Cruz and Cruz (No.2)

[2017] FCCA 2941

FEDERAL CIRCUIT COURT OF AUSTRALIA

CRUZ & CRUZ (No.2) [2017] FCCA 2941

Catchwords:
FAMILY LAW – Second tranche of litigation in respect of both property and parenting issues – parenting orders made as proposed by mother and Independent Children’s Lawyer – only real property overseas – only Australian asset being father’s superannuation  – superannuation awarded to wife – order for spousal maintenance appropriate.

Legislation:

Family Law Act 1975 (Cth) ss.60CC, 90MT(1)(a)

Goode & Goode [2006] FamCA 1346

Applicant: MS CRUZ

Respondent: MR CRUZ

File Number: MLC 6359 of 2016

Judgment of: Judge Burchardt

Hearing date: 10 November 2017

Date of Last Submission: 10 November 2017

Delivered at: Dandenong

Delivered on: 7 December 2017

REPRESENTATION

Counsel for the Applicant: Ms Sevdalis

Solicitors for the Applicant: RRR Lawyers

Counsel for the Respondent: In person

Counsel for the Independent Children’s Lawyer: Mr Lynch

Solicitors for the Independent Children’s Lawyer: Peter Lynch

ORDERS

(Amended pursuant to Rule 16.05(2)(e) of the Federal Circuit Court Rules 2001 on 12 December 2017).

Parenting

1. All previous parenting orders be discharged.

2. The Applicant have the sole parental responsibility for the child X born (omitted) 2003 (“the child”), but is to consult the Respondent so far as practicable before major decisions.

3. The child live with the Applicant.

4. The child spend time and communicate with the Respondent in accordance with her wishes.

5. The Applicant and the Respondent attend separate parent counselling sessions at Lifeworks to develop their understanding of the child’s situation.

6. In the event the child agrees to the same, the Applicant, the Respondent and the child attend family counselling with Lifeworks.

7. The Applicant and the Respondent, and their servants and agents, be restrained from:

   (a)Denigrating the other in the child’s presence or hearing or allowing anyone else to do so;

   (b)Discussing the family law proceedings in the child’s presence or hearing or allowing anyone else to do so.  

8. The Applicant is to encourage the child to:

   (a)Attend counselling with the Respondent; and

   (b)Spend time and communicate with the Respondent.

9. The Applicant be permitted to travel internationally subject to 30 days written notice of the travel, including:

   (a)Itinerary details and countries of travel; and

   (b)Accommodation details.

Spousal Maintenance

1. Order 2 of this Honourable Court on 18 April 2017, being that the Respondent pay to the Applicant for the maintenance of the Applicant, the sum of $400 per week be discharged and that the Respondent pay in place thereof $300 per week until 18 April 2019.

2. The Orders of this Honourable Court on 30 October 2017 being an attachment of earning order against the Respondent’s employer remain in full force and effect.

Property

1. Pursuant to Section 90MT(1)(a) of the Family Law Act 1975, whenever a splittable payment becomes payable in respect of the Respondent’s interest (member number (omitted)) in the (omitted) Super Plan (omitted) under the (omitted) Superannuation (“the Trustee”) shall pay to the Applicant the amount calculated in accordance with Part 6 of the Family Law (Superannuation) Regulations 2001, using a base amount of $18,147 $40,000, and there should be a corresponding reduction in the entitlement of the person to whom a splittable payment would have been made but for these Orders.

2. The operative time for this Order shall be 4 days after the Trustee has been served with a copy of these Orders. 

3. The paragraphs of these Orders are binding on the Trustee.

4. The parties hereby direct and authorise the Trustee to do all such acts and things and sign all necessary documents to fulfil any obligation set out in the Family Law Act 1975 and the Family Law (Superannuation) Regulations 2001 so that the Applicant’s entitlement can be calculated and paid to him in accordance with these Orders.

5. Until the payment of the interest of the Applicant pursuant to these Orders, the Respondent be and hereby is restrained from doing any act or thing or giving any direction which would have the effect of reducing or prejudicing the entitlements of the Applicant pursuant to these Orders.

