Clunes & Dern - [2021] FedCFamC1F 336

FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 1)
Clunes & Dern [2021] FedCFamC1F 336

File number(s): SYC 1626 of 2021

Judgment of: AUSTIN J

Date of judgment: 10 December 2021

Catchwords: FAMILY LAW – PRACTICE AND PROCEDURE – Review of decision – Where a Senior Registrar made orders restraining the husband’s use of personal injury damages it is anticipated he will soon recover – Where the husband no longer opposes an injunction and the dispute is confined to its form – Where on the balance of convenience the husband ought not be required to seek permission from the court to spend his own money – Orders made – Husband to deposit any monetary damages he receives into a controlled money account and notify the wife of any expenditure exceeding $3,000, with the onus being on the wife to apply for an order preventing such expenditure – Husband to furnish the wife with regular written reports detailing all expenditure from the fund – No order as to costs.

Legislation: Family Law Act 1975 (Cth) Pt VIII

Cases cited:
Mullane & Mullane (1983) 158 CLR 436

Tsiang & Wu (2019) FLC 93-911

Williams & Williams (1985) FLC 91-628

Division: Division 1 First Instance

Number of paragraphs: 23

Date of hearing: 10 December 2021

Place: Newcastle

Counsel for the Applicant: Mr Todd

Solicitor for the Applicant: Mills Oakley

Counsel for the Respondent: Mr Gould

Solicitor for the Respondent: Clinch Long Woodbridge Lawyers
ORDERS

SYC 1626 of 2021

FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)

BETWEEN:
MS CLUNES

Applicant

AND:
MR DERN

Respondent

ORDER MADE BY:

AUSTIN J

DATE OF ORDER:

10 DECEMBER 2021

THE COURT ORDERS THAT
1.Orders to 1 to 4 inclusive made on 25 October 2021 are discharged.
2.Upon the husband’s receipt of any money paid in satisfaction of a verdict or settlement entered in his favour in Suit Number … presently pending before the Supreme Court of NSW, the husband shall deposit such money into a controlled money account held by his solicitors, save for payment of the following debts:
(a)Medicare rebates;
(b)Costs and disbursements incurred in the Supreme Court suit; and
(c)Out-of-pocket expenses particularised in the Supreme Court suit.

3.The husband is restrained from causing or allowing any withdrawal from the controlled money account in excess of $3,000 unless he has given the wife 21 days’ written notice of the sum and intended purpose of the proposed withdrawal.
4.Upon establishment of the controlled money account, the husband shall provide to the wife written reports within seven days of 28 February, 30 April, 30 June, 31 August, 31 October and 31 December, of every withdrawal made from the account within the period of two months preceding those dates.
5.Otherwise, the applications for interim relief contained within the following documents are dismissed:
(a)The Application in a Case filed on 30 July 2021;
(b)The Response to an Application in a Case filed on 17 September 2021;
(c)The Application for Review filed on 10 November 2021; and
(d)Exhibit H2

BY…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Clunes & Dern

Details

AGLC: Clunes & Dern [2021] FedCFamC1F 336
Case: [2021] FedCFamC1F 336
Decision Date

CaseChat Overview and Summary

In the matter of Clunes & Dern, the court was called upon to determine the allocation of responsibility for initiating further litigation regarding contested expenditure from a personal injury claim. The wife argued that the husband, whose mental health condition had been impacted by the injury, should bear the burden of seeking court permission if she opposed his spending plans. She contended that his mental instability rendered him prone to impulsive and unreasonable spending. The husband, on the other hand, maintained that he should not be required to seek such permission as the damages were his property, and he should be free to spend them as he sees fit, subject to any court-imposed restrictions.

The central legal issue before the court was whether the husband should be obligated to seek the court's permission before spending the damages if the wife objected, given his mental health condition and the nature of his proposed expenditures. The court had to balance the need to protect the wife's interests against the husband's right to manage his own property. It examined the medical evidence concerning the husband's mental state and the reasonableness of his proposed expenditures, and considered the principles applicable to the division of property in the context of personal injury damages.

The court concluded that the husband's mental health condition, as evidenced by the most recent psychiatric assessments, did not substantiate the wife's concerns about his ability to manage his finances. It found that many of the husband's proposed expenditures were reasonable. Given that the damages were intended to compensate the husband for his injuries, the court held that he should have the right to spend them as he chooses, subject to any court-imposed restrictions. Therefore, the court ruled that the onus should not fall on the husband to seek the court’s permission to spend the money if the wife objected.

