Campi & Ferrin
[2024] FedCFamC1F 342
•22 May 2024
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 1)
Campi & Ferrin [2024] FedCFamC1F 342
File number(s): PAC 4152 of 2021 Judgment of: RIETHMULLER J Date of judgment: 22 May 2024 Catchwords: FAMILY LAW – PROPERTY – Enforcement Application – Wife seeking to enforce consent orders for sale of matrimonial home – Husband now opposes sale – Husband resides in property with children – Wife seeking to be appointed trustee of sale – Inability of parties to cooperate to sell the property – Wife appointed trustee for sale – Interim property settlement orders for distribution of part of sale proceeds. Legislation: Family Law Act 1975 (Cth) s 106A Division: Division 1 First Instance Number of paragraphs: 31 Date of hearing: 8 December 2023 & 16 February 2024 Place: Parramatta Solicitor for the Applicant: Shephard & Shephard Counsel for the Respondent: Mr Matthews & Mr Sanson Solicitor for the Respondent: ATW Family Law Counsel for the Independent Children's Lawyer: Did not participate Solicitor for the Independent Children's Lawyer: Phillip A Wilkins & Associates ORDERS
PAC 4152 of 2021 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)
BETWEEN: MS CAMPI
Applicant
AND: MR FERRIN
Respondent
INDEPENDENT CHILDREN'S LAWYER
ORDER MADE BY:
RIETHMULLER J
DATE OF ORDER:
22 MAY 2024
THE COURT ORDERS THAT:
1.The Applicant Wife be appointed trustee for sale of the property situated at and known as D Street, Town E in the state of New South Wales being the whole of the land contained in folio identifier Lot … in Deposited Plan …, with all the obligations and privileges pertaining thereto (including signing for and on behalf of the Respondent Husband any contract for the sale of land and any transfer pursuant to the Real Property Act 1900 (NSW) and determining the price and the manner in which the property is to be sold).
2.Pending the sale of the property situated at and known as D Street, Town E in the State of New South Wales being the whole of the land contained in the folio identifier Lot … in Deposited Plan … and to the extent to which he is able, the Respondent Husband shall continue to meet the outgoings (including electricity, gas, telephone and council rates) in respect of the property.
3.Order 3.6 of the Orders of Judge Newbrun made 25 May 2022 be amended by deleting the figures “$100,000” and inserting “50 per cent of the amount remaining after satisfaction of the payments identified in Orders 3.1 to 3.4”.
4.Costs be reserved.
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).
Part XIVB of the Family Law Act 1975 (Cth) makes it an offence, except in very limited circumstances, to publish an account of 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 has been approved pursuant to subsection 114Q(2) of the Family Law Act 1975 (Cth).
REASONS FOR JUDGMENT
RIETHMULLER J:
The wife applies to enforce consent orders for the sale of the matrimonial home at D Street, Town E. The wife seeks that a registrar sign the necessary documents pursuant to s 106A of the Family Law Act 1975 (Cth) or alternatively, that she be appointed trustee for sale.
The parties entered into consent orders on 25 May 2022 for the property to be sold, with each party to receive $100,000 as an interim property settlement and the net balance to be paid into the husband’s solicitor’s trust account until the matter is resolved on a final basis. The orders also provide that the husband retain exclusive occupation of the property pending its sale. The husband now opposes the sale of the property, where he lives with the parties’ two children, aged 12 and 14, respectively. Currently, the children do not wish to have contact with the wife.
BACKGROUND
The parties’ assets consist almost entirely of the property. The property is approximately ten hectares and is located in a small town. There is a mortgage on it and the husband has been meeting the repayments in the sum of $3,075 per week relying upon financial support from social security and his own mother. The parties were together for thirteen years. The husband seeks 65 per cent of the assets, while the wife seeks an equal split.
History of the sale price
After the parties entered into consent orders in May 2022, the property was listed for sale with F Real Estate at a price of $5 million. In mid-2022, an offer of $3.5 million was rejected by the parties as it was below the parties’ asking price. There was an offer in late 2022 that was mistakenly conveyed as $4 million when in reality, it was for $3 million and was not a formal offer.
In late 2022, the husband expressed his desire that a new agent be appointed and for the reserve price to be set at $4 million. The parties agreed to appoint G Real Estate as their new agent with the agency agreement lasting three months. In early 2023, the parties received a valuation that recommended that the auction reserve price be set at $3 million, based upon a valuation between $2.6 million and $3.2 million. The auction was scheduled for later that month.
