Burch & Pruitt (No 2)
[2023] FedCFamC1F 759
•30 August 2023
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 1)
Burch & Pruitt (No 2) [2023] FedCFamC1F 759
File number(s): MLC 2179 of 2021 Judgment of: BENNETT J Date of judgment: 30 August 2023 Catchwords: FAMILY LAW – PROPERTY SETTLEMENT – dispute about compliance with procedural Orders and interim Order for payment of expenses Division: Division 1 First Instance Number of paragraphs: 18 Date of hearing: 30 August 2023 Place: Melbourne Counsel for the Applicant: Mr Williams Solicitor for the Applicant: Mitchell Family Law Counsel for the Respondent: Mr Potter Solicitor for the Respondent: M And K Lawyers Group Pty Ltd ORDERS
MLC 2179 of 2021 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)
BETWEEN: MS BURCH
Applicant
AND: MR PRUITT
Respondent
ORDER MADE BY:
BENNETT J
DATE OF ORDER:
30 AUGUST 2023
BY CONSENT THE COURT ORDERS THAT:
1.Pending the Final Hearing of this matter the Husband continue to pay all mortgage repayments towards the mortgage registered over K Street as and when they fall due, and further he pay all other costs associated with K Street including, but not limited to, rates, taxes and all like apportionable outgoings and indemnify and keep the wife indemnified with respect to such expenses.
2.For the avoidance of doubt, paragraph 8 of the Order made on 26 July 2023 remains in full force and effect.
3.The time for compliance by the husband with paragraph 9(b) of the Order made on 26 July 2023 be and is hereby extended to 4.00pm this day, 30 August 2023, and the husband’s solicitors forthwith notify the wife’s solicitors of compliance with the said order identifying said vehicles NOTING THAT there are no keys for Motor Vehicle 1.
4.Notwithstanding the operation of paragraph 8(a) of the Order made on 26 July 2023 the husband be and is hereby at liberty to use the M Street, Town L property as security for borrowings the proceeds of which are to be applied solely for the purpose of his legal fees.
5.Within 14 days of these Orders, the Husband pay all arrears owing on the NAB Portfolio Facility (…96) ("the NAB Portfolio Facility"), with respect to the following sub portfolio accounts:
(a)NAB portfolio sub account …33;
(b)NAB portfolio sub account …14;
(c)NAB portfolio sub account …63;
(d)NAB portfolio sub account …93;
(e)NAB portfolio sub account …62.
(f)NAB portfolio sub account …14; and
(g)NAB portfolio sub account …54.
("the Husband's sub portfolio accounts") AND IT IS NOTED that the husband informed the court that all accounts are up to date.
6.Pending the Final Hearing the Husband pay as and when they fall due and payable all repayments on the Husband's sub portfolios accounts within the NAB Portfolio Facility (referred to in paragraph 5) hereof and indemnify the Wife and keep her indemnified with respect all liability for the Husband's sub portfolio accounts.
7.That within 14 days of the date of these Orders, the Husband do all such acts and things to provide to the Wife's solicitors copies of all documents relating to the refinance of the mortgage over the property situate at N Street, Melbourne in the State of Victoria and O Street, City P in the State of Western Australia, including details of the source of funds applied towards the refinance NOTING THAT without impacting the husband’s obligations pursuant to this Order the husband maintains that the documents are at the former matrimonial home in the bedroom above the garage.
8.That within 14 days of the date of these Orders, the Husband provide to the Wife copies of the following by way of updated financial disclosure:
(a)Copy trust statements from Q Lawyers trust account for all funds held by the Husband in his personal name, on his behalf, and/or in the name of any of his entities he controls for the period 1 January 2020 to date;
(b)A copy of a trust statement from R Lawyers Trust Statement confirming the bank details of the accounts the settlement funds for the property at S Street, Region T of $747,758 were directed to;
(c)Copy statements for the following NAB accounts (previously requested):
(i)NAB Private Portfolio Sub Account …33 in the name of Mr Pruitt for the period 10 September 2022 to 9 February 2023 and from 10 March 2023 to date;
(ii)NAB Private Portfolio Sub Account …93 in the name of U Pty Ltd and V Company for the period 10 September 2022 to 9 February 2023 and from 10 March 2023 to date;
(iii)NAB Private Portfolio Sub Account …14 in the name of Mr Pruitt for the period 10 September 2022 to 9 February 2023 and from 10 March 2023 to date;
(iv)NAB Account …97 in the name of W Pty Ltd for the period 1 October 2022 to date;
(v)NAB Account …82 in the name of U Pty Ltd for the period 1 October 2022 to date, together with statements numbered 1 - 3;
(vi)NAB Z Company Credit Card …42 in the name of Mr Pruitt for the period 27 July 2022 to date (no disclosure provided by your client directly for this account since 13 August 2021); and
(vii)NAB Z Company Credit Card …71 in the name of Mr Pruitt for the period 27 July 2022 to date (no disclosure provided your client directly for this account since June 2021).
