DALLIMORE & DALLIMORE

[2021] FCCA 9

FEDERAL CIRCUIT COURT OF AUSTRALIA

DALLIMORE & DALLIMORE [2021] FCCA 9

Catchwords:
FAMILY LAW – Property – 79A application – enforcement of orders.

Legislation:

Family Law Act 1975 (Cth), s.79A

Cases cited:

La Rocca & La Rocca (1991) FLC 92-222

Prowse v Prowse (1995) FLC 92-557
Rohde & Rohde (1984) FLC 91-592

Applicant: MR DALLIMORE

Respondent: MS DALLIMORE

File Number: SYC 542 of 2011

Judgment of: Judge Boyle

Hearing date: 28 January 2020

Date of Last Submission: 28 January 2020

Delivered at: Sydney

Delivered on: 4 February 2021

REPRESENTATION

Solicitors for the Applicant: The Applicant in person

Solicitors for the Respondent: The Respondent in person

ORDERS

1. That the husband’s application pursuant to section 79A of the Family Law Act 1975 be dismissed.

2. The husband pay to the wife or as she directs the amount of $21,838 within 28 days.

3. If the husband fails to comply with order 2 herein, an enforcement warrant issue forthwith for the seizure and sale of the Motor Vehicle 1 and Motor Vehicle 2 and for the proceeds of sale to be paid to the wife.

4. That within 28 days of the sale of the Motor Vehicle 1 and Motor Vehicle 2, the husband pay to the wife the amount of $21,838 minus the proceeds received by the wife from the sale of the Motor Vehicle 1 and Motor Vehicle 2.

5. In the event that the husband does not comply with orders 2 and 4 herein, the wife be appointed trustee for sale of the property at B Street, Suburb C NSW (“the B Street, Suburb C Property”) and shall do all acts and things necessary to cause the B Street, Suburb C property to be listed on the market for sale by private treaty with a real estate agent and do all acts and things and sign all documents required to:

   (a)Request a Real Estate Agent to recommend a listing price to be placed on the B Street, Suburb C property for the purpose of a sale by private treaty and accept such recommended listing price.

   (b)Instruct such solicitor or conveyancer as the parties agree upon to undertake the conveyancing on the joint instructions of the parties for the sale of the B Street, Suburb C property and in default of agreement instruct such solicitor as may be nominated by the President for the time being of the Law Society of NSW upon the request of either party (“the Solicitor”) and the costs of and incidental to such appointment shall be paid equally by the parties as and when they fall due.

   (c)The contract for sale of land for the sale of the B Street, Suburb C property shall contain such reasonable terms and conditions as may be agreed between the parties, or in default of agreement, as advised by the solicitor or conveyancer acting on the sale and the time for completion of the contract shall be 42 days.

   (d)In the event that the parties are unable to agree on any issue in relation to the marketing and advertising of the B Street, Suburb C property then the parties shall accept the recommendations of the Agent in that regard.

   (e)The husband shall co-operate in every way with the Agent in relation to the marketing of the B Street, Suburb C property including making the keys available and allowing inspection of the property at times requested by the Agent and ensuring that the property is in a neat and clean condition at the time of inspection by prospective purchasers.

   (f)If the B Street, Suburb C property is listed for sale by private treaty and is not sold within 60 days then, on the request in writing of either party, the parties shall forthwith do all acts and things necessary to submit for sale, and sell, the B Street, Suburb C property by public auction and for this purpose they shall:

   (i)Appoint such Auctioneer as is recommended by the Agent (hereinafter called "the auctioneer") to conduct the auction sale.

   (ii)Request the auctioneer to recommend a reserve price to be placed on the B Street, Suburb C property for the purpose of the auction sale and accept such recommended reserve price.

   (iii)Pay to the auctioneer any moneys requested for costs and expenses in relation to the auction, in equal shares.

   (iv)Attend at the auction sale and negotiate with the highest bidder in the event that the reserve price is not reached.

   (v)Accept the advice of the auctioneer as to the acceptance of a price less than the reserve price.

