Darwin and Laurie

[2013] FCCA 1480

FEDERAL CIRCUIT COURT OF AUSTRALIA

DARWIN & LAURIE [2013] FCCA 1480

Catchwords:
FAMILY LAW – Property proceedings pursuant to s.90SM of the Family Law Act 1975 (Cth) – very brief period of cohabitation – undefended – ex tempore judgment.

Legislation:

Family Law Act 1975 (Cth), ss.90SB(c), 90SM

Applicant: MS DARWIN

Respondent: MR LAURIE

File Number: MLC 5372 of 2013

Judgment of: Judge Hartnett

Hearing date: 11 September 2013

Delivered at: Melbourne

Delivered on: 11 September 2013

REPRESENTATION

Counsel for the Applicant: Mr Strum

Solicitors for the Applicant: Clancy & Triado

The Respondent: No appearance

THE COURT ORDERED ON 11 SEPTEMBER 2013 THAT:

1. Within 60 days the Respondent husband do all such acts and things and sign all such documents as may be required to transfer to the Applicant wife at her sole expense all of his right, title and interest in the real property situate at and known as Property L in the State of Victoria being the whole of the land more particularly described in Certificate of Title Volume [omitted] (“the [L] property”).

2. Contemporaneously with the transfer described in order 1 herein, the wife do all such acts and things and sign all such documents as may be required to refinance the Westpac Banking Corporation mortgage registered dealing number [omitted] (“the [L] mortgage”) so as to remove all liability of the husband and that the wife thereafter indemnify the husband against all payments and liability pursuant to the [L] mortgage and all apportionable rates, taxes and outgoings of or with respect to the [L] property of whatsoever nature and kind.

3. If the wife is unable to procure the refinance referred to in order 2 herein, the [L] property be sold altogether out of Court at a price, by an agent and upon terms determined solely by the wife and that the proceeds of sale be applied as follows:-

   (a)firstly, to pay all costs, commissions and expenses of the sale;

   (b)secondly, to discharge the [L] mortgage; and

   (c)thirdly, the balance to the wife.

4. The husband be liable for and indemnify and forever hold indemnified the wife against all payments and liability whether past, present or future in respect of Westpac Banking Corporation Flexi Loan [omitted].

5. In the event that the wife or the husband refuses or neglects to comply with any of the provisions of these orders:-

   (a)pursuant to s.106A of the Family Law Act 1975 (Cth), a Registrar of the Federal Circuit Court of Australia at Melbourne is hereby appointed to execute all deeds and documents in the name of the defaulting party and do all acts and things necessary to give validity and operation to these orders;

   (b)the party in default is ordered to pay any and all foreseeable damages to the other party caused by the default; and

   (c)the party in default is ordered to pay all reasonable costs incurred by the other party for the purpose of enforcing this order and proving damages.

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

   (a)each party be solely entitled to the exclusion of the other to all other property (including choses-in-action) in the possession of such party as at the date of these orders;

   (b)monies standing to the credit of the parties in any joint bank account are to become the property of the wife;

   (c)each party forego any claims they may have to any superannuation, long service leave, redundancy, retirement, retrenchment and like benefits belonging to or earned by the other;

   (d)insurance policies remain the sole property of the named owner;

   (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; and

   (f)any joint tenancy of the parties in any real or personal property is hereby expressly severed.

7. The husband have liberty to seek to set aside these orders upon written application filed and served by him within 14 days of service of these orders upon him.

8. Service be effected by the solicitors for the wife serving a copy of this order upon the husband by email to his email address at [omitted].

9. The husband pay the costs of the wife thrown away on 13 August 2013 in the sum of $2,000. 

10. Otherwise all extant applications are dismissed.

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

FEDERAL CIRCUIT COURT
OF AUSTRALIA
AT MELBOURNE

MLC 5372 of 2013

MS DARWIN

Applicant

And

MR LAURIE

Respondent

REASONS FOR JUDGMENT

1. These proceedings commenced by the Applicant de facto wife filing an Initiating Application on 4 July 2013.  The final orders sought by the Applicant in that Application are orders which the Court makes this day.  In support of her application, the Applicant relied upon an Affidavit sworn by her on 2 July 2013 and a Financial Statement sworn by her on 2 July 2013.

