Caine & Seddon (No 2)
[2022] FedCFamC2F 1286
Federal Circuit and Family Court of Australia
(DIVISION 2)
Caine & Seddon (No 2) [2022] FedCFamC2F 1286
File number(s): ADC 2127 of 2021 Judgment of: JUDGE DICKSON Date of judgment: 23 September 2022 Catchwords: FAMILY LAW – Property – undefended final hearing –de facto relationship – small asset pool – where respondent has failed to engage in proceedings – where Court is satisfied that respondent is on notice of these proceedings – where applicant is appointed as sole trustee for sale of the former home – where respondent entered into a Tenancy Agreement over the former home without the applicant’s knowledge or consent – where applicant is granted sole use and occupancy of the said home – significant post separation contributions by the applicant – where adjustment made for applicant’s legal costs incurred throughout litigation - future needs – where applicant has sole care of the children – just and equitable for there to be a 80/20% split in the applicant’s favour of the net non-superannuation assets – applicant to retain her superannuation – just and equitable Legislation: Family Law Act 1975 (Cth) Pt VIIIAB, ss 90SF, 90SM
Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) rr 10.27, 11.56
Cases cited: Clauson & Clauson [1995] FamCA 10, (1995) FLC 92-595, 18 Fam LR 693
Jabour & Jabour [2019] FamCAFC 78
Ragusa & Ragusa [2021] FedCFamC2F 470
Stanford & Stanford (2012) 247 CLR 108
Division: Division 2 Family Law Number of paragraphs: 79 Date of hearing: 12 September 2022 Place: Adelaide Counsel for the Applicant: Ms Ross Solicitor for the Applicant: Mildwaters Lawyers The Respondent: did not appear ORDERS
ADC 2127 of 2021 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 2)
BETWEEN: MS CAINE
Applicant
AND: MR SEDDON
Respondent
order made by:
JUDGE DICKSON
DATE OF ORDER:
23 SEPTEMBER 2022
UPON NOTING:
A.Pursuant to rule 11.59(b) of the Federal Circuit and Family Court of Australia (Family Law) Rules 2021 the Court is satisfied that the tenant of the B Street, Town C property being Ms G has received notice of the terms of the order for enforcement.
THE COURT ORDERS THAT:
1.As and by way of final orders for property settlement:
(a)the Applicant is hereby appointed as the sole agent on behalf of the parties for the sale of the property of the real estate known as B Street, Town C (“the B Street, Town C property”) and for that purpose the following shall apply: -
(i)the Applicant is hereby authorised to do all such things and sign all such documents necessary to list and sell the B Street, Town C property and it shall be listed for sale by private treaty with D Real Estate in Town E or with such other agent as the Applicant appoints (“the real estate agent”);
(ii)the list price of the B Street, Town C property shall be such sum as is recommended by the real estate agent as an appropriate list price;
(iii)the sale price of the B Street, Town C property shall be such amount as is at least 90% of the list price and shall be accepted by the Applicant as the sale price;
(iv)the parties are to co-operate in every way with the real estate agent in relation to the marketing of the property for sale;
(v)upon settlement of the B Street, Town C property, then any net proceeds of sale of that property shall be disbursed as follows: -
A.payment of all monies owing and secured by registered mortgage number … to the Commonwealth Bank of Australia over the B Street, Town C property;
B.payment of all agent’s commission and advertising or other agent’s expenses of sale;
C.payment of the legal and conveyancing expenses relating to the sale;
D.payment of all remaining matrimonial liabilities including:-
(i) Council rates owing on the B Street, Town C property;
(ii) SA Water Rates owing on the B Street, Town C property;
E.Such sum representing EIGHTY PERCENTUM (80%) of the parties total net non-superannuation assets after bringing to account the assets to be retained by the applicant value at $3,000.00, to be deposited in the Trust Account of the Applicant’s solicitors, Mildwaters Lawyers, for and on behalf of the Applicant.
F.The balance thereof (if any) to the Respondent.
(b)that pending sale and settlement of the B Street, Town C property the Applicant shall have sole use and occupancy of the B Street, Town C property.
(c)that the Applicant do retain as her sole property the following:
(i)jewellery and furniture and effects;
(ii)the Motor Vehicle 1;
(iii)cash savings and bank accounts in her sole name;
(iv)her Super Fund F superannuation entitlements;
(v)any long service and annual leave entitlements; and
(vi)any other property in her possession.
(d)the Respondent do retain as his sole property the following: -
(i)jewellery and furniture and effects;
(ii)the Motor Vehicle 2;
(iii)the motorbike;
(iv)the Motor Vehicle 3;
(v)the camper trailer;
(vi)cash savings and bank accounts in his sole name;
(vii)his superannuation entitlements;
(viii)any long service and annual leave entitlements; and
(ix)any other property in his possession.
(e)that each party shall indemnify and keep indemnified the other party for all liabilities in his or her sole name including any Capital Gains Tax arising from the sale of the said B Street, Town C property.
