CRICHTON & CRICHTON

[2018] FamCA 1075

FAMILY COURT OF AUSTRALIA

CRICHTON & CRICHTON [2018] FamCA 1075

FAMILY LAW – SPOUSAL MAINTENANCE – where the wife seeks an order for spousal maintenance – where the wife is unable to work full time – where the wife is a carer for a child – where the husband disputes the child’s need for care - where the husband and wife agreed the wife should cease work full time when the parties were living together to care for the child – where the wife is unable to support herself – Order made for spousal maintenance.

FAMILY LAW – CHILD SUPPORT – where the wife seeks existing child support orders be varied – where there was no service upon the Child Support Registrar – where the failure of service prevents the application being heard in this Court - Order for the matter to be stood over until the matter is listed for final hearing.

Child Support (Assessment) Act 1989 (Cth) ss 116, 117
Family Law Act 1975 (Cth)
Family Law Rules 2004 (Cth) r 4.18

Stein & Stein (2000) FLC 93-004

APPLICANT: Ms Crichton

RESPONDENT: Mr Crichton

FILE NUMBER: SYC 4040 of 2017

DATE DELIVERED: 17 December 2018

PLACE DELIVERED: Sydney

PLACE HEARD: Sydney

JUDGMENT OF: Rees J

HEARING DATE: 10 December 2018

REPRESENTATION

COUNSEL FOR THE APPLICANT: Ms Bridger

SOLICITOR FOR THE APPLICANT: Jo-Anna FS Moy Solicitor

COUNSEL FOR THE RESPONDENT: Mr Millar

Orders

IT IS ORDERED

1. That pending further order, the husband pay to the wife spousal maintenance in the sum of $601 per week such sum to be paid on the Monday immediately after the date of these orders and weekly thereafter.

2. That the application of the wife filed 6 August 2018 seeking orders in relation to child support departure be stood over generally.

Note: The form of the order is subject to the entry of the order in the Court’s records.

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

Note: This copy of the Court’s Reasons for Judgment may be subject to review to remedy minor typographical or grammatical errors (r 17.02A(b) of the Family Law Rules 2004 (Cth)), or to record a variation to the order pursuant to r 17.02 Family Law Rules 2004 (Cth).

FAMILY COURT OF AUSTRALIA AT SYDNEY

FILE NUMBER: SYC 4040 of 2017

Ms Crichton

Applicant

And

Mr Crichton

Respondent

REASONS FOR JUDGMENT

1. This matter came before the Court in a duty list in relation to interim applications for spousal maintenance and a child support departure order.

2. The applicant, Ms Crichton (“the wife”) seeks an order that the respondent, Mr Crichton (“the husband”), pay spousal maintenance for her in the sum of $2,719 per week and that the existing child support orders be varied to provide that the husband pay school fees for the parties’ younger child.

3. The husband opposes both applications.

4. The parties’ two children, X born in 2001 and Y born in 2003, live with the wife and do not spend time with the husband. The older child attends school by distance education because of health concerns, and the younger child attends a private school.

5. The former matrimonial home has been sold and an amount of some $1.5 million is held in a controlled monies account.

SPOUSAL MAINTENANCE

1. The wife asserts that she is unable to work and thus support herself because she is required to be available to care for X. The husband denies that assertion and it is his case that the wife should get a job and support herself.

2. In an affidavit sworn on 4 August 2017, the husband deposed:

   On or about August of 2015, [X] began having intermittent fainting spells. The doctor told us that all was well and it was normal for teenage girls to faint.

   During 2015, [X] started fainting more regularly from once a month, to fortnightly and then weekly. We were still being told by the doctors that they could not find anything wrong or any cause for the fainting.

   When [X] had a fainting spell at school I was called by the school who notified me of what had happened. When I was able to, I attended the school which was approximately a dozen times. If I was available, I collected [X] from school and took her home. When I was not available to pick her up from school, [the wife] met [X] at the hospital if an ambulance had been called. Each time she was taken to hospital she would be taken to the emergency department and then she would return home.

3. The husband deposed that in July 2015, X was diagnosed with a medical condition. The husband deposed:

   On 16 October 2015, [the wife] resigned from work to focus on finding someone who could help get some answers for [X’s] condition. It was clear that [the medical condition] was quite rare and we could not find anyone who would treat [X] in Sydney. The specialists in Sydney were unwilling to assess her until she reached the age of eighteen (18) which is in another 18 months. While her condition is not life threatening, in order for [X] to minimise the effects of her condition, healthy eating, regular exercise and lots of rest are required.

