Charonne & Charonne

[2009] FamCA 487

FAMILY COURT OF AUSTRALIA

CHARONNE & CHARONNE [2009] FamCA 487

FAMILY LAW  PROPERTY– interim orders and injunctions
FAMILY LAW – CONTRAVENTION – late served – adjourned

APPLICANT: Mr Charonne

RESPONDENT: Ms Charonne

FILE NUMBER: MLC 4853 of 2007

DATE DELIVERED: 25 May 2009

PLACE DELIVERED: Melbourne

PLACE HEARD: Melbourne

JUDGMENT OF: Brown J

HEARING DATE: 25 May 2009

REPRESENTATION

COUNSEL FOR THE APPLICANT: Litigant in person

SOLICITOR FOR THE APPLICANT: NA

COUNSEL FOR THE RESPONDENT: Ms R. Stoikovska

SOLICITOR FOR THE RESPONDENT: Marshalls & Dent

Orders

BY CONSENT

(1)That pursuant to the husband’s continuing obligation to provide the wife full and frank disclosure, the husband provide or cause to provide the wife’s solicitors with copies of:

(a)the husband’s lodged personal income tax return for the year ending 30 June 2009;

(b)the lodged tax return and the annual financial statement for the Charonne Business trust for the year ending 30 June 2009;

(c)the lodged trust tax return and the annual financial statement for the Charonne Family Trust for the year ending 30 June 2009;

(d)the lodged trust tax return and the annual financial statement of the N Trust for the year ending 30 June 2009;

within 7 days of any such document being completed or in circumstances of taxation returns lodged with the Australian Taxation Office.

IT IS FURTHER ORDERED

(2)That the husband forthwith do all acts and things necessary to ensure that his brother, C Charonne, forthwith vacates the property known as H property no later than midday on 3 June 2009.

(3)That unless the husband the wife agree in writing, H property is to be occupied by tenants who pay market rental in accordance with arrangements made by H reservations, save for the one week in the July 2009 school holidays in which the parties daughter L is with the husband, provided that the husband and L spend that period at H property, and rental received (after any commissions and necessary outgoings) be paid into St George Mortgage Account ….

IT IS FURTHER ORDERED BY CONSENT

(4)That until such time as there is agreement in writing or 45 days prior to the trial date, the husband be restrained from obtaining an updated valuation of H property from the HY Property Group.

(5)That H property be placed on the market for sale (“the sale”) and the following process occur:

(a)A reserved price of $900,000 is to be set, unless both parties agree in writing to vary same;

(b)J Real Estate and RT Real Estate be appointed as joint selling agents (‘The selling agent”);

(c)The husband shall do all acts and things necessary to instruct and authorise the selling agents to inform and keep the wife informed of any offers to purchase H property (both verbally and in writing) contemporaneously at the same time the husband is advised;

(d)the husband shall do all acts and things necessary to instruct and authorise the wife’s solicitors, to receive copies of all documents relating to the sale and settlement of the sale of H property contemporaneously at the same time the husband received such material; and

(e)for the purposes of this order, the wife’s solicitors be at liberty to provide a copy of these orders to the selling agents.

(6)The husband shall do all acts and things necessary to cause the proceeds of the sale of H property to be applied as follows:

(a)firstly to pay all the selling agent’s fees, commissions and expenses, and all legal costs and distributions of the sale;

(b)secondly to discharge any mortgages registered against H property;

(c)thirdly, to satisfy full payment to the wife of any monies that may then continue to remain outstanding pursuant to any Court orders; and

(d)fourthly, the balance then remaining to be deposited in the joint names of the husband and the wife with the wife’s solicitors Marshalls & Dent, with withdrawals to be made only upon a Court order directing same or upon the written consent of both parties.

(7)To enable paragraph 10 of the orders made 12 August 2008 to be practically enforced, within 7 days from the date of thses ordered, the husband provide or cause to provide the following organisations:

(a)Bendigo Bank;

(b)Commonwealth Bank of Australia;

(c)ANZ Bank;  

(d)St George Bank;

(e)NAB;

care of their respective contact points, with written and signed authorities, authorising and requesting each organisation to:

(i)provide the wife’s solicitors, with a summary of all accounts the husband holds in his name and/or to which the husband is a signatory;

(ii)upon the request of the wife’s solicitors, provide the wife’s solicitors with copies of all account statements to which the husband is an account holder for the period 1 January 2007 to date but not including the trust and office accounts of N Partners;

(iii)upon the request of the wife’s solicitors, provide the wife’s solicitors with a current balance of all accounts to which the husband is an account holder but not including the trust and office accounts of N Partners;

(iv)contemporaneously with the conclusion of all statement periods for all accounts to which the husband is an account holder, provide the wife’s solicitors, with a copy of each statement (irrespective of whether the husband has elected to only receive electronic statements himself).