2.In the event that the tenant Ms G fails to vacate the B Street, Town C property within 28 days of the date hereof, then in accordance with rule 11.61(2) of the Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (‘the Rules’) an enforcement warrant do issue in accordance of rule 11.56 of the Rules authorising an enforcement officer to enter the said B Street, Town C property and give possession of the said property to the Applicant, being a person entitled to possession in accordance with the terms of this order.
3.Pursuant to rule 11.62 of the Rules, the enforcement officer may, when enforcing a warrant (with such assistance as the enforcement officer requires) and, if necessary, by force, do any of the following:
(a)Enter and search the said property; and
(b)Take possession of or secure against interference of the said property the subject of the warrant; and
(c)Enter and remove from the property any person who is not lawfully entitled to be on the said property.
4.If the Respondent refuses or neglects to sign or execute any deed or instrument necessitated by these Orders a Judicial Registrar or Deputy Registrar of the Court is hereby appointed to sign or execute the deed or instrument in the name of the Respondent and to do all things necessary to give validity and operation to the deed or instrument, with the cost of obtaining such signature or execution by the Court officer to be paid by the Respondent.
5.All extant applications be dismissed.
6.Liberty to the Applicant to apply for consequential orders on short notice.
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 a pseudonym Caine & Seddon (No 2) has been approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
REASONS FOR JUDGMENT
JUDGE DICKSON:
INTRODUCTION
These reasons concern an application for property settlement filed by the applicant de facto wife (‘the applicant’) on 5 May 2021.
These reasons are to be read in conjunction with the Reasons for Judgment dated 28 March 2022, being Caine & Seddon [2022] FedCFamC2F 462.
BACKGROUND
The parties in this matter are the applicant, Ms Caine, and the respondent, Mr Seddon (‘the respondent’). The parties commenced a relationship in 2006 and separated for the final time on 27 October 2019, hence it was a relationship of some 13 years duration.
There are two children of the relationship, X born in 2016 now aged six years and Y who was born in 2015 and is now aged seven years.
The said children reside with the applicant and as at the date of Trial spend no time with the respondent.
A final Intervention Order naming the applicant as the Protected Person and the respondent as the Defendant was made in the Town K Magistrates Court on 29 October 2020.
On 8 July 2022, an order was made listing the applicant’s property settlement application for Trial on an undefended basis.
HISTORY OF PROCEEDINGS
I incorporate paragraphs 4 through 9 of my Reasons for Judgment dated 28 March 2022 as to the litigation history in this matter at that date.
On 8 April 2022, an order was made in Chambers at the request of the applicant varying the agent to be engaged for the sale of the B Street, Town C property. Accordingly, paragraph 1(a)(i) of the orders made 28 March 2022 were varied to include the words ‘or such other real estate agent as the applicant appoints for that purpose’.
On 8 July 2022, the matter was again listed before the Court. The respondent yet again failed to appear at Court, either in person or with the assistance of a legal representative. The Court was advised that there had been ongoing difficulties with respect to the sale of the B Street, Town C property. The Trial date of 10 August 2022 was confirmed with an order made that it proceed on an undefended basis. Further directions were made for the filing of updated Trial material by no later than 6 August 2022.
On 10 August 2022, the respondent again failed to appear in person or represented by a legal representative. Regrettably, there had been delays in the filing of the applicant’s updated Trial material given COVID-19 health complications affecting both the applicant and her solicitor. In those circumstances, the Trial did not proceed and was listed for final hearing on 12 September 2022.
On 10 August 2022, a further order was made during the period of the adjournment directing the applicant to personally serve the tenant of the B Street, Town C property Ms G (‘Ms G’) with a letter informing her that the applicant intends to proceed with an application for the sale of the said property and for sole use and occupation pending sale. The order further provided for the said Ms G to be advised that the applicant would pursue an enforcement warrant should Ms G fail to vacate as required.
In short, as the summary sets out above, the respondent has failed to participate in the proceedings up to the date of Trial. The sheer volume of Affidavits of Service filed by the applicant demonstrate the lengths to which she has gone to bring these proceedings to the attention of the respondent, ultimately to no avail.
DOCUMENTS RELIED UPON BY THE APPLICANT
The applicant gave brief updating evidence in chief and otherwise relied upon the following documents at Trial on 12 September 2022:
Court documents
(1)Initiating Application filed 5 May 2021;
(2)Trial Affidavit of Ms Caine filed 22 August 2022;
(3)Financial Statement of Ms Caine filed 5 May 2021;
(4)Affidavit of Ms Caine filed 9 September 2022;
(5)Affidavit of Service filed 27 July 2021;
(6)Affidavit of Service filed 9 November 2021;
(7)Affidavit of Service filed 4 March 2022;
(8)Affidavit of Service filed 21 March 2022;
(9)Affidavit of Service filed 11 April 2022;
(10)Affidavit of Service filed 8 August 2022;
(11)Affidavit of Service filed 18 August 2022;
(12)Affidavit of Service filed 25 August 2022;
(13)Cost Notice filed 7 September 2022;
(14)Affidavit of Ms Caine filed 9 September 2022;
(15)Outline of Case Document filed 11 September 2022; and
(16)Affidavit of Service filed 12 September 2022.