   (vi)In the event the B Street, Suburb C Property is not sold at any auction held pursuant to these orders or by private negotiation within fourteen (14) days after the said auction then the parties shall do all acts and things and sign all necessary documents to procure a further auction to take place within a further 35 days of that date with a reserve price which is 5% lower than the reserve price for the previous auction and otherwise upon the same terms and conditions as applied to the first auction.

   (g)The B Street, Suburb C Property shall not be sold at a price which is not a price agreed upon by the parties unless:

   (i)It is sold at auction for not less than the reserve price; or

   (ii)Paragraph 5(f)(v) of these orders applies; or

6. That the husband do all acts and things necessary such that on completion of the sale of the B Street, Suburb C property the proceeds of sale shall be paid in the following manner and priority:

   (a)In payment of agent's commission, auction costs, advertising expenses and conveyancing expenses of the sale;

   (b)In payment to the wife a sum of $21,838 minus any proceeds received by the wife from the sale of the Motor Vehicle 1 and Motor Vehicle 2.

   (c)Discharge the mortgage over the property; 

   (d)In payment to the husband of the remaining balance.

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

FEDERAL CIRCUIT COURT
OF AUSTRALIA
AT SYDNEY

SYC 542 of 2011

MR DALLIMORE

Applicant

And

MS DALLIMORE

Respondent

REASONS FOR JUDGMENT

1. These proceedings began by way of an enforcement application filed by the wife on 18 September 2018 for enforcement of orders made 6 May 2013. On 23 January 2019 the Registrar issued an enforcement warrant in relation to seizure and sale of property against the husband in order to satisfy the existing property orders.

2. The husband filed an initiating application on 7 March 2019 seeking a variation of the orders, pursuant to section 79A of the Family Law Act 1975 (Cth) (“The Act”).

3. On 9 July 2019 orders were made which stayed the operation of the enforcement warrant pending the disposal of the husband’s section 79A proceedings. The wife seeks to enforce the property orders of 6 May 2013, and that an enforcement warrant issue to enable property to be seized and sold in satisfaction of the debt. She seeks that the section 79A application be dismissed.

Documents Relied on

1. The husband filed an initiating application, financial statement and affidavit on 7 March 2019. Further affidavits were filed on 11 April 2019, 9 January 2020 and 23 January 2020.

2. The wife filed a response, financial statement and affidavit on 15 April 2019; a further enforcement warrant and affidavit were filed on 24 January 2020.

3. Much of the material filed by the parties was repetitive, and difficult to follow.  I accept that they were both doing the best they could to represent themselves.

4. Orders were made on 28 November 2019 for the parties to attend mediation through D Counselling, but if mediation could not occur prior to the hearing date, the matter would proceed.  The husband sought an adjournment because he approached D Counselling, and was unable to obtain a date for mediation prior to the hearing date.  I drew his attention to the terms of the order.  The adjournment was not granted.

Background

1. The husband is 79 years old.  He has been in receipt of the age pension since 2015.  The wife is 57 years old and receives the disability pension.  The parties have one child Ms E who is over 18 years, and finished school in 2019.

2. The parties commenced a relationship in 1994 and were married in Country F.  Consistent with their many disputes, they disagree about whether they separated in 1996 or 1998.  The date is not relevant to this application. 

3. Property orders were made by consent in 1998.  In 1999 the parties reconciled.  Ms E was born in 2001.  Final separation occurred in April 2002, under the one roof.

4. In 2005 the wife and Ms E moved from the home to separate rental accommodation.  The husband paid the wife’s rent voluntarily until consent orders were made on 6 May 2013 with respect to the property proceedings.

5. The consent orders of 6 May 2013 required that the husband pay to the wife the sum of $153,300 by way of monthly instalments of $1,825 commencing 6 December 2012.  Payments at that rate would continue until 6 December 2019.  The money was to be paid directly to a real estate agent, for the wife’s rent.  There were various conditions within the orders on the requirement for payment.

