Callahan and Callahan (No.2)

[2016] FCCA 1459

FEDERAL CIRCUIT COURT OF AUSTRALIA

CALLAHAN & CALLAHAN (No.2) [2016] FCCA 1459

Catchwords:
FAMILY LAW – Final ruling on form of orders.

Applicant: MS CALLAHAN

Respondent: MR CALLAHAN

File Number: MLC 8083 of 2012

Judgment of: Judge Burchardt

Hearing date: 4 April 2016

Date of Last Submission: 4 April 2016

Delivered at: Melbourne

Delivered on: 20 June 2016

REPRESENTATION

Counsel for the Applicant: Ms Swart

Solicitors for the Applicant: Kelly & Associates Family Lawyers

Counsel for the Respondent: Mr Williams

Solicitors for the Respondent: Lanham Lawyers Pty Ltd

ORDERS

1. Within 60 days hereof the wife pay to the husband the sum of $158,553 (“the settlement sum payment”).

2. Contemporaneously with the payment the husband:

   (a)transfer all his right, title and interest in the properties known as follows:

   (i)Property M1

   (ii)Property M2 (“the properties”)

   to the wife.

   (b)the husband transfer the Nissan Maxima to the wife.

   (c)the wife refinance the properties and discharge all liabilities of whatsoever nature in respect thereto into her sole name.

   (d)the husband transfer all his right title and interest in the yacht to the wife.

3. The wife indemnify the husband in respect to all assets retained by her and shall be responsible for all tolls, fines, fees and charges relating to her use of the Nissan Maxima vehicle.

4. The husband indemnify the wife and be solely responsible for the discharge of the personal liabilities standing in his name being his:

   (a)(omitted) Bank Mastercard;

   (b)Personal loan with (omitted) Bank; and

   (c)(omitted) Bank overdraft.

5. The husband and wife each retain all superannuation standing in their respective names with the wife to remove any flagging order in respect to the husband’s superannuation forthwith.

6. In addition to the sum of $158,553 referred to in Order (1) hereof, the wife reimburse the husband for 50% of the home valuations and yacht valuations as per Court Orders.

7. Save as set out herein each party retain all chattels and assets standing in their respective names including any chose in action and indemnify the other for all liabilities of whatsoever nature arising from the retention of such assets pursuant to these Orders.

8. In the event that the wife defaults in respect to any payment to the husband as specified in these Orders then either Property M1 or Property M2 be sold forthwith by public auction.

9. The wife nominate within 14 days of default which of the two properties she seeks to sell.

10. Upon the wife’s election as to the sale of the property the parties sell such property upon terms as to be agreed or in default as determined by the President of the Real Estate Institute or his nominee whose decision shall be binding with the cost of such nomination being a selling cost.

11. In the event that either party fails to execute any document or transfer pursuant to these orders the same may be executed by a Registrar of this Court pursuant to s.106A of the Family Law Act 1975 (Cth) (“the Act”) upon satisfying the Registrar by affidavit of the necessity for such execution.

12. The proceeds of sale of the property nominated by the wife be applied as follows:

    (a)selling costs;

    (b)discharge of any mortgage charge or encumbrance;

    (c)payment of the amount outstanding to the husband together with interest calculated by the Act and the Family Law Rules 2004 from the time of default until settlement;

    (d)payment of any capital gains tax to be determined by an accountant agreed to by the parties’ solicitors with liberty to apply; and

    (e)the balance to the wife.

NOTATION:

(A)These Orders without the default provisions mean that the wife retains:

(i)both Property M1 & Property M2 properties and encumbrances;

(ii)the yacht;

(iii)the Nissan Maxima; and

(iv)responsibility thereafter for all outgoings of whatsoever nature including insurance related to the assets to be retained by her.

(B)The husband retain:

(i)his superannuation;

(ii)all his personal liabilities, being his loans specified herein;

(iii)$158,553; and

(iv)reimbursement of 50% valuation fees as ordered.

(C)The paintings located at the former matrimonial home be divided on a pick for pick basis.

