CUMMINS & CREIGHTON

[2017] FamCA 169

FAMILY COURT OF AUSTRALIA

CUMMINS & CREIGHTON [2017] FamCA 169

FAMILY LAW – PROPERTY – Interim proceedings – Whether it is appropriate to make interim orders – Where the asset pool reasonably well identified – Where husband agrees to wife selling particular personalty and where wife seeks same order in the alternative – Where no identifiable cash pool from which provision could be made – Where discussion of general principles – Where appropriate to make order for interim distribution of property – Where appropriate to make orders preserving other items of personalty

Family Law Act 1975 (Cth) ss 79, 114

Harris & Harris (1993) FLC 92-378
Strahan & Strahan [2009] FamCAFC 166

APPLICANT: Ms Cummins

RESPONDENT: Mr Creighton

FILE NUMBER: PAC 4337 of 2014

DATE DELIVERED: 22 March 2017

PLACE DELIVERED: Parramatta

PLACE HEARD: Parramatta

JUDGMENT OF: Foster J

HEARING DATE: 24 February 2017

REPRESENTATION

SOLICITOR FOR THE APPLICANT: Mr Vassili of Michael Vassili Barristers & Solicitors

COUNSEL FOR THE RESPONDENT: Mr Kenny

SOLICITOR FOR THE RESPONDENT: Watts McCray Lawyers

Orders

1. That within 14 days of the completion of the single expert valuation of the Motor Vehicle 1 the husband at his expense cause the said vehicle to be delivered to premises nominated by the wife within 14 days from the date of this order and that thereafter the wife be at liberty to sell the said vehicle at the best price reasonably obtainable by her and retain the net proceeds of sale.

2. The characterisation of the proceeds of sale of the Motor Vehicle 1 received by the wife and her subsequent disposition and use of those funds if any are reserved to final trial.

3. That pending further order the husband be restrained from disposing of or removing the Motor Vehicle 2 from his premises pending further order unless the vehicle remains in his personal possession.

4. That pending further order the wife be restrained from disposing of the compliance plate (vehicle identification plate) for the Motor Vehicle 2.

5. That otherwise all pending interim applications are dismissed.

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 Cummins & Creighton 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 PARRAMATTA

FILE NUMBER: PAC 4337  of 2014

Ms Cummins

Applicant

And

Mr Creighton

Respondent

REASONS FOR JUDGMENT

1. In these financial proceedings the applicant wife filed an amended Application in a Case on 9 February 2017 (amending her Application in a Case filed 16 November 2016). In the application she sought orders that in summary provided for:

   a)the payment to her by the husband of the sum of $95,000.00 by way of interim property settlement or costs,

   b)that in default of the payment the wife be appointed trustee for sale of a motor vehicle being a Motor Vehicle 1 and that upon sale she retain after selling costs the balance of the proceeds of sale,

   c)otherwise, the wife sought various other orders including facilitating the  disclosure and valuation of a wide range of motoring personalty including vehicles.

2. Ultimately at interim hearing the wife sought the following orders (Exh “B”):

   a)that the respondent husband facilitate the valuation of the cars and parts as provided for in Orders 4 and 5 of the Application in a Case filed on 9 February 2017 on or before 6 March 2017,

   b)that in the event that the husband fails to comply with the previous order within 72 hours of 6 March 2017 the husband shall organise a licensed and insured carrier to transport the motor vehicles and car parts to an address as nominated by the applicant wife in their present condition and the respondent husband is to pay all costs associated with transporting the motor vehicles and car parts to the wife’s nominated address,

   c)that notwithstanding the previous order and within 48 hours of the date of these orders the husband is to facilitate the delivery of the Motor Vehicle 1 to the address of the applicant wife and the applicant wife shall be appointed as trustee for sale of the Motor Vehicle 1 and funds to be disbursed as follows:

   i)payment of auctioneers fees, advertising expenses and any legal expenses of the sale and

   ii)the balance to be paid to the applicant wife or as directed by the applicant wife.

The husband

1. The husband for his part, not having filed a formal response to the wife’s application initiating proceedings that was filed in September 2014, filed a Response to the wife’s Application in a Case on 22 February 2017.

