Cabot and Cabot

[2019] FamCA 636

FAMILY COURT OF AUSTRALIA

CABOT & CABOT [2019] FamCA 636

FAMILY LAW – PROPERTY – Interim distribution – Where the wife seeks orders for spousal maintenance by way of lump sum payment – Where the wife seeks, in the alternate, orders for periodic spousal maintenance – Where the wife seeks a lump sum payment for interim costs – Where the wife seeks leave to submit questions to the single expert out of time – Where the husband seeks orders dismissing the wife’s application – Where the husband seeks orders that wife provide disclosure in relation to overseas bank accounts – Where the husband consents to an order for partial property distribution in the sum of $200,000 – Where the application for interim spousal maintenance is dismissed – Orders made for interim partial property distribution – Order made for general disclosure by each party – Order made granting leave to the mother to submit questions to the single expert out of time.

Family Law Act 1975 (Cth) ss 72, 79, 80, 106B, 114, 117.
Evidence Act 1995 (Cth) s 144.
Family Law Rules 2004 r 4.15, 11.03, 12.07, 15.67A, 19.04, cl 6 of Sch 1.

Aitken & Murphy (No 2) [2012] FamCA 239
Aytugrul v R (2012) 286 ALR 441
Davidson & Davidson (No. 2) (1994) FLC 92-469
Yunghanns & Ors v Yunghanns & Ors (1999) FLC 92-836
Edgar & Strofield (2016) FLC 93-711
Gattellaro v Westpac Banking Corporation (2004) 204 ALR 258
Hall v Hall (2016) 257 CLR 490
Iphostrou & Iphostrou and Ors [2011] FamCA 20
Medlow & Medlow (2016) 54 Fam LR 389
Stanford & Stanford (2012) FLC 93-518
Strahan & Strahan (Interim Property Orders) (2011) FLC 93-466
Wenz & Archer (2008) 40 Fam LR 212

APPLICANT: Ms Cabot

RESPONDENT: Mr Cabot

FILE NUMBER: PAC 1189 of 2018

DATE DELIVERED: 10 September 2019

PLACE DELIVERED: Sydney

PLACE HEARD: Sydney

JUDGMENT OF: McClelland DCJ

HEARING DATE: 20 August 2019

REPRESENTATION

COUNSEL FOR THE APPLICANT: Mr Kirk QC

SOLICITOR FOR THE APPLICANT: Pearson Emerson Meyer Family Lawyers

COUNSEL FOR THE RESPONDENT: Mr Lloyd

SOLICITOR FOR THE RESPONDENT: Swaab Attorneys

Orders

1. That pursuant to s 79 and s 80 of the Family Law Act 1975 (Cth), there be a partial property distribution to Ms Cabot (“the wife”) in the sum of $200,000 with such amount to be obtained by the wife in accordance with the following Orders.

2. That, within 14 days of receiving a request from the wife, Mr Cabot (“the husband”) shall do all acts and things as is necessary to facilitate an application to be made by the wife to the National Australia Bank for either:

   (a)A draw down on the National Australia Bank mortgage secured over the property located at B Street, Suburb A, New South Wales, being the whole of the land and improvements comprised on Certificate of Title folio identifier … (“The Suburb A property”); or

   (b)A further loan or an increase in the National Australia Bank mortgage secured over the Suburb A property of $200,000.

3. For the purposes of Order (2), the husband shall do all acts and things and sign all documents necessary including providing such assistance as is reasonably requested by the wife to enable her to prepare and execute any and all applications for finance and providing any and all supporting documents that are in his possession and which are required for the purpose of the wife making the application.

4. That in the event of the loan application referred to in Order (2) being approved in full or in part, then the wife is to receive 100 percent of the advance that the National Australia Bank approves by way of partial property distribution.  

5. That pursuant to r 15.67A of the Family Law Rules 2004 (Cth) (“the Rules”), the time pursuant to r 15.65(1)(a) of the Rules be extended such that the wife be permitted to ask questions of the joint expert within seven (7) days of the date of these Orders.

6. That the wife meets the reasonable costs of the joint expert incurred as result of the wife making the request for questions in accordance with Order (5).

7. That within 12 weeks of bank statements being issued to each of the entities listed in this Order, in respect of bank accounts held or operated by those entities, the husband shall use his best endeavours to cause to be provided to the wife’s legal representatives copies of bank statements of the following:

   (i)C Pty Ltd;

   (ii)C Unit Trust;

   (iii)D2 Unit Trust;

   (iv)D Pty Ltd;

   (v)D1 Pty Ltd;

   (vi)D2 Pty Ltd;

   (vii)D2 Unit Trust;

   (viii)The E Pty Ltd;

   (ix)The E Unit Trust; and

   (x)The F Unit Trust.

8. Within 14 days, each party serve on the other a letter setting out any documents they assert are required to be disclosed by that other party, pursuant to the Rules, which they assert have not previously been disclosed.

9. Subject to Order (10), within seven (7) days of receipt of the list referred to in Order (8), the recipient forward to the requesting party copies of all documents referred to in the list.

10. If a party does not provide a document in accordance with Order (9), they are required to serve a letter on the other party setting out:

    (a)If a party asserts that the documents sought have previously been provided, the dates on which the documents were provided, including  a copy of relevant correspondence;

    (b)If a document is not available, the last time the document was in their possession; or

    (c)If they object to the production of a document, the basis for that objection.