4. The husband deposed:

   In February of 2016, [X] tried to go back to school but was finding it difficult and embarrassing fainting in front of the other kids. I picked [X] up from the school sick bay on numerous occasions.

   ...

   On 22 June 2016, [X] had severe abdominal pain and [the wife] took her to [C Hospital]. [The wife] stayed with [X] at the hospital and I looked after [Y].

   On 29 July 2016, [X] was again taken to hospital with severe rib pain, It [sic] was unclear if this pain was a side effect of the medication she was on. She was once again discharged with no further answers to the cause of her pain.

   On 1 August 2016, [X] passed out, while [the wife] was away from home picking up [Y]. I attended to [X] by helping her to lay down and after some time she was fine again.

5. In an affidavit sworn on 2 August 2018, the wife deposed:

   Prior to me resigning from my employment in October 2015, [the husband] and I talked about me caring for [X]. We discussed that I had no sick leave or holiday leave left, my pay was being docked and I was constantly leaving work to collect [X] from school or hospital ... [The husband] and I agreed I should resign “I think that is the best idea, I cannot take time off I am too busy. [X’s] health is too important. Someone has to look after her.” [Dr D] advised me that it could take a while for X to grow out of the condition. [Dr D] is [X’s] treating doctor].

   [X] did not improve and wasn’t attending school for more than two hours every few days and she was falling behind, I engaged a maths tutor to help her study but it was very hard for [X] and the tutor company suggested she do Distant Education, I discussed this with [the husband] and he agreed and liked the idea of not paying private school fees when [X] wasn’t attending school. He agreed Distance Education was the best option for [X] to be able to continue her schooling and said that we should push for her school ... not to charge us the one terms notice to leave.

6. The wife deposed “I care for [X] full time. She can have a fainting spell at any time. When this occurs, [X] needs to be put in a safe position. [X] suffers from migraines most days.”

7. The wife, in her affidavit sworn on 7 December 2018, deposed “[X] continues to suffer from fainting episodes, migraines joint and rib pain and nose bleeds all of which occur at any time and without any degree of predictability.”

8. Dr E swore an affidavit in the wife’s case. Before me, the husband objected to the affidavit being relied upon on the basis that Dr E was not a single expert.

9. The issue of Dr E’s evidence was first raised before Judge Monahan in the Federal Circuit Court on 28 February 2018. There is no transcript available of the proceedings on that day but I note that it is agreed that the issue of a report from Dr E was raised and the Judge ordered “The Respondent provide to the Applicant any questions to be put to the relevant child’s expert within 14 days from the date of these orders.”

10. On 10 May 2018, Judge Monahan ordered “Each party have leave to photocopy any documents produced on subpoena for the purposes of forwarding the documents to the child’s expert AND such leave is granted on condition that the copying party destroys all photocopies at the conclusion of the matter.”

11. It is not in dispute that the ‘child’s expert’ is a reference to Dr E. In fact, the husband did photocopy documents and forwarded them to Dr E requesting that she provide additional information by way of answers to questions. The husband chose not to proceed with that request and no answers were provided by Dr E.

12. Whilst no formal order was made for the appointment of Dr E as a single expert, it would seem clear that in the Federal Circuit Court, Dr E was treated as if she were a single expert and the husband was given the same opportunities to participate in her report as he would have been given had Dr E been formally appointed. In those circumstances, I accepted Dr E’s report into evidence.

13. Dr E is a specialist in private and public practice, and senior specialist at F Hospital.

14. Dr E stated, in relation to her expertise:

    I am primarily an adult [specialist]. However in the course of my work over 32 years in [my field], Pediatric [sic] [specialists] refer a considerable number of children and adolescents to me who have [medical conditions] and I often care for three generations of inherited [medical conditions] within the one family.

    I have specialist knowledge appropriate to this case based on my training, study and experience, having diagnosed and managed 6 female adolescents who have [the medical condition], over the last few years.

15. Having regard to the fact that the parties were unable to find a suitable treating specialist for X in Sydney and were forced to consult Dr D in Melbourne, it would seem that the particular condition which affects X is not common and I accept that Dr E’s stated experience qualifies her as an expert for the purpose of the preparation of this report.

16. Dr E had available to her the reports of Dr D who is X’s treating doctor in Melbourne. Dr E also interviewed X.

17. Dr E stated:

    I cannot comment on whether there is any component of exaggeration of symptoms. The relevant fact is the current day to day symptoms which I accept because of the consistency and the telling, the consistency with reports of treating doctors and consistency with the diagnosis … and my observations in similar young women.

