Burns and Burns

[2007] FamCA 60

FAMILY COURT OF AUSTRALIA

BURNS & BURNS [2007] FamCA 60

FAMILY LAW - S.79(2) JUST AND EQUITABLE - FINAL PROPERTY ORDERS

Family Law Act 1975 (Cth)

APPLICANT: MRS BURNS

RESPONDENT: MR BURNS

FILE NUMBER: MLF 1854 of 2005

DATE DELIVERED: 6 FEBRUARY 2007

PLACE DELIVERED: MELBOURNE

JUDGMENT OF: YOUNG J

HEARING DATE: 6 FEBRUARY 2007

REPRESENTATION

COUNSEL FOR THE APPLICANT: MR O'SHANNESSY

SOLICITOR FOR THE APPLICANT: STEPHEN FARMER & ASSOCIATES

COUNSEL FOR THE RESPONDENT: MR DICKSON

SOLICITOR FOR THE RESPONDENT: HOLDING REDLICH

Orders

1. THAT on or before 13 February 2007 ("the first date") the husband:-

   (a)       pay to the wife the sum of $20,000 ("the first payment"); and

   (b)do all things and sign all documents to transfer to the wife at her expense the BMW motor vehicle currently driven by her.

2. THAT on or before 7 May 2007 ("the second date"):-

   2.1      the wife:-

   (a)provide to the husband a release and Discharge of Mortgage in relation to the first mortgage to NAB (Mortgage) and the NAB Flexi-Plus Loan ("the mortgages") and pending the second date neither party draw down on either of the mortgages;

   (b)in the event the wife has not provided the discharge/release provided in paragraph 2.1(a), the home be forthwith placed on the market for sale, with the wife to have the conduct of the sale, and she to receive the net proceeds of the sale after discharge of the mortgages.

   2.2the husband (contemporaneously with the provision of a Discharge of the Mortgages):-

   (a)pay to the wife the further sum of $20,000 ("the second payment"); and

   (b)provide to the wife a Release of any guarantee executed by her in favour of National Australia Bank for any loans of O Pty Ltd, the U Trust, I Pty Ltd, the D Trust or the husband (save for the mortgages);

   (c)transfer to the wife at her expense all his right, title and interest in T ("the home");

3. THAT until 6 May 2007 (or on provision of the Discharge of Mortgages, if earlier) the husband pay or continue to pay or cause to be paid:

   (a)       registration, insurance and reasonable maintenance of the wife's BMW;

   (b)fuel up to a maximum of $150 per month (including any arrears owing under the order of 8/9/05); and

   (c)mortgage instalments as they fall due on the mortgages and thereafter:

   (d)the orders of 8/9/05 be discharged (paragraphs 7 and 8 to be discharged forthwith); and

   (e)the wife meet all payments on the mortgages as they fall due.

4. THAT the husband indemnify the wife and keep her indemnified in relation to any and all liabilities of, or arising from the wife's involvement or association with:-

   (a)       O

   (b)       U

   (c)       I

   (d)       D ("the entities")

   and the wife assign to the husband any interests (including any loan account in her favour) she may have in relation to any of the entities.

5. (a) THAT this is an order to which Section 77A of the Family Law Act 1975 applies;

   (b)the sum of $50,000 of the assets being retained by the wife is attributable to the provision of spousal maintenance to the wife;

   (c)the wife have leave to make an oral application for periodic spousal maintenance and such application be dismissed.

6. THAT unless otherwise specified in these orders (save for enforcement purposes):-

   (a)each party retain all assets in their respective possession (the home contents being deemed to be in the wife's possession);

   (b)each party be solely liable for any liability relating to any item of property being retained by that party pursuant to these Orders;

   (c)each party retain their respective superannuation entitlements.

7. THAT any further account rendered by M be met equally by the parties.

8. THAT pending payment by the husband of the first and second payments:-

   (a)he be restrained from receiving any long service leave entitlements from his employer, save to place in his solicitors' trust account a sum sufficient to meet the obligations outstanding as they fall due; and

   (b)the husband authorise and request his employer R Pty Ltd to advise the wife forty-eight (48) hours prior to making any payment of such leave entitlements to the husband.

9. THAT all applications (including the wife's Amended Application filed 22/09/06 and the husband's Amended Response filed 19/10/06) be otherwise dismissed and the matter be removed from the Pending Cases List.

IT IS CERTIFIED

1. THAT pursuant to Rule 19.50 of the Family Law Rules this matter reasonably required the attendance of Counsel for each of the husband and wife.

2. THAT all subpoenaed documents be returned by Subpoena Clerk, Melbourne Family Court, be returned to the person or association producing same.

3. THAT the extempore reasons for judgement be transcribed, placed on the file to be made available to the parties.

IT IS NOTED

A.THAT the NAB have indicated that no problems are anticipated in releasing the wife from guarantee upon the co-guarantors signing a fresh guarantee.

B.THAT the husband anticipates there being no issue in relation to the co-guarantors taking those steps.