The cancellation of the auction
The auction was cancelled only hours before it was due to commence. The swimming pool on the property is not compliant with council regulations. The wife submits that the husband deliberately used this issue to delay the auction and sale. The husband argues that there are numerous reasons for the delay and that he believes they should all be remedied in order to obtain the best possible sale price. The husband claims that the issues prior to the auction were a need for slashing and mulching on the property, the non-compliance of the pool, and the lack of interest from purchasers.
There was difficulty obtaining the wife’s agreement for slashing and mulching, due to a substantial fine of $100,000 that the parties had previously received due to past illegal clearing on the property. In early 2023, soon after being informed by the Local Land services that they were permitted to slash and mulch on the property, the wife consented to the work being done.
During the hearing on 16 February 2024, the husband claimed that he first realised the swimming pool was not compliant with regulations only two days before the auction. However, in the husband’s affidavit, he acknowledges that the parties received an email some months earlier from the conveyancers informing them that the pool was not compliant and that they needed to either obtain a certificate or risk a purchaser rescinding the contract prior to completion.
As the husband has exclusive occupation of the property, the wife asked that the issue be addressed by him. Five days later, the parties were advised that an additional special condition was drafted regarding the pool. The husband claims that he understood from the conveyancer that the special condition negated the need for a non-compliance certificate.
The parties received an urgent email in early 2023 from the conveyancer regarding an issue with the auction (set to commence in two days) as a non-compliance certificate had not been obtained for the pool. The wife says that on the day of the auction, the pool certifier was not permitted entry to the property when he tried to inspect the pool to issue a non-compliance certificate. Therefore, the auction was cancelled hours before it was meant to begin. Prior to the cancellation, the husband claims the agent informed him that “It is very possible no one is going to attend. I wouldn’t be surprised if it doesn’t sell” however, there is no evidence from the agent. The husband says he became increasingly concerned with a lack of buyer interest.
The husband says that he was content to obtain the non-compliance pool certificate but discovered that, if the property did not sell at auction or within 90 days afterwards, the parties would then be required to fix the pool themselves. The husband investigated the costs of making the pool compliant, which he says would cost $20,000, or removing the pool, which would cost around $12,300, and also says that the need for a development approval that might cause further delays. The husband is concerned that the property is unlikely to sell in 90 days given a lack of interest, and that the parties would be responsible for the costs.
At this point, the original agency agreement with G Real Estate had expired. The wife says that the husband has failed to sign the new agency agreement with the conveyancer and real estate agent, and has failed to sign the reserve price form, nor has he allowed access to the pool inspector for the purposes of obtaining the non-compliance certificate, in order to delay the sale.
On 24 May 2023, the wife’s solicitors informed the husband that if he did not sign the agency agreement and the forms for the new mid-2023 auction, the wife would file an Application in the court. The husband claims that his understanding is that once the original agency agreement expired, it “rolled over” to an exclusive agency agreement and that he did not need to sign anything, which he says was confirmed in a conversation with the owner of G Real Estate in late 2023. However, no copy of the agreement was produced.
The husband also claims the pool has not been inspected by a certifier because he is attempting to see whether there is a way around obtaining the non-compliance certificate due to his fears the parties’ will become liable to make the pool compliant if the property does not sell.
A letter dated 5 October 2023 advised that the agent suggested a marketing price of $2.5 million.
The Enforcement Application
The wife’s Enforcement Application was first heard on 8 December 2023 and 12 December 2023. The wife did not press the Application on 12 December 2023 as she was hoping to regain her fraught relationship with the children, which may have worsened if she forced the sale of the home. Orders were made on 12 December 2023 for them to attend upon a family therapist. The family therapist advised that family therapy was not recommended for the children.
Most recently, a letter from the real estate agent dated 12 February 2024 suggested that a price guide of $2.2 million be put forward for the purposes of the property’s marketing to attract prospective buyers.
In his affidavit filed 16 February 2024, the husband proposed a new agent, H Real Estate, citing that he has concerns with the existing agent (that he previously put forward), G Real Estate.
The wife has submitted that the husband is causing undue delay which has caused her financial and emotional hardship, while also increasing the costs resulting from the proceedings. The wife argues there is significantly greater prejudice for her as the husband’s conduct is dissipating the asset pool while the wife has a limited income and ability to meet her needs.
Despite the large mortgage payments, the husband maintains that he is not trying to stop the sale altogether but seeks that the property be sold at a later date, although the husband is seeking that the consent orders for the sale of the property be discharged.