6. Unless otherwise specified in these orders and save for the purposes of enforcing any monies due under these or any subsequent orders:

   (a)The Applicant and the Respondent are solely entitled to the exclusion of the other to all other property (including choses-in-action) in the possession of the Applicant and the Respondent as at the date of these orders) including motor vehicles;

   (b)The Applicant and the Respondent hereby forgo they may have to any monies standing to the credit of the other;

   (c)Save as provided by these orders, the Applicant and the Respondent hereby forego any claims that they may have to any superannuation benefits belonging to or earned by the other;

   (d)All insurance policies in existence as between the Applicant and the Respondent become the sole property of the owner named there under;

   (e)Each party be solely liable for and indemnify the other against any liability encumbering any item of property to which that party is entitled pursuant to these orders.

7. There be liberty to apply in relation to implementation of these orders.

8. All applications be otherwise dismissed.

IT IS NOTED that publication of this judgment under the pseudonym Cruz & Cruz (No.2) is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).

FEDERAL CIRCUIT COURT
OF AUSTRALIA
AT MELBOURNE

MLC 6359 of 2016

MS CRUZ

Applicant

And

MR CRUZ

Respondent

REASONS FOR JUDGMENT

Procedural History

1. On 6 April 2017, I gave reasons for judgment in this matter which is a parenting and property dispute.  These reasons for judgment should be read with those reasons (the earlier reasons).  At paragraph 54 of the earlier reasons, I noted:

   Given that I am going to be ordering counselling, in effect, by consent of the parties, it seems, in my view, preferable in the ultimate to make the Court’s orders as interim orders.  The Court would wish to know what effect the counselling has and to maintain some form of ongoing control over whether the process is properly complied with, rather than having the matter returned by way of contravention application. 

2. At paragraph 56, I noted:

   Accordingly, and doing the best one can in an evidentiary landscape in which many features are, unfortunately, missing, the only order the Court will make in relation to parenting is that the mother have sole parental responsibility and the parties attend counselling with an independent counsellor, with a view to improving the relationship between the father and the child.

3. I then dealt with property issues.  I noted at paragraph 69:

   The mother’s final position is nuanced.  She clearly seeks the sale of the property in India but it is implicit in the submission as made by counsel that the difficulties of an order forcing the father to sell such property, operating as it necessarily would, extraterritorially, and not insignificant.

4. I noted that the father proposed to sell his property in India in 2018 and the difficulties of the court overseeing the outcome of the sale process in India.  I ordered the father to pay the mother $78,000, which was 60 per cent of the value of the Indian property.

5. I noted that the event of default, I would simply order that the mother receive all of the relatively small superannuation available (paragraph 75).

6. I went on to find that the father could easily afford an additional $300 per week out of his salary by way of spousal maintenance for a period of two years, this being a reasonable time given the mother’s health and other difficulties to re-establish herself. 

7. As it transpired, I did not make any orders for counselling, but rather on 18 April 2017, ordered the appointment of an Independent Children's Lawyer and a family report.  I adjourned the matter for mention in September 2017.

8. The family report which was released on 31 August 2017 noted at paragraphs 71 - 72 that family counselling might assist the father and X to discuss their relationship problems, and that separate parental counselling sessions might be useful to support the parents to think about their shared role as X’s carers and to involve their parental conflict. 

9. The report went on to recommend sole parental responsibility to the mother, that X live with her mother, that she spend time and communicate with her father as she chooses to do so, and that the parents attend counselling sessions at nominated agencies. 

10. On 18 September 2017, I adjourned the matter to trial on 10 November 2017 and ordered the father to pay the mother $5,800 of urgent spousal maintenance and sought to restrain him from otherwise dealing with his funds in his (omitted) Super account. 

11. Those orders followed the wife’s application in a case filed 20 July 2017 noting that the husband had not paid the spousal maintenance as sought, and the father’s affidavit material suggesting that he did not have the capacity to pay such an amount.  The $5800 was funds understood to be then under the father’s control.

12. The wife then filed an application in a case on 23 October 2017 because of the non-payment of the $5800, and on 30 October 2017, I made the order sought to garnishee the father’s wages. 

13. By email dated 17 November 2017, the father sought that the order be set aside as it was causing him significant financial difficulty.