2. In the Response to the Application in a Case he sought final orders as to property adjustment as between the parties that in summary provided for:

   a)the transfer of a real estate property at B Street, Suburb C to the wife subject to the existing mortgage encumbrance thereon,

   b)the transfer to the wife of the Motor Vehicle 1,

   c)the transfer to the husband of the Motor Vehicle 2,

   d)and that otherwise the parties retain all other property and entitlements in their respective possession.

3. The husband sought no orders in his Response with respect to the interim orders sought by the wife. This circumstance was remedied by the husband’s counsel providing a memorandum as to minutes of orders sought by the husband in the context of the interim application (Exh “C”): those orders in summary provided:

   a)that the husband facilitate D Valuers carrying out a valuation of the Motor Vehicle 2, the Motor Vehicle 1 and the Motor Vehicle 3 in the week commencing 6 March 2017,

   b)that the husband thereafter make the Motor Vehicle 1 available for collection by the wife within 48 hours of such a valuation,

   c)that the wife retain the Motor Vehicle 1 at the valuation price by way of interim property settlement with such to be taken into account on final settlement,

   d)that the husband be restrained from disposing of or removing of the Motor Vehicle 2 from his premises pending further order unless the vehicle remains in his personal possession,

   e)that the wife be restrained from disposing of the compliance plate (vehicle identification plate) for the Motor Vehicle 2 pending further order,

   f)that the wife filed a financial statement within 14 days,

   g)that the wife disclose the financial arrangements concerning the occupation of the former matrimonial home by Mr E.

4. Ultimately, certain orders were made by consent in the following terms:

   1.By consent it is ordered that both the husband and wife are entitled to be in attendance when the single expert valuer is valuing motor vehicles and parts and for the purpose of this order the husband shall provide to the wife’s solicitor by email communication notice of when the single expert valuer is to inspect the subject cars and parts and undertake valuation and where such inspection and valuation is to take place in a timely fashion and in any event not less than 48 hours before the single expert undertakes inspection and valuation.

   2.Each of the parties be restrained from being accompanied by any other person for the purposes of the preceding order.

5. The remainder of the issues raised by the wife’s application were left to be determined.

The wife’s evidence

1. The wife relied on:

   a)the affidavit of Ms F filed 16 November 2016,

   b)the wife’s affidavit filed 7 December 2016,

   c)the affidavit of Ms G filed 14 December 2016,

   d)the affidavit of Ms H filed 21 February 2017,

   e)the wife’s financial statement filed 26 June 2015.

2. The parties commenced cohabitation in December 1995 and married in 1997.

3. They separated in March 2006 although the wife asserts they remain separated under the one roof thereafter until August 2014 at which date the husband left the former matrimonial home.

4. There are two children of the marriage now aged 15 and 13. They reside with the wife.

5. At the commencement of cohabitation the wife was in full-time employment with the public service.

6. The wife asserts that at the commencement of cohabitation she had the following assets:

   a)the property at I Street, Suburb J unencumbered and having an estimated value of $130,000.00,

   b)property and K Street, Suburb L having an estimated value of $195,000.00 and substantially encumbered by a mortgage of about $184,000.00,

   c)accumulated superannuation of about $212,000.00,

   d)furniture having a value of about $8,000.00,

   e)savings of about $10,500.00 in a credit union.

7. At the commencement of cohabitation the husband was also working with the public service and the wife asserts that he had assets comprising the following:

   a)a sum of about $25,000.00 from the earlier sale of the real estate property,

   b)accumulating superannuation the amount of which is not known to the wife,

   c)a motorbike value not known.

8. In 1996 the husband used his cash funds to purchase a Motor Vehicle 4 for $22,000.00.

9. Subsequent to the commencement of cohabitation the parties resided in the wife’s Suburb L property until they moved to the property at B Street, Suburb C.

10. The wife says that during cohabitation she met all household expenses and mortgage payments and property outgoings. She says that the husband made little financial contribution from his income as his income was applied to the support of his father in the years until 2004 or otherwise used for his own purposes.

11. Motor vehicles: The wife gives detailed evidence of the purchase of sale of various motor vehicles during the period of the parties’ marriage. Some vehicles were paid by way of funds drawn by the wife against the property mortgage, others from the parties’ savings account with the M Credit Union. Of particular significance is the purchase in July 2000 of an Motor Vehicle 5 for $92,000.00 that was later sold for $605,000.00 with the net proceeds of sale being paid into the parties’ M credit Union account.