C.THAT in the event that the wife is unable to service the mortgages after 6 May 2007 pending sale and/or at wife's request, the husband may apply the second payment towards such payments as they fall due at two-monthly intervals.

D.THAT the parties intend that these orders shall as far as practicable determine the financial relationship between them and avoid further proceedings between them.

E.THAT in the event of default by either party, the other party have liberty to bring such application as they may be advised (including any application under Section 79A if that party asserts that the incurable defaults constitutes a miscarriage of justice).

FAMILY COURT OF AUSTRALIA AT MELBOURNE

FILE NUMBER: MLF 1854 of 2005

MRS BURNS

Applicant

And

MR BURNS

Respondent

REASONS FOR JUDGMENT

1. In the matter of Burns, MLF 1854 of 2005, Mr Dickson of counsel appears for the husband, Mr O'Shannessy of counsel appears for the wife.  The issue before the court was settlement of property and all financial issues as between the parties.  The matter was stood down this morning and the parties have, with the assistance of counsel and solicitors, resolved all financial issues and I now have minutes of orders which are sought by consent.  Both parties are in court and have heard my prior discussions with counsel and are present for these brief extempore reasons.

2. The marriage in this case was of approximately 24 years.  There are two adult children now 23 and 21 years of age.  The employment circumstances of the parties are known to the court.  The matrimonial home has an agreed gross value of $785,000 and a net equity of approximately $420,000.  The corporate structure is explained in the affidavits.  There has been a valuation of the family trust and of an operating company undertaken by Mr C. 

3. There was a level of concern and issue as to the basis of the financial records, statements and returns previously produced by the entities and through the involvement of the husband, but nevertheless they were the only documents available to the independent expert.  When the matter was first mentioned this morning there was a very real level of dispute as to the basis of preparation of valuation and of the available financial assets and interests before the court.

4. In that context the matter was stood down and, either on a pragmatic basis or for good commonsense, and with the assistance of the legal advisers, the clients have brought about a settlement which I regard as being appropriate in the circumstances. I will hereafter declare, pursuant to section 79(2) of the Family Law Act 1975, that the negotiated settlement is just and equitable.

5. The effect of the settlement is that the wife takes in her sole name the T property, which currently is registered as tenants in common in the names of each of the parties.  Additionally, there is a provision over time for her to be paid $40,000 by two instalments of $20,000 and she retains her superannuation and the motor vehicle specifically identified in paragraph 3 of the orders and on a basis that there are some continuing payments in respect of that BMW.

6. Otherwise, the counter side of the settlement is that the husband retains his superannuation, his long-service leave and work-related benefits, and such of the equity or asset that is involved with the various trusts and entities identified in paragraph 4 of the order.  Specifically, the argument about any real value or blue-sky worth of those entities is a matter which the parties have agreed will, if it exists, remain with the husband.

7. I have carefully read the various affidavits and reports of the independent expert and there clearly were significant financial issues in asserting that there was a real value.  The real substance of the argument in this case probably lay in the preparation of those documents over past years and financial disclosure then made, and they are matters that are not in a position to be litigated on the available material today and would have required extensive and costly cross‑examination of the orders or others.

8. As I indicated, for commonsense and very good practical and legal reasons, the parties, on proper advice and knowing full well all of the issues, have resolved this matter.  Mr O'Shannessy asserts that on one view the wife takes 58 per cent of the available pool of assets.  That of course is dependent upon the difficult question of what the pool of assets might actually have been determined to represent.

9. A more appropriate way of looking at this case is that the wife takes the hard assets in the home, cash, superannuation and motor vehicle.  Given her limited employment and the fact that she is 49 years of age, that gives her some financial security.  In contrast, whilst the husband is of the same age, he has formally repartnered and has the skill, knowledge and ability of his years in the business to endeavour to move forward financially.

10. There was one paragraph in the orders that I required to be deleted; that is, paragraph 6 of the draft orders which provided to the wife only a right to apply under section 79A of the act to set aside the orders upon financial default in the payment of $40,000 or otherwise in the release of her from an existing guarantee.  After discussion with counsel, it is agreed that that matter is better dealt with as a notation to the order and counsel will draft an appropriate and agreed-to valuation.

11. Otherwise, I have read and understand the balance of the orders including the release by National Australia Bank of the wife from the guarantee and the circumstances required to bring that about.  These orders are final.  All existing applications will be dismissed.  The proceedings will be removed from the list of cases awaiting hearing.

12. For those brief reasons, and having a very proper understanding of the affidavits filed and the matters and facts in issue, I declare that these orders are just and equitable under section 79(2) of the act. I will have these extempore brief reasons for judgment transcribed, placed upon the court file and made available to all parties so that there can never be any misunderstanding as to the appropriateness of these orders, which are made in the presence of the parties and their experienced legal practitioners.

I certify that the preceding paragraphs are
a true copy of the reasons for judgment herein
of The Honourable Justice Young

………………………………………………………..
Associate: 
Date: 14 February 2007

IT IS NOTED that this judgment for all publication and reporting purposes be referred to as BURNS & BURNS