14. I have set out this somewhat protracted and confusing history to put in context what the parties were arguing about at trial.  I have not set out their affidavit material in any detail as it will be sufficient in the particular circumstances of this case to concentrate on what they said at court.

15. The father in opening said he wanted the child to spend alternate weekends with him and one or two times per week.  The child was to be permitted to call at any time that she wanted.  He opposed an order for sole parental responsibility.

16. Counsel for the mother indicated that the issues were parenting matters, spousal maintenance and property.  She pointed out the parties were married on (omitted) 2001 in India and X was born on (omitted) 2003.  They migrated to Australia in (omitted) 2014.  Separation took place on 8 January 2016 and divorce on 23 May 2017.  Counsel passed up a set of proposed orders which I marked as MFI1.  Spousal maintenance is sought till 18 April 2019, being a period of two years from my original judgment. 

17. The property pool consists of the property in India and the husband’s two superannuation accounts.  The trustee has not been served but the wife seeks an equalisation of superannuation.  Counsel seeks that there be a 60/40 split of the parties’ property, as earlier found by the court and in default that the (omitted) superannuation be paid entirely to her client.  Counsel submitted it was a long marriage of about 10 years and the child’s wishes were in the family report.  The mother is unemployed and has medical issues.

The Evidence of the Mother

1. The mother adopted her amended Financial Statement and affidavits as true and correct.

2. She gave evidence that she had recently been in hospital for surgery as an emergency for one week.  She had endometriosis and bleeding and her fallopian tubes had been removed.  Exhibit A1 is a medical report entirely consistent with this evidence.  I note that the report relevantly states, “She has a very slow recovery currently mainly due to her high level of stress and lack of support.” 

3. Under cross-examination by the father, the mother confirmed that she worked for several years in India in a (employment omitted).  It was put to her that those funds were used for buying the property.  The wife said that in India the husband was working.  The funds had come from him.

4. Under cross-examination by the Independent Children's Lawyer, the mother said it was not her wish that X not see her father.  She said the girl does not want to see her father or communicate with him and tells her this.  She told the family reporter this too.  She said she had not contributed to this and does not tell X not to talk with her father.  Her daughter knows about finances.  Sometimes she talks to her about money.  She wants to go on a school trip, for example, but her mother does not have the money.  The mother said that she never criticises the father to her daughter.  I would interpolate and say that this is clearly untrue.

5. The mother was taken to paragraph 66 of the family report in which the writer noted the criticism made by the mother of the father whilst X was present.  The mother said that X knew the father was getting married because he had gone to India and was very disappointed that he did not call. 

6. When asked about counselling with the father, the mother said he agreed to this, but the father never tries to contact her.  She would encourage the child if the child wants it.  She understood counselling was ordered, but it did not happen as the husband was in India.  She has called LifeWorks.  It costs $45 and she does not have the money.  She is fearful of the father for some terrible incidents happened.  He used abusive language to her.  She has an Intervention Order which stops the father from contacting her.  There has been no violence since April 2017.  The father had called her three to four months ago before he went to India.  This is about June.  She would agree to counselling with the father if the court so ordered.  It was possible things might improve but she would not force her daughter.  She wanted an order for sole parental responsibility. 

7. The father had provided no help in the last years.  Sole parental responsibility would mean that financially she would have to look after her daughter.  She cries if she is told she has to spend time with her father and it is up to her daughter.  She would be prepared to tell the father of significant decisions in X’s life.  The father has remarried but she does not know about the wife. 

8. The Independent Children's Lawyer put it to her that he had spoken to her daughter on Wednesday and she had said she did not want her father and had complained about the property in India to which she had felt entitled. 

9. The mother said that this was the flat.  She had some memories of it and was very attached to it. 

10. Under further cross-examination by the father permitted by leave, the mother said that she had contacted him when she was in hospital.  He said he was working and did not want to spend time.  She had given him the key to her residence.  She conceded that the husband had given her her bond for her rental property. 

11. In re-examination the mother confirmed that she worked in India, before her daughter was born, in 2005 - 2006.  The earnings were used in the home but she has not worked since.  She could commence LifeWorks next year. 

The father’s opening

1. The father said he needed two things in relation to X.  He wanted time when we could communicate.  Counselling was much more needed now.  Everything stopped on 20 June 2017.  He does not agree to sole parental responsibility and seeks at least alternate weekends from Saturday morning to Sunday evening. 

