partnership.

5. In paragraphs 29 to 63 inclusive he responds to the affidavit of the wife filed 4 March 2020.  He deposed to:

   ·being self-employed as a farm worker;

   ·continuing to receive a wage from the partnership Estrella Company;

   ·to his role in the partnership being the manager of the breeding program and animal health;

   ·having no interest in the partnership Estrella Company;

   ·not intending to proceed with an Application for Departure from Administrative Assessment of Child Support as sought in his amended response filed in May 2018;

   ·having supported the wife’s hardship application with B Bank, to the Hardship Agreement providing for loan repayments to be made in the sum of $300 per month between 31 October 2019 to 31 March 2020 and thereafter interest only payments to be made on a monthly basis;

   ·the interest payments currently being in the sum of $696 per month plus $10.93 per month by way of default interest;

   ·having continued to contribute to the B Bank mortgage at the rate of $330 per month in accordance with the order of February 2016;

   ·the Hardship Agreement ceasing on 1 October 2020;

   ·denying that arrears of mortgage had accrued as a result of his failure to comply with the terms of the order;

   ·the wife attempting to intentionally mislead the Court in respect to the terms of the Hardship Agreement, the duration of same and the payments expected by the bank;

   ·it being common practice for the wife to undertake hospitality work during the marriage and post-separation;

   ·his taxable income for the financial year ended 30 June 2018 being significantly higher because of a grape payment made to him in June 2018 rather than September 2018 to finalise his share farming agreement with the partnership Estrella Snrs;

   ·that higher income having effected his child support liability such that it was a higher rate;

   ·his 2019 taxable income being $52,998 resulting in a reduction of his child support obligations to $155.39 per week;

   ·the wife’s taxable income for the financial year 30 June 2017 being $41,000;

   ·X’s overseas exchange program being unlikely to proceed due to the COVID-19 pandemic;

   ·providing monetary gifts to Y and X on the occasions of birthdays and Christmas;

   ·not agreeing with the wife’s version of the asset pool;

   ·not being involved in subdivision of property owned by him other than to the extent of being required to grant permission to allow a new title to pass through his section of land arising from his brother Mr J Estrella selling a parcel of native vegetation to his neighbour Mr K in exchange for a title owned by Mr K and being effected to the extent that he owns adjoining property;

   ·that there is a dispute between he and the wife in respect to the treatment of his inheritance;

   ·the wife being aware that he owed a debt to his father with respect to the H property;

   ·the wife having retained or received the benefit of assets totalling $1,071,048 post-separation including $151,048 in bank accounts and term deposits and the former matrimonial home in the sum of $800,000;

   ·the wife retaining or having had the benefit of 93 per cent of the assets of the marriage;

   ·having never had any intention of disposing of any property pending the finalisation of these matters;

   ·having fully accounted for his income in his taxation returns;

   ·the wife’s taxable income being:

   o$68,000 in the financial year ended 30 June 2016;

   o$41,000 in the financial year ended 30 June 2017;

   o$4,369 in the financial year ended 30 June 2018; and

   o$1,730 in the financial year ended 30 June 2019; and

   ·that the wife is untruthful in respect to disclosure in respect to her savings at separation and her use of funds thereafter.

Counsel submissions

1. It was submitted by Counsel for the wife that:

   ·the husband has had access to and used the bulk of the parties assets and further, that arising from his inheritance on the death of his father a minimum of $1.9 million was injected into the asset pool;

   ·in the husband’s amended response filed on 16 October 2020 he proposed as part of the final orders sought that the wife keep the former matrimonial home free of mortgage;

   ·such is an agreed position;

   ·he further proposes a cash payment of $350,000 to the wife but seeks a six month timeframe to meet that obligation;

   ·in circumstances where the wife seeks $150,000 by way of interim property settlement as well as a discharge of the mortgage over the former matrimonial home in the sum of $160,000 those amounts are close to the $350,000 cash payment offered by the husband;

   ·if the Court was with the wife it was necessary to turn to the question of how those funds could be achieved;