6. The husband complied with Order 5 until 6 August 2018, when he ceased payments.  By that time there had been increases in the wife’s rent from $1,825 to $1,955 per month.  The husband increased his monthly payments accordingly.  He seeks that the additional amount of $130 per month be taken into account when assessing the amount paid pursuant to the orders.

7. Both parties were unhappy with the consent orders, although there is no issue that each consented to the orders at the time.  It was difficult to get the parties to focus on the issues in dispute.  They both persisted in raising longstanding complaints about the other.

8. The husband has received the aged pension since 2015.  He owns the home in which he resides.  His evidence is that the value of the home has fluctuated from time to time.  It is subject to a reverse mortgage.  He advised during the hearing the mortgage was at $800,000.  He says that the loan has increased between $42,000 - $44,000 per annum.

9. The husband seeks that the orders of 6 May 2013 be varied pursuant to section 79A(1)(b) or (1)(c), so that no further payment is required by him. He seeks that the enforcement warrant be discharged. His position was confirmed by him at the beginning of the hearing. The wife opposes his application.

10. Section 79A deals with setting aside final property orders:

    (1)  Where, on application by a person affected by an order made by a court under section 79 in property settlement proceedings, the court is satisfied that:

    (b)  in the circumstances that have arisen since the order was made it is impracticable for the order to be carried out or impracticable for a part of the order to be carried out; or

    (c)a person has defaulted in carrying out an obligation imposed on the person by the order and, in the circumstances that have arisen as a result of that default, it is just and equitable to vary the order or to set the order aside and make another order in substitution for the order;

    the court may, in its discretion, vary the order or set the order aside and, if it considers appropriate, make another order under section 79 in substitution for the order so set aside.

11. The consent orders of 6 May 2013 required payment of $153,300 to be made on a periodic basis between 6 December 2012 and 6 December 2019, by way of monthly instalments of $1,825. The orders set out various conditions, including should the wife cease to pay rent.  The orders also made reference to what was to occur should the wife rent a different property, and a requirement for the parties’ daughter Ms E to have her own bedroom, and that the accommodation be no more than 5 kilometres from her school.

12. Order 5.7 provides:

    That should any of the above conditions not be met, the applicant [the wife] forfeits the right to enforce the payment of the balance owing by the respondent pursuant to this Order and the respondent’s obligations pursuant to this Order are discharged. 

    The husband relies on this provision to waive his obligation to make further payments pursuant to the orders. 

13. The wife vacated the rental property in June 2019.  She and Ms E commenced residing with a friend of the wife.  She does not pay rent, but assists with cleaning, cooking and the like.  She pays money towards expenses when she is able to do so.

14. The wife’s position is that she could not maintain the rent once the husband ceased making payments, and has had to borrow money from a friend.  The wife provided evidence of fund transfers for rent paid by her friend on her behalf.  Whilst the husband was suspicious as to why this was occurring, and that it may be that the wife was secreting funds, I do not accept that is the case.  

15. The wife complains that the husband has failed to make financial disclosure.  He provided her with summaries of his accounts, for example, rather than the full statements.  It was disingenuous of the husband to assert that there was no need for the wife to be aware of his specific expenses, when he took issue with hers.  Nonetheless, I am not satisfied that the husband has been hiding or secreting funds on the material before me.

16. The husband complained that the wife spent money on “excess grocery bills” and extravagantly spent money at salons. Having had an opportunity to consider the statements provided, they do not support the husband’s broad criticism.  The husband complained $14,000 was deposited into her account, without a source of the funds being identified.  He did not take me to those amounts, and did not cross examine the wife specifically about those matters.

17. The husband complained that the wife rejected out of hand a proposal he made, when he advised he could not continue to meet the rent payments.  He suggested Ms E live with him, and that the wife rent the spare bedroom to boarders.  I make no criticism of the wife rejecting that proposal.