Exhibits
(1)Letter to Ms G dated 16 August 2022 from Mildwaters Lawyers (Exhibit A3);
(2)Rates Assessment in the joint names of the parties for the B Street, Town C property showing balance as at 2 September 2022 of $5,823.85 (Exhibit A4);
(3)Undated letter from D Real Estate to the applicant confirming sale details for the B Street, Town C property (Exhibit A5);
(4)D Real Estate property marketing schedule in the name of the applicant (Exhibit A6); and
(5)D Real Estate Residential Sales Agency agreement signed by the applicant on 11 September 2022 (Exhibit A7).
ISSSUES TO BE DETERMINED AT TRIAL
The issues for the Court to determine at Trial are as follows:
(1)The weight to be attached to the parties’ various financial and non-financial contributions;
(2)Their respective future needs, if any;
(3)A percentage division of the gross asset pool bringing to account the factors set out in section 90SM of the Family Law Act 1975 (Cth) (‘the Act’);
(4)Whether or not there should be a superannuation splitting order made in favour of the respondent.
ORDERS SOUGHT AT TRIAL
At Trial, the applicant sought the following orders:
1. That all previous orders be discharged.
2.That as and by way of final orders for property settlement it is ordered as follows: -
(a) the Applicant is hereby appointed as the sole agent on behalf of the Applicant and the Respondent for the sale of and shall do all do all acts and sign all documents necessary to list the real estate known as [B Street, Town C] South Australia (“the [B Street, Town C] house”) for sale and for that purpose the following shall apply: -
(i) the [B Street, Town C] house shall be listed for sale by private treaty with [D] Real Estate in [Town E] or with such other agent as the Applicant appoints (“the real estate agent”);
(ii) the list price of the [B Street, Town C] house shall be such sum as is recommended by the real estate agent as an appropriate list price;
(iii) the sale price of the [B Street, Town C] house shall be such amount as is at least 90% of the list price and shall be accepted by the Applicant as the sale price;
(iv) the parties are to co-operate in every way with the real estate agent in relation to the marketing of the property for sale;
(v) when the [B Street, Town C] house is sold, then any net proceeds of sale of that property shall be paid in the following manner: -
(1) payment of all monies owing and secured by registered mortgage number … to the Commonwealth Bank of Australia over the [B Street, Town C] house;
(2) payment of all agent’s commission and advertising or other agent’s expenses of sale;
(3) payment of the legal and conveyancing expenses relating to the sale;
(4) payment of all remaining matrimonial liabilities including:-
(i) Council rates owing on the [B Street, Town C] house;
(ii) SA Water Rates owing on the [B Street, Town C] house;
(5) the balance thereof to be deposited in the Trust Account of the Applicant’s solicitors, Mildwaters Lawyers, by and on account of the Applicant.
(b) that until the [B Street, Town C] house is sold and the sale is settled, the Applicant shall have sole use and occupancy of the [B Street, Town C] house.
(c) that the Applicant is hereby permitted and authorised to obtain payment into her account of the rental bond held by Housing SA for the [B Street, Town C] house and thereafter is authorised to expend such bond on any cleaning, maintenance and repair work on the [B Street, Town C] house incurred as a result of the tenancy of [Ms G], with any balance of the bond remaining after payment for such work to be paid by the Applicant to [Ms G];
(d) that the Applicant shall be solely entitled to all personal property in her
possession including: -
(i) jewellery and furniture and effects;
(ii) the [Motor Vehicle 1];
(iii) cash savings and bank accounts in her sole name;
(iv) her [Super Fund F] superannuation entitlements;
(v) any long service and annual leave entitlements;
(vi) and any other property in her possession.
(d) that the Respondent shall be solely entitled to all personal property in his
possession including: -
(i) jewellery and furniture and effects;
(ii) the [Motor Vehicle 2];
(iii) the motorbike;
(iv) the [Motor Vehicle 3];
(v) the camper trailer;
(vi) cash savings and bank accounts in his sole name;
(vii) his superannuation entitlements;
(viii) any long service and annual leave entitlements;
(ix) and any other property in his possession.
(e) that each party shall indemnify and keep indemnified the other party for all liabilities in his or her sole name.
2.That in the event that the tenant [Ms G] does not vacate the [B Street, Town C] house within 14 days of the date of these orders an enforcement warrant shall issue authorising the Marshall of this Court to remove the said [Ms G] from the [B Street, Town C] house.
3.That if the Respondent refuses or neglects to sign or execute any deed or instrument necessitated by these Orders a Registrar of Deputy Registrar of the Court is hereby appointed to sign or execute the deed or instrument in the name of the Respondent and to do all things necessary to give validity and operation to the deed or instrument, with the cost of obtaining such signature or execution by the Court officer to be paid by the Respondent.
4. That the Respondent pay the Applicant’s costs of and incidental to these proceedings, with the amount of such costs to be limited to the balance of the net proceeds of sale of the [B Street, Town C] house pursuant to Order 1(a)(v)(5) hereof.