(8)That within 7 days hereof the husband provide or cause to provide the wife’s solicitors with all documents in the husband’s power, possession or control relating to the WorkCover Insurance Invoice in the name of G Pty Ltd (which is annexed and marked “AC8” in the wife’s affidavit filed 15 May 2009) and in writing authorise the solicitors for the wife, Ms A. Moylan of Marshalls & Dent to make such inquiry as the wife may deem necessary of the WorkCover Insurer relating to the premium.

IT IS FURTHER ORDERED

(9)That within 21 days from the date of these orders, the husband provide or cause to provide the wife’s solicitors with:

(a)a certified English translation of the valuation report of the real property in Japan, referred to in the Notation to the 12 August 2008 orders;

(b)copies of all correspondence (including but not limited to the husband’s letter of instruction), records of discussion and file notes, in respect to the husband furnishing instructions for resulting report referred to in subparagraph (a) herein; and

(c)a certified English translation of all correspondence and documents the husband received from the appointed valuer referred to in subparagraph (a) herein and the question of ultimate liability for the costs of translation be reserved to the trial judge.

IT IS FURTHER ORDERED BY CONSENT

(save for subparagraphs (b) and (i))

(10)That paragraph 13 of the orders made 4 July be discharged and instead, the husband be and is hereby restrained by himself, his servants and agents from:

(a)charging, encumbering, disposing of or alienating his interest in any real property to which the husband, the wife or any entities to which either of the parties have an interest;

(b)charging, encumbering, disposing of or alienating or doing any act or thing and executing any document which may result in the selling, disposing of, encumbering, removing, transferring or in any way dissipating any other real or other property of the husband, the wife or any entities to which wither of the parties have an interest, save to pay:

(i)the husband’s reasonable living expenses;

(ii) the reasonable living expenses of the husband’s adult daughter, at a level commensurate with that presently paid;

(iii)any assessed taxation liability due and payable by the husband;

(iv)mortgage liabilities, rates, taxes and outgoings on any real property in which the husband, wife or entities in which the parties have an interest, have an interest;

(v)payments which the husband is required to make pursuant to Court order, whether to the wife or otherwise; and

(vi)such other payments as are agreed by the parties in writing.

(c)resigning from any office held by him in any companies/ entity to which the husband has an interest;

(d)resigning any power of appointment which he has in relation to any trust in which the husband controls and/or in which he and/or the wife has or may have a beneficial interest;

(e)causing himself or the wife to be removed as a beneficiary of any trust either the husband, the wife or any entities to which either of the parties have an interest;

(f)causing to be appointed any further beneficiaries of any trust either the husband, the wife or any entities to which with of the parties have an interest;

(g)removing or causing to be removed any trustee of any trust either the husband, or the wife or any entities to which with of the parties have an interest;

(h)appointing or causing to be appointed any further or other trustee or trustees of any interest either the husband, the wife or any entities to which with of the parties have an interest;

(i)making any distributions from any trust in which the husband, the wife or any entities in which the parties have an interest, without 28 days written notice to the wife, save to pay:

(i)the husband’s reasonable living expenses;

(ii)the reasonable living expenses of the husband’s adult daughter, at a level commensurate with that presently paid;

(iii)any assessed taxation liability due and payable by the husband;

(iv)mortgage liabilities, rates, taxes and outgoings on any real property in which the husband, wife or entities in which the parties have an interest, have an interest;

(ii)payments which the husband is required to make pursuant to Court order, whether to the wife or otherwise; and

(iii)such other payments as are agreed by the parties in writing.

(j)taking any steps or doing any things so as to vary or amend the terms of any Deed of Trust or any other instrument governing or relating to any of the trusts which either the husband, the wife or any entities in which either of the parties have an interest, in any way whatsoever.

(11)That the wife execute the discharge of mortgage over Certificates of Title Volume … Folio … and Volume … Folio .. provided that:

(a)the superannuation fund GA Fund receive no less than $297,500 at settlement;

(b)the solicitors for the wife shall be at liberty to attend upon 48 hours notice by the husband of the proposed settlement date, time and place;

(c)the settlement monies be invested in the GA Pty Ltd Commonwealth Bank Cash Investment Account (“the account”); and

(d)neither of the husband or the wife is permitted to draw down on the account without the prior written contact of the other party.