18. The husband purchased a Motor Vehicle 2 second hand 10 years ago.  The current Redbook value is $3,800 to $4,800. The husband claimed that he had transferred ownership of the vehicle to Ms E for payment by instalments to a value of $6,000.  He provided no evidence that he has sold the Motor Vehicle 2 to Ms E.  The wife disputes that there is any such arrangement.

Issues

1. The issues for determination are:

   (a)The ownership of the Motor Vehicle 2

   (b)The effect of order 5.7 on enforcement, or whether it should apply to reduce the amount outstanding by $10,950;

   (c)Whether there is any basis to vary the orders pursuant to section 79A

The Parties Financial Positions

1. The parties did not file a joint balance sheet at the hearing.  The best evidence I have of their financial positions can be gleaned from their financial statements.

2. The husband is retired on the aged pension.  His assets are the home at B Street, Suburb C New South Wales, valued at $1.9 million.  It is subject to a reverse mortgage which stood at $772,840 on 30 June 2019.  At the time of the hearing the husband’s evidence of the amount owed was $800,000.  He has $548 cash in the bank.  He is the registered owner of a Motor Vehicle 2 with a Redbook value of between $3,800 to $4,800.  He asserts he entered into an agreement with his daughter to pay for the car in instalments to the amount of $6,000.  He also owns a Motor Vehicle 1 valued at $14,000.  He has household contents valued at $30,000. He has no superannuation.  He has credit card debts of $19,200.

3. The wife is presently on a disability pension. She has cash of approximately $450, a Motor Vehicle 3 valued at $6,000 and household contents at $5,000. She has superannuation of $40,339. The wife states that she owes $4,000 to friends.

The ownership of the Motor Vehicle 2

1. The husband has argued that Ms E has exclusive use of the Motor Vehicle 2.  His evidence is they entered into an agreement in November 2019 that she will pay $250 per month to the value of $6,000 for the car.  The wife argues that Ms E has the use of her father’s Motor Vehicle 2 from time to time when he lends it to her.  It is not kept at her home, where Ms E lives. Ms E uses the wife’s car when residing with her.

2. The husband did not produce any evidence about change in title of the Motor Vehicle 2, or periodic payments made by Ms E. The litigation had commenced prior to the time he claims he made this arrangement with Ms E.  I do not accept the husband’s evidence about the transfer of the motor vehicle.

Whether Order 5.7 should apply to reduce the amount outstanding by $10,950

1. Order 5 of the consent orders states the following:

   5. That the respondent pay or cause to be paid for the applicant, by way of a property settlement pursuant to Section 79, the sum of $153,300 commencing 6 December 2012 and ending 6 December 2019 (“the settlement sum”) subject to Orders 5.5, 5.7 and 6,  payable by way of monthly instalments of $1,825 (“the monthly instalments”) to be paid directly to Real Estate Agent of Suburb G towards the applicant’s rent in respect of the applicant’s current rental property for herself and Ms E at H Street, Suburb G (“the H Street, Suburb G property”)  and provided that:-

   5.1 Should the applicant wish to rent another property or is forced to move to another property other than the H Street, Suburb G property (the “alternate property”) then she will enter into the lease agreement in her sole name, pay the bond and notify the respondent of the managing real estate agent within three (3) days of doing so. The respondent will thereafter re-direct the monthly instalments to the new managing real estate agent with any difference in rent to be paid by the applicant;

   5.2 That any alternate property shall provide comparable amenities to the H Street, Suburb G property;

   5.3 At all times the applicant is to ensure that Ms E has her own bedroom;

   5.4 That any alternate property that the applicant wishes to lease shall be no more than five (5) kilometres radius from the school that Ms E is attending at that time;

   5.5 That should Ms E cease living with the applicant (that is, not spending any overnight time with the applicant) for a period exceeding 3 calendar months, other than during times as agreed between the parties, then the respondent’s obligations pursuant to this Order shall cease unless otherwise agreed between the parties (e.g. in the event of extenuating circumstances such as illness or if agreed by the parties, Ms E taking up an exchange student placement or going to boarding school). The rental payments will resume once Ms E resumes overnight time with the applicant for a period exceeding 3 calendar months;