The court ordered that the husband was not required to seek permission from the court to spend the personal injury damages if the wife objected, provided that his spending complied with any existing court orders. The wife was left to protect her interests through other means, such as seeking appropriate injunctions if necessary.

Orders

Orders of the court

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Background

Background to the litigation

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Evidence

Evidence Before The Court

As can be seen, the dispute is confined to the choice of person upon whom the burden should fall to instigate further litigation in respect of those items of proposed expenditure which prove controversial, when it may be reasonably anticipated that many items of expenditure are unlikely to be controversial at all.EVIDENCE The wife relied upon:(a)her affidavit filed on 30 July 2021; and(b)a letter prepared by the husband’s treating psychiatrist on 19 September 2021 (Exhibit W1). The husband relied upon:(a)his affidavit filed on 17 September 2021 (but only paragraphs 13–19, 21–22 and 27–29, together with any annexures referred to in those particular paragraphs); and(b)a more recent letter prepared by the husband’s psychiatrist on 1 December 2021 (Exhibit H1).LEGAL PRINCIPLES There is no dispute that the husband’s personal injury claim is a “chose in action” and therefore comprises “property” within the wide meaning of that term in the Act (Mullane & Mullane (1983) 158 CLR 436 at 445). There is no dispute that, when the chose in action crystallises in the form of a verdict and judgment in the husband’s favour, the damages paid to him in satisfaction will also be “property”. It was acknowledged, as it had to be, that such damages are amenable to division between the parties in the exercise of discretion under Pt VIII of the Act (Williams & Williams (1985) FLC 91-628 at 80,093). The parties agreed the principles referred to in Tsiang & Wu (2019) FLC 93-911 apply to the preservation of such property. The parties agree the risk of the personal injury damages being indiscriminately spent before the property settlement proceedings can be concluded justify an injunction being granted. The narrow contest is over the level of such risk and hence where the balance of convenience lies in casting the onus to seek further intervention by the court.DISPOSITION The wife contends the husband should have the onus of seeking the court’s permission to spend the money, if she objects to his expenditure. She gives two reasons why that is so. First, the husband’s symptoms, caused or exacerbated by his accident, allegedly disturb his ability to modulate his conduct, rendering him currently “labile, erratic, impulsive and changeable within minutes”. Secondly, she points to the expenditure the husband deposed he wished to make from the damages he recovers (Husband’s affidavit at [28]) which she implies, but does not overtly express, to be unreasonable. As to the husband’s condition, the most recent medical evidence available from his treating psychiatrist (Exhibits W1 and H1) do not easily bear out the wife’s current apprehension about his impulsivity and unreliability. As to the husband’s planned expenditure, much of it appears perfectly reasonable. In any event, it must be remembered that the damages eventually paid to the husband are to compensate for the injury which he (not the wife) has suffered. The money paid to him in the form of damages will comprise his (not her) property. The husband is free to do with his property whatever he likes, to the extent not constrained by injunction.

Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

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File number(s):	SYC 1626 of 2021
Judgment of:	AUSTIN J
Date of judgment:	10 December 2021
Catchwords:	FAMILY LAW – PRACTICE AND PROCEDURE – Review of decision – Where a Senior Registrar made orders restraining the husband’s use of personal injury damages it is anticipated he will soon recover – Where the husband no longer opposes an injunction and the dispute is confined to its form – Where on the balance of convenience the husband ought not be required to seek permission from the court to spend his own money – Orders made – Husband to deposit any monetary damages he receives into a controlled money account and notify the wife of any expenditure exceeding $3,000, with the onus being on the wife to apply for an order preventing such expenditure – Husband to furnish the wife with regular written reports detailing all expenditure from the fund – No order as to costs.
Legislation:	Family Law Act 1975 (Cth) Pt VIII
Cases cited:	Mullane & Mullane (1983) 158 CLR 436 Tsiang & Wu (2019) FLC 93-911 Williams & Williams (1985) FLC 91-628
Division:	Division 1 First Instance
Number of paragraphs:	23
Date of hearing:	10 December 2021
Place:	Newcastle
Counsel for the Applicant:	Mr Todd
Solicitor for the Applicant:	Mills Oakley
Counsel for the Respondent:	Mr Gould
Solicitor for the Respondent:	Clinch Long Woodbridge Lawyers

SYC 1626 of 2021
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)
BETWEEN:	MS CLUNES Applicant
AND:	MR DERN Respondent

ORDER MADE BY:	AUSTIN J
DATE OF ORDER:	10 DECEMBER 2021