2. So far as spousal maintenance was concerned, the biggest thing was salary.  His salary of $120,000 is gross and he receives $7000 per month net.  He has given a breakdown of the essentials.  He has a current family to support with tuition fees for his son.  He is left with nothing after garnisheeing.  The current balance in his account is $30 and he has still a week to go before he is paid.  His wife is about to travel and is awaiting a visa.  He asked rhetorically how he could sustain his family of three.  He has to pay his rent on credit card.  Child support is $1733 per month and with spousal maintenance the total was $3733.  His car, rent and home is $2000 which only leaves him $600 left over.  It is not impossible for the mother to work.  He did take care of his daughter while she was in hospital.  He went to India in (omitted) 2017.  He never used abusive language to the mother and was a carer for his daughter. 

3. So far as property was concerned, he said that the property market had declined in India and his Indian property was now worth only $100,000.  He would need to be there for an extended time and could not do so because of his job.  There will be a 20 per cent capital gains tax to apply.  There would be a loss if there was a panic sell.  There should be a fifty-fifty division of property.  He would not in any event be able to transfer money to Australia.  He wanted any moneys realised from the sale of the Indian property to be transferred to an Indian account. 

4. The father then made some comments about superannuation which I am afraid were incomprehensible and said that his credit card bill is about $15,000. 

The father’s evidence

1. The father adopted his Financial Statement as correct and his affidavits. 

2. Under cross-examination by counsel for the wife, the father confirmed that he is an (occupation omitted) and currently employed as a (occupation omitted).  He has been in this sort of work for eighteen and a half years.  He is a permanent employee of (employer omitted) and earns $10,000 a month gross, $7127 net.  He is also paid $950 per month superannuation. There was some argument as to whether this was part of his overall figure but it is clear from his affidavit filed 27 September 2017 and the payslip annexed thereto that the $950 superannuation is an additional amount. 

3. He has additionally to the $3800 that he has accrued in superannuation some $36,294 superannuation with (omitted) Super, a total of some $40,000.  The father said he is paying arrears of child support which constitute an extra $200 for him.  I should interpolate and say that from the answers the father gave he is extremely knowledgeable about his finances in a general way.  There was cross-examination about recent time he has spent with the child which took the matter little further.

4. He had met his current wife on (omitted) 2017 for the first time and was married on (omitted).  It was an arranged marriage and his wife has an 18 year old child.  He has paid for a dependent visa for the wife and indeed he has paid $7000 in visa fees.  He is trying to get his wife here but has not yet bought a ticket.  He has paid for a tourist visa for her for a cost of $150.  The tourist visa lasts for some three to four months and her son will stay at school in India.  He had not told X that he had remarried.  He would not discuss his expenses with her.  He does not discuss finances with his child.  He said that the wife’s expenses were too high.  He was cross-examined about steps taken to initiate counselling but it appears that any endeavours were merely desultory. 

5. The husband said his house in India was now worth $100,000 - 120,000.  He opposed a superannuation split as he would need it later on.  Indeed it emerged during questions about his superannuation that the father was adamant that he would not give the mother any funds of it or assistance in any way. 

6. The father said his daughter was smart.  When asked if he understood that his daughter did not want to see him, he replied rhetorically “Since when?”  This answer betrayed an astounding lack of insight given the family report.  He was not aware that the mother was having surgery last month.

7. Under cross-examination by counsel for the Independent Children's Lawyer, the father confirmed that he wanted to be part of decisions made about his daughter.  He did not understand what was meant by equal shared parental responsibility although he wanted it.  He says he does not communicate at all with the mother since 20 June 2017.  He said the only way forward was counselling.  There is not current Intervention Order.  He is not scared of the mother at the moment, but she stalks him.  The separation under one roof took much earlier than indicated.  They were separate residences since January 2016.