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 Cabot & Cabot 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 SYDNEY

FILE NUMBER: PAC1189 of 2018

Ms Cabot

Applicant

And

Mr Cabot

Respondent

REASONS FOR JUDGMENT

Introduction

1. The Applicant, Ms Cabot (“the wife”), was born in 1965 and is currently aged 53 years. The Respondent, Mr Cabot (“the husband”), was born in 1965 and is currently aged 54 years. The parties met in 1985 when they were living in Country G and upon their marriage in 1993 began living together. There are three (3) adult children of the parties’ relationship, one (1) of whom continues to reside at the former matrimonial home with the wife. The matrimonial home, which is located in the suburb of Suburb A, is the major asset of the parties. The parties separated on 13 March 2018 and, since that time, they have been involved in proceedings before this Court. In those proceedings, the wife is seeking an outcome that would confirm her ongoing ownership of the matrimonial home which is in her name. The husband contends that the size of the parties’ property pool is such that an Order confirming the wife’s ongoing sole ownership of the matrimonial home would not represent a just and equitable adjustment of the parties property pursuant to s 79 of the Family Law Act 1975 (Cth) (“the Act”).

2. As is commonly the case, pending the final hearing of this matter, the parties are in dispute about a number of issues.  This decision concerns an interim Application by the wife for spousal maintenance, a litigation funding Order and leave to ask questions of a joint single expert out of time.  The husband, in response, has sought the dismissal of the wife’s Application, Orders for the sale of the matrimonial home and for there to be a partial property distribution between the parties.  He also seeks ancillary procedural Orders.

Background

1. In 1965, the husband was born in Country G.

2. In 1965, the wife was born in Country G.

3. On 29 June 1983, the Mr S Family Trust was established.

4. In 1993, the parties married and commenced living together.

5. On 4 May 1995, the Cabot Family Trust was established, with the husband, the wife and Mr H as appointers and K Pty Ltd as trustee.

6. In 1995, the parties’ eldest child, X, was born.

7. In 1995, the husband contends that he lent the Cabot Family Trust an amount which was in excess of $5 million.

8. In 1996, the parties moved to Australia.

9. On 23 November 1998, an amendment was made to the Mr S Family Trust to appoint the wife and her sisters, Ms L and Ms M, as additional trustees of the trust.

10. In 2000, the parties’ children, Ms Y and Ms Z, were born.

11. On 15 May 2002, the parties purchased, in the wife’s name, a property located at B Street, Suburb A (“the matrimonial home”).

12. In 2009, the wife’s father, Mr S, unfortunately passed away.

13. Subsequent to the passing of Mr S, there have been various transactions regarding his estate, including depositing proceeds of the estate into bank accounts in Country O which are in the name of the wife, her mother, Ms S, and her sister, Ms L.  There is a dispute between the parties in respect to the ownership of the proceeds held in those accounts.  By way of broad summary, the wife contends that the proceeds belong to her mother and that both herself and her sister are named as account holders as a matter of mere convenience.  Specifically, it is contended that having both of their names recorded as joint account holders assists both the wife and her sister to engage in transactions concerning the accounts for the benefit of their mother.

14. The husband, at this stage of the proceedings, questions whether that is an accurate characterisation of the accounts and whether it reflects the actual ownership of funds held in those accounts.  He therefore seeks further information concerning those accounts and, in particular, transactions that have occurred in respect to funds held in those accounts.  In other words, the husband contends that there is a live issue as to whether the wife has an interest in funds held in those accounts such that her interest should be identified and included as an asset of the wife for the purpose of these proceedings. I have been unable to make any determination in respect to that issue in these interim proceedings.

15. On 26 August 2016, the Ms S Family Trust was established.

16. On 13 March 2018, the parties separated.  The husband contends that, in the period subsequent to the parties’ separation, the Cabot Family Trust has paid approximately $1,554,000 on behalf of the husband, the wife and the children.

17. On 19 March 2018, the wife filed the Initiating Application in these proceedings.  The husband notes that the Financial Statement filed by the wife with her Initiating Application disclosed savings in banks in Australia of $299,289.  As noted, the husband also contends that the wife has failed to disclose funds held in other overseas accounts.  He further contends that the wife is a beneficiary of the Ms S Family Trust.

18. On 8 April 2018, the husband vacated the matrimonial home and on 24 April 2018 the husband filed his Response to the wife’s Initiating Application.

19. The husband notes that, on 21 September 2018, the wife filed a Financial Questionnaire in which she indicated that, as at the date of commencement of cohabitation, she had an interest in the Mr S Family Trust.

20. In December and January 2018/2019, the wife travelled to South East Asia and in February 2019, the wife travelled to New Zealand.  In April 2019, the wife travelled to Country N. The husband contends this is an indication of the wife’s ability to adequately support herself.

21. On 8 April 2019, the wife filed her Application in a Case seeking interim financial Orders and on 29 April 2019 the husband filed his Response to the wife’s Application in a Case.

22. On either 2 or 3 May 2019, the husband caused the amount of $40,000 to be transferred into the trust account of the wife’s legal advisers to assist her to fund these legal proceedings. 

23. On 14 May 2019, the husband paid an amount of $22,028 to the Australian Taxation Office in respect of the wife’s income tax payable for the financial year ending 30 June 2018.

24. On 4 June 2019, the wife resigned as a director of Ms S Pty Ltd and P Pty Ltd, in circumstances which the husband contends raises an issue in respect to the wife’s bona fides in seeking her present relief.  It has been unnecessary to determine that issue for the purpose of these proceedings.

25. On 7 June 2019, the wife received a refund from the Australian Taxation Office of $42,170.  The husband contends that the wife has failed to disclose how those funds have been applied. He further contends that the fact that the wife has received these funds is relevant to the Court’s consideration of the wife’s assertion that she is unable to adequately support herself.