5. That the proceedings be dismissed as finalised.
6. Liberty to the Applicant to apply for consequential orders
I am satisfied that the respondent has been put on notice as to the proposed orders sought by the applicant. The respondent was personally served on 11 September 2022 with the applicant’s Trial affidavits filed 19 August 2022 and 9 September 2022 respectively and a sealed copy of the Outline of Case Document and proposed Minute of Order filed 11 September 2022.
Out of an abundance of caution, when the Trial commenced the respondent was called in the precinct of the Court but consistent with all other hearings, failed to attend either in person or via a legal representative. I also record here in my Reasons that at approximately 3:17pm my Court was advised a male person had contacted the National Centre alleging that he was waiting for a phone call from the Courts in relation to his matter at 2:15pm that day. The Trial was halted temporarily whilst my Legal Associate dialled into the virtual court room, but no one appeared for or on behalf of the respondent.
ASSETS AND LIABILITIES AVAILABLE AT TRIAL
The applicant’s Trial affidavit at paragraphs 38 to 44 inclusive sets out the gross Asset and Liability schedule to the best of her knowledge as follows:
ASSET Respondent Applicant Joint House at B Street, Town C (‘the B Street, Town C house’) $276,000 Bank O account (Ms Caine’s) – account ending numbers …40 $1,271 Bank account (Mr Seddon’s) Unknown Motor Vehicle 1 $45,000 Motor Vehicle 2 $17,500 Motorbike $3,100 Motor Vehicle 3 $19,990 Camper trailer $3,500 Shed contents $5,000 E House contents $2,000 E Cash from sale of Motor Vehicle 4 $3,000 TOTAL $49,090 $51,271 $276,000 TOTAL ASSETS
$376,361 – except the respondent’s bank account or any other undisclosed assets owned by the respondentSUPERANNUATION Respondent Applicant Super Fund F $85,510 Unknown Unknown LIABILITY Respondent Applicant Joint Mortgage on house at B Street, Town C $175,058
Credit card debt $1,736 Car loan with Company P $54,021 Loan from applicant’s father Mr Q for deposit on Motor Vehicle 1 $15,000 Dog fines $761 SA Water $244 District Council of Town K $7,839 TOTAL $244 $71,518 $182,897 TOTAL LIABILITIES $254,659
FINDINGS AS TO THE ASSETS AND LIABILITIES OF THE PARTIES
The true value of the B Street, Town C property will only be realised once the said property has been sold. The applicant has now signed a Residential Sales Agency Agreement (‘RSAA’) with D Real Estate and the property will be listed for $250,000.00. The RSAA also sets out that:
(a)The agent’s genuine estimate of sale is $220,000.00; and
(b)The selling price sought or acceptable to the vendor is $230,000.00.
Further funds have been paid for advertising from the money received by the applicant from the sale of the Motor Vehicle 4.
I propose to exclude from the List of Assets the applicant’s Bank O account balance in the sum of $1,271.00 in circumstances where the respondent has failed to file any answering documents or provide disclosure as to his personal savings. To do so would be inequitable to the applicant.
I propose to exclude the applicant’s Motor Vehicle 1 in the sum $45,000.00 from the List of Assets, noting that this motor vehicle was purchased post separation by the applicant. The funds that were advanced to her by a member of her family and Company P. The sum totalling $69,021.00 will also be excluded for the same reason.
I propose excluding the value of the applicant’s house contents in the sum of $2,000.00 given her evidence as contained in paragraph 40 of her Trial affidavit that such items were purchased post separation. There is no evidence of the respondent’s house contents and it would be inequitable to the applicant for this item to be included.
The cash from the sale of the Motor Vehicle 4 will be included as the applicant gave evidence of such amount being expended in legal fees and costs for the sale of B Street, Town C.
The applicant’s evidence in chief updates the mortgage balance to $178,991.00 in August 2022. The balance is likely to fluctuate pending final settlement. Repayments have now been suspended until 2 November 2022. The mortgage to the Commonwealth Bank of Australia is currently $3,933.74 in arrears.
The District Council of Town K arrears owing now total $5,823.00 as of 2 September 2022 after the applicant gave evidence in chief and this line item will be amended accordingly.
I accept the applicant’s evidence that the credit card debt, dog fines and SA Water liabilities are joint. The applicant has made a significant post separation contribution by reducing the credit card debt from $15,000.00 to its current balance since separation.
Based on the above findings, I find that the asset and liabilities of the parties as follows:
ASSET OWNERSHIP VALUE ($) B Street, Town C property Joint To be sold Motor Vehicle 2 Respondent 17,500 Motorbike Respondent 3,100 Motor Vehicle 3 Respondent 19,990 Camper trailer Respondent 3,500 Shed contents Respondent 5,000 E Cash from sale of Motor Vehicle 4 Applicant 3,000 TOTAL ASSETS (EXCLUDING SALE PROCEEDINGS) 52,090 SUPERANNUATION OWNERSHIP VALUE Super Fund F Applicant 85,510 Unknown Respondent Unknown LIABILITY OWNERSHIP VALUE Mortgage on B Street, Town C property Joint 178,991 Credit card debt Applicant 1,736 Dog fines Applicant 761 SA Water Respondent 244 District Council of Town K Joint 7,839 TOTAL LIABILITIES 189,571
Based on the above findings, the total net non-superannuation assets of the parties are $52,090.00 excluding the sale proceeds from the B Street, Town C property, which are yet to be determined. The total liabilities are approximately $187,571.00 excluding sale costs and fluctuation in the mortgage balance at the date of settlement.