   ·in his amended response filed on 16 October 2020 the husband proposes in paragraph 8.2 to sell Lot 3 L Street, D Town, a property valued at $1.4 million;

   ·there is a dispute between the parties as to whether a debt attaches to that property in favour of the husband’s mother in the sum of $1.262 million;

   ·even so there would be sufficient funds to meet the wife’s interim claim if the property was sold;

   ·in the alternative the husband could borrow the necessary funds from B Bank, referring the Court to the correspondence tendered by agreement between the solicitors for each of the parties detailing communications between the husband and Mr N of B Bank between 12 May 2020 and 18 August 2020;

   ·the effect of the correspondence was that the husband would be able to borrow approximately $155,000 secured over Section … O Street, P Town;

   ·in order for the husband to meet the cash settlement sum he proposed to pay to the wife in the final orders sought by him, it would be necessary for him to sell property;

   ·of the $80,000 cash sum retained by the wife at separation and subsequently returned to her by order of this Court, the money had been largely used for legal costs;

   ·the wife’s outstanding legal costs referred to in paragraph 26 of her affidavit filed 4 March 2020 were now $126,236 by way of solicitor’s fees, $25,000 by way of Counsel fees together with work in progress unbilled in the sum of approximately $9,000;

   ·the husband did not refer to any outstanding legal fees in his financial statement filed 23 March 2020;

   ·a question remained as to how he had paid his fees;

   ·although the wife had previously run her business F Business she had very limited work since March 2020 as a result of the economic environment;

   ·she had undertaken education but there was little meaningful employment;

   ·the parties’ child Y having attained the age of 18 years, child support has ceased for Y;

   ·the husband has an income of approximately $100,000 a year as well as the use of the majority of the marital assets and inheritances; and

   ·realistically the trial was likely to proceed over five days and that the sum of $40,000 the wife deposed to as being the likely cost of trial was an underestimate when including preparation.

2. When asked by the Court if the wife’s outstanding legal fees were already approximately $160,000, how would the wife have sufficient funds to pay for legal representation for trial, Counsel advised that the wife would secure funding for that purpose.  The wife’s Counsel stressed that on a final basis the wife was seeking more than the $350,000 cash payment referred to by the husband in his response.

3. It was submitted on behalf of the husband’s Counsel that:

   ·the husband has paid all instalments with respect to the housing loan in the joint names of the parties secured over the former matrimonial home since approximately 14 May 2020 including arrears;

   ·as at 31 October 2020 the monthly payments required by the bank with respect to the housing loan will be approximately $1,000;

   ·the husband will continue to pay all of the mortgage payments over the former matrimonial home if his child support obligations do not alter significantly;

   ·the wife has made an application to the Child Support Agency for a Departure from the current Administrative Assessment of child support;

   ·she seeks an assessment of child support based on the husband’s current estimated earnings of $93,600;

   ·if the wife was successful, the husband would have no capacity to pay and continue to pay the mortgage instalments with respect to the B Bank mortgage or rates, taxes and insurances;

   ·he will agree to be liable for all mortgage payments in respect of the former matrimonial home pending trial unless there is a change in his child support liability;

   ·the husband has no cash savings;

   ·all of the parties financial resources are in the form of real property;

   ·the husband has made an application to B Bank but the reference to the possibility of the husband borrowing money by way of mortgage over the property at Section … O Street, P Town was advised in correspondence to the husband dated 18 August 2020 as being “subject to strict policy exception policies” the details of which the husband is unaware;

   ·the husband has been “chasing” B Bank with respect to clarification of the special lending criteria but has met with limited response;

   ·the husband wants to explore all possible finance avenues;

   ·the caveats over the various properties restrict his capacity to borrow;

   ·it is not necessary for the caveats to be maintained if the husband is restrained by order from selling or encumbering the various properties pending trial;

   ·the husband is agreeable to such an order;

   ·if the husband can’t borrow money he has to sell a property;

   ·he would seek to sell the property at Section … O Street, P Town known as “R Paddock” prior to any other property as it would least compromise the farming enterprise;