1. Despite 2016 orders for each second weekend, those orders were not followed;  also all his communication was blocked.  There was no time between September 2016 until trial 2017.  From April to June 2017 he saw his daughter five to six times whenever she was free.  On 20 June 2017 she came out late from school and he picked her up at 7.30pm to 8pm for dinner only.  On 25 June there were communications about seeing a film but then suddenly everything stopped.  He has tried to communicate.  He went to India on (omitted) and was there for one month, coming back on (omitted).  He tried to contact his daughter three to four times.  As soon as he landed, there was a hearing on 9 September.  He is simply waiting for counselling to start.  He had no objection to the issue of passport to X or any objection to overseas travel if sufficient notice was given. 

The evidence of Ms M, the family report writer

1. Ms M adopted her report as true and correct and it was tendered as exhibit M1. 

2. Under cross-examination by counsel for the mother, Ms M opined that X should attend counselling only if she wanted to. 

3. Under cross-examination by the Independent Children’s Lawyer, Ms M agreed that the mother should notify the father of major matters to do with X’s wellbeing and should also encourage the child to have counselling with the father and spend time with him.  Nonetheless, Ms M said she was as firm as X and X was very firm in her desire not to see her father.

4. Under cross-examination by the father, Ms M said that lack of finances directly affected X’s life.  There had been emotional veracity in what X had said.  When she saw X, financial support had been withdrawn.  This was a lived experience for her.  The child is insecure about finances.  X is a very able young woman whose interests are not being fulfilled because of lack of funds.  She has had three changes of school.

5. In final submissions, counsel for the mother indicated X already has a passport and the mother seeks an order that the child be permitted to travel internationally.  This would be on notice.  She otherwise sought orders in the minutes provided.  

6. Counsel submitted that the existing order of spousal maintenance should continue.  The mother has not worked since the child was very young and she is new to Australia.  Counsel pressed for payment from the receipts of the matrimonial home in India be made in Australia or in default that all superannuation be transferred to the mother.  She submitted that the husband had not been honest in his disclosure.  He had only just disclosed his bank account.  Counsel pointed out that the husband has no duty to maintain his stepson.  There is no evidence about this 18 year old child in any event and no proof that the new wife would come to Australia.

7. Counsel for the Independent Children’s Lawyer supported orders 1 to 6 sought by the mother, but the sole parental responsibility should be the consultation as far as practicable before major decisions. 

8. The father has been seeing the child regularly until June 2017 but when the financial support was withdrawn, time stopped. The Independent Children’s Lawyer submitted that the orders for the child to spend time made by Judge McNab on 9 September 2016 should be set aside given that they were inconsistent with the proposed orders he was supporting.  The child’s wishes have serious force and those views have been repeated to the Independent Children’s Lawyer.

9. The Independent Children’s Lawyer sought three further orders.  First, the mother is to encourage X to (a) attend counselling with the father and (b) spend time and communicate with him.  Second the mother be permitted to travel overseas with X subject to 30 days notice of all details of the travel including (a) itinerary details and countries of travel and (b) accommodation details.  The third order sought was the discharge of his appointment and it was submitted that this process should be brought to an end.

10. The father’s initial submissions were, I regret to say, initially unintelligible.  He went on to say that he has requested a review by the Child Support Agency.  His child support is deducted from his salary and will continue until X is 18.  The mother is enrolled in an English training course in Australia.  Her health is in better shape than last year and she should get a job.  He has to care for his wife and her son and is not sure about her visa.  Spousal maintenance has to be considered in the context of his net salary of $7127 per month.  Half his salary goes on child support and spousal maintenance and half on rent and a car.  There is nothing over and he needs time to sell the property.

Findings about the evidence and the witnesses

1. I noted in my earlier reasons a number of evidentiary lacunae in the case.  Those lacunae have scarcely been remedied by the further hearing. 

2. In the first hearing I had formed, perhaps, a generally favourable picture of the father.  As time has gone on, however, I have radically revised my views.  It is clear that he is extremely determined to give the mother as little as possible and preferably nothing.  He resents paying child support as assessed.  He does not even want to give the mother any of his superannuation.

3. Whatever the value of the property is in India, it seems that the father’s own parents live there and the reality is that it will not, contrary to his earlier assertions, be sold in the foreseeable future.  If it is sold, it seems far more probable to me than otherwise that none of the net proceeds of that sale will ever find their way to the wife.  I foresee, if nothing else, protracted Court proceedings in India. 