IT IS FURTHER ORDERED

(12)That the contravention application filed by the wife with leave this day be listed for hearing at 10:00am on 12 June 2009.

(13)That the case be referred to the Child Responsive Program and the parties and the child of marriage, L, born in July 2001 attend upon the nominated family consultant at times to be advised on 16 June 2009 and it is requested that the family consultant:

(a)read the report of Mr Y dated 2 June 2008 and filed herein; and

(b)consider whether an updated family report (of Mr Y or otherwise) would be useful.

(14)That the applications for final parenting, property and spousal maintenance orders be adjourned to 10:00am on 30 July 2009 before Registrar Sikiotis for trial directions and such other direction as the Registrar finds appropriate.

(15)That the applications for final parenting, property and spousal maintenance orders by listed for trial as the second matter in the rolling list commencing on 9 November 2009 before an interstate judge.

IT IS CERTIFIED

(13) That pursuant to Rule 19.50 of the Family Law Rules 2004 this matter reasonably required the attendance of counsel.

AND THE COURT NOTES

That the order made on 12 August 2008 which imposes continuing obligations on the parties remain in full force and effect.

IT IS NOTED that publication of this judgment under the pseudonym Charonne & Charonne is approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth)

FAMILY COURT OF AUSTRALIA AT MELBOURNE

FILE NUMBER: MLC 4853 of 2007

MR CHARONNE

Applicant

And

MS CHARONNE

Respondent

REASONS FOR JUDGMENT

1.The background to this case has been spelt out in an earlier judgment of mine and referred to in a recent ruling of the Senior Registrar. I will not repeat it.  The proceedings commenced in 2007.  They involve an application for parenting orders in respect of the parties' daughter and applications for both spousal maintenance and property orders.  The matter has been before the court a number of times.  Some six or seven interim applications have been filed.  The most recent documents on the file are numbered in the 80s; more have been filed with leave today. It is common ground that the court and the parties should be putting in place a regime which will result in these matters being tried, rather than the attrition of repeated interim applications. 

2.Before the court is an amended application filed by the husband on 15 May. The wife filed an amended response today, pursuant to leave.  The parties have resolved a number of aspects of these applications; for that reason little need to said about the background to them.

Contravention application

3.The unsealed copies of the wife’s amended response, an affidavit in support of it and a contravention application were delivered late on Friday to the husband's office, and also emailed to him.  He has told me he did not receive them.  He has seen them this morning and they will be filed.  In due course, I will fix a return date for the contravention application.  Although it is based on evidence which is referred to in the material which supports the wife’s response, procedural fairness requires proper notice of an application which can have significant consequences. 

Suspension of orders of 12 August 2008

4.The husband's amended application initially sought that orders made by me on 12 August 2008 be suspended until further order.  As he told me at that outset of today’s hearing, that application was refused by the Senior Registrar very recently.  Whilst the husband has explained to me the basis on which it was brought, he accepts that application has been dismissed.

Transfer to the Federal Magistrates Court 

5.The husband had sought that the proceedings be transferred to the Federal Magistrates Court.  The motive for that is a perception that the applications will get on more quickly there.  They may be listed faster, it is true, but the more important thing is when they get heard.  The number of interim applications in this case, and the matters discussed by counsel and the husband today, satisfy me that if this case were sent to the Federal Magistrates Court, the odds are overwhelming that it would be re-transferred back to this court, with consequent frustration to both parties.

6.I have indicated the matter could be listed for trial in December.  Five days are available, but no more than five days.  I do not suggest it is a five-day case but give that indication.  I propose to work towards that as the trial date.  If an earlier date is available, the parties will be advised. I will not be transferring the case to the Federal Magistrates Court.

Orders by consent

7.In paragraph 5 of the amended application the husband sought certain orders relating to a discharge of mortgage. The parties have reached an agreement on that issue and the orders will be made by consent.

8.The wife's amended response contains the 14 numbered orders contained in her original response, plus two more.  Sensibly, the parties have used that document as the draft for the orders on which they agree.

9.The parties have reached agreement on numbered paragraphs 1, 2 and 3 of the wife's amended response and on paragraphs 4(a), (d), (e) and (g).  They have not reached agreement on paragraphs 5 and 6. 

H property

10.In paragraph 5 the wife sought that the husband do everything necessary to ensure his brother vacates a property at H.

11.H property has figured in a number of applications and orders made to date. It is a sport-related property. It is the property, as the husband confirmed in submissions today, into which some $99,000 of the proceeds of his previous professional partnership was deposited.  He has deposed to subsequently withdrawing some $90,000 and to the distribution of the bulk of that sum.  It is that withdrawal which, to a substantial extent, founds the contravention application the wife has brought against him. 

