CATO & CATO

[2012] FamCA 78

FAMILY COURT OF AUSTRALIA

CATO & CATO [2012] FamCA 78

FAMILY LAW - SPOUSAL MAINTENANCE – Interim – where the wife has been unable to secure employment and cannot support herself – where the wife’s asserted expenses include the expenses of the children – where the husband concedes the ability to pay approximately $1,000 per week – found that the children’s expenses must be disregarded – orders that the husband pay spousal maintenance of $1,000 per week

FAMILY LAW - PROPERTY SETTLEMENT – Interim – where the wife seeks a lump sum payment of $120,000 – whether the wife will receive a property settlement sufficient to cover the lump sum advance sought – where the court not satisfied that this was the case - orders that the wife’s application for interim property settlement be dismissed

Stein & Stein [2000] FLC 93-004
Strahan & Strahan (Interim property orders) [2009] FamCAFC 166

APPLICANT: Ms Cato

RESPONDENT: Mr Cato

FILE NUMBER: SYC 7191 of 2008

DATE DELIVERED: 1 March 2012

PLACE DELIVERED: Sydney

PLACE HEARD: Sydney

JUDGMENT OF: Rees J

HEARING DATE: 29 February 2012

REPRESENTATION

COUNSEL FOR THE APPLICANT: Mr Gould

SOLICITOR FOR THE APPLICANT: Meyer Partners Family Lawyers

COUNSEL FOR THE RESPONDENT: Mr Schonell SC

SOLICITOR FOR THE RESPONDENT: Abrams Turner Whelan Family Lawyers

Orders

1. That the husband pay to the wife, by way of spousal maintenance, the sum of $1,000 per week, the first payment to be made on 7 March 2012 and weekly thereafter.

2. That the application of the wife for an order by way of interim property settlement is dismissed. 

IT IS NOTED that publication of this judgment by this Court under the pseudonym Cato & Cato has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).

FAMILY COURT OF AUSTRALIA AT SYDNEY

FILE NUMBER: SYC 7191 of 2008

Ms Cato

Applicant

And

Mr Cato

Respondent

REASONS FOR JUDGMENT

1. Before the court are proceedings instituted by an application in a case filed 7 February 2012 in which Ms Cato (“the wife”), seeks orders requiring Mr Cato (“the husband”) to pay to her the sum of $1,875 per week and a lump sum of $120,000, the characterisation of those payments to be determined by the trial judge.

2. In discussions between Counsel and me, it was agreed that I should treat the application for periodic payment as an application for spousal maintenance and the application for the lump sum as an application for interim property settlement.

spousal maintenance

1. There being no child under the age of 18 years living with the wife, her application was expressed to be based on her inability to obtain employment. Her affidavit evidence sets out at Paragraphs 40 to 42 her evidence in relation to that issue.

2. The husband’s case was that the wife had not met the threshold test. He relied in that submission on a number of matters. Although a number of orders have been made for the provision of money for the use of the wife, the first on 9 February 2009, the husband has never conceded that the orders made provision for spousal maintenance and that characterisation has been left to the trial judge.

3. Firstly, the husband pointed out that the matters deposed to in Paragraphs 40.1 to 40.6 of the affidavit appeared to be identical to those deposed to in an earlier affidavit sworn 4 August 2011. Similarly, paragraphs 41 and 42 were identical to paragraphs of the earlier affidavit.

4. The husband relied upon a medical report of Dr K dated 22 September 2011 which was annexed to the wife’s affidavit. In that report, Dr K states, “it is encouraging to see that she has also obtained contract based work for later in the year”.

5. There is no mention by the wife of this contract based work in her affidavit.

6. The husband also relied on a report of Dr S dated 22 July 2010 where Dr S observed, “At the time of assessment the patient would certainly be able to maintain employment if she so desired to work [in the education field], or any of the other forms of occupation for which she has been trained.”

7. Among the areas of employment referred to by the wife in her affidavit there was no mention of work in the education field. I was informed from the bar table that her qualifications are not current. She has undertaken a number of courses and studies but, apparently, has not sought to update those qualifications. Neither has she applied for a position in retail which was her last employment before separation.