(d)Copies of statements from the following Commonwealth Bank of Australia accounts (previously requested):
(i)CBA Account …62 in the name of Mr Pruitt for the period 1 July 2022 to date;
(ii)CBA Account …04 in the name of U Pty Ltd for the period 31 May 2022 to date;
(iii)CBA Account …14 in the name of BB Pty Ltd for the period 1 May 2022 to date;
(iv)CBA Account …87 in the name of Mr Pruitt for the period 1 May 2022 to date;
(v)CBA Account …83 in the name of U Pty Ltd for the period 1 January 2022 to 16 December 2022; and
(vi)CBA Loan Account …43 in the name of U Pty Ltd for the period 9 March 2022 to 16 December 2022.
(e)Copies of statements for the following CC Bank Account …37 in the name of W Pty Ltd for the following periods"
(i)9 April 2022 to 23 June 2022; and
(ii)23 February 2023 to date.
(f)Copies of statements for the Husband's DD Company credit card account …08 for the period 14 May 2023 to date.
9.Within 7 days of the date of these Orders, the Husband pay to the Wife's solicitors trust account, the sum of $2,695 reflective of his share of valuation report fees paid by the Wife on his behalf prior to the Final Hearing listed on 8 May 2023.
10.That the Husband be initially liable for the reasonable cost of any further property valuations required, as a result of the Final Hearing on 8 May 2023 being adjourned at the Husband's request, the husband is at liberty to seek contribution or a right to seek reimbursement from the wife at the final hearing.
11.The time for compliance by the husband with paragraph 6 of the Order made on 26 July 2023 be extended to 21 September 2023 at 12.00 noon.
12.The husband pay the wife’s costs of and incidental to the costs thrown away this day fixed in the sum of $9,800 to be paid within 30 days to the wife’s practitioners.
13.Within 7 days the husband provide to the wife, through their respective practitioners, banking records evidencing rent received for the last 12 months for the property at K Street, Suburb EE in the State of Victoria.
14.That there be liberty to apply at short notice in the event of the Husband's non compliance with these Orders.
IT IS DIRECTED:
15.That the Email from the husband to the Court dated 6 July 2023 at 6.45pm be marked Exhibit “C1” and remain on the Court file.
16.The Screenshot of the Husband’s Z Company Activity Statement be marked Exhibit “H1” and remain on the Court file.
17.The Husband’s Z Company Activity Schedule produced on subpoena be marked Exhibit “W1” and remain on the Court file.
IT IS FURTHER ORDERED THAT:
18.The Amended Application in a Proceeding of the Wife filed 10 August 2023 be and is otherwise dismissed.
19.My reasons for decision this day be transcribed and, when settled, placed on the Court file.
Trial Directions
20.This matter be fixed for final hearing before me on 22 January 2024 at 10.00 am estimated to take 4 days (“the final hearing”).
21.Each party file and serve an undertaking as to disclosure by 1 October 2023.
22.By not later than 8 January 2024 each party file and serve an updated financial statement.
23.In anticipation of the final hearing, each party file and serve any amended application or response and all affidavit material, including expert evidence as to valuation or agreements in relation thereto, or proofs of evidence in support of his/her case, as follows:-
(a)The applicant wife by not later than 20 November 2023;
(b)The respondent husband by not later than 27 November 2023;
(c)The applicant wife in reply by not later than 1 December 2023. (Amended 2 September 2023)
24.Not less than 14 days prior to the commencement of the final hearing, the parties determine what, if any, rulings are required as to the admissibility of evidence and notify my Associate – email ...@... – that the matter requires Court time so that any strike out application may be listed prior to the commencement of the final defended hearing.
25.Any party against whom a ruling is made striking part of that party’s affidavit or that of their witness, must file and serve a copy of the affidavit(s) from which the inadmissible has been redacted and do so by not later than 9:00 a.m. on the next working day after the agreement to strike out or the strike out ruling.
26.Any solicitor / practitioner who prepares an affidavit of which portions are ruled inadmissible and are struck out may be precluded from charging for that part of the affidavit which is struck out in addition to being liable for costs incurred on any strike out application (or a proportionate part thereof). Practitioners must be ready to deal with issues arising from material being struck out of evidence including issues of conflict between the interests of the solicitor and the interests of the client.
27.If a legal practitioner is precluded from charging costs for preparation of material which is struck out, he/she particularise for his/her client the amount of money by which the client’s legal costs will be reduced as a consequence of the material being held to be inadmissible.