12.The evidence is that the husband's brother is presently in occupation of H property.  It is put by the husband that he has been there since just before Easter this year, and that he is doing maintenance and other work on the property.  He will leave before the start of the sport season.  There is no commercial value in the property at this time.  It is not routinely rented save in the sport season.  The husband has referred to the potential to create some sort of right in his brother if an order in these terms were made, but I place no weight on that submission.  What is sought is not an order directed to the brother.  It is an order directed to the person who has granted the licence which allows his brother to be there.  The husband has told me that his brother will vacate before the start of the sport season, which commences in June.  In those circumstances I can see no prejudice in making an order requiring him to ensure that occurs. The property is to be vacated by 3 June, being the Wednesday before the long weekend. 

13.Paragraph 6 of the wife’s response seeks that H property be occupied by tenants who pay market rent and in the application the wife specified the market rent.  It is put by the husband that the figures advanced by her are high season rents.  Anyone who has been involved in the sport knows that, as with many properties, rentals vary according to the season. As with most recreational rentals, rates may be offered at the last minute; websites such as wotif.com make their living from such arrangements, owners preferring occupation, albeit at a reduced rate, to vacancy.

14.The husband has said that he proposes spending a week in the property in the school holidays with the parties' daughter L, his partner and a cousin.  The wife is concerned that the property will not be available for rental that week. That is true, and it is true she is not having the benefit of such a week’s holiday, and does not seek it. 

15.I propose to order that, unless the parties agree, H property is to be occupied by tenants who pay market rent in accordance with the arrangements made by H Reservations.  I will not specify the rental figures, being satisfied that would be counterproductive and may lead to the property being untenanted, and to a loss of income.  Whilst there is a provision for the parties to agree in writing, the history of this matter is such that one could not be confident that agreements could be made swiftly.  Absent that agreement, the rent will be in accordance with the arrangements made by H Reservations. Rental for H property will be paid to the St George mortgage account and neither the husband nor the wife will be able to draw funds from that account without the consent of the other.

16.I will exclude the one week in the July school holiday period in which the parties' daughter, L, is with the husband, provided that she is with him at H.  I do not propose to order that he pay rental for that week’s occupation.  No doubt that can be taken into account in due course.

Further orders by consent

17.Paragraph 7 of the wife’s response relates to a valuation and is agreed, with the addition of the words "save with the agreement in writing or 45 days prior to the trial". 

18.The parties have agreed on the provisions of paragraphs 8, 9 and 10. I have noted, and it is on the record, the submission of the husband in respect of any perceived breaches of existing orders; his evidence is of authorising all the banks as required but of some requiring more detailed authorisations than others.

19.Paragraph 11 is also agreed, with an addition as handwritten in the minute of the consent order.

WorkCover Insurance

20.In paragraph 12 the wife seeks to be able to pay, from the St George Freedom business account, the WorkCover insurance invoice for S Business, the business conducted by her. That business is the subject of some disagreement between the parties, particularly as to its viability and income-earning capacity.  The business, and I will not rehearse it all again, is organised through G Pty Ltd.  The husband's position is that he has not been involved in the business since separation and, save for paying the initial WorkCover premium when it was set up, he seeks no involvement in it. He is content for the wife to pay this invoice from this source; she needs no order.

21.The wife has said that there is no prejudice in making that order, in these circumstances.  There certainly is not any prejudice to the husband but the court should not use its powers without cause. It is on the record in this judgment that the husband does not object to her paying proper WorkCover insurance invoices from the specified account.  In those circumstances it is not appropriate for the court to make an order, which may signal - to an objective reader - that this was the subject of dispute. I am sure I need not make it clear that the court would not be pleased were the matter to return because objection was taken to such a payment.

Real property in Japan

22.Paragraph 13 relates to a real property in Japan, to which reference was made when this matter was first before me.  There is a note to the orders of 12 August which records that the husband asserted that he had a valuation of real property in Japan.  My recollection is that the husband’s superannuation fund has a one-third interest in that property.  The note recorded that the property was, he said, valued at AUD $150,000.

23.The wife then reserved the right to seek an independent valuation of that property, pending translation of a document provided by the husband and the provision by him of the letter of instructions to the Japanese valuer.  There was no specific order requiring the provision of that letter of instructions but it is clear from the note that that was what was envisaged.  The wife complains that she has not received that letter and she seeks a certified English translation of the valuation report of that property and other documents referrable to the alleged valuation.