    The care which I think is appropriate for [the wife] to provide to her daughter ... is that which is currently being provided by [the wife].

18. Dr E’s stated:

    [X’s] illness places a very real limitation on her wife[’s]… capacity to work.

    Because of the possibility of syncope, which is not predictable, I do not think that [the wife] could return to full time work and leave [X] unattended between the [sic] 9am and 5pm each day.

    …

    Given this pattern of needing to be constantly with [X], I can only envisage [the wife] doing a few hours of work a day, and that this work is done from home.

19. Dr E stated “I do not think [the wife] can leave [X] for more than an hour or two at present.”

20. I am satisfied that, when the parties were living together, the husband and the wife agreed that it was necessary for the wife to stop working full time in order to care for X.

21. The wife last worked in 2015. Presumably, her employment prospects would not be assisted by her history, in her previous employment, of needing to leave work unexpectedly to collect X from school or hospital.

22. I am satisfied that the wife cannot work on a full time basis at present because of the exigencies of X’s care.

23. Whether she would be able to obtain paid employment for a few hours each day, working from home, as Dr E suggests might be appropriate, is not known.

24. However, she is not, at this time, able to support herself.

25. What then, are the wife’s reasonable needs?

26. She seeks an order that the husband pay the sum of $2,719 per week based upon her assertions in her Financial Statement. The wife estimates her own Part N expenses to be $168 per week and the Part N expenses of the children, including school fees and medical expenses, to be $2,234 per week.

27. In Stein & Stein (2000) FLC 93-004, the Full Court held that the power of the Court to make orders for spousal maintenance is not to be confused with the power of the Court to make orders for the support of children :

    49.It seems to us that in the context of an application for spousal maintenance the consideration in s 75(2)(d) of “the commitments of each of the parties that are necessary to enable the party to support... a child... that the party has a duty to maintain” has greater significance in determining the capacity of a payer to provide support rather than in determining the extent to which the other party requires support. In a maintenance case if, for example, a husband is called upon to pay maintenance for his wife, the Court must determine his capacity to pay that maintenance having regard to his obligation to support his children. The level of support that the wife needs for herself is not dependent upon the level of support she must give to others. In a property case however, the extent to which a division of property may be seen as being appropriate might only properly be measured by examining all the demands that each spouse has to meet.

    50. By way of example, s 66M makes it clear that a step-parent does not have a duty to maintain step-children, other than in the circumstances which the Court is required to take into account under s 66M. It would not be a proper application of s 75(2)(d) to create a liability of a father to support his step-children via the device of a maintenance application by his estranged wife on the basis that she has a duty to maintain her children and that she requires the provision of maintenance for herself so that she can in turn support her children.

    51. Whilst the legislation permits the Court in exercising its s 74 power to take into account only the various matters set out in s 75(2), the legislation gives little guide as to the manner in which they are to be so taken into account. The power exercised under s 74 is to make such order as the Court considers proper for the provision of maintenance of a party to a marriage. This is not to be confused with the power of the Court to make orders for the maintenance of children or step-children under the provisions of Part VII of the Act nor for the provision of child support under the Child Support (Assessment) Act.

    52. There is, however, an overlap between the various sections. In order to avoid “double dipping”, s 117 of the Child Support (Assessment) Act enables the Court to take into account in proceedings for a departure order:

    “any payments... made or to be made (whether under this Act, the Family Law Act 1975 or otherwise) by the liable parent... to the carer entitled to child support... for the benefit of the child.”

    As already indicated, s 75(2)(na) enables the Court, in determining an application for spousal maintenance, to take into account any child support that has been provided, is being provided or might be liable to be provided in the future.

    53. Each relevant area of legislation requires different considerations. The obligation to maintain children under Part VII of the Family Law Act is, like the obligation to provide child support under the Child Support (Assessment) Act, an obligation which has priority over all commitments of a parent other than commitments necessary to enable the parent to support himself or herself or any other child or other person that parent has a duty to maintain and is not of a lower priority than a duty of a parent to maintain any other child or any other person. 

    54. Child maintenance is to be determined having regard to the matters set out in ss 66J and 66K of the Family Law Act, whilst child support is governed generally by the provisions of the Child Support (Assessment) Act, and in respect of any application for departure from administrative assessment, by the provisions of s 117. The matters to be taken into account under both Part VII of the Family Law Act and under the relevant sections of the Child Support (Assessment) Act are not identical to matters to be given consideration in respect of claims for spousal maintenance. 

