DANAHER & REDLING - [2020] FCCA 2768

FEDERAL CIRCUIT COURT OF AUSTRALIA

DANAHER & REDLING

[2020] FCCA 2768

Catchwords:
FAMILY LAW – Property – the de facto Wife’s application for property orders – where the de facto Husband has greater earning capacity – where the de facto Husband has greater financial resources – where the de facto Husband has failed to make full and frank disclosure – where there has been a failure by the de facto Husband to comply with previous court orders – whether there should be an adjustment for contributions – whether there should be an adjustment in the de facto Wife’s favour for s.90SF(3) factors – whether the de facto Husband has as director of the Trustee of the self-managed superannuation fund will comply with a superannuation splitting order.

HELD – Determination there be no adjustment for contributions – there be a 10% adjustment in favour of the de facto Wife for s.90SF(3) factors – splitting order in relation to the self-managed superannuation fund such that the de facto Wife receives a base amount of $50,000 – orders for a cash payment to be made to the de facto Wife by the de facto Husband in the event the splitting order cannot be complied with within 60 days.

Legislation:

Family Law Act 1995 (Cth), ss.90SM, 90SF(3)

Cases cited:

Stanford v Stanford [2012] HCA 52
Karlovsky & Karlovsky (No. 3) [2019] FamCA 847

Applicant:

MS DANAHER

Respondent:

MR REDLING

File Number:

MLC 8949 of 2019

Judgment of:

Judge Bender

Hearing date:

18 September 2020

Date of Last Submission:

18 September 2020

Delivered at:

Melbourne (by Videoconference)

Delivered on:

9 October 2020

REPRESENTATION

Counsel for the Applicant:

Mr Andrew Robinson

Solicitors for the Applicant:

Pearsons Lawyers Pty Ltd

Counsel for the Respondent:

Mr Anthony Fronis

Solicitors for the Respondent:

A ACE Solicitors

ORDERS

The Respondent pay to the Applicant the sum of $71,028.20 (“the payment”) on or before 8 December 2020 (“the date”) being 60 days from the date of these orders.
Orders (3) – (6) herein are subject to orders (7)-(8) herein.
In respect of superannuation:
(a)a base amount of $50,000 be allocated by the Court as required by section 90XT(4) of the Family Law Act 1975, to the Applicant out of the Respondent’s interest (“the Respondent”) in the B Super Fund (“the Fund”) of which the Trustee is B Super Pty Ltd (“the Trustee”).
(b)pursuant to section 90XT(1)(a) of the Family Law Act 1975, whenever a splittable payment becomes payable from the Respondent’s interest in the superannuation Fund, the Trustee shall pay to the Applicant an amount calculated in accordance with Part 6 of the Family Law (Superannuation) Regulations 2001, using the base amount of $50,000 and there be a corresponding reduction in the entitlement that the Respondent would have had in the superannuation Fund but for these Orders.
(c)if, before a splittable payment becomes payable in respect of the Respondent’s superannuation interest, the Trustee is permitted (be legislation and the Trust Deed of the Superannuation Fund)…

Grounds of appeal

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

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

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

Consideration

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

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

Continue reading DANAHER & REDLING

Details

AGLC: Danaher and Redling [2020] FCCA 2768
Case: [2020] FCCA 2768
Decision Date: 9 October 2020

CaseChat Overview and Summary

In the Family Court of Australia, Judge Bender considered an application by the de facto wife for property orders against the de facto husband. The dispute involved the division of assets and liabilities following the breakdown of the de facto relationship, with particular focus on the husband's greater earning capacity and financial resources, his failure to make full and frank disclosure, and his non-compliance with previous court orders.

The court was required to determine whether an adjustment should be made for contributions, whether a further adjustment was warranted in favour of the de facto wife under section 90SF(3) of the *Family Law Act 1975* (Cth) due to the husband's conduct, and how a self-managed superannuation fund should be treated, specifically concerning the husband's role as director of the trustee.