IT IS NOTED that publication of this judgment under the pseudonym Callahan & Callahan (No.2) is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).

FEDERAL CIRCUIT COURT
OF AUSTRALIA
AT MELBOURNE

MLC 8083 of 2012

MS CALLAHAN

Applicant

And

MR CALLAHAN

Respondent

REASONS FOR JUDGMENT

1. This is the tag end of a dispiritingly bitter dispute between a couple who were married for many years. The difficulties that attended them are set out in my earlier reasons for judgment, which should be read together with this addendum.

2. The reason for this further judgment is that the parties have been quite unable to agree on some aspects at least as to how my earlier conclusions should be brought into effect. There are a number of issues still extant between them.

The extra value in the properties

1. The wife now seeks to retain both the properties at Property M1 & Property M2. She says she has finance available to enable her to do so. Given her overarching financial situation this is slightly surprising but counsel for the wife assures the Court that this is so.

2. The values adopted at trial were on the current boundaries which would value Property M1 at $1,050,000 and Property M2 at $900,000. As I noted at paragraph 135 of my earlier judgment:

   “[w]hile there is a slightly greater financial gain in adjusting the title boundaries, any move requiring cooperation between the parties is likely only to produce further litigation. Unless the matter otherwise resolves, the properties will remain as they are.”

3. Counsel for the husband sought that an additional $40,000 be as it were, notionally added to the pool. This is because the wife will now retain both properties and can for a cost of $10,000, increase the values of the properties by altering the titles back in conformity with the prior boundaries producing a value of $1,200,000 dollars for Property M1 and $800,000 for Property M2.

4. The husband sought an additional 40 percent of the $40,000 accordingly.

5. The wife resisted.

6. In my opinion, it is far more probable than otherwise that the wife will indeed alter the title boundaries back to their former state and obtain an advantage of a net $40,000 therefrom. It is eminently in her interests to do so and as I understand the matter, the configuration thereby derived is probably more attractive to a potential further developer in any event.

7. The extra $40,000 will be added to the pool.

The husband’s debts

1. Although this commenced as a point of disagreement, following discussion with counsel as I understand it, the wife does not oppose the husband retaining his debts in respect to Mastercard ($15,420), personal loan ($39,617) and (omitted) Overdraft (14,751). This is a total of $69,788. There will need to be a proportionate increase in the amount actually paid to the husband of that sum.

The provisions in the event of default

1. The wife seeks an order that Property M2 be sold in the event that she is unable to refinance. Counsel asserted that there would be sufficient funds following the sale not only to pay the mortgage but any capital gains tax that may be occasioned. Counsel for the husband sought to give the wife the option.

2. The parties’ positions in this case have changed and varied significantly from time to time and almost from moment to moment.

3. The husband was seeking ownership of the yacht until at the very last minute he changed his mind. I think it is sensible to give the wife the option as to whether she sells Property M1 or Property M2 in the event of default. If Property M2 is the more preferable to her she will doubtless choose it.

The net effect on the figures

1. The addition of a further $40,000 as I have determined above produces a total of net assets of $3,025,687. With the liabilities remaining as they are the net total of assets decreases to $2,436,618.

2. Of that the husband’s 40 percent is $974,647. When his superannuation of $874,687 is removed the resultant total is $99,960.

3. From that total should be deducted the $11,195 payable in respect of X referred to in the earlier judgment producing a total of $88,765.

4. Adding to that is the parties’ methodology now agrees the $69,788 that the husband will take responsibility for in respect of his personal debts, the resultant total to be paid to him is $158,553.

The precise form of orders to be made

1. Both counsel have produced workable versions of the orders proposed. On balance I think those of the husband’s are easier to follow and I have adopted that template.

2. I do not propose to publish draft orders and give them to the parties for comment. It is all too likely given the history of this matter, that there will be further expense and time involved. The parties have spent all too much by way of funds on this bitter contest. It must come to an end.

I certify that the preceding nineteen (19) paragraphs are a true copy of the reasons for judgment of Judge Burchardt

Date: 20 June 2016