    55. Spousal maintenance is ultimately governed by the provisions of ss 72 and 74, namely there being no right to spousal maintenance unless there is a capacity to meet it and an inability by the claimant to meet the claimant's own self-support.

    56. In this case, the wife's duty to maintain her own children was only a duty to make an equitable contribution towards their support. The extent of that equitable contribution had not been evaluated by the trial Judge but could probably be said to have been non-existent having regard to the vast amount of wealth available to the husband. On that analysis, even if it was appropriate for the trial Judge to have taken into account the commitments of the wife necessary to enable the wife to support her children, it could not be said that the expenditure of monies on the children by the wife over and above the monies she would be able to obtain by way of appropriate assessment of child support could be seen as necessary expenditure by the wife. It certainly could not be seen as an element of her self-support.

    57. In our view, we must conclude that his Honour erred when taking into account what his Honour described as ``the obligation to maintain the children pursuant to s 75(2)(d)''. In one sense the wife had no obligation to support the children because that obligation could be clearly met by an application for departure from administrative assessment of child support. In another sense, even if she had an obligation to maintain those children, the fact that she was meeting that obligation could not be said to be a necessary element of the amount of support she needed for herself.

28. Thus, the necessary expenses of the wife for the purpose of her application for spousal maintenance are confined to those applicable to her own support.

29. I consider that the expenses demonstrated in the wife’s Financial Statement are:

    Part N Expenses  $168

    Rent (half of $750)  $375

    Car expenses  $38

    Health insurance (half)  $20

    Total  $601

30. On behalf of the husband it was submitted that he had no capacity to pay that, or any amount.

31. The husband relied on a Financial Statement sworn 31 August 2018. He deposed to an income of $1,153 per week or about $60,000 per annum. That income is derived from G Pty Ltd, a business which the husband runs using the vehicle of a family trust (“the trust”). The husband is sole shareholder and director of the trustee company.

32. The Financial Statements of G P/L for the year ended 30 June 2018 disclose that the trust had a profit before tax of $147,180. Included in the expenses of the trust, were a total of $9,034 for the costs of the husband’s car. In addition the financial statements disclose that in the year ended 30 June 2018, the outstanding loan of $31,046 shown as a liability of the trust to the husband in the previous year had been discharged.

33. The financial statements of the trust for the same period show that the husband had borrowed $103,284 from the trust in that financial year.

34. Counsel for the wife tendered bank statements for an ANZ account in the name of the husband from 31 May 2018 to 25 September 2018 showing total deposits from G P/L in that period of $36,885 or an average of about $2,850 per week. In the same period, some $18,000 was paid to the husband’s solicitors. In the same period, credit card statements show that the husband spent more than $2,000 on Airbnb in the UK and almost $3,000 on wine purchases.

35. I note that in August 2018, the husband had in excess of $28,000 in a bank account and that at 30 June 2018, G P/L had $155,252 in cash at hand or at bank. In addition, the family trust had listed shares valued at $259,803 and cash of $2,696.

1. I do not accept that the husband’s income as he has deposed represents all of the funds available to the husband from time to time, from the family trust and from G P/L.

2. The husband has the capacity to pay spousal maintenance in the sum of $601, whether from income or from capital.

LUMP SUM MAINTENANCE

1. In the alternative to periodic maintenance, the wife seeks lump sum maintenance of $100,000 to be paid from the controlled monies account.

2. I do not consider it appropriate to make a lump sum order. The husband has paid child support as assessed and his payments are up to date. If he were to default on the payment of periodic spousal maintenance, the matter can be revisited.

CHILD SUPPORT

1. Rule 4.18 of the Family Law Rules 2004 (Cth) prescribes the documents to be filed with any application relating to child support in the following terms:

   4.18  Documents to be filed with applications

   (1)  A person must file with an application mentioned in an item of Table 4.1, the documents mentioned in the item.

   Table 4.1   Documents to file with applications

Item	Application	Documents to be filed with application
1	All applications for child support	An affidavit setting out the facts relied on in support of the application, attaching: (a) a schedule setting out the section of the Assessment Act or Registration Act under which the application is made; (b) a copy of any decision, notice of decision or assessment made by the Child Support Registrar relevant to the application and statement of reasons for that decision; and (c) a copy of any document lodged by a party with the Child Support Registrar, or received by a party from the Child Support Registrar, relevant to the decision or assessment
2	Application under section 111, 116, 123, 129, 136, 139 and 143 of the Assessment Act and 111C of the Registration Act	An affidavit setting out the facts relied on in support of the application, attaching: (a) the documents mentioned in this column in item 1; (b) a completed Financial Statement; (c) a copy of any relevant order or agreement
3	All applications for child maintenance	A completed Financial Statement

Note:  The documents required to be filed with an application under this rule are in addition to the documents required to be filed under rule 2.02.