8. The husband asserts that the wife has received $620,687 in direct payments by him and taking into account assets retained by her. The wife admits to advances of $548,122, from which she has paid legal fees of $196,322 leaving a balance of $212,000 which she characterises as spouse maintenance. The husband asserts that she is obliged to account for that remaining sum if she asserts that she is unable to support herself.

9. The amount of $212,000 is equivalent to expenditure of $70,666 per annum for three years. Having regard to what I find to be her expenses, I consider the spending has been reasonably explained.

10. The husband asserts, based on conversations with the children, that the wife lives in a de-facto relationship with a man known to him as “[P]”. That assertion was made in the affidavit in these proceedings and also in an earlier affidavit of the husband sworn 5 March 2010. That assertion was known to the wife and denied in correspondence but she gives no evidence in relation to the nature of the relationship or its financial basis. It is a matter she could have addressed. I am not in a position to determine that issue.

11. I am far from convinced that, in the long term, the wife cannot support herself. However I am faced with the position that, at the date of this application, she has been unable to secure employment and that she cannot, at this time, support herself. Her asserted expenses, as set out in her affidavit, include the expenses of the children. In accordance with the decision of the Full Court in Stein and Stein [2000] FLC 93-004, I will disregard the children’s expenses. However having done so, I must include the whole of her rent as her expense. The husband submits that she does not need a three bedroom house but this is not a matter I can determine.

12. Similar criticisms were made of the husband’s claimed expenses but I propose to allow each party’s expenses as claimed.

13. The wife therefore establishes a need for support of $1,535 per week.

14. The husband concedes an ability to pay approximately $1,000 per week. That is the order I shall make.

interim property settlement

1. The wife seeks a payment of $120,000 which is asserted to be for legal fees to complete the trial.

2. The only evidence before me as to the asset pool is the balance sheet provided by the husband which is annexure Q to his affidavit.

3. He asserts the pool to be:

   Matrimonial assets  $1,744,757

   Add back funds advanced to the wife     $   543,116

   Add back legal fees of husband                $     81,489

   Total  $2,369,362

   Less liabilities  $   684,766

   Total  $1,684,596

   The parties each have a superannuation entitlement:

   Husband  $318,404

   Wife  $  13,401

   Total  $331,805

   Husband’s family assets  $261,000

4. The husband’s case is that the wife should receive 40 per cent of the asset pool, excluding the assets he characterises as “Family Assets”. Forty per cent of the matrimonial assets would be $673, 838. Any splitting of the superannuation fund, in whatever proportion, would not be available to the parties.

5. The wife has already received $548,122 on her evidence, or $620,687 on the husband’s evidence. The whole of the amount, which ever is correct, has been spent and while it can be notionally added back, in reality that would have no effect.

6. It is submitted on behalf of the wife, that if I ordered the husband to pay her $50,000 she would not then have received the whole amount that the husband concedes. However, the major asset of the parties is the former matrimonial home which the husband values in the balance sheet at $1,550,000. In order for the wife’s argument to succeed, I would need to be certain that the sale price, net of selling costs, would be $1,550,000. There is no evidence that could lead me to that conclusion.

7. The Full Court in Strahan and Strahan (Interim property orders) [2009] FamCAFC 166 said at paragraph 137:

   Once a court proceeds to exercise the power in s 79 of the Act, being in the substantive phase, a court is required to undertake consideration of the matters in section 79(4) including by reference to  s 79(4)(e) the matters in section 75(2) so far as they are relevant. However consideration of such matters may be brief and if it is established that ‘it seems likely to the Court that…the applicant…will be likely to receive by way of property settlement a sum sufficient to cover the advance, that would seem to be sufficient to enable the order sought to be made.

8. For the reasons set out in Paragraphs 22 and 23 I cannot be satisfied that the wife will receive a property settlement sufficient to cover the advance and therefore the application for interim property settlement will be dismissed.

I certify that the preceding twenty-four (24) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Rees delivered on 1 March 2012.

Associate: 

Date:  1 March 2012