Competing applications

The wife’s Application

1. The Order’s sought by the wife are set out in her Application in a Case filed 7 August 2019, as follows:

   Definitions

   1. For the purpose of these Orders:

   a. "Act" means the Family Law Act 1975.

   b. "ANZ Business Notice Term Deposit" means the Business Notice Term Deposit held with the ANZ Bank in the name of K Pty Ltd ATF the Cabot Family Trust, being Account Number …11 and which had a balance of $284,529 as at 7 May 2019.

   c. "J Street Lease" means the commercial lease entered into between The Trust Company Limited ("The Trust Company") as Lessor and D1 Pty Limited as Lessee, dated 9 March 2016 and which commenced on 1 January 2017.

   d. "Suburb A property" means the property situated at B Street, Suburb A in the State of New South Wales, being the whole of the land and improvements comprised on Certificate of Title folio identifier ….

   e. "Husband" means Mr Cabot born …1965;

   f. "Joint Expert" means Mr Q of R Firm, who was appointed by the Parties as a joint expert pursuant to Rule 15.44 of the Family Law Rules 2004, to value the Parties' respective interests in the Cabot Family Trust.

   g. "NAB mortgage" means the mortgage to National Australia Bank  secured over title to the Suburb A property, being registered mortgage number ….

   h. "Wife" means Ms Cabot born … 1965;

   i. "Parties" means the Husband and the Wife.

   Short Notice

   2. That leave be granted for this interim application to be listed for hearing on short notice.

   Spousal Maintenance

   3. That the Husband pay or cause to be paid direct to the Wife the sum of $120,000 by way of lump sum maintenance pursuant to s72 of the Act.

   OR IN THE ALTERNATIVE TO ORDER 3 AND 5 - 9

   4. That the Husband pay from the date of these orders, and pending further order, by way of interim spousal maintenance pursuant to s72 of the Act the sum of $3,300 per week into a bank account nominated by the Wife in writing.

   OR IN THE ALTERNATIVE TO ORDERS 3 AND 4

   5. That forthwith the Husband do all acts and things necessary to cause an application to be made to National Australia Bank for either:

   5.1 a drawdown on the NAB mortgage; or

   5.2 a further loan or an increase in the NAB mortgage, of $120,000.

   6. For the purposes of order 5 the Parties shall do all acts and things and sign all documents necessary, including preparing and executing any and all applications for finance and providing any and all supporting documents.

   7. That in the event the loan application referred to in order 5 is approved in full or in part, then the wife is to receive 100% of the advance that the National Australia Bank approves with such payment to be paid to the Wife and categorised as spousal maintenance.

   8. The Husband will pay the NAB mortgage repayments as and when they fall due.

   9. In the event that the sum of $120,000 is not paid to the wife within 14 days of the date of these orders, the husband pay by way of interim spousal maintenance pursuant to s72 of the Act, the sum of $3,300 per week into a bank account nominated by the Wife in writing.

   Interim Costs

   10. That within seven (7) days of the date of these Orders the Husband shall cause to be paid to the Wife an amount equal to each amount he has paid, or that has been paid on his behalf, including payments by way of trust distributions or loans to the husband from any corporate entity in which he has an interest, to his solicitors and barrister in relation to these proceedings for the period 6 May 2019 to the date of these orders.

   11. That from the date of these orders until the conclusion of these proceedings the Husband shall:

   11.1 account to the Wife on the last business day of each calendar month in respect of the legal costs that he has incurred or that have been incurred by any third party (including experts and counsel) on his behalf with his family law solicitors that month, whether or not he has paid the amount at the date of such account; and

   11.2 within 7 days of the Husband's compliance with order 11.1 of these Orders, cause to be paid to the Wife's family law solicitors' trust account an identical payment as that incurred with his family law solicitor, whether or not the Husband has paid the amount due to his family law solicitors.

   12. That the Wife have liberty to apply to the Court for the provision of such further sum that may be required to meet the Wife's costs and disbursements including but not limited to Counsel's fees, accountants and valuation fees and all other fees and charges reasonably incurred by the Wife in respect of the conduct of these proceedings.

   J Street Lease

   13. Within 7 days the Husband, in his capacity as director of D1 Pty Ltd, do all acts and things and sign all documents necessary to arrange for a replacement guarantee to be provided to The Trust Company under the J Street Lease.

   14. That the Husband, in his personal capacity and in his capacity as the director of K Pty Ltd, be restrained by injunction from disposing of the funds held in the ANZ Business Notice Term Deposit except with the consent of the Wife in writing or order of this Court.

   Questions to Expert

   15. That pursuant to Rule 15.67 A of the Family Law Rule 2004, the time pursuant to Rule 15.65(1 )(a) of the Family Law Rules 2004 be extended such that the Wife be permitted to ask questions of the Joint Expert within 7 days of the date of these Orders.

   Disclosure

   16. That within 7 days of bank statements being issued to each of the entities listed in 16.1 to 16.10, in respect of bank accounts held or operated by those entities, the Husband provide copies of those bank statements to the Wife's lawyers:

   16.1 C Pty Ltd;

   16.2 C Unit Trust;

   16.3 D2 Unit Trust;

   16.4 D Pty Ltd;

   16;5 D1 Pty Ltd;

   16.6 D2 Pty Ltd;

   16.7 D2 Unit Trust

   16.8 The E Pty Ltd;

   16.9 The E Unit Trust; and

   16.10 The F Unit Trust.

   17. That within 7 days the Husband provide all documents to the Wife, to the extent that he has not done so already, requested by her under cover of her letters dated 3 May 2019, 10 May 2019, 29 May 2019 and 3 July 2019.

   Costs

   18. The Husband pay the Wife's costs of, and incidental to, this Application.

2. During the course of the proceedings, the wife tendered an alternate Minute of Order (marked ‘Exhibit BW’ in the proceedings). It was submitted that, after hearing argument, the Court might consider those orders to be appropriate. It was nonetheless made clear that the wife was pressing the Orders she sought in her Application in a Case other than proposed Orders 13 and 14.