28.Any party who proposes at the final hearing to seek orders against a superannuation trustee do all acts and things necessary to ensure that the superannuation trustee has been accorded procedural fairness in relation to the order proposed to be sought and that party be in a position to prove that procedural fairness has been accorded if called upon to do so.
29.By not later than 15 January 2024 at 4.00 pm the husband and the wife each file and serve and provide to my Associate by e-mail – ...@... – an outline of case which includes:-
(a)a list of documents upon which that party will rely at trial;
(b)a list which identifies the property, including equitable interests in property, of each of the husband and the wife;
(c)any monies or premature distributions of property to which either party has been entitled, including that property or money which is no longer in existence, and the basis (if any) upon which such property is to be adjusted against the entitlement of either party and the extent of that adjustment;
(d)whether it is just and equitable within the meaning of s79(2) to make an order adjusting the husband and/or the wife’s interests in property; and
(e)a summary of argument including but not limited to the following matters relating to a final alteration of property interests:-
(i)the contribution based entitlement of each party;
(ii)in dot point form the different types of contribution being financial contributions (s79(4)(a)), non-financial contributions (s79(4)(b)) and contributions to the welfare of the family (s79(4)(c)) upon which that party relies to support the contribution based entitlement for which they contend;
(iii)any other matters relevant to a division of property including any adjustment to the contribution-based claim (if any) having regard to the factors in s79(4)(d), (e), (f) and (g);
A.in dot point form what relevant s75(2) or other factors relied upon by that party for any adjustment;
B.why the orders sought by that party are appropriate;
(f)a summary of any matters upon which evidence is adduced from experts and is not agreed, including but not limited to:-
(i)the date and outcome of the last conference between experts;
(ii)the particular matters upon which there is no agreement between experts;
(iii)what the difference there would be to the final outcome in the event that one expert’s view of any particular matter is accepted over the other experts view;
(g)a summary of argument in relation to any other financial relief which is sought including child support or spousal maintenance;
(h)a minute of the orders which he/she seeks be made at the final hearing if the orders sought differ in any respect from his/her last filed application or response.
30.The parties prepare an Electronic Court Book using EBrief Ready AND IT IS DIRECTED that for this purpose my Legal Associate provide the template of the Electronic Court Book to the solicitors for the parties and the solicitor for the applicant include their documents first.
31.In the event that this matter resolves prior to the hearing date, the solicitors for the parties notify my Associate promptly.
AND IT IS NOTED BY THE COURT that, in the event that a party fails to attend a hearing or defaults in the filing of documents or things required of him/her, the Court may proceed to determine the matter without any input by the non-attending or defaulting party.
Note: The form of the order is subject to the entry in the Court’s records.
Note: This copy of the Court’s Reasons for judgment may be subject to review to remedy minor typographical or grammatical errors (r 10.14(b) Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 10.13 Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth).
Section 121 of the Family Law Act 1975 (Cth) makes it an offence, except in very limited circumstances, to publish proceedings that identify persons, associated persons, or witnesses involved in family law proceedings.
IT IS NOTED that publication of this judgment by this Court under the pseudonym Burch & Pruitt has been approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
REASONS FOR JUDGMENT
Ex-temporeBENNETT J
This matter comes before me as the adjourned return date of the wife’s Application in a Proceeding filed 24 July 2023, having been on a preliminary and urgent basis by me on 26 July 2023 in the absence of the husband.
Today, Mr Williams of Counsel appears on behalf of the wife. The wife attends Court to participate. The husband has instructed Macpherson Kelley, who filed a notice of address for service in these proceedings on 7 August 2023. Mr Potter of Counsel appears on behalf of the husband, who is also in Court to participate. Both Counsel have instructing solicitors present in court.
The wife seeks to proceed with an amended Application in a Proceeding which was filed on 10 August 2023 and made returnable today. In support of that Application, she files an affidavit which was sworn by her on 28 August 2023 and essentially sets out what has happened since 26 July 2023 to date. It recites that the husband has failed or neglected to comply with obligations imposed on him by the Order made 26 July 2023.
Pursuant to the Order made on 26 July 2023:
·The husband was required to file by 14 August 2023 any response or affidavit upon which he relied in response to the wife’s affidavit of 21 July 2023 and any other evidence. Nothing has been filed but his Counsel seeks a further three weeks for hiss instructors to prepare those documents.
·The husband was required to provide an explanation as to why he failed or neglected to appear on 26 July. He has failed or neglected to do that.
·The husband was required to file a financial statement by 14 August 2023. That has not been done.
·The husband was required to deposit all keys to vehicles which are described in the Order as Motor Vehicle 2; Motor Vehicle 3; Motor Vehicle 1 and Motor Vehicle 4 to the solicitors for the wife except for one set of keys to be retained and used by him. No keys have been provided. Today, the husband says that the Motor Vehicle 1 has no key and that appears to be accepted by the wife.