Based on the above figures, the applicant will be retaining $3,000.00 of personal assets and the respondent will be retaining $49,090.00 of personal assets.
The only superannuation entitlements disclosed at Trial were the applicant’s in the sum of $85,510.00. The respondent has failed to provide any information to the Court as to his superannuation balance at Trial. The applicant gave evidence in chief that at or about the final date of separation she remembered the respondent having approximately $45,000.00 in superannuation. The applicant gave evidence that the respondent had informed her that he had withdrawn money from his superannuation balance during the COVID-19 pandemic.
THE NATURE OF AN UNDEFENDED HEARING
It is trite to observe that proceedings to be determined in the absence of one party is a significant matter. The Court has an obligation to ensure that parties to the proceedings before it have an opportunity to participate in those proceedings. However, there must be limits on such an obligation which cannot be indefinitely prolonged.
I am satisfied that the respondent has been afforded every opportunity to be heard. The Court can therefore proceed to make orders that may adversely affect the respondent.
For the reasons that I have already outlined above and with particular reference to the volume of Affidavits of Service that have been filed by the applicant, I am satisfied that the respondent has been given an adequate opportunity to appear in these proceedings and to put his position before the Court.
In the decision of Ragusa & Ragusa[1] Judge Brown eloquently summarised the position facing the Court in cases such as this one, in the following terms:
[the wife] is entitled to have her application for settlement of property matters determined within a reasonable period of time pursuant to the applicable principles of law. This is important, given the delays which have arisen in the conduct of the case, none of which are attributable to any act or omission attributable to [the wife].
As such, she needs neither [the husband’s] formal imprimatur, nor his cooperation to have her application determined. Rather, there is an obligation, on the part of [the husband] if he wishes to be involved in the proceedings for him to attend at Court as required and to pursue any application put by him or on his behalf with due diligence.
The Federal Circuit Court and Family Court is a Court of private law. It determines disputes between parties according to law. In this case, according to the provisions of Part VIII of the Family Law Act 1975 (Cth) (‘the Act’) which relate to the division of property following the breakdown of a de facto relationship.
The Court cannot compel a party to engage with litigation. It is however obliged to give each party the opportunity to put evidence before the Court and, if he or she so wishes to do, contest any evidence relied upon by the opposing party.
However, a party, whether by intransigence, disinterest or manipulation, cannot succeed in denying an applicant a just resolution according to law to his or her application by choosing not to take part in proceedings because they do not proceed in the manner of his or her preference. That would be fundamentally unfair to the opposing party and an affront to the proper administration of justice which requires that a properly instituted application be finalised within a reasonable period of time relative to the complexity and issues raised in such an application.[2]
[1] Ragusa & Ragusa [2021] FedCFamC2F 470.
[2] Ibid [52]-[56].
Part 10.6 of the Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) (‘the Rules’) deal with the Court’s authority to enter Judgment against a respondent if that respondent defaults in complying with a Court order or fails to prosecute any proceedings with due diligence.
Pursuant to rule 10.26, a party is in default if, among other things, he or she has failed to:
(1) For the purposes of rule 10.27, an applicant is in default if the applicant fails
(a) comply with an order of the court in the proceeding; or
(b) file and serve a document required under these Rules; or
(c) produce a document as required by Division 6.2.2; or
(d) do any act required to be done by these Rules; or
(e) prosecute the proceeding with due diligence.[3]
[3] Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) r 10.27.
Returning to the facts of this case, I am satisfied that the respondent has not prosecuted these proceedings with due diligence and has failed to comply with numerous order of the court. In these circumstances, pursuant to the provisions of rule 10.27 of the Rules, the applicant is entitled to seek the dismissal of the husband’s application.[4]
[4] See r 10.27(1)(a).
In addition and significantly, pursuant to the provisions of rule 10.27(3) of the Rules, the Court may, if it considers it is just, enter judgment and make orders in favour of the applicant as against the respondent on an undefended basis. For the reasons expressed herein and based on my reading of the file, the respondent has been given adequate notice of these proceedings. He has failed to file answering documents and given the factual matrix and the delay, it is just that the case be finalised at this juncture.
However, the applicant is not entitled as of right to the orders that she seeks simply because the respondent fails to prosecute a case. The onus still remains on the applicant to establish to the Court that the orders which she seeks are just and equitable according to law.
In essence, the applicant still must satisfy the Court that she has sufficient evidence to establish her case and to persuade the Court that the result she proposes is just and equitable. The Court’s preeminent responsibility is to ensure a just result between the parties, notwithstanding the failure by one party to participate properly in the proceedings. However, in the absence of satisfactory rebutting evidence, the applicant’s affidavit material in this case is to be accepted by the Court unless it appears inherently unreliable or unsatisfactory or may, as I observe, result in an unjust decision.