3. However, insofar as the husband partially consented to an Order proposed by the wife, in the proposed Minute of Order, Exhibit BW, it is to be noted that proposed Order 3 of that document, which was headed “Interim Costs”, was as follows:

   3.  The husband pay into the trust account of the wife’s solicitors the sum of $275,000 in the following instalments:

   3.1 $65,000 within 14 days of the date of these orders;

   3.2 $210,000 within 7 days of these proceedings being set down for hearing.

4. The wife’s case outline document (marked ‘Exhibit AW’ in the proceedings) makes it clear that the wife’s primary Application, in respect to litigation funding, is for a lump sum amount in accordance with proposed Order 3 in the Minute of Order.  The case outline document clarifies that proposed Orders 10, 11 and 12 of the wife’s Application in a Case are sought in the alternative to such an order for the payment of a lump sum amount.  As noted, by reference to the proposed Orders which have been set out above, those proposed Orders 10, 11, and 12 seek what is commonly known as a dollar-for-dollar costs order.

1. During the course of the proceedings, the parties helpfully reached an agreement in respect to proposed Order 16, whereby the husband has agreed to use his best endeavours to obtain and provide the relevant documentation within a period of 12 weeks. In addition, during the course of the proceedings, the parties indicated that they did not wish to be heard in respect to a general Order that I proposed in respect to outstanding disclosure. 

The husband’s Application

1. The Orders sought by the husband are set out in his Response to an Application in a Case filed 16 August 2019, as follows:

   1. That Ms S be joined as Respondent 2 to the proceedings, that Ms S Pty Ltd as trustee of the Ms S Family Trust be joined as Respondent 3 to the proceedings and that P Pty Ltd as trustee of the P Unit Trust be joined as Respondent 4 to the proceedings.

   2. That the wife's Application in a Case filed 7 August 2019 be dismissed.

   3. That within 7 days of the date of these Orders the wife reply to the questions posed and provide copies of the documents requested in a letter from Swaab to Pearson Emerson Meyer, dated 12 August 2019, a copy of which is annexed and marked "A".

   4. That within 7 days of the date of Orders the 2nd respondent provide to the husband's lawyers a schedule setting out the following details in relation to all overseas accounts in Country N and Country O of which the wife was a joint account holder with the second respondent from August 2015 to date

   (a) source of any credits including the identity of the payer;

   (b) date of withdrawal of funds;

   (c) the amount withdrawn;

   (d) the name of the recipient of the funds;

   (e) details of the financial institution, including the country, name of the account, branch and account number to which the funds were transferred.

   5.(a) That within 14 days of the date of Orders the wife do all acts and things and sign all necessary documents in order to place the former matrimonial home at B Street, Suburb A ("Suburb A") on the market for sale by way of public auction at an agreed minimum reserve price.

   (b) If there is a dispute as to the real estate agent to act on the sale of Suburb A, that the parties do all acts and things and sign all necessary documents in order to appoint the president or his/her nominee of the Real Estate Institute of NSW to determine said agent and the parties shall abide by his/her determination of same and equally pay any costs in obtaining the said determination.

   (a) If there is a dispute as to the solicitor/conveyancer to act on the sale of Suburb A, that the parties do all acts and things and sign all necessary documents in order to appoint the president or his/her nominee of the Law Society of NSW to determine the solicitor/conveyancer to act on the sale and the parties shall abide by his/her determination of same and equally pay any costs incurred in obtaining the said determination.

   (b) If there is a dispute as to the minimum reserve price, that the parties do all acts and things and sign all necessary documents in order to appoint the president or his/her nominee of the Real Estate Institute of NSW to determine the said price and the parties shall abide by his/her determination of same and equally pay any costs incurred in obtaining the said determination.

   (c) That the wife cooperate in every way to effect the sale of Suburb A, including but not limited to:

   (i) allowing inspection of Suburb A at all reasonable times as required by the agent;

   (ii) allowing open inspections of Suburb A by prospective purchasers at all reasonable times as nominated by the agent;

   (iii) not doing or saying anything to hinder or prevent a sale being effect;

   (iv) ensuring that Suburb A is in a neat and clean condition at the time of open inspections.

   (d) That the husband and the wife do all acts and things in order to distribute the proceeds of sale of Suburb A as follows and in the following priority:

   (i) agent's costs and other sale expenses;

   (ii) legal/conveyancing costs pertaining to the sale;

   (iii) adjustment of water rates and council rates;

   (iv) the amount of $200,000 to each party by way of part property settlement/interim costs which is to be added back into the Balance Sheet at the final hearing of the property settlement;

   (v) the net balance deposited into an interest bearing controlled monies account at an agreed bank in the joint names of the parties pending further order.

   (e) That neither the husband nor the wife nor either of their lawyers be permitted to withdraw any funds from the controlled monies account referred to above without the prior written consent of the husband and the wife or Court Order.

   6. That the wife's resignation as director of P Pty Ltd and Ms S Pty Ltd (the companies) be set aside in accordance with s106B of the Family Law Act 1975.

   7. That pending further order the wife be restrained from:

   (a) resigning as a director of the companies;

   (b) transferring her shareholding in the companies;

   (c) relinquishing her interest as a beneficiary of the Ms S Family Trust.

   8. That the wife pay the husband's costs of and incidental to these proceedings.

Evidence and witnesses

1. The wife relied upon the following documents:

   a)Application in a Case filed 7 August 2019;

   b)Affidavit of the wife filed 7 August 2019;

   c)Affidavit of Ms S filed 1 May 2019;

   d)Financial Statement filed 7 August 2019 by the wife; and

   e)Cost Notice pursuant to r 19.04 of the Family Law Rules 2004 (Cth) (“the Rules”).