Mr Potter of Counsel makes an adjournment application on behalf of the husband. He seeks an adjournment to allow his instructing solicitors three weeks to prepare responding affidavit material. The wife’s affidavit records correspondence sent from Macpherson Kelley sent on 14 August, in which they said that they required until 21 August to be able to comply with the Orders of 26 August as for filing of material. Then on 21 August 2023, Macpherson Kelley wrote saying, amongst other things:
Our client was overseas for work in July, which we are instructed his former lawyers were informed of, and he is still out of Melbourne, returning in August 2023.
It was not quite as straightforward as stated. The wife, in her material, refers to documents produced in compliance with subpoena by Z Company, saying that the husband was booked on the following business flights from City FF to City GG in 2023 and from City GG to Melbourne the following day. The wife further deposes that:
I understand that [Mr Pruitt] attended [an event in Region T] in August 2023.
To say that the husband was overseas in July and is “still out of Melbourne” is, in my view, misleading. Very early in his submissions, Mr Potter said that he was instructed to take issue with the statement that his client had returned to Melbourne from City GG in July 2023 and said that his client had documentary evidence to support the fact that he returned in August 2023, which is when Mr Potter was instructed that the husband had indeed returned.
Counsel for the husband tendered screenshot from his mobile telephone which was marked exhibit “H1”. This is apparently the document to which the husband referred when stating categorically that he did not arrive back in Melbourne until August 2023. Looking at the document, it does not support that statement. It is called an activity statement, for a start. It relates to customer travel. It shows that in August 2023, the husband received loyalty credits in relation to his flight from City FF to City GG in July 2023. There is an entry that in August 2023 more were credited to the husband’s statement in relation to his flight from City GG to Melbourne in July 2023. They are precisely the places and dates for travel set out and deposed to by the wife in paragraph 30 of her affidavit. It is difficult to see where any ambiguity at all arises.
So, the husband had indeed returned in July 2023, just as the wife’s affidavit indicated (but the husband denied). The husband said, through his Counsel, that he had no independent recollection of any dates as to where he was during that time. He says that the trip to City FF was for business; he caught up with clients; he saw “[Mr HH]” for lunch, and there was reference to a webinar. These were engagements, details of which were in his phone, but he said there are more extensive engagements in his paper diary.
The event which prevented the husband from complying with the order to file documents and do other things was, described by his Counsel, as a business event. The husband says that he paid an entrance fee, that he flew by JJ Company to Town KK, that he entertained clients for a week, and that he considered the matter was business related.
In terms of retaining Macpherson Kelley, he has paid them $10,000 as of Monday of this week, that is, two days ago. $5,000 came from the husband’s CC Bank account on 24 August and $5,000 came from the husband’s Commonwealth Bank (CBA) account ending …62 on 28 August. The husband says, through his Counsel, that he has exhausted his capacity to pay legal fees and now must borrow funds to do so. He proposes to use the Town N property, which is unencumbered, and the wife will agree to that course.
The wife sought to proceed with her amended Application in a Proceeding. I permitted Mr Potter the opportunity to obtain instructions as to what matters could be agreed to by the husband. There was a considerable amount of resolution was received and certain orders have been made by consent.
In terms of the tenancy of the property at K Street, Suburb EE, it transpires that the property was rented to a friend of the husband. Originally there were two tenants but only one now remains. Through his Counsel the husband says that the lease was oral not written. There is nothing in writing. There was no letting agent. Mr Potter informed the Court that on 1 August 2023, that husband gave the remaining tenant 60 days’ notice to vacate the property.
The husband maintains that the documents required by the wife are located in a bedroom above the garage at the former matrimonial home. He is in any event required to comply with the order that has been made today by consent.
The parties agree that the husband should be liable for the reasonable cost of any further joint property valuations by single expert witnesses of real property with a right to seek reimbursement from the wife for part or all of the costs so borne at the final hearing.
At the conclusion of his submissions in support of the adjournment application, Mr Potter had obtained instructions and conveyed that his client agreed to many of the orders which had been sought by the wife. In all of the circumstances, neither Counsel thought any further hearing date was necessary, and the wife’s application can stand dismissed.
The amount of costs sought by the wife, in the first instance, related only to costs thrown away today. I have made an order in relation to those costs in a fixed sum of $9,800.00. Understandably, there was no opposition to liability for costs. Sensibly, in my view, there was no dispute as to quantum.
I have allocated this matter a date for final hearing in January 2024 and it was agreed that I would make trial directions in Chambers. Those trial directions are incorporated in the order I made today.
I certify that the preceding eighteen (18) numbered paragraphs are a true copy of the ex-tempore Reasons for Judgment of the Honourable Justice Bennett. Associate:
Dated: 15 January 2024
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