4. I do not accept that the mother is as scared of the father as she says.  I have seen her in his presence on a number of occasions at Court and her demeanour is rather one of anger than of fear. 

5. What is clear is that X does not want to see her father.  This is partly because she has been overinvolved in the financial difficulties that the mother feels the father has visited on her, but I also note Ms M’s view that the child’s concentration on financial matters is entirely reasonable in the circumstances.  It is for her a lived experience.

6. Given all the deficiencies in the parties’ evidence and the fact that I have little confidence, having seen them give their evidence, that either of the two main players are entirely truthful, I propose to wrestle in relatively shorthand form with the matters in dispute.

Parenting issues

1. This is not a case in which is it is necessary to set out in full statutory pathway as exemplified in Goode & Goode [2006] FamCA 1346 at [65]. Nor is it necessary to go through each of the considerations in section 60CC(2) and (3) seriatim.

2. This is because X is at an age when her views are effectively decisive. Ms M said that she was only as firm in her recommendations as X was and X was very firm.  It is clear that X does not wish to see her father or have anything to do with him at the present time.  This is what she has said to the report writer and, recently, to the Independent Children’s Lawyer. 

3. Notwithstanding this, however, I think that the orders sought by the Independent Children’s Lawyer should be made.  The mother should be encouraged, however little one might hope she will obey the orders, to facilitate counselling to assist X with her father’s relationship and to spend time with him.

4. The fact that the father seeks the immediate reimposition of Judge McNab’s orders simply ignores everything the child has said and this betrays a complete lack of insight, especially when this lack of desire on X’s part is - at least in large part - based on her perception as to the father’s financial behaviour.  Since, as I find, the father is ruthlessly determined to give the mother as little as is humanly possible, his chances of improvement of time with his daughter appear to be minimal in any event.

5. It is plainly obvious that the orders sought by the mother and the Independent Children’s Lawyer are the least worst way forward.

Property

1. As earlier indicated, it has become increasingly clearer over time that the father will either not sell the property in India at all and/or will undoubtedly not provide any of the funds to the mother in any enforceable way.  This Court cannot make orders to operate extraterritorially and although counsel for the mother sought that orders be made in personam while he is in Australia, the net effect is that they would have to have extraterritorial effect.

2. In the circumstances, it is entirely just and equitable that the mother’s default position be enforced and I will order that all the father’s superannuation vest in the mother.  This may give her some opportunity on hardship grounds to seek to establish herself. 

3. The evidence in the case taken as a whole shows that the father has a long history of gainful and remunerative employment as an (occupation omitted).  There is no doubt that he will continue to have that employment for many years to come.  He is under no obligation to support his adult (by Australian standards) son who is in India and there is nothing known as to his new wife’s circumstances there.

4. This is a most unusual case turning on a most unusual set of facts.  The order I am going to make in relation to superannuation is really all the Court can do.

Spousal maintenance

1. Superficially, the father might be thought to have a point.  Approximately half his wage goes in child support and spousal maintenance and, if the wife is successful, will continue to do so until April the year after next. The wife’s health is uncertain and her incapacity to work for a period of time is, in my view, entirely understandable. 

2. Nonetheless, the father has a considerable quantity of discretionary expenditure inasmuch as his rental is substantially greater than that of the wife’s without obvious explanation given that his new wife and child are not living with him.  Likewise, his car is something he may have to revisit. Further, I note he has been able to visit India for two months recently and has spent $7,000 on visas. He is not bereft of resources.

3. Nonetheless, and even making these allowances, a figure of $400 a week is on his uncontested Financial Statement figures, probably beyond him. I am going to reduce the spousal maintenance to $300 per week, to be paid until 18 April 2019.

Conclusion

1. This has been a messy and unsatisfactory case.  It has been before the Court on numerous interlocutory applications in which the parties have bickered freely at every point.  I have never had a feeling that I have a complete understanding of the parties’ true state of affairs in regard to almost any aspect of their dispute.  These reasons of judgment, which I have written in a relatively peremptory way and shorthand way, are simply the best the Court can do to bring finality to a matter that thoroughly needs it. 

I certify that the preceding sixty-nine (69) paragraphs are a true copy of the reasons for judgment of Judge Burchardt

Date: 7 December 2017