2. The matter first came before the Court on 13 August 2013.  On that day, Mr Strum of counsel appeared for the Applicant and there was no appearance on behalf of the Respondent de facto husband.  There was before the Court at that time, two Affidavits of attempted service, both filed 9 August 2013, and an Affidavit sworn by Ms S on 9 August 2013 wherein she deposed as to attempts to serve the Respondent with the documents in these proceedings.  The Court was satisfied, on 13 August 2013, and on the evidence before it, that service could be effected upon the Respondent by email to his email address at [omitted].  The Court as a consequence made Orders on 13 August 2013 as follows:-

   “THE COURT ORDERS THAT:

   1. The Respondent husband file and serve a response, affidavit and financial statement within 14 days hereof.

   2. In the event the Respondent husband fails to comply with order 1 herein, the Applicant wife is at liberty to proceed undefended on the adjourned date.

   3. The solicitors for the Applicant wife serve a copy of this order upon the Respondent husband by email to his email address at [omitted].

   4. The Applicant wife’s costs of this day are reserved.

   5. Pursuant to r.21.15 of the Federal Circuit Court Rules 2001, the Court certifies that it was reasonable for the parties to employ an advocate.

   6. The proceedings are adjourned to 11 September 2013 at 10.00am for further hearing (and final hearing if undefended).”

Service

1. Prior to that first hearing date and on or about 5 July 2013, the solicitors for the Applicant instructed Network Process Service to personally serve the Applicant’s court documents upon the Respondent at his last known address for service, as advised by his former lawyers, being unit 4, Property P in the State of Victoria.  On or about 18 July 2013, the solicitors for the Applicant received notification from Network Process Service that service had been attempted upon the Respondent at that address, but that it had been unsuccessful. In late July 2013, it came to the Applicant’s attention the Respondent may be located in unit 3, Property P.  The Applicant’s solicitors, on or about 29 July 2013, instructed Network Process Service to attempt service upon the Respondent at that address.  Again, service was attempted without success.

2. The Applicant’s solicitor’s assistant, Ms B, on or about 6 August 2013 attempted to reach the Respondent on his mobile telephone number.  The Respondent answered the phone and identified himself as the Respondent. Ms B informed him of the Applicant’s application, that the solicitors for the Applicant had been attempting to serve upon him and further, advised the Respondent that there was a court date of 13 August 2013.

3. Ms B requested up‑to‑date contact details of the Respondent, and the Respondent advised that his address was unit 4, Property P. Further, that his email address was [omitted].  These were the same details already on the Applicant’s solicitor’s file.  Ms B advised the Respondent that she would forthwith post and email the Applicant’s court documents to him, to which the Respondent replied “Yes, great, thanks”.  On that same day, Ms B emailed the Respondent attaching the Applicant’s court documents and on 7 August 2013, she also arranged to post the documents to him.

4. In respect of the Orders that were made on 13 August 2013, there is an Affidavit on which the Applicant relies, deposed to by Ms S on 9 September 2013. That Affidavit goes to compliance with the order as to service, as set out in those Orders.  Ms S is an associate lawyer employed by the Applicant’s solicitors.  She sets out in that Affidavit at paragraphs 7 and 8, the following:-

   “7. In accordance with Paragraph 3 of the Orders, on 19 August 2013 my legal assistant, Ms B, served the Respondent with a copy of the sealed Orders by email to his email address at [omitted]. … A copy of the Orders was also posted to the Respondent's address at Unit 4, Property P, [P] under cover of letter dated 19 August 2013. …

   8. At the time of swearing this Affidavit, Clancy & Triado has not been served with any response, affidavit or financial statement of the Respondent within 14 days or at all as required by Paragraph 1 of the Orders. I have reviewed the Commonwealth Law Courts portal and there is no record of the Respondent having filed any such documents. No correspondence has been received from the Respondent at all since he was served with a copy of the Orders.”

History

1. Statements of fact in these reasons should be taken as findings of fact on the balance of probabilities.  The Court notes that the matter proceeds on an undefended basis, and that the evidence before the Court, as set out in the Affidavit and Financial Statement of the Applicant, is unchallenged by the Respondent.  Further, the Court notes that the Respondent filed no material in the proceedings and put before the Court no evidence as to his financial circumstances.