12. Otherwise, various motor vehicle parts and equipment have been purchased by the wife over a period of years and with proceeds from the sale of the Motor Vehicle 5.

13. Suburb C: in 1997 the wife sold her Suburb J property for $125,000.00 with the net proceeds of sale being applied in reduction of the mortgage secured on her Suburb L property.

14. Later in 2001 the wife purchased in the joint names of herself and the husband the property at B Street, Suburb C for $790,000.00. The purchase price comprised funds available from the wife’s then redundancy payment totalling about $145,000.00, $91,800.00 from the wife’s superannuation with First State Super and the balance by way of mortgage security from City Coast Credit Union. The wife further asserts that she paid stamp duty on the purchase of about $31,000.00 from her own credit union account.

15. The wife’s Suburb L property was sold later in 2001 and after payment of loans relating to motor vehicles the sum of $293,600.00 was paid in reduction of the mortgage secured over the Suburb C property.

16. Subsequent to final separation in 2014, the wife has relied upon Centrelink payments and child support for her support and the support of the two children in her care. To supplement her finances she has withdrawn various funds from her accumulated superannuation entitlements such that as at 15 July 2016 she had a remaining balance of superannuation of about $130,000.00.

17. Subsequent to separation there have been ongoing difficulties in relation to motor vehicles and motor vehicle parts as between the husband and wife. Further difficulties have occurred in relation to ongoing payment of school fees for the child N and the husband’s child-support obligation.

18. The mother asserts that since September 2014 she has borrowed significant sums from friends and family and at present has outstanding legal fees of about $15,000.00.

19. Final parenting orders were made in relation to the children on 20 January 2016. In summary, they provide: that the children live with the mother, that the child O spend time with the father each alternate Saturday from 10.00 am to 3.00 pm and at other times as agreed. The father has a fractured relationship with the child N but the orders provide for him to be able to send letters, cards and presents to the child.

20. It is clear that the primary parenting obligation falls on the mother.

21. In summary, it is contended by the mother that the matrimonial pool for adjustment comprises the following:

    a)the jointly owned property at Suburb C having an agreed value of approximately $1,500,000.00 and unencumbered,

    b)various motor vehicles and motor vehicle parts and equipment and personalty including wine having overall value of about $500,000.00,

    c)modest savings,

    d)the husband’s superannuation having a value of about $420,000.00 and the wife’s superannuation having a value of about $132,000.00.

22. Otherwise, the wife has obligations by way of personal borrowings referred to above and outstanding legal fees and the husband an outstanding personal loan, credit card debt and a motor vehicle lease debt.

The husband’s evidence

1. The husband relied upon his affidavit filed 22 February 2017 and his financial statement filed on the same day.

2. The husband is in employment on a salary of about $235,000.00 per annum. He is presently living in rented premises.

3. Regrettably, the husband’s affidavit is drafted as a form of pleading in response to the wife’s affidavit. However, it is clear that whilst there are some discrete issues as to fact as to the financial history of the relationship substantially it is as represented by the wife.

4. The husband gives his detailed response to the wife’s very detailed assertions about the circumstances pertaining to the motor vehicle dealings during the relationship, such issues to be the subject of determination at final hearing.

Interim Property and Injunctions

1. The Court has power under s 114 of the Family Law Act 1975 (Cth) to make such order or grant such injunction as it considers proper with respect to the matter to which the proceedings relate including an injunction in relation to the property of a party to the marriage or an injunction relating to the use or occupancy of the matrimonial home.

2. The principles as to applications for interim property provision are well settled, (Strahan & Strahan [2009] FamCAFC 166) and require a two-step process.

3. Firstly, there must be circumstances enlivening the power to make an interim order. The test is not limited to “compelling circumstances” but whether it would be “appropriate” to make an interim order, with the “overarching consideration” being the interests of justice.