The husband submits that he receives no income apart from Centrelink and $9 per week of child support from the wife, however, he says that he is also meeting the mortgage repayments, and has no ability to rehouse himself and the children.
Since the asset pool largely consists of the property, as the sale price reduces, so does the settlement available to the husband. When the sale occurs, the husband and the children will be displaced. The husband argues that he does not want to spend his available funds on rehousing their family in a rental, and that the asset pool should be preserved but does not propose paying the wife’s entitlement and retaining the house. The wife contends that any disadvantages the husband has in relocating can be met by an interim distribution of funds. In this respect, she agreed to interim property settlement orders providing the husband with 50 per cent of the sale proceeds.
I am not persuaded that the husband has been genuinely attempting to effect the sale of the property. The husband did not make an effort to obtain the pool non-compliance certificate, and he did not organise access to the property for the pool certifier, which led to the auction being delayed. The husband did not sign the new agency agreement or the reserve form and did not provide written evidence from the agent that such forms did not need to be signed. The husband’s solicitors have written to the wife’s solicitors numerous times requesting that the sale be delayed for various reasons. There is now a lack of buyer interest. I acknowledge that the husband may be reticent to move as he resides in the property with the children. However, the sale price has been falling since the husband entered into consent orders to sell the home. I am not persuaded to discharge the consent orders for sale of the home.
Whether to appoint the wife as trustee for the sale of the property
The wife is seeking that a registrar sign the necessary documents (pursuant to s 106A of the Family Law Act), or in the alternative, that she be appointed trustee for the sale. I am not persuaded that the use of s 106A will be practical as the wife would need to repeatedly come back to have various documents executed and it does not resolve the problems of ensuring access to the property. I am persuaded to appoint a trustee for the sale in order to sell the property.
Appointing an independent trustee would cost the parties a large amount, the trustee would not be familiar with the proceedings leading to further delays, and above all, neither party is seeking such an order. Since the asset pool is almost entirely composed of the property, it is in the wife’s interest to attempt to achieve a high sale price as she expects to receive a significant proportion of the proceeds. It is not put that the wife is incapable of effecting a sale. Indeed, the wife’s general aptitude has been demonstrated by her running her own consulting business. It is appropriate that the wife be appointed trustee for sale, as opposed to appointing an independent trustee.
I will therefore make Order 4 of the orders sought by the wife in her Amended Application in a Case filed 14 August 2023 for the property to be sold by the wife as trustee for sale and for the sale:
In the alternative to Orders 2 and 3 above, the property situated at and known as [D Street, Town E] in the State of New South Wales being the whole of the land contained in folio identifier Lot […] in Deposited Plan […] be sold by the Applicant Wife as a sole trustee for sale, with all the obligations and privileges pertaining thereto (including signing for and on behalf of the Respondent Husband any contract for the sale of land and any transfer pursuant to the Real Property Act 1900 (NSW) and determining the price and the manner in which the property is to be sold);
I will not need to make Order 5 from the wife’s application as the parties already entered into consent orders providing for the disbursement of the sale proceeds (Order 3 of 25 May 2022). However, Order 3.5 and 3.6 of the consent orders only provide for each party to receive $100,000 of the net sale proceeds. In light of the concession that the husband receive 50 per cent of the net sale proceeds by way of interim property settlement (as he must rehome himself and the children following the sale and on the wife’s case, he receives 50 per cent of the net proceeds), Order 3.6 should be amended to provide for the husband to receive 50 per cent of the net proceeds of sale.
Despite the husband’s reluctance to support the sale of the property, I am not persuaded to make Order 6 of the wife’s Application at this stage (that the husband deliver up vacant possession of the property within 42 days) as it would require the husband to rehouse the children immediately. However, if the husband does not fully cooperate with the wife, I will consider making such an order to ensure the wife is able to carry out the sale.
I will make Order 7 of wife’s Application, that the husband meet the outgoings of the property pending the sale as he has the benefit of residing there:
Pending the sale of the property situated at and known as [D Street, Town E] in the State of New South Wales being the whole of the land contained in the folio identifier. Lot […] in Deposited Plan […]. and to the extent to which he is able, the Respondent Husband shall continue to meet the outgoings (including electricity, gas, telephone and council rates) in respect of the property.
It is appropriate to reserve the costs of the Application to the trial judge.
I therefore make orders accordingly.
I certify that the preceding thirty-one (31) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Riethmuller. Associate:
Dated: 22 May 2024
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