APPLICABLE LEGAL PRINCIPLES
In this case, the applicant wife proposed an adjustment of the parties’ existing interests in their property available for division at trial. The relevant sections of the Act as they relate to de facto property are contained in sections 90SM and 90SF respectively.
Section 90SM(1) of the Act provides that in property settlement proceedings after the breakdown of a de facto relationship the Court may make such order as it considers appropriate. In considering what orders should be made under section 90SM, the Court must take into account the following factors.
(a) the financial contribution made directly or indirectly by or on behalf of a party to the de facto relationship, or a child of the de facto relationship:
(i) to the acquisition, conservation or improvement of any of the property of the parties to the de facto relationship or either of them; or
(ii) otherwise in relation to any of that last-mentioned property;
whether or not that last-mentioned property has, since the making of the contribution, ceased to be the property of the parties to the de facto relationship or either of them; and
(b) the contribution (other than a financial contribution) made directly or indirectly by or on behalf of a party to the de facto relationship, or a child of the de facto relationship:
(i) to the acquisition, conservation or improvement of any of the property of the parties to the de facto relationship or either of them; or
(ii) otherwise in relation to any of that last-mentioned property;
whether or not that last-mentioned property has, since the making of the contribution, ceased to be the property of the parties to the de facto relationship or either of them; and
(c) the contribution made by a party to the de facto relationship to the welfare of the family constituted by the parties to the de facto relationship and any children of the de facto relationship, including any contribution made in the capacity of homemaker or parent; and
(d) the effect of any proposed order upon the earning capacity of either party to the de facto relationship; and
(e) the matters referred to in subsection 90SF(3) so far as they are relevant; and
(f) any other order made under this Act affecting a party to the de facto relationship or a child of the de facto relationship; and
(g) any child support under the Child Support (Assessment) Act 1989 that a party to the de facto relationship has provided, is to provide, or might be liable to provide in the future, for a child of the de facto relationship.[5]
[5] Family Law Act 1975 (Cth) s 90SM.
In relation to section 90SM(4)(e), which are colloquially known as ‘the future needs factors’, the Court is also to take into account the following matters contained in section 90SF(3) of the Act:
(a) the age and state of health of each of the parties to the de facto relationship (the subject de facto relationship ); and
(b) the income, property and financial resources of each of the parties and the physical and mental capacity of each of them for appropriate gainful employment; and
(c) whether either party has the care or control of a child of the de facto relationship who has not attained the age of 18 years; and
(d) commitments of each of the parties that are necessary to enable the party to support:
(i) himself or herself; and
(ii) a child or another person that the party has a duty to maintain; and
(e) the responsibilities of either party to support any other person; and
(f) subject to subsection (4), the eligibility of either party for a pension, allowance or benefit under:
(i) any law of the Commonwealth, of a State or Territory or of another country; or
(ii) any superannuation fund or scheme, whether the fund or scheme was established, or operates, within or outside Australia;
and the rate of any such pension, allowance or benefit being paid to either party; and
(g) a standard of living that in all the circumstances is reasonable; and
(h) the extent to which the payment of maintenance to the party whose maintenance is under consideration would increase the earning capacity of that party by enabling that party to undertake a course of education or training or to establish himself or herself in a business or otherwise to obtain an adequate income; and
(i) the effect of any proposed order on the ability of a creditor of a party to recover the creditor's debt, so far as that effect is relevant; and
(j) the extent to which the party whose maintenance is under consideration has contributed to the income, earning capacity, property and financial resources of the other party; and
(k) the duration of the de facto relationship and the extent to which it has affected the earning capacity of the party whose maintenance is under consideration; and
(l) the need to protect a party who wishes to continue that party's role as a parent; and
(m) if either party is cohabiting with another person--the financial circumstances relating to the cohabitation; and
(n) the terms of any order made or proposed to be made under section 90SM in relation to:
(i) the property of the parties; or
(ii) vested bankruptcy property in relation to a bankrupt party; and
(o) the terms of any order or declaration made, or proposed to be made, under this Part in relation to:
(i) a party to the subject de facto relationship (in relation to another de facto relationship); or
(ii) a person who is a party to another de facto relationship with a party to the subject de facto relationship; or
(iii) the property of a person covered by subparagraph (i) and of a person covered by subparagraph (ii), or of either of them; or
(iv) vested bankruptcy property in relation to a person covered by subparagraph (i) or (ii); and
(p) the terms of any order or declaration made, or proposed to be made, under Part VIII in relation to:
(i) a party to the subject de facto relationship; or
(ii) a person who is a party to a marriage with a party to the subject de facto relationship; or
(iii) the property of a person covered by subparagraph (i) and of a person covered by subparagraph (ii), or of either of them; or
(iv) vested bankruptcy property in relation to a person covered by subparagraph (i) or (ii); and
(q) any child support under the Child Support (Assessment) Act 1989 that a party to the subject de facto relationship has provided, is to provide, or might be liable to provide in the future, for a child of the subject de facto relationship; and
(r) any fact or circumstance which, in the opinion of the court, the justice of the case requires to be taken into account; and
(s) the terms of any Part VIIIAB financial agreement that is binding on either or both of the parties to the subject de facto relationship; and
(t) the terms of any financial agreement that is binding on a party to the subject de facto relationship.[6]
[6] Ibid s 90SF.