2. The Applicant was born [in] 1965 and she is currently 48 years of age.  She resides at Property L in the State of Victoria (‘the [L] property’).  She is employed as a [omitted] and earns approximately $73,000 per annum.  The Respondent was born [in] 1958, in the United Kingdom, and is currently 55 years of age.  He migrated to Australia on a working visa in early 2010.  Whilst the Applicant had never married, the Respondent had previously been married four times and had other girlfriends and domestic partners. The Applicant believes the Respondent has a son from his second wife, being [X] born [in] 1993, but her evidence was that the Respondent had no contact with his son.

3. To the best of the Applicant’s knowledge, the Respondent is presently unemployed, having resigned from his employment as a [omitted] on 21 August 2012, where he purportedly earnt approximately $150,000 per annum. The Respondent purports to be a qualified [omitted].

4. The Applicant and Respondent met in around late January 2012, and commenced a de facto relationship soon thereafter.  At the time, the Applicant was residing in a property owned solely by her, at Property B in the State of Victoria (‘the [B] property’).  The Respondent was residing in a caravan park.  The Respondent told the Applicant that he had recently separated from his girlfriend and that he was living temporarily in the caravan park while searching for rental accommodation.

5. In or around March or April 2012, the Applicant invited the Respondent to come and live with her at her home in [B].  Cohabitation commenced in April 2012, although the Respondent would come and go from the house and did not settle in permanently until late May 2012.  The parties became engaged in June 2012.  At the time, the Respondent was still married to his former wife, Ms W, who resides in Brisbane.  The Applicant and Respondent subsequently separated on or about 1 November 2012, following numerous incidences of family violence perpetrated by the Respondent against the Applicant, causing the Applicant to fear for her personal safety.

Contributions

1. At the commencement of cohabitation, the Applicant was the sole registered proprietor of the [B] property valued in the sum of approximately $330,000, which was subject to a mortgage in favour of the National Australia Bank in the sum of approximately $120,000.  The Applicant also owned motor vehicles and had an interest in the [omitted] Industry Superannuation Fund.  To the best of the Applicant’s knowledge the Respondent owned a 1941 [omitted] vehicle, in respect of which he owed monies.

2. After the parties commenced their cohabitation, the Applicant continued to pay the [B] mortgage from her personal income.  The Respondent would sometimes give her cash towards groceries and household bills, and generally paid for their entertainment expenses.  They also both purchased some items of furniture.

3. In around early June 2012, the parties commenced to look at prospective properties to purchase.  On or about 27 June 2012, they purchased the [L] property as joint registered proprietors, for the sum of $447,000, together with stamp duty and other costs.  The Respondent paid an initial deposit of $1,000 on the day.  The Respondent also procured a personal loan from the Westpac Bank, in his sole name, in order to pay a further deposit of $43,000 on 29 June 2012.  No security was provided in respect of repayment for that personal loan.

4. The purchase of the [L] property settled on 4 September 2012.  The balance of the purchase price plus stamp duty and other costs was funded by way of a mortgage in favour of the Westpac Bank, in joint names.  The total loan amount was $587,600 which comprised a refinancing of the then existing [B] property mortgage of $120,000 and a further loan of $467,600 for the [L] property.  The minimum monthly repayment for the [B] property mortgage was approximately $1,100 and the minimum monthly repayment for the [L] property mortgage was approximately $2,496 each month, totalling $3,596 per month.

5. The Respondent advised the Applicant that in order to obtain the [L] property mortgage she was required to provide the [B] property as security, which she agreed to do.  During the financing process, the Respondent placed pressure upon the Applicant to transfer the [B] property into their joint names.  The Applicant did not think that appropriate, at that stage in their relationship, and refused.  The [L] mortgage included an offset account with $27,000 available in it.  $19,500 of those funds was later used to purchase a 1955 [vehicle omitted] truck imported from the United States of America.  The truck is unregistered but remains in the possession of the Applicant.

6. When the Respondent and Applicant purchased the [L] property, their intention was to move into the property together and rent out the [B] property.  The rent from the [B] property was to be applied to pay the mortgage loan of $587,600 and the Respondent was otherwise to meet the shortfall in the mortgage from his income.  The parties agreed they would share the utility and other bills equally.  However, shortly prior to the settlement of the [L] property the Respondent informed the Applicant that he had been made redundant from his employment, effective 20 August 2012.  The Applicant later discovered that the Respondent had actually resigned from his employment.