2. The husband relied upon the following documents:

   a)Financial Statement filed 19 March 2018 by the wife;

   b)Financial Questionnaire filed 21 September 2018 by the wife;

   c)Affidavit of the wife filed 8 April 2019;

   d)Financial Statement filed 8 April 2019 by the wife;

   e)Affidavit of Ms S filed 1 May 2019;

   f)Affidavit of the husband filed 16 August 2019; and

   g)Financial Statement filed 16 August 2019 by the husband.

3. The following exhibits were relied upon:

   a)Case outline of the wife (‘Exhibit AW’);

   b)Proposed Minute of Order of the wife (‘Exhibit BW’);

   c)Annexures to the wife’s Affidavit (‘Exhibit CW’);

   d)Joint accountant, Mr Q of R Firm, report dated 11 April 2019 (‘Exhibit DW’);

   e)Financial Statement of the husbanded dated 20 August 2019 (‘Exhibit EH’);

   f)Cost notice provided by the husband dated 19 August 2019 (‘Exhibit FH’); 

   g)Cost notice provided by the wife dated 19 August 2019 (‘Exhibit FW’); and

   h)Wife’s bank statements provided pursuant to r 4.15 of the Rules (‘Exhibit GW’).

Interim spousal maintenance

1. The wife has primarily sought that the husband pay her a lump sum amount of $120,000.  In the alternative, the wife seeks an Order for the payment of periodic spousal maintenance in the sum of $3,300 per week.  In the further alternative, the wife seeks Orders which appear to be in the nature of mandatory injunctions requiring the husband to approach the National Australia Bank with a view to applying for a further draw down on the mortgage with that bank or a further loan with a view to increasing the mortgage to facilitate the payment to the wife of the amount of $120,000.  As noted, the Orders propose that the funds so paid to the wife be categorised as “spousal maintenance.”

2. In Hall v Hall (2016) 257 CLR 490 at [496], the High Court described the “gateway” requirement for the consideration of a spousal maintenance application pursuant to s 74 of the Act. The gateway requirement is set out in s 72(1) of the Act, as follows:

   (1)  A party to a marriage is liable to maintain the other party, to the extent that the first-mentioned party is reasonably able to do so, if, and only if, that other party is unable to support herself or himself adequately whether:

   (a)  by reason of having the care and control of a child of the marriage who has not attained the age of 18 years;

   (b)  by reason of age or physical or mental incapacity for appropriate gainful employment; or

   (c)  for any other adequate reason;

   having regard to any relevant matter referred to in subsection 75(2).

3. The difficulties associated with making findings of fact in interim proceedings have been acknowledged.  As the Full Court said in Edgar & Strofield (2016) FLC 93-711 at [15]:

   …the limits to an interim hearing are well known.  Disputed issues of fact cannot be resolved at an interim hearing...

4. Despite those limitations, in Hall v Hall (supra) at [497], the High Court confirmed that:

   No doubt, on an application for an interim order “[t]he evidence need not be so extensive and the findings not so precise” as on an application for a final order. But there is nothing to displace the applicability to an exercise of the power conferred by s 74(1) of the ordinary standard of proof in a civil proceeding now set out in s 140 of the Evidence Act 1995 (Cth).

   [References omitted] 

5. The parties’ children have all reached maturity, however, the wife contends that she is unable to adequately support herself because of a diminished capacity to find employment.  In that context, at paragraph 36 of her Affidavit, the wife states that she has not been in paid work since the parties first came to Australia in 1996 and that, instead, she has dedicated herself to the care of the children.  Further, at paragraphs 55 through to 60 of her Affidavit the wife states, as follows:

   55. I have not been in paid employment since we first came to Australia in 1996 and I do not have any other income which I receive to meet the expenses I incur for myself each week.

   56. When Mr and I arrived in Australia in 1996 X was only nine months old however I had stopped working full-time just before X was born and whilst we were still living in Country G. I continued to care for X upon arrival in Australia and have continued to run the home and care for the children over the 23 years that we have lived in Australia.

   57. Mr never expected me to work and would regularly say to me during the course of the marriage:

   "I am earning enough money for us so that you will never have to work."

   and

   "You just leave the business to me and worry about running the house and looking after the kids"

   and

   "I am working hard to earn the money so you don't have to work".

   58. I have not taken any steps to obtain paid employment outside of the home. This is partly because I have continued my role as homemaker to the children. Both Y and Z completed their HSC in 2018 and after Mr Cabot moved out of the Suburb A property in April 2018, I was solely responsible for caring for them and assisting them with their heavy study and assessment load.

   59. I do not charge X board for living in the Suburb A property. Mr Cabot and I had always agreed that we would allow the children to remain living in the home rent free for as long as they needed. I recall that in or around May 2017 Mr and I were discussing the fact that his nieces and nephews, who were in their late twenties and working full time, were still living at home. During the course of that conversation Mr Cabot said to me " understand why they are living at home. Not having to pay rent gives them a chance to save money to put towards a mortgage one day. I will do the same for my children".

   60. My capacity to earn is not significant. I have no training or qualifications to enable me to obtain gainful employment and as such I do not anticipate being in a position to enter the workforce.

6. During the course of the proceedings, it was acknowledged that while the wife stated, in paragraph 60 of her Affidavit, that she has “no training or qualifications” to enable her to obtain gainful employment, it is the case that, prior to moving to Australia, the wife was awarded a commerce degree from a university in Country G.  It was, nonetheless, submitted by senior counsel for the wife that the Court could infer that those qualifications obtained by the wife more than 25 years ago in a foreign country are not such that they will assist the wife to obtain employment as a 53 year old woman who has been out of the workforce for a considerable period of time.