I am satisfied, given the length of the parties’ relationship, the fact that there are two young children arising from the relationship and because the applicant seeks a division of property in order to be able to finalise her property application, that it is appropriate, applying the principles set out in the decision of Stanfordv Stanford,[7] for there be an adjustment of the parties’ existing interests in the property which I find is available for division at Trial.
[7] Stanford & Stanford (2012) 247 CLR 108.
PROPERTY ADJUSTMENT PURSUANT TO SECTION 90SM
As stated in section 90SM of the Act, the Court may make such order as it considers appropriate following the breakdown of a de facto relationship, altering the interests of the parties to the de facto relationship in the property available for division at the time of Trial.
The parties commenced cohabitation in 2006 and separated for the final time on 27 October 2019. The parties were in a relationship for around 13 and a half years.
It is asserted by the applicant, and I accept, that at the commencement of cohabitation neither party had any assets or liabilities of any significant value. At the date of cohabitation the parties were aged 23 and 22 years respectively.
The applicant concedes that during the relationship each of the parties made financial contributions by way of income from their respective employment to the acquisition and maintenance of assets or the support of their family.
The applicant concedes that early in the relationship each of the parties contributed to domestic duties and responsibilities. Following the birth of the parties’ first child in 2015, and continuing until some undetermined date in early 2017, the respondent undertook domestic duties and caring for the parties’ children whilst the applicant was at work.
It is the applicant’s unchallenged evidence that as and from May 2017, the respondent undertook minimal responsibilities for either domestic duties or childcare, which then fell to the applicant when the said children were not at childcare or kindergarten. It is the applicant’s case that from May 2017 the respondent’s use of illicit substances, but in particular methamphetamine, became chronic with the respondent’s behaviour adding an extra burden for the applicant to navigate. Paragraph 90 of the applicant’s Trial affidavit sets out the behaviour witnessed and experienced by her after May 2017 when the respondent became fully immersed in the drug culture.
The applicant argues that since separation in 2019 she alone has made further contributions to the exclusion of the respondent by:
(a)Doing all things necessary to sort out and meet repayments of joint liabilities;
(b)Engaging in employment and being the sole provider for the said children, financially and otherwise; and
(c)Performing all domestic duties required to benefit the said children.
I note that the support of the children has been hers alone and with no child support paid by the respondent. The evidence suggests that this is likely to continue into the future.
The applicant concedes that since separation, the respondent has made payment of the SA Water rates on the B Street, Town C property and has contributed $18,050.00 of the $28,600.00 in total rent repayments received from the tenant Ms G into the mortgage account with Commonwealth Bank mortgage account. As at the date of Trial, the said Commonwealth Bank mortgage was in arrears by $3,993.74.
CONSIDERATION OF FUTURE NEEDS
I have had regard to paragraphs 127 to 139 of the applicant’s Trial affidavit, which refers to what are colloquially known as “future needs”, albeit, that the affidavit refers to the section of the Act relating to married persons, rather than section 90SM(4)(d)-(g) and 90SF(3), which deals with persons who have been in a de facto relationship, such as the parties in this case.
At the date of Trial, the parties are of comparable ages, with the applicant aged 39 years and the respondent aged 38 years. The applicant is said to be in good health and able to engage in employment. Understandably, given the failure by the respondent to engage in these proceedings, the applicant is unable to state with any certainty as to whether or not the respondent remains in good health or engaged in employment.
The applicant is employed by the Employer R, South Australia and earns approximately $91,654.00 gross per annum. The applicant contends that the respondent has various qualifications which would enable him to work, should he choose to do so and reference is also given in her Trial affidavit to the respondent’s past employment. There is no current administrative assessment for Child Support.
The applicant has the full time care of the parties’ two children, aged five and seven years respectively. The respondent is currently not spending time with the children and has not done so for some considerable period of time.
The applicant receives no financial support for the two children and is therefore responsible for meeting all costs associated with their care. Based on current evidence, I accept that the applicant is likely to bear the responsibility for the children financially and otherwise until they attain the age of majority.
To my mind, the lack of financial support for the subject children by the respondent is a significant factor to be brought to account in the circumstances of this case given that the children are only seven and five years respectively.
Since separation, the applicant has continued to pay rent for accommodation for herself and the children. The applicant currently pays the amount of $370.00 per week. The applicant asserts, and I accept, that since separation the respondent has retained the rental payments of the B Street, Town C property to the exclusion of the applicant and with not all of those funds being applied to the mortgage balance.
In addition to the section 90SM and 90SF(3) considerations, the applicant refers the Court to an additional matter to be considered by the Court in relation to justice and equity. The applicant contends that as a consequence of the respondent’s failure to engage in these proceedings, she has incurred legal fees in excess of what should have or could have been incurred had the respondent engaged in these proceedings, or participated in proper negotiations to resolve the matter.