   ·if the husband has to sell the property he would hope to do so within approximately four months depending on the market;

   ·in those circumstances funds may not be available within the timeframe required by the Court prior to the June trial listing;

   ·if the Court makes an order for litigation funding it would be necessary for the matter to be listed again to monitor the progress of the husband’s application for finance;

   ·the husband’s legal fees were paid up to the date of the hearing;

   ·they totalled approximately $150,000;

   ·the husband had personally paid all except the last $15,000 to $20,000 which was paid on his behalf by his mother;

   ·work in progress at the time of the hearing was approximately $6,250;

   ·the wife promotes an argument that the only source of litigation funding for her post-separation was the $80,000 cash returned to her by order of the Court;

   ·the wife’s financial statement of 24 February 2016 disclosed savings of $27,625;

   ·the wife failed to disclose additional funds available to her as at January 2016 totalling $146,222 of which $34,875 was held in her F Business account as at 8 January 2016;

   ·the total savings retained by the wife as at separation were $151,048 excluding the $80,000 cash;

   ·the wife has had the benefit of remaining in the former matrimonial home post-separation;

   ·those sums do not ultimately exceed the wife’s entitlement but that the parties are not agreed as to the composition of the asset pool;

   ·there is a dispute about the existence or otherwise of a loan to the husband’s mother in a sum in excess of $1 million which has a significant impact on the size of the asset pool;

   ·the husband is concerned that funds provided by way of litigation funding may not be utilised by the wife for legal fees and that she will then seek further litigation funding;

   ·the wife’s expenditure of monies in her possession from separation to the current time is not clear;

   ·the Court needs to take a cautious approach; and

   ·if an order is made for interim property settlement there will be no certainty as to what purpose those funds would be put by the wife.

4. In submissions in reply, the wife’s Counsel conceded that at separation the wife had $134,682 in various accounts, that she had $21,000 in her business account and that the wife’s overseas travel post-separation was for the purpose of visiting children and confined to fares.

Conclusion

1. The wife seeks orders for interim property settlement.

2. The parties were not in dispute as to the jurisdiction of the Court to make such orders, although it was submitted on behalf of the husband that the Court should approach the making of such an order cautiously.  The husband’s Counsel referred to the dispute between the parties as to the quantum of the asset pool to be divided between them on a final basis in due course.

3. The Court’s jurisdiction to make orders for interim settlement of property arises in this case from the terms of sections 79 and 80(1)(h) of the Family Law Act 1975 (Cth) (“the Act”).

4. It is not necessary to establish compelling circumstances for the Court to make an order for interim property settlement.  In Strahan & Strahan[1] the Full Court said at [132]:

   It is not necessary to establish compelling circumstances. All that is required is that in the circumstances it is appropriate to exercise the power. In exercising the wide and unfettered discretion conferred by the power to make such an order, regard should be had to the fact that the usual order pursuant to s 79 is a once and for all order made after a final hearing.

   [1] (Interim Property Orders) (2011) FLC 93-466

5. The Full Court went on to say in [139] of the same case:

   We also emphasise that in order to establish an appropriate case for an interim property settlement order more is required than the mere fact that upon a final hearing the applicant would receive the property being sought (or an amount in excess of the funds being sought) from the other party.

6. The wife seeks the interim orders primarily for the purpose of paying legal fees.  She deposed in paragraphs 25 and 26 of her affidavit filed 4 March 2020 to needing to be able to fund the proper preparation of her matter for trial, and to her lawyers having advised her at that time that they will not appear at trial without security for payment of fees.

7. The further orders she seeks with respect to interim property settlement requiring the husband to either discharge the mortgage over the former matrimonial home or pay the total of the instalments as and when they fall due pending trial, are based on her asserted lack of capacity to meet that cost herself.[2]

   [2] Wife’s affidavit filed 4 March 2020, paragraph 24

8. The parties separated in or about June 2015.  At the time of separation, the husband vacated the former matrimonial home.