Judge Bender determined that no adjustment would be made for contributions. However, a 10% adjustment was ordered in favour of the de facto wife under section 90SF(3) factors, reflecting the husband's conduct. The court also made orders for the splitting of the self-managed superannuation fund, granting the de facto wife a base amount of $50,000. In the event that this superannuation splitting order could not be complied with within 60 days, the de facto husband was ordered to make a cash payment to the de facto wife. Further orders detailed the process for the superannuation split, including the obligations of the trustee and the parties, and provided for alternative arrangements and security for the payments.

Orders

Orders of the court

The Respondent pay to the Applicant the sum of $71,028.20 (“the payment”) on or before 8 December 2020 (“the date”) being 60 days from the date of these orders.

Orders (3) – (6) herein are subject to orders (7)-(8) herein.

In respect of superannuation:

(a) a base amount of $50,000 be allocated by the Court as required by section 90XT(4) of the Family Law Act 1975, to the Applicant out of the Respondent’s interest (“the Respondent”) in the B Super Fund (“the Fund”) of which the Trustee is B Super Pty Ltd (“the Trustee”).

(b) pursuant to section 90XT(1)(a) of the Family Law Act 1975, whenever a splittable payment becomes payable from the Respondent’s interest in the superannuation Fund, the Trustee shall pay to the Applicant an amount calculated in accordance with Part 6 of the Family Law (Superannuation) Regulations 2001, using the base amount of $50,000 and there be a corresponding reduction in the entitlement that the Respondent would have had in the superannuation Fund but for these Orders.

(c) if, before a splittable payment becomes payable in respect of the Respondent’s superannuation interest, the Trustee is permitted (be legislation and the Trust Deed of the Superannuation Fund) to make a payment to the Applicant (and accordingly reduce the Respondent’s benefit) then the Trustee may make that payment (and reduce the Husband’s benefit by the amount calculated by the Trustee) in full satisfaction of its obligations under these Orders.

(d) the Trustee shall do all such acts and things and sign all such documents as may be necessary to:

(i) Calculate, in accordance with the requirements of the Family Law Act 1975 and the Family Law (Superannuation) Regulations 2001, the entitlement for the Applicant created by Order (3) of these Orders.

(ii) Pay the entitlement whenever the Trustee makes a splittable payment out of the Respondent’s interest in the superannuation Fund; and

(iii) the Respondent shall do all acts and things and sign all such documents as may be required so that in accordance with the obligations set out under the Family Law Act 1975 and the Family Law (Superannuation) Regulations 2001 the Trustee of the Superannuation Fund can calculate the entitlement of, and make payment to, the Applicant in accordance with these Orders.

(e) This Order binds the Trustee of the Fund.

This Order have effect from the operative time and the operative time is four (4) clear business days after the service of a sealed copy of these Orders on the Trustee.

By no later than 8 December 2020 the parties, in their capacities as Trustees of the fund do all necessary acts and things and sign all such documents as may be required to transfer and roll-out the whole of the Applicant’s member account and/or entitlement in the Fund to such other superannuation Fund as she shall nominate at the equal shared expense of the parties (“the Super Roll Out”).

Orders (2)-(5) of these orders are binding on the parties in their capacities as directors of the Trustee and on that basis procedural fairness has been afforded on the Trustee.

In order to give effect to orders (2)-(6) herein, the Respondent shall do all acts and things necessary to have $50,000.00 of the monies currently invested on behalf of the Fund with Company C placed into the Fund’s Commonwealth Bank of Australia account by no later than 8 November 2020 and provide proof of same to the Applicant’s solicitors.

In the event the Respondent fails to comply with order (7) herein, orders (2)-(6) herein shall be discharged and the Respondent do all things necessary to pay the Applicant the sum of $50,000 (the default payment”) by no later than 8 December 2020 (“the default payment date”).

At the time of the Super Roll Out pursuant to order (5) herein or if the Respondent fails to comply with order (7) herein, whichever is the sooner, the Applicant do all acts and things and sign all documents as may be necessary at the expense of the Respondent to resign as:

(a) a Director of the Trustee of the Fund;

(b) transfer her one (1) ordinary share in the Trustee of the Fund to the Respondent; and

10.

Pending the Super Roll Out or order (8) coming into effect, each of the Applicant and Respondent be and are restrained from:

(a) dealing with, charging, encumbering or disposing of any property of the Fund other than in accordance with the terms of this order or with the consent in writing of the other; and

(b) rolling over or transferring their member benefits to another superannuation fund.