7. It was contended, by the senior counsel for the wife, that the Court should take judicial notice of the fact that the wife, who is 53 years of age with such a limited qualification, would have difficulty in obtaining employment.

8. Respectfully, I do not accept that this is a matter in respect to which it is appropriate to take judicial notice. Section 144 of the Evidence Act 1995 (Cth) (“the Evidence Act”) displaces the common law doctrine of judicial notice: Gattellaro v Westpac Banking Corporation (2004) 204 ALR 258 at [17], per Gleeson CJ, McHugh, Hayne and Heydon JJ; Aytugrul v R (2012) 286 ALR 441 at [21], per French CJ, Hayne, Crennan and Bell JJ.

9. Section 144 of the Evidence Act provides:

   Matters of common knowledge

   (1) Proof is not required about knowledge that is not reasonably open to question and is:

   (a) common knowledge in the locality in which the proceeding is being held or generally; or (b) capable of verification by reference to a document the authority of which cannot reasonably be questioned.

   (2) The judge may acquire knowledge of that kind in any way the judge thinks fit.

   (3) The court (including, if there is a jury, the jury) is to take knowledge of that kind into account.

(4) The judge is to give a party such opportunity to make submissions, and to refer to relevant information, relating to the acquiring or taking into account of knowledge of that kind as is necessary to ensure that the party is not unfairly prejudiced.

1. With respect to senior counsel for the wife, it would not be reasonable for me to find that a woman of 53 years of age will be unable to find employment or face difficulty in finding employment such that they are able to adequately support themselves merely because they have been out of the workforce for a considerable period of time. In this case, the wife states she has not been in full-time employment since shortly before the birth of X in 1995 and has not been in any form of paid employment since moving to Australia in 1996.  Whether or not she will face difficulty in obtaining employment may depend upon a range of factors including, to identify but a few: the nature of the position sought; the person’s general level of health and education including the extent to which they are or are not literate; the manner in which they present; the persons general life skills; and, even contacts that the person has who may provide assistance to obtain employment.

2. Accordingly, without the wife having applied for employment, the contention that she would face difficulty in obtaining such employment is a matter of mere conjecture.  In that respect, the wife contends, at paragraph 60 of her Affidavit, that, as result of the fact that she has been out of the workforce since 1996 in circumstances where she states she has “no training or qualifications,” she does not “anticipate being in a position to enter the workforce.”  As noted by the High Court, in Hall v Hall (supra), the wife carries the onus of satisfying the Court on the balance of probabilities that she has satisfied the gateway requirements of s 72(1) of the Act. I am not satisfied that the wife meets the requirements of s 72(1), as set out above. In the absence of evidence of the wife attempting to obtain employment, it is a matter of mere speculation and conjecture as to whether she would, as she anticipates, be unable to find employment to enable her to support herself adequately.

3. In those circumstances the wife’s Application for spousal maintenance must be dismissed.

Lump sum interim property distribution for litigation funding

1. As noted, paragraphs 5, 6, 7 and 8 of the wife’s Application in a Case seeks, in the alternative to her claims for spousal maintenance as set out in paragraphs 3 and 4 of her Application in a Case, Orders that are in the nature of a mandatory injunction requiring the husband to approach the National Australia Bank to obtain funds in order to pay the wife the sum of $120,000.

2. While expressed in the Application in a Case, filed by the wife, as a claim in respect to spousal maintenance, during the course of the proceedings, senior counsel for the wife contended that the Court has power to make such an order by way of an interim property distribution.  As a related matter, senior counsel for the wife contended that the Court similarly has power to make an Order, as sought in ‘Exhibit BW’, by way of partial distribution of property in the sum of $275,000 as sought by the wife.

The law in respect to interim property distributions

1. Section 79 and s 80(1)(h) of the Act confer power on the Court to make orders for an interim property settlement including, as in this instance, for litigation funding. By way of summary, the relevant legal principles that I apply in this matter are as follows:

   ·Section 79 confers a discreet power to make Orders for property settlement and the Court may exercise that power through “a succession of orders until the power ... is exhausted” or until a final order dealing with all the known property of the parties is made: Gabel & Yardley (2008) 40 Fam LR 66, as cited in Strahan & Strahan (Interim Property Orders) (2011) FLC 93-466 at [85,640] (“Strahan & Strahan”).  

   ·Section 80 is not, in itself, a source of jurisdiction for such an Order to be made. Rather, the section is an “enabling provision” that provides various ways in which the general power in s 79 may be exercised in individual cases: Davidson & Davidson (No. 2) (1994) FLC 92-469 and Yunghanns & Ors v Yunghanns & Ors (1999) FLC 92-836. This includes, by s 80(1)(h), the making of “a permanent order, an order pending the disposal of proceedings or an order for a fixed term or for a life or during joint lives or until further order.”

2. There are two stages to the hearing of an Application for interim property adjustment orders: Strahan & Strahan (supra) at [85,645]-[85646]: The first stage is a “procedural step” which requires an analysis of whether the circumstances of the case trigger the Court’s power to invoke s 80(1)(h) to make an order for partial property adjustment. At this stage, the “overarching consideration” is the interests of justice.

3. The second stage is the “substantive step” where the provisions of s 79 must be considered and applied, but with limitations, given that it is not the final hearing.

4. The overriding consideration at all stages of the process is that the Court is satisfied that it is “just and equitable” to make the order in circumstances before the Court: Stanford & Stanford (2012) FLC 93-518 at [86,640]-[86,642].

5. In Medlow & Medlow (2016) 54 Fam LR 389 at [410], the Full Court said:

   The onus was clearly upon [the applicant for relief] to establish that there were sufficient assets available for the interim distribution and that the effect of any interim order was capable of being reversed as part of the final hearing or at least would not defeat [the respondent]’s property claim. The onus was not on the [respondent] to adduce such evidence.