7. The Respondent contributed $4,000 to the Westpac mortgage account on 1 October 2012, which was applied to meet the October 2012 mortgage repayment.  Thereafter, the parties separated on 1 November 2012.  The Respondent left the [L] property and has not resumed occupation of it.  The Applicant, since that time, has made all mortgage repayments on the [L] property using the rental income from the [B] property and her personal income.

8. The Applicant has also been solely responsible for the management and maintenance of the [B] and [L] properties.  At the date of separation there was $4,488 in a joint bank account, comprising rental income from the [B] property, the Applicant’s salary and the proceeds of the settlement deposit of $1,000.  Those monies were applied by the Applicant to meet the November 2012 mortgage repayment and a water bill of $247.87.  There was also $7,420 remaining in the offset account attached to the [L] property mortgage.  Those funds were applied by the Applicant to assist with the mortgage repayments after separation.

9. The Applicant has struggled financially during the currency of this year to meet the mortgage repayments with respect to both real properties.  However, she does not wish to sell the [L] property.  She is concerned that there will likely be a deficit between the net sale proceeds of the [L] property and the [L] mortgage if the property is sold.  The Applicant estimates that [L] has a current value of $430,000, and her evidence is that there is currently $452,000 owing in respect of the [L] property mortgage.  To the best of the Applicant’s knowledge, the Respondent still has outstanding his personal loan with the Westpac Bank.  She is unaware of its current status.

Asset pool

1. As at this date, on the Applicant’s evidence, the pool of assets is as follows:-

   a)the [L] property, value $447,000, minus the current mortgage of $467,600, leaving a negative equity of $9,400;

   b)the [B] property, with a value of approximately $330,000, less a mortgage of $120,000, leaving an equity of $210,000;

   c)monies in the Applicant’s NAB bank account $16,078;

   d)Westpac shares of the Applicant $15,800;

   e)a 1995 [vehicle omitted] motor vehicle owned by the Applicant $850;

   f)a 1934 [vehicle omitted] of the Applicant value $60,000; 

   g)household contents value $5,000;

   h)a 1957 [vehicle omitted] $20,000;

   i)a 1936 [vehicle omitted], $45,000;

   j)1955 [vehicle omitted], (purchased with joint borrowings and not registered) value $20,000, borrowings $20,000;

   k)Applicant’s superannuation with [omitted] Industry Super $94,321; and

   l)debts, Applicant’s NAB MasterCard $516.

Other matters

1. On 8 November 2012, the Applicant applied for an intervention order against the Respondent at the Magistrates Court of Victoria at [omitted].  On 27 November 2012, an Interim Intervention Order was made against the Respondent.  He had been served with a copy of the Application and Summons and was present at the hearing, but did not consent to the order being made.  The Interim Intervention Order prevented the Respondent from approaching within five metres of the Applicant or within 200 metres of the [L] property and any other place where the Applicant lived or worked.

2. The intervention order application was listed for final hearing on 19 October 2013.  On that day, a Final Order was made against the Respondent by consent, without admission, to continue for a period of 12 months.  The Applicant’s evidence is that the Respondent has a long history of violence, abuse and financial deception against women and children in Australia and abroad, which she claimed was highly relevant to the intervention order proceedings.

3. The Applicant spent approximately $14,000 in legal fees preparing the intervention order matter for final hearing.  In paragraph 37 of her Affidavit sworn 2 July 2013, the Applicant sets out Affidavits relied upon by her in the Magistrates Court of Victoria intervention order case.  Those Affidavits are annexed to the Affidavit of the Applicant sworn 2 July 2013 and set out a history of family violence and/or financial deception allegedly perpetrated by the Respondent upon third parties, but the relevance of this material to these proceedings is remote.

4. The Respondent is not an Australian citizen and the Applicant believes him to be in breach of his visa conditions.  The Respondent owes many debts.  For that reason, the Applicant is of the belief that the Respondent would be unable to refinance the [L] property portion of the mortgage, so as to enable the [L] property to be transferred into his sole name, as sought by him in correspondence forwarded to the Applicant by lawyers acting on his behalf on 18 January 2013.