(2)  For paragraph (c) of item 1 of Table 4.1, if the applicant does not have a copy of a document lodged by the other party with the Child Support Agency, the applicant may file the summary of the document prepared by the Child Support Agency.

1. Rule 4.23 relates to service upon the Child Support Registrar.

   Service of application

   (1)  The persons to be served with an application under this Part are:

   (a)  each respondent;

   (b)  a parent or eligible carer of the child in relation to whom the application is made;

   (c)  the Child Support Registrar.

   (2)  Except for an application for an order staying a decision or an urgent order for child maintenance, an application must be served at least 28 days before the hearing date.

   (4)  Any documents on which the applicant intends to rely must be served on the persons mentioned in subrule (1) at least 21 days before the hearing date.

2. There was no compliance with the requirements of Schedule 1 and no service upon the Child Support Registrar.

3. Service upon the Child Support Registrar is required because, where the proceedings are commenced pursuant to s116 of the Child Support (Assessment) Act 1989 (Cth) (“the Assessment Act”), the Registrar is entitled to intervene.

4. Although the applicant did not specify the basis on which it was asserted that the Court had jurisdiction to hear the application, in circumstances where there are assessments in place until 31 December 2018, the last assessment issued 4 June 2018. The only basis could be that provided by s116 of the Assessment Act.

CHILD SUPPORT (ASSESSMENT) ACT 1989 - SECT 116

Application for order under Division

(1)  A liable parent or a carer entitled to child support may, in respect of an administrative assessment of child support for a child, apply to a court having jurisdiction under this Act for an order under this Division in relation to the child in the special circumstances of the case if:

(b)  both of the following apply:

(i)  the liable parent or carer entitled to child support is a party to an application pending in a court having jurisdiction under this Act;

(ii)  the court is satisfied that it would be in the interest of the liable parent and the carer entitled to child support for the court to consider whether an order should be made under this Division in relation to the child in the special circumstances of the case; or

(c)  in the case of a liable parent--the administrative assessment of child support payable by the liable parent for the child is made under subsection 66(1).

Note 1: For the orders that a court may make under this Division see section 118.

Note 2: With a court's leave, a court may make an order under this Division in respect of a day that is more than 18 months earlier than the day on which the relevant application was made (see subsection 118(2B)). A person is taken to have applied under this section if leave is granted.

Note 3: A court may make an order under this Division if the court sets aside a child support agreement under section 136.

(2)  An application may be made by the carer entitled to child support, or the liable parent, in relation to the child.

(3)  Subject to section 145 (Registrar may intervene in proceedings), the parties to the application are the liable parent and the carer entitled to child support.

1. The “special circumstances” of the case were, it was submitted, the fact that the younger child has attended her present school since she was in kindergarten. That fact was considered in the determinations of the Child Support Agency leading to the Notice of Decision dated 19 January 2018 which required the husband to pay an increased amount to contribute to the costs of school fees. The husband’s liability was increased for three separate periods:

   1 July 2017 to 31 December 2017 increase by $13,235

   1 January 2018 to 31 December 2018 increase by $19,780

   1 January 2019 to 31 December 2019 increase by $20,240.

   Those increased amounts were referable to the school fees.

2. On behalf of the husband, counsel submitted that the application is an abuse of process in circumstances where no appeal has been lodged in relation to the decision of 1 May 2018.

3. However, on an interim basis, I am not required to determine that issue. I consider failure to serve the Child Support Registrar to be a bar to the application’s proceeding.

4. The rationale of s116 of the Assessment Act is to ensure that parties are not unnecessarily forced to litigate in two different venues. Since there is no hearing anticipated in the family law proceedings until such time as the matter is listed for final hearing, the departure application will be stood over generally.

5. If these parents want their children’s medical expenses to be properly addressed and their younger daughter’s school fees to be paid, they have $1.5 million in a controlled monies account from which those payments could be made by agreement.

6. If they prefer to instruct lawyers to argue about which of them should pay, then that is also a matter for them and no doubt the legal costs will well exceed the costs of their daughters about which they are in dispute.

I certify that the preceding fifty-five (55) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Rees delivered on 17 December 2018.

Associate: 

Date:  17 December 2018