11.

Immediately following implementation of the Super Roll Out or order (8) coming into effect, the Respondent be solely liable for and indemnify and keep indemnified the Applicant in relation to any and all liabilities, including but not limited to any Taxation Payable, of or in relation to the Fund and including any liability in respect of any obligation of the Applicant as a Trustee and from all interest, penalties, costs, fines, claims, demands and proceedings of and in relation to the Fund and her role as a Director of the Trustee.

12.

In the event the Respondent fails to make the payment by the date and/or the default payment by the default payment date, the Respondent sign all documents and do all acts and things necessary to transfer to the Applicant the real property at D Street, Suburb E (“D Street, Suburb E”) to be held on trust for sale and upon completion of the sale, the proceeds of be applied:-

(a) firstly, to pay sale costs and expenses;

(b) secondly, to discharge the registered mortgage;

(c) thirdly, so much of the payment or the default payment as is then outstanding from the due date together with interest at the rate of 7% per annum to the Applicant; and

(d) the balance (if any) to the Respondent.

13.

Pending the date, the default payment date or the completion of the sale of D Street, Suburb E, the Respondent have the sole and exclusive right, enjoyment and benefit of D Street, Suburb E and during such right he shall pay all repayments pursuant to the mortgage and all outgoings in relation to the property of whatsoever nature and kind.

14.

In the event that the payment and/or the default payment has not been made by the date or the default payment date, the Respondent shall forthwith vacate the property and provide vacant possession to the Applicant.

15.

Pending the sale of D Street, Suburb E:

(a) the Respondent continue to pay the mortgage instalment repayments of principal and interest and all outgoings of the property as and when they fall due;

(b) the Respondent hold his interest in D Street, Suburb E upon trust pursuant to these Orders; and

(c) the Respondent not deal with, encumber, gift, alienate or otherwise dispose of his interest in D Street, Suburb E or any other property or financial resource other than with the Applicant’s written consent or Court Orders first obtained.

16.

The Respondent forthwith do all acts and things necessary to sell the F Boat and G Boat Trailer registered in his name and the proceeds of sale be divided on the basis the Applicant receives 60% and the Respondent receives 40% and to give effect to these orders, the Applicant co-operate with the Respondent in making the speedboat available for inspection by potential purchases.

17.

The Applicant otherwise retain for her sole and exclusive use, enjoyment and benefit all other items of property (both real and personal and including choses-in-action and financial resources) in her name, possession and/or control including but not limited to:

(a) the proceeds of sale of H Street, Suburb E already received by her;

(b) the proceeds of sale of the Motor Vehicle 1 and caravan already received by her;

(d) her personal belongings and effects;

(e) the furniture, furnishings and household contents in her possession;

(f) her bank accounts and savings; and

(g) her Super Fund J contributions and entitlements.

18.

Subject to compliance with these Orders the Respondent retain for his sole and exclusive use, enjoyment and benefit all other items of property in his name (including D Street, Suburb E, choses-in-action and financial resources) and include:

(a) the proceeds that he received from the sale of H Street, Suburb E;

(b) his share of the proceeds of sale of the Motor Vehicle 1 and caravan;

(d) inheritance from his late mother;

(e) his bank accounts and savings;

(f) motor vehicles registered in his name including Motor Vehicle 2, Motor Vehicle 3 and Motor Vehicle 4;

(g) B Super Fund (including funds removed therefrom) subject to orders (2)-(6) herein; and

(h) Super Fund L entitlements.

19.

The Applicant shall be solely liable for and indemnify the Respondent in relation to all debts and liabilities in her name or attaching to any item of property that she is retaining pursuant to these Orders;

20.

The Respondent shall be solely liable for and indemnify the Applicant in relation to all debts and liabilities in his name or attaching to any item of property that he is retaining pursuant to these Orders;

21.

Upon receipt of the payment and compliance by the Respondent with orders (2)-(7) herein and/or payment of the default payment, the Applicant withdraw, at her expense, any Caveat lodged by her or on her behalf over D Street, Suburb E.

Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

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