9. It is common ground that in or about October 2015 the husband withdrew the sum of $60,000 from the parties’ joint B Bank portfolio loan account.  He deposed earlier in these proceedings to paying the monthly interest arising from that withdrawal from the mortgage account.

10. At the time of separation the husband was employed as a farmer and the wife as a hospitality worker with S Corporation.

11. Proceedings between the parties commenced by way of an application filed by the wife on 14 December 2015 relating to the above withdrawal, with a response filed by the husband on 23 February 2016.  The husband filed a financial statement on 23 February 2016 and the wife on 24 February 2016.

12. The husband deposed to average weekly income of $1,561 and to having funds in the National Australia Bank in the total sum of $50,616.  He deposed to other assets comprising real estate, shares, a motor vehicle and superannuation entitlements.

13. In the wife’s financial statement she deposed to total average weekly income of $1,225 and to funds in Westpac Bank totalling $27,625, with $23,580 of that amount being held in her F Business account.  She deposed to other assets comprising real estate, a motor vehicle and ascribed a value of $10,000 to her business.  She also deposed to superannuation entitlements.

14. It subsequently transpired and is not in dispute that as of approximately January 2016, the wife had additional undisclosed funds available to her comprising of some $45,000 in a Westpac eSaver account, a term deposit in the sum of approximately $70,000 due to mature on 1 February 2016 and the sum of $34,875 in her F Business account as at 8 January 2016.  I am satisfied that the normal expenses associated with the wife’s business at that time may well have accounted for the lesser amount in that account at the time of the filing of her first financial statement.

15. In addition to the funds at bank, the wife had the further sum of $80,000 in cash savings.  These funds were the subject of an earlier application and an order of 10 May 2018 requiring that the sum of $80,000 held in the husband’s solicitors’ trust account be paid to the wife’s solicitors’ trust account by way of interim property settlement.  The question of how that payment should be taken into account at the final hearing was reserved to the trial judge.

16. The application filed by the wife on 17 April 2018 sought orders from the Court for the payment of the $80,000 such that she could use those funds for the payment of legal fees and disbursements incurred in the proper preparation of her case for trial.

17. In paragraph 23 of the wife’s affidavit filed 16 April 2018 the wife deposed as follows:

    I am currently indebted to my lawyer in the sum of $24,266.35.  I am informed that a further $6,500 is in WIP.  Invoices to date including disbursements for Counsel fees and valuations total $63,630.60.  I have paid $39,364.25…”

18. In paragraphs 26 and 27 of her affidavit filed 4 March 2020 in support of this application the wife deposed as follows:

    I need to be able to fund the proper preparation of my matter for trial.  I have not been able to pay for any legal work performed since July 2018; the invoices paid to date relate to work prior to that time.  I owe my Counsel $10,078.  I currently owe more than $65,000 to my lawyer plus work in progress for this current application.

    My lawyers have advised me that they will not appear at Trial without security for payment of fees.  I am advised that estimated Counsel fees for a five day trial plus conferences and settling trial affidavit material will be approximately $40,000 plus GST.

19. In the wife’s financial statement filed 4 March 2020 she deposed to her liabilities totalling $133,134 excluding legal fees.  She did not include any amount owed by way of legal fees as a liability in that statement.

20. It was submitted by her Counsel at the hearing on 26 October 2020 that her outstanding legal fees comprised $126,236 by way of solicitor’s fees, $25,000 by way of Counsel fees and unbilled work in progress of $9,000.

21. No evidence was adduced by the wife with respect to the quantum of her outstanding legal fees save for that referred to in paragraph 35 hereof.

22. In paragraph 20 of the wife’s affidavit filed in support of her earlier application for interim property orders she deposed to not having funds to prepare her case for trial.  She deposed to having $23,580 in her F Business bank account and $4,045 in her personal account when she commenced the proceedings, as well as a bank cheque in the sum of $70,000 being the term deposit proceeds.

23. She deposed in the same paragraph to that cheque being subsequently banked into her personal account and to the funds having been all but exhausted by payment of legal fees and disbursements, expenses associated with the parties’ daughter’s Rotary exchange to Europe and for living expenses during a period of unemployment.  She did not provide a breakdown to the Court in that evidence as to what amounts had been paid in respect of each of the expenses to which she referred.