4. In Strahan (supra), the Full Court said:

   132. In relation to the first stage, in our view, when considering whether to exercise the power under s 79 and s 80(1) (h) of the Act to make an interim property order the “overarching consideration” is the interests of justice. It is not necessary to establish compelling circumstances. All that is required is that in the circumstances it is appropriate to exercise the power. In exercising the wide and unfettered discretion conferred by the power to make such an order, regard should be had to the fact that the usual order pursuant to s 79 is a once and for all order made after a final hearing.

5. Secondly, the Court is to have regard to relevant matters in s 79 of the Family Law Act 1975 (Cth).

6. It needs to be kept in mind that the final outcome of property settlement should not be compromised by an interim property order. Either the remaining property needs to be adequate to meet the legitimate expectations of both parties at the final hearing or the order that is contemplated needs to be capable of being reversed or adjusted if it is subsequently considered necessary to do so.

7. It is important to have regard to an overall caution. In Harris & Harris (1993) FLC 92-378, the Full Court said (at 79929-79930):

   As a generality, the interests of the parties and the Court are better served by there being one final hearing of s 79 proceedings.

8. In Strahan (supra), the Full Court said at [132]:

   … regard should be had to the fact that the usual order pursuant to s 79 is a once and for all order made after a final hearing.

9. It is now well settled that in property cases the Court must identify the existing legal and equitable interests of the parties in the property, the liabilities and financial resources of the parties at the time of the hearing and then whether it is just and equitable to make a property settlement order.  Such a consideration should not be guided by an assumption that the parties’ rights to, or interests in, property are, or should be, different from those that then exist. The question is whether those rights and interests should be altered.

10. There is no presumption that one or other party has the right to have the property of the parties divided between them or a right to an interest in marital property that is fixed by reference to the various matters in s 79(4). The Court needs to conclude that it would be unjust or unfair to leave property rights intact.

11. In many cases this requirement is readily satisfied where the parties are no longer in a marital or de facto relationship and, thus, for example, the common ownership or use of property by husband and wife will no longer be possible or the express or implicit assumptions that underpinned existing property arrangements such as the accumulation of assets or financial resources by one for the benefit of both have been brought to an end with the relationship.

12. Both parties in this matter in any event seek that the Court makes final adjustive orders.

13. It is clear that the wife has made a most significant contribution to the present property of the parties. The great majority of the accumulated matrimonial wealth is represented by the one unencumbered real estate property.

14. The wife seeks an interim order for the payment to her of a specific sum but adduces no evidence as to where funds are readily available to meet that order.

15. Otherwise in the alternative she seeks to have possession of the Motor Vehicle 1 and be at liberty to sell that vehicle for the best price reasonably obtainable. The husband has no objection to the vehicle being made available to the wife although contends that it should be retained by her as part of her property settlement at the value placed on it by the single expert valuer.

16. In all of the circumstances it is appropriate that there be an order that the wife have possession of the Motor Vehicle 1 motor vehicle and that she be at liberty to sell that vehicle for the best price reasonably obtainable and that she retain the balance of proceeds of sale. The retention by her of those proceeds of sale and the expenditure, if any, of those sale funds by her will be a matter for consideration at final trial.

17. It is otherwise appropriate that the vehicle not be made available to the wife until the completion of the single expert valuation as contemplated by the parties and as provided for in part by the consent order made on 24 February 2017.

18. Otherwise, as to orders sought by the husband it is noted the parties have agreed to the mechanism for single expert valuation of motor vehicles and motor vehicle parts and equipment.

19. It is appropriate that pending further order the husband be restrained from allowing the Motor Vehicle 2 from leaving his possession and that the wife be restrained from disposing of the compliance plate for the Motor Vehicle 2.

1. The wife has not filed a Financial Statement since 2015 and it is her own evidence that her financial circumstances have changed significantly since that time. It is appropriate that she file an updated financial statement but trial directions made on 24 February 2017 provide for such a document to be filed by no later than 31 March 2017. Thus a further order is not required.

2. If the husband has an interest in relation to the circumstances of the occupation of the former matrimonial home by Mr E who on the wife’s evidence has advanced to her significant funds then he is at liberty to administer a request for further and better particulars to the wife in the usual way.

3. Orders will thus be made in accordance with these reasons.

I certify that the preceding fifty five (55) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Foster delivered on 22 March 2017.

Associate: 

Date:  21 March 2017