24.The husband's submission is that the wife has an adult son who lives in Japan with his Japanese wife, that she is in regular contact with them, and that it would be much simpler, cheaper and more practical for her to get the documents translated by them, if that is what she wants. 

25.The reality is, that it is the husband who seeks to rely on the document. If it is to be adduced in proceedings it will have to be translated.  The fine print of the valuation may or may not be a matter of knowledge to an intelligent layperson who speaks Japanese.  Anyone who speaks another language knows that aspects of commercial language may be unfamiliar to even a reasonably fluent speaker.  In my judgment, the husband should provide the certified English translation and a copy of the correspondence.  Costs are at large but I will order that those costs be borne by him now, but be in the discretion of the trial judge.  If it turns out to be a storm in a teacup, the trial judge can rectify any disadvantage by a costs order.

26.Paragraph 14 is not pressed.

Injunctions

27.What is sought in paragraph 15 is a broad-ranging series of injunctions.  The wife's concerns about dissipation of funds are spelt out in her affidavit.  The parties have reached agreement, save in respect of paragraphs (b) and (i).  The husband's evidence is that the partnership arrangement pursuant to which he earns a living involves seven trusts, one of which is his, and a corporate trustee.  Earnings are distributed to his trust.

28.From those earnings the husband pays all the usual costs and expenses of living, costs of maintaining and financing real properties, and costs of supporting his adult student daughter, who is visually impaired and who has been financially supported by him for some time.  He pointed out in submissions that if an order were made as set our in subparagraph (b), he could not service the mortgages or make tax or super payments or support his daughter.  Even were a proviso included exempting some expenditure, he is concerned he may be constrained from meeting important obligations.

29.It is trite to say that there is not a great deal of trust between the parties. Each accuses the other of not telling a straight story and of not being candid about financial affairs.  That is not uncommon in such cases and there is little use in judges delivering homilies about it.  The contravention application illustrates the problem.

30.Having regard to the evidence, I am satisfied it is appropriate to make the injunction sought in sub-paragraph (b) but with some wide-ranging provisos.  These provisos will exempt the husband's reasonable living expenses; reasonable expenses to support his adult daughter; assessed tax liabilities; all rates, taxes, outgoings and mortgage liabilities on real property; all court-ordered payments, whether to the wife or otherwise; and such other payments as are agreed in writing by the wife.  Paragraph (i) will be subject to the same set of provisos. This should ensure assets are not dissipated prior to trial.

Section 118 order

31.The last application is for an order under s 118 of the Family Law Act 1975. As everybody in the courtroom knows, if the court is satisfied that proceedings are frivolous or vexatious, it can order that the person who instituted them not, without leave, institute further proceedings. Today, the husband has obtained some orders sought by him in his amended application; a number of orders have been made as sought in the wife's amended response. It could not be said either were frivolous or vexatious, or at least not in their entirety.

32.I do have concerns about the extent of interlocutory litigation in this case.  I am not satisfied the parties are at the point where one or both should be restrained from issuing without leave. However, if further applications are brought by a party - I exclude the contravention application to be filed with leave today – and then dismissed, the party who brought them should face the reality that indemnity costs are likely, and an injunction as sought could be made.

S Business accounts

33.At the outset the husband raised a concern that the wife was not, he said, complying with the provisions of paragraph 11 of the orders of 12 August.  As I said earlier there is a dispute between the parties as to the financial viability and income-earning capacity of that business. The husband's evidence is that it is showing a modest net profit, whereas the wife’s evidence is that it is effectively revenue neutral. 

34.The orders of 12 August provided that, until further order, the wife provide to the husband quarterly accounts for S Business within 28 days of the end of each quarter, including profit and loss statements, balance sheets and BAS statements.  The husband has told me although he received them for a period, full details for the September and December 2008 quarters, and the March 2009 quarter, have not been provided, and that he has experienced some problems in obtaining material from Westpac. I am content to allow that oral application to be made. 

35.Counsel for the wife has pointed to material in her client's affidavit which suggests there has been compliance, albeit late, for which she attributes responsibility to an accountant.  The order is clear on its face.  It requires more than information about gross sales and gross purchases.  What is required are proper quarterly accounts which include profit and loss statements, balance sheets and BAS statements.

36.All I do at this stage is note that the continuing obligations imposed on the parties by the August orders remain binding.  I note the dispute on the facts, which is not a dispute I can resolve today.  I note the importance of compliance with those orders.

37.I will order that my reasons for judgment be transcribed and a copy be made available to the parties.  I will certify for counsel.

I certify that the preceding thirty-seven (37) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Brown

Associate: 

Date:  9 June 2009