The applicant filed a Cost Notice pursuant to rule 12.06 of the Rules dated 7 September 2022. The said Cost Notice describes current total costs to date at $22,747.92, with only $3,072.00 having being paid off the total sum incurred. Future estimated costs are $4,900.00, largely for counsel fees for the Trial. The Court is further advised that the applicant has entered into a payment plan with her solicitors and is paying the sum of $100.00 per month towards her outstanding legal fees.
As a consequence of this matter having to proceed to a final hearing, the applicant argues that justice and equity result in an apportionment of a loading in her favour as a consequence of the respondent’s failure to act.
I accept the submission of the applicant that she will be indebted to her solicitor for approximately $24,575.00 plus GST and that she will likely need to meet all or some of those legal fees from her property settlement entitlement. The respondent by virtue of his failure to engage in these proceedings has no legal fees.
I find that the applicant has incurred unnecessary legal expenses on account of the respondent’s failure to comply with orders of this Court and engage in the resolution of these proceedings. In the Court’s view, this case is a relatively straightforward and simple matter. The asset pool is very modest. The parties should have been able to resolve the division of their property at a much earlier juncture had the respondent made an effort to engage in the proceedings.
TENANCY OF THE B STREET, TOWN C PROPERTY
Post separation and without the applicant’s knowledge or consent, the respondent entered into a tenancy arrangement with one Ms G. The tenancy has caused unnecessary complications and stress for the applicant. The applicant has attempted on two separate occasions to have the tenant removed from the B Street, Town C property. The applications have been unsuccessful at SACAT as the applicant is not a party to the Tenancy Agreement.
An order was made by the Court on 10 August 2022 directing the applicant to cause the tenant to be served personally with a letter advising her that the applicant intended to proceed with an application to have the tenant removed from the B Street, Town C property, if necessary pursuant to an enforcement warrant. The letter personally served on the tenant dated 16 August 2022 has been marked Exhibit A3. I am satisfied from a perusal of Exhibit A3 that the tenant has had notice of the application and accordingly it is permissible for the applicant to proceed with an application for warrant for possession of real property in accordance with Division 11.1.7 of the Rules.
The affidavit filed by the applicant on 9 September 2022 deposes to recent communications with the tenant. The tone of the communications is the cause of apprehension on behalf of the applicant that the tenant was resistant to vacating the B Street, Town C property. However, in evidence in chief the applicant gave evidence of recent developments which suggests that the tenant has now vacated or is in the process of vacating the B Street, Town C property. The applicant’s evidence is that she would not be able to confirm this until shortly after the Trial when her real estate agent will be able to undertake a “walk by” to ascertain whether or not the property is still occupied.
Out of an abundance of caution and to ensure the smooth pathway forward in this matter given its difficult trajectory to this point, I intend to exercise my discretion to make an order for a warrant for possession of the real property at B Street, Town C in the event that the said tenant does not vacate the property as she has been directed to do.
The power to order a warrant for possession of real property is set out in rule 11.56 of the Rules. Rule 11.56(3) provides that:
If a person other than the respondent occupies land under a lease or written tenancy agreement, a warrant for possession may be issued only if the court gives permission.[8]
[8] Federal Circuit and Family Court of Australia (Family Law) Rules 2021 r 11.56(3).
I am satisfied that the tenant has received notice of the terms of the order by virtue of the letter served on her on 16 August 2022 and in these circumstances it is appropriate that the order be enforced against the tenant as if the tenant were a party to these proceedings as the Court is entitled to do.[9]
[9] Ibid r 11.61.
OVERALL EFFECT OF THE ORDERS
Based on my assessment of the parties’ contributions, the section 90SF(3) factors and considerations as to justice and equity, I have come to the conclusion that the parties’ net non-superannuation assets should be divided as to 80 per centum to the applicant and 20 per centum to the respondent. The applicant will be retaining assets totalling $3,000.00. The respondent is retaining assets totalling $49,090.00.
I decline to make an order splitting the applicant’s superannuation. There is no evidence of the respondent’s superannuation balance to enable the Court to make an adjustment which might be considered just and equitable. This is a very small asset pool and the parties are a long way from retirement.
I am satisfied for the reasons given, noting the length of the relationship, the parties’ respective financial and nonfinancial contributions and my findings thereon and the section 90SF factors, that the orders proposed herein are just and equitable in the circumstances.
In pronouncing the within orders, I have had regard to the decision of Stanford. As set out herein the Court finds that it is just and equitable to make orders adjusting the parties’ legal and equitable interests in property. I have also had regard to the decision of Jabour,[10] which directs the Court to consider the myriad of contributions to be made by parties in a marriage or relationship such as this, particularly one of significant length and involving a number of children.
[10] Jabour & Jabour [2019] FamCAFC 78.
I have also considered the decision of Clauson.[11] This is such a case which justifies an assessment outside of so called “normal parameters” given the small asset pool, the applicant’s significant post separation contribution, her future needs and the legal costs incurred.
[11] Clauson & Clauson [1995] FamCA 10, (1995) FLC 92-595, 18 Fam LR 693.
For all of the above reasons, I make the orders as set out at the commencement of this Judgment.
I certify that the preceding seventy-nine (79) numbered paragraphs are a true copy of the Reasons for Judgment of Judge Dickson. Associate:
Dated: 23 September 2022
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