24. In the reasons I delivered ex-tempore on 10 May 2018 I referred to both parties having spent over $30,000 in legal fees to that time, with the husband having paid $32,000 to his solicitors using funds from his inheritance.  The wife’s evidence was that she had paid $39,364.25 of $63,630.60.  This payment was made prior to her receiving the $80,000 in May 2018.

25. That accords with her evidence as to her indebtedness to her lawyer at that time in the sum of $24,266.35 although I note that she deposed to owing a further $6,500 in “WIP” at that same time.

26. In paragraphs 42 and 43 of the wife’s affidavit filed 4 March 2020 in support of this application she deposed to the sum of $80,000 being paid into her solicitor’s trust account pursuant to the order of 10 May 2018 and to $12,781.05 being refunded to her.  She deposed to the balance being applied to the payment of accumulated invoices for legal fees and disbursements as of May 2018.

27. That evidence would suggest that the sum of $67,219 was retained by the wife’s solicitors for legal fees, at a time when the wife’s evidence was that she owed $24,266 plus work in progress of $6,500, a total of $30,766.

28. On the wife’s evidence therefore as at May 2018 there was approximately $36,500 (rounded) held in her solicitors’ trust account on account of fees after the transfer of the $80,000 from the husband’s solicitors’ trust account to the wife’s solicitors’ trust account and the subsequent payment of the outstanding fees of $30,766.  It may be of course that further fees had been incurred between 16 April 2018 and mid-May 2018 reducing that trust balance somewhat.

29. The wife’s evidence as contained in paragraph 26 of her affidavit filed 4 March 2020 is that she has not been able to pay for any legal work performed since July 2018.  In that same paragraph she deposed to invoices paid to date relating to work prior to that time.

30. In paragraph 43 of her affidavit filed 4 March 2020 she deposed to receiving the further sum of $4,574 by way of costs arising from the first interim property settlement application, paid to her solicitor’s trust account in May 2019.  She further deposed in that same paragraph to the sum of $2,287 being paid to Counsel from those funds in part-payment of her outstanding invoices, to $2,000 being refunded to her notwithstanding outstanding unpaid legal work and, to the balance of $287 being retained in her solicitor’s trust account.

31. In submissions on 26 October 2020 the Court was informed from the Bar table by the wife’s Counsel that the amount of fees and disbursements owing to the wife’s solicitor and Counsel as at that time was approximately $160,000.

32. The wife has been remarkably coy about the details of her financial circumstances since the filing of her first financial statement in 2016 which omitted significant detail as to monies held in bank accounts and in cash.

33. She has not told the Court how much of the $70,000 she retained at separation in a term deposit was utilised on legal fees prior to the swearing of her affidavit on 16 April 2018, but leaves it to the Court to assume that it was those funds that provided the source of the $39,364.25 paid to her solicitor prior to 16 April 2018.

34. Likewise, although she has deposed to her solicitor retaining $67,219 in her trust account from the interim property settlement of $80,000 in May 2018, there is little to no detail provided by the wife as to exactly what fees were incurred when.  She deposed to not having been able to pay any legal fees post-July 2018.

35. On her evidence, her outstanding legal fees at April 2018 totalled $30,766.  There is no evidence adduced by the wife as to how much her legal fees had increased between swearing her affidavit on 16 April 2018 and receiving the $80,000 by way of interim property settlement shortly after 10 May 2018.  It is unlikely that legal fees in the sum of $36,453 would have been incurred between those dates, being the difference between $67,219 and $30,766.

1. It is common ground that excluding the wife’s business account, she retained cash and savings at or about separation in the sum of approximately $195,000, being $70,000 in a term deposit, funds at bank of approximately $45,000 and cash in the sum of $80,000.

2. The cash retained by the husband at or about separation was some $50,000 he removed from the parties mortgage account.