   5.6 That the applicant shall give the respondent 2 weeks’ notice of her wish to move to an alternate rental property and the respondent shall be entitled to inspect the proposed rental property to ensure it complies with the provisions of this Order and only if it does not, the respondent shall provide notice of such to the applicant within 24 hours of the inspection;

   5.7 That should any of the above conditions not be met, the applicant forfeits the right to enforce the payment of the balance owing by the respondent pursuant to this Order and the respondent’s obligations pursuant to this Order are discharged;

2. While it is an unusual order, order 5 placed obligations on the wife, which if not fulfilled forfeit her right to enforce the orders.  The wife ceased to rent a property from June 2019.  I accept the husband has no obligation to pay the instalments from that date to the conclusion date pursuant to the order, being 6 December 2019.  The husband ceased to make payments on 6 August 2018.  The parties agree that the amount outstanding is $21,838, which takes into account the additional amounts paid by the husband to meet the wife’s increased rent.

Whether there is any basis to vary the orders pursuant to section 79A

1. In the context of 79A(1)(b) “impracticable” has been interpreted as follows:

   [T]he appropriate application of section 79(1)(b) ought to be is that circumstances that have arisen in which it becomes impracticable to carry out the orders are circumstances that could not reasonably have been contemplated.[1]

   [1] La Rocca & La Rocca (1991) FLC 92-222.

1. The circumstances were considered in Rohde:

   It is not enough that circumstances have arisen since the order was made which make it unjust for the order or part of the order to be carried out; the onus is upon the applicant to establish to the reasonable satisfaction of the court, that in the circumstances that have arisen it is impracticable for the order or part of the order to be carried out.[2]

   [2] Rohde & Rohde (1984) FLC 91-592 at p 79,768.

2. The main thrust of the husband’s argument is that it is impractical for him to have carried out his obligations under the orders because his financial circumstances have significantly worsened. Whilst this is unfortunate it is not an appropriate basis to set aside the orders under this section.

3. The husband argues that the wife’s failure to comply with the conditions in order 5 of the consent orders grounds his application under s79A(1) (c). As she has not complied with the terms of order 5, the orders for his periodic payments should also be set aside and thus the enforcement application dismissed.

4. The sum of $21,838 is calculated on the basis that the husband’s obligation to make payments ceased when the wife stopped paying rent for accommodation.  The orders “forfeit her right to enforce payment of the balance” after she fails to comply with her obligations. It does not affect the requirement on the husband to make payment prior to the default occurring. I do not accept the husband’s argument.  The wife’s default is already taken into account in the calculation of the sum outstanding. 

5. It is a serious matter for the court to exercise its discretion under section 79A. The Full Court has stated:

   we do not think it would be correct to say that there is even a prima facie entitlement to have the consent orders set aside once a miscarriage of justice has been established, because to do so would be to limit to the discretion of the court and to place an onus on the respondent to show circumstances why the order should not be made.[3]

   [3] Prowse v Prowse (1995) FLC 92-557 at p 81,566.

6. The husband has made periodic payments over a significant period.  He increased the amount to meet the increased costs of the wife’s rent when that was required.  I accept that he had difficulty meeting the payments.  The assets available to realise the funds owed to the wife are the two motor vehicles and the home in which the husband resides. He owns his home, subject to a reverse mortgage.  There is no evidence that were he required to do so he could not draw funds to meet the modest amount owed, which is $21,838, less the amount raised by sale of the motor vehicles.  Orders were made by the Registrar pursuant to the enforcement warrant for the seizure and sale of the two motor vehicles.  I accept that should occur. 

7. Both parties in this matter are in difficult financial positions.  I find that the husband is able to meet the payment of $21,838 to the wife.  The orders shall give him time to make any necessary arrangements following the sale of the motor vehicles to borrow further on the mortgage, or make arrangements for sale to meet the deficit.

I certify that the preceding forty-one (41) paragraphs are a true copy of the reasons for judgment of Judge Boyle

Associate:

Date: 3 February 2021