1. In response to that correspondence, the Applicant sought a transfer of the [L] property into her sole name.  No response was received by the Applicant from the Respondent.  In the absence of a lack of communication from the Respondent to the Applicant to resolve matters by agreement, the Applicant was required to make this application before the Court and incur the necessary legal costs in doing so.

Consideration

1. The Applicant in these proceedings seeks an alteration of property interests pursuant to s.90SM of the Family Law Act 1975 (Cth) (‘the Act’). The Court in the circumstances of this case must firstly turn to a consideration of s.90SB(c) of the Act, which provides as follows:-

   “A court may make an order under section 90SE, 90SG or 90SM, or a declaration under section 90SL, in relation to a de facto relationship only if the court is satisfied:

   (a) that the period, or the total of the periods, of the de facto relationship is at least 2 years; or

   (b) that there is a child of the de facto relationship; or

   (c) that:

   (i) the party to the de facto relationship who applies for the order or declaration made substantial contributions of a kind mentioned in paragraph 90SM(4)(a), (b) or (c); and

   (ii) a failure to make the order or declaration would result in serious injustice to the applicant; or

   (d) that the relationship is or was registered under a prescribed law of a State or Territory.”

2. The Court is satisfied that although this de facto relationship is of a duration of considerably less than two years, and there is no child of the de facto relationship, that the Applicant de facto wife who is making application for the orders that are sought this day, has made substantial contributions of a kind mentioned in s.90SM(4)(a), (b) or (c) of the Act, and that a failure to make the orders as sought will result in serious injustice to the Applicant.

3. The Court considers this application for alteration of property interests pursuant to s.90SM of the Act and takes into account those matters which it must pursuant to s.90SM(4) of the Act. Further, the Court takes in account, pursuant to s.90SM(3) of the Act, that it must not make an order under this section unless it is satisfied that, in all the circumstances, it is just and equitable to make the order.

4. The financial contribution made by the Applicant to the asset pool is overwhelming in that the entire asset pool was acquired with a direct financial contribution of the Applicant, save the [L] property and the 1955 [vehicle omitted] truck.  In respect of those two assets, the Respondent made a contribution in the sum of $44,000, being $1,000 of his savings and a liability to repay an unsecured personal loan in the sum of $43,000.  Further, the Respondent jointly took out a loan with the Applicant, which has as its security the [L] property and the Applicant’s [B] property, and some part of those borrowed monies were used by the parties to acquire the [omitted] truck.

5. Otherwise it is the Applicant who has solely contributed to the ongoing post-separation mortgage repayments in respect of the [L] property which she continues to occupy, and the mortgage repayments in respect to the [B] property in relation to which she receives a rental receipt.  Furthermore, the Applicant has attended to the maintenance and conservation of both properties in the period since separation. 

6. This was an extremely brief period of cohabitation.  The Applicant applied her income toward the benefit of the family unit, as did the Respondent from time to time.  Any order which this Court makes will not affect the earning capacity of either party to the de facto relationship.  The Applicant has been left with the liability of the increased mortgage to service and proposes that she refinance that mortgage into her sole name using as security both the [B] and [L] properties, and that the Respondent have no further liability in that regard.

7. In the circumstances of this case it is just and equitable to make the orders which the Applicant seeks.  The Respondent has failed to participate in the proceedings.  He has placed no evidence before the Court and has failed to respond to the orders as sought by the Applicant or the evidence put before the Court by her.  The Court is unaware of his current financial circumstances because of his failure to disclose them.  The parties resided together for a very brief period of time, initially in the home of the Applicant and thereafter for a matter of weeks in a home purchased by them. Since the Respondent’s departure from the [L] property he has made no contribution to its acquisition, conservation or maintenance, and the Applicant faces the prospect, in the event that she is unable to refinance the properties into her sole name, of being required to sell the [L] property and pay out any shortfall in the mortgage obligation by virtue of the security which the bank has over her [B] property.  This will place her in a financial position worse than the one she was in at the commencement of cohabitation. But that is the position she unfortunately now finds herself in. The Court will accede to her application.

I certify that the preceding thirty-three (33) paragraphs are a true copy of the reasons for judgment of Judge Hartnett

Associate: 

Date:  27 September 2013