3. The only evidence as to the wife’s lawyers not being prepared to continue to act for her such that she may be unrepresented at trial is contained in paragraphs 26, 27 and 45 of her affidavit filed 4 March 2020 where she says:

   I need to be able to fund the proper preparation of my matter for trial…

   My lawyers have advised me that they will not appear at Trial without security for payment of fees…

   Unless I am awarded funds with which to fund my trial, I will be unrepresented.

4. That evidence comprises hearsay and submission.

5. It is not supported by evidence from the wife’s solicitor as to her position with respect to the wife’s payment of outstanding fees.

6. In addition, the references are to being able to fund the proper preparation of the matter for trial, to the lawyers advising the wife they will not appear at trial without security for payment of fees including conferences and settling trial affidavit material and, that unless the wife is awarded funds to fund her trial she will be unrepresented.

7. In answer to a question from the Court during submissions, as referred to in paragraph 15 of these reasons, Counsel for the wife advised that the wife would secure funding for the purpose of trial even if all of the $150,000 the wife was seeking by way of interim property settlement was utilised in payment of existing outstanding fees.

8. The husband likewise put little to no evidence to the Court with respect to the quantum of his legal fees and whether or not fees were outstanding.

9. I have already referred in paragraph 16 of these reasons to submissions being made by the husband’s Counsel with respect to the quantum of the husband’s legal fees and whether or not they were paid.  Those submissions were made in answer to a question from the Court.

10. The submission was that the husband’s legal fees had totalled approximately $150,000 to that time which he had paid himself save for the last $15,000 to $20,000 which had been paid by his mother.  There was no evidence before the Court of any borrowings made by the husband to fund his fees and the Court can only presume that they were paid from the husband’s income.  There is no doubt that the husband’s income has significantly exceeded that of the wife at least in the last two to three years.

11. I am satisfied on the evidence however that the husband has little cash available to him and an order for interim property settlement in the sum of $150,000 as sought by the wife could, to my mind, only be achieved by way of the sale of property.

12. I am not satisfied in the circumstances of this case that it is appropriate to exercise the power pursuant to sections 79 and 80(1)(h) of the Act to make an order for interim property settlement with respect to the sum of $150,000.

13. The wife has failed to put before the Court clear evidence as to the disposition of the funds available to her at separation and has adduced no evidence other than hearsay as to current outstanding fees and the requirements of her solicitor.

14. Submissions were made on behalf of the wife that the amount she was seeking by way of interim property settlement was minimal compared to the size of the asset pool and further, that on the husband’s own case he was proposing a cash payment to the wife in addition to her retaining the former matrimonial home freehold that was approximately equal to the amount that she was seeking.

15. I am not satisfied that such a position justifies an order for interim property settlement.[3]

    [3]Strahan & Strahan (Interim Property Orders) (2011) FLC 93-466, paragraph 139

16. It was argued on behalf of the wife that post-separation, the husband has controlled the vast majority of the parties’ assets.

17. The majority of the parties’ assets consist of farming land.  There is no doubt the husband has retained the use of that land post-separation, firstly the property referred to as “H’s at L Street” and latterly, the properties inherited by the husband upon the death of his father.

18. The parties are in dispute, firstly as to whether a debt is properly due and owing to the husband’s mother in respect of the H property, and secondly, as to the extent of the wife’s entitlement to the properties inherited by the husband.

19. At separation the only other assets of the parties were the former matrimonial home, a quantity of stock and equipment, a modest quantity of shares, the parties’ motor vehicles, the savings and cash in the possession of the wife to which I have already referred, the household furniture and the parties’ personal effects.

20. For the reasons to which I have referred, I am of the view that the circumstances of this case do not support the interim order in the terms sought by the wife in paragraph 1 of her application in a case filed 4 March 2020.  The wife’s financial position and the status of her legal fees is unclear, the wife’s claim with respect to her solicitor’s requirements is unsubstantiated by evidence that the Court would expect from her solicitor and, the quantum of the asset pool is currently very unclear.

21. For those reasons I decline to make an order in terms of paragraph 1 of the wife’s application in a case filed 4 March 2020.