6. There are a variety of circumstances in which interim property settlement Orders have been made, such as those summarised by Riethmuller FM (as he then was) in Wenz & Archer (2008) 40 Fam LR 212. Relevantly, for the purpose of these proceedings this includes, as in Wenz & Archer (supra) at [53], where a party may need access to resources to “meet debts which may result in the party being pursued by creditors.”

7. It is also relevant to not that, in evaluating an Application for a litigation funding Order, it is appropriate to have some regard to the fact that, in family law proceedings, one party may have the predominance of resources: Strahan & Strahan (supra) at [85,643] – citing, with approval, Riethmuller FM in Wenz v Archer (supra) at [53].

8. In that respect the authorities are quite clear that, wherever possible, the Court should endeavour to even out the playing field between litigants where one party, in this case the husband, has predominant control of and access to the matrimonial property pool: Iphostrou & Iphostrou and Ors [2011] FamCA 20 at [60].

1. In the context of interim property orders, in Strahan & Strahan (supra) at [85,631], Boland and O’Ryan JJ analysed relevant authorities and noted:

   In Poletti and Poletti  Nygh J, when describing an application for “interim costs”, referred to the reasons of the Full Court in Wilson and Wilson and said it is a “situation where one party to the marriage controls almost exclusively what might be described as the patrimony of the parties and has control of the bulk of the assets and funds of the parties, where an order may be made to ensure that the other party, who does not have the fortune of controlling those funds, at least has an equal or near equal opportunity to present his or her case”: see also In the Marriage of Polletti  at 796 per the Full Court (Ellis, Strauss and Butler JJ). The Full Court in Zschokke at 83,220 made a number of relevant remarks about the “desirability of legal representation for both parties in family law proceedings”.

   [Citations omitted]

2. In this matter, the husband consented to the Court making an Order for interim property distribution in favour of the wife in the sum of $200,000.  While that amount was not particularised, it would be an amount that includes the sum of $120,000 that the wife seeks to meet her weekly expenses in order to sustain herself. It would also include the first tranche of the lump sum amount which the wife seeks for interim costs in the sum of $65,000.  Implicitly, therefore, the husband acknowledges that each of the requirements of Strahan & Strahan (supra) are satisfied. As noted, these requirements are that it is in the interests of justice for there to be an Order for partial property distribution to the wife in the sum of $200,000 and, further, that it is just and equitable for such an order to be made having regard to the matters set out in s 79 of the Act. Further, it is implicit that the husband acknowledges that such an interim property distribution can be adjusted or accommodated at final hearing, consistent with the principles adumbrated in Medlow & Medlow (supra).

3. In my view, an interim partial property distribution in order to enable a party to meet their week to week expenses to sustain themselves falls within the category of cases identified by Riethmuller FM in Wenz & Archer (supra) at [53]. It is, therefore, appropriate to make an Order for there to be a partial property distribution in favour of the wife in the sum of $120,000. It is in my view, however, inappropriate for such an Order to be categorised as a payment of spousal maintenance in circumstances where I have determined that the wife has not made out such a claim.

4. Similarly, for reasons discussed by the Full Court in Strahan & Strahan (supra) at [85,631], I am satisfied that it is appropriate for there to be an Order for there to be a further lump sum payment in the sum of $65, 000 to the wife to enable her to meet her litigation expenses up until the point of the parties attending a conciliation conference. I note that the husband consents to the wife receiving an interim property distribution of $200,000 and I will make orders in those terms. It is a matter for the wife as to whether she wishes to draw down or borrow the additional $15,000.

5. I am not, however, satisfied that it is appropriate, at this stage of the proceedings, to make an Order for there to be a second interim property distribution to the wife in the sum of $210,000 for interim costs.  This is because, in my view, it is not in the interests of justice for there to be a further interim property distribution to pay an amount to the wife on the assumption that the case will proceed to final hearing. In that respect, it is of significance that the parties are yet to attend a mediation or conciliation conference. It is premature to make an Order that necessarily assumes that either or both of those processes will fail.

6. In forming that view, I note that s 79(9) of the Act provides that, unless the Court is satisfied that an exception applies, final Orders in respect to the distribution of the parties property are not to be made unless the parties to the proceedings have attended a conference in relation to the matter with a Registrar or Deputy Registrar of the Court. Rule 12.07(2) of the Rules requires the parties attending the conciliation conference to make “a genuine effort to reach agreement on the matters in issue between them.”

7. I further note that cl 6(1)(c) of Sch 1 to the Rules provides that, subject to it being in the best interests of their client, lawyers are required to endeavour to reach a solution by settlement rather than to continue legal action.

8. It is to be noted that the wife sought orders requiring the husband to be the borrower of the funds to be paid to the wife and also to pay interest in respect to any funds obtained from the National Australia Bank. In circumstances where I have dismissed the wife’s claim for spousal maintenance and I was not addressed on the potential application of s 114 of the Act, which empowers the Court to grant an injunction including a mandatory injunction, I decline to make such an Order in circumstances where the wife is the legal owner of the matrimonial home which is the property against which the mortgage is secured.

9. As it was consented to, I will, however, make an Order for there to be an interim property distribution to the wife in the sum of $200,000 together with an Order requiring the husband to do all such things as are necessary to facilitate the wife making an a application to the National Australia Bank for either a draw down on the National Australia Bank mortgage secured over the matrimonial home, or to obtain a further loan or an increase in the National Australia Bank Mortgage to the amount of $200,000.

Dollar for dollar Order

1. As previously noted, the wife’s Application for a dollar for dollar litigation funding Order was expressed in the alternative to her Application for there to be an Order for the payment of a lump sum amount by way of partial property distribution.  I have declined to make an Order for the payment of the second lump sum sought by the wife in order to fund her legal expenses in the post conciliation phase.  For similar reasons, I decline to consider the wife’s Application for an Order in respect to her anticipated legal costs by way of a dollar for dollar Order.

2. It is therefore unnecessary for me to consider the issue as to whether the Court has the power to make a dollar for dollar order pursuant to s 117 of the Act.

Extension of time to submit further questions to a single expert

1. Proposed Order 15 of the wife’s Application in a Case seeks an extension of time for her to ask questions, pursuant to r 15.67A of the Rules, of the single expert valuer, Mr Q, who has provided a report to the parties dated 11 April 2019 (marked ‘Exhibit DW’ in the proceedings).

2. That Application is opposed by senior counsel for the husband who contends that the wife’s evidence does not address the matters, in respect to which the Court is required to be satisfied, pursuant to r 11.03 of the Rules. That rule relevantly provides that, in considering whether to grant an extension of time for a party to undertake an act which is otherwise permissible under an order of the Court or the rules of the Court, the Court is required to consider:

   (a) whether there is a good reason for the non-compliance;

   (b) the extent to which the party has complied with orders, legislative provisions and the pre-action procedures;

   (c) whether the non-compliance was caused by the party or the party's lawyer;

   (d) the impact of the non-compliance on the management of the case;

   (e) the effect of non-compliance on each other party;

   (f) costs;

   (g) whether the applicant should be stayed from taking any further steps in the case until the costs are paid; and

   (h) if the application is for relief from the effect of subrule 11.02(1)--whether all parties consent to the step being taken after the specified time.

3. The reasons for the wife’s non-compliance, within the time limit specified in the Rules, for a party to request answers from a single expert, are explained at paragraphs 142 through to 147 of the wife’s Affidavit. Essentially, it appears that the questions have been drafted for the wife with the assistance of a “shadow expert” as identified in paragraph 146 of the wife’s Affidavit.

4. A party is, of course, entitled to prepare their case as best they see fit including by retaining the services of a “shadow expert.” However, if that course of action is adopted, every endeavour should be made to ensure that any questions drafted by the shadow expert for the assistance of a party are submitted within the timeframe specified in the Rules.

5. Nevertheless, I am not satisfied that the husband will suffer any real prejudice other than in respect to costs if the questions are now submitted to the single expert by the wife.

6. On that basis, I propose to make an Order in terms of proposed Order 15 sought by the wife save to the extent that I will include, in that Order, that the wife is responsible for any additional costs incurred by the single expert in responding to the questions asked by the wife.

Further disclosure

1. As noted earlier in this decision, during the course of the proceedings, I discussed with the parties a proposal that, in lieu of the Orders each of the parties are seeking in respect to further disclosure, I make a general Order requiring the parties to notify the other of any additional documents or categories of documents that they require the other party to disclose.  After that notice is received, the other party is to provide those documents or to particularise the reasons for the non-disclosure.  Neither party wished to be heard in opposition to that proposed course of action. Accordingly, I have made an Order to that effect.

Orders sought by the husband

1. At the hearing the husband indicated he was not, at this stage, pressing proposed Order 1 of the Orders sought in his Response filed 16 August 2019 until such time as he obtains additional information from the wife.

2. The Order I have made for general disclosure addresses or, at least, substantially addresses the matters set out in proposed Orders 3 and 4 of the husband’s Response.

3. The husband acknowledged that it was inappropriate, in these interim proceedings, for the Court to consider whether an Order should be made under s 106B of the Act as proposed in the prayer 6 of the husband’s Response. Proposed Order 7 of the husband’s Response was related to that issue and, similarly, is therefore not addressed.

4. Accordingly, the major issue to consider in terms of the husband’s Application is whether, at this stage of the proceedings, an Order should be made requiring the parties to sell the matrimonial home.

5. The reasons advanced by the husband for that proposed course of action are set out in paragraphs 17 through to 20 of the husband’s Affidavit.  Most relevantly, for the purpose of these proceedings, the husband contends that, at the conclusion of this case, it will be necessary for the matrimonial home to be sold in order to facilitate the just and equitable distribution of the parties’ matrimonial property.  Specifically, he contends that the Orders sought by the wife, in her Application for final orders filed 19 March 2018,  to retain the matrimonial home, “would constitute a division of no less than and 113% in her favour.”

6. The difficulty is that, for reasons which I have earlier set out, it is not possible in interim proceedings to make findings of fact where they are in dispute.  Relevantly, the wife maintains her contention that, at final hearing, it will be found that there are sufficient assets between the parties such that it would be appropriate for the Court to make an Order for her to retain the matrimonial home.

7. In that context, in Aitken & Murphy (No 2) [2012] FamCA 239 at [158], Young J said that, in considering whether to make an Order for a partial distribution of property prior to final hearing, “care must be taken not to potentially defeat any party’s claim or legitimate expectations in a final hearing,” including, the fact that a party should not be “required to liquidate an asset reasonably sought to be retained in the final hearing.”

8. At this stage of the proceedings, the issues in dispute between the parties, including in respect to the potential size of the property pool, are such that it is not possible for me to determine whether the wife’s Application that she retain the matrimonial home is reasonable.

9. Accordingly, at this stage of the proceedings, I decline to make that Order sought by the husband for the matrimonial home to be sold.

Conclusion

1. For all the reasons as set out in this decision, I make the Orders as set out at the commencement of my reasons for judgment.

I certify that the preceding eighty six (86) paragraphs are a true copy of the reasons for judgment of the Honourable Deputy Chief Justice McClelland delivered on 10 September 2019.

Associate: 

Date:  10 September 2019