22. I do not take the same view however with respect to the orders sought by the wife in paragraphs 2(a) and (b) of her application in a case.

23. It was submitted by the husband’s Counsel that as at April 2020 the husband had assumed responsibility for and paid all instalments with respect to the housing loan in the parties’ joint names secured over the former matrimonial home since May 2020 including arrears.

24. There is no doubt that the husband’s income has been significantly greater than that of the wife post-separation.  I have already referred to his apparent capacity to pay his fees to date.

25. The wife deposed a weekly income as at 4 March 2020 in the sum of $846 comprising total salary or wages of $360, Newstart allowance/Family Tax Benefit A and B of $330 and child support payments in the sum of $156.  I take into account that Y has now attained the age of 18 years and that the husband’s liability for child support as at the date of this order would have been varied.

26. The husband deposed to an income as at 23 March 2020 of $1,812 per week comprising wages of $1,800 and $12 by way of share dividends.

27. It was submitted by Counsel for the husband that he was not opposed to the order as sought in paragraph 2(a) and (b) of the said application in a case if the parties dispute regarding child support did not result in an increase to the husband’s rate of child support payments, in which case it was submitted that he would have no capacity to pay the mortgage instalments as well as child support.

28. It would appear on the husband’s case that he has been making the payments without complaint since April 2020.

29. I am satisfied taking into account the parties disparate financial circumstances that justice and equity would be afforded to the parties by the Court exercising its power to make an order for interim property settlement by way of instalments sufficient to pay all mortgage payments as and when they fall due.  This is in respect of the housing loan with B Bank in the joint names of the parties, being loan account number …40, together with rates and taxes and all household insurances accruing from time to time with respect to the said property (paragraph 3 of the wife’s application in a case).

30. I am satisfied that the wife has no capacity to make those payments.  The husband has accommodation available to him being the house previously occupied by his parents on one of the farming properties.  The wife remains living in the former matrimonial home with the parties’ two children, one of whom is under the age of 18 years.  In the event that the husband’s financial circumstances change, it is open to him to bring an application in a case to vary or discharge this order.

31. I am satisfied that the terms of this order will not necessarily require the sale of real estate.  Accordingly it is not necessary, as suggested by Counsel for the husband, for the matter to come back to Court prior to trial for the purpose of determining the progress of the sale of any property.

32. I find that it is just and equitable to make this order.  I find that it is reflective of what has been occurring with the consent of the husband in any event and has been conceded to be an order acceptable to him save and except for a change with respect to his child support liabilities.  I find that it is appropriate that the character of the monthly mortgage payments and the payments of rates, taxes and household insurance be reserved to trial.

33. The wife further seeks an order for injunction restraining the husband from warning or attempting to discharge the caveats the wife has lodged over three properties registered in the sole name of the husband.

34. I find that the caveats unreasonably limit the husband in terms of his exploration of finance possibilities and that there is no evidence in this matter to date suggestive of the husband attempting to deal with property in a manner designed to defeat any claim of the wife.

35. I am satisfied, as submitted by the husband’s Counsel and in accordance with the consent of the husband, that the issue of security over those properties can best be addressed by an injunction restraining the husband from dealing with them other than with the consent of the wife or an order of this Court.

36. The wife also sought an order that the husband forthwith disclose the details of his dealings with the land comprised and described in Certificate of Title Register Book Volume … Folio … registered in his sole name.

37. The husband deposed to those issues in his affidavit filed 23 March 2020 to the extent of being required to grant permission to allow a new title to pass through his section of land arising from a transaction between his brother Mr J Estrella and a neighbour Mr K regarding transfer of property covered in native vegetation.

38. That particular aspect of the application was not pressed by Counsel for the wife. I am satisfied, on the basis of the evidence of the husband to which I have referred, that an order in terms of that as sought by the wife, is supported by the evidence.

39. For those reasons I make the orders as set out at the commencement of these reasons for judgment.

I certify that the preceding ninety-one (91) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Mead delivered on 17 December 2020.

Associate:

Date: 17 December 2020