De Silva & Ratnayake
[2021] FedCFamC1F 347
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 1)
De Silva & Ratnayake [2021] FedCFamC1F 347
File number(s): SYC 6075 of 2021 Judgment of: SCHONELL J Date of judgment: 24 December 2021 Catchwords: FAMILY LAW – INJUNCTIONS – Exclusion from matrimonial home – Where the wife seeks the sole use and occupation of the matrimonial home – Where the husband opposes the wife’s application and submits that the parties can co-exist under one roof – Consideration of the circumstances of the parties and whether an exclusive occupation order is necessary – No order for the exclusive use and occupation of the home made.
FAMILY LAW – FINANCIAL – Where the wife seeks an interim costs order – Where the parties executed a Binding Financial Agreement – Whether a clause in the Agreement addressing spousal maintenance was void pursuant to s 90E – Where it was found that the clause was not void.
FAMILY LAW – FINANCIAL – Where the wife seeks an interim costs order under s 117 – Where the wife seeks costs order for litigation funding – Consideration of the financial capacity of both parties – Where there is financial disparity between the parties – Where justice may be compromised if no order made – Costs order made.
Legislation: Family Law Act 1975 (Cth) ss 74, 90E, 114, 117 Cases cited: Ellerton & Jennings (2021) FLC 94-059; [2021] FedCFamC1A 39;
Dickinson & Packam [2021] FamCA 298
Ming & Dao [2020] FamCA 726
Mullane v Mullane (1983) 158 CLR 436; [1983] HCA 4
Naylen & Naylen [2021] FamCA 392
Ryder & Bonham [2017] FamCA 979
Salvage & Fosse (2020) FLC 93-96; [2020] FamCAFC 144
Division: Division 1 First Instance Number of paragraphs: 65 Date of hearing: 23 December 2021 Place: Sydney Counsel for the Applicant: Mr Cummings SC Solicitor for the Applicant: Mills Oakley Law Firm Counsel for the Respondent: Mr Williams QC Solicitor for the Respondent: Jo-Anna F.S. Moy Solicitor ORDERS
SYC 6075 of 2021 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)
BETWEEN: MS DE SILVA
Applicant
AND: MR RATNAYAKE
Respondent
ORDER MADE BY:
SCHONELL J
DATE OF ORDER:
24 DECEMBER 2021
THE COURT ORDERS THAT:
1.The husband shall pay the wife within 28 days the sum of $40,000 by way of interim costs.
2.On a without admissions basis the husband is restrained from abusing, insulting, belittling, rebuking or otherwise denigrating the wife.
3.On a without admissions basis the husband will not issue and is hereby restrained from issuing to the wife a notice to vacate the property at B Street, Suburb C, New South Wales under the provisions of Clause 11A of the Financial Agreement executed by the parties and dated 7 March 2013.
4.The wife's Amended Application in a Case and the husband's Response to that Amended Application is otherwise dismissed.
5.The matter is otherwise adjourned to the Docket Registrar on a date to be fixed for a procedural hearing.
Note: The form of the order is subject to the entry in the Court’s records.
Note: This copy of the Court’s Reasons for judgment may be subject to review to remedy minor typographical or grammatical errors (r 10.14(b) Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 10.13 Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth).
Section 121 of the Family Law Act 1975 (Cth) makes it an offence, except in very limited circumstances, to publish proceedings that identify persons, associated persons, or witnesses involved in family law proceedings.
IT IS NOTED that publication of this judgment by this Court under the pseudonym De Silva & Ratnayake has been approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
EX TEMPORE REASONS FOR JUDGMENT
SCHONELL J:
These are proceedings for interlocutory relief brought by the Applicant Wife ("the wife") against the Respondent Husband ("the husband") seeking exclusive occupation of the former matrimonial home of the parties at Suburb C in the State of New South Wales, and a payment of $100,000 as interim costs.
The wife's senior counsel identified that the source of power for the $100,000 payment was either by way of interim spousal maintenance or pursuant to the costs power under s 117 of the Family Law Act 1975 (Cth) ("the Act"). The wife, through her senior counsel, indicated that she did not pursue Order 6 in the wife's Case Outline document seeking to permit a company called "Plenty Legal Finance" to take a charge over the former matrimonial home. No submissions were put in furtherance of what might be described in Order 6 as a "dollar-for-dollar" order, and it is presumed, therefore, that part of the relief contained in the Case Outline document was abandoned.
The husband, for his part, sought a dismissal of the wife's application and confirmed through his Queen's Counsel that he did not seek to exclude the wife from the home nor take any steps to enforce the provisions of the Financial Agreement ("the Agreement") that might permit him to do so.
Upon enquiry, each party's counsel agreed that a mutual non-denigration order could be made by the Court. However, there was no appearance by the wife or her legal representatives, and accordingly the husband agreed to orders on a without admissions basis.
The wife relied upon the following documents:
(1)Amended Application in a Case filed 29 October 2021;
(2)Affidavit of the wife filed 29 October 2021;
(3)Affidavit of Dr D, Consultant Psychiatrist filed 9 September 2021;
(4)Financial Statement of the wife filed 29 October 2021; and
(5)Case Outline document.
The wife also tendered two documents being a Costs Notice labelled as Exhibit "A" in the proceedings, and a signed Costs Agreement labelled as Exhibit "B" in the proceedings.
The husband relied upon the following documents:
(1)Response to Initiating Application filed 16 December 2021;
(2)Response to an Application in a Case filed 16 December 2021;
(3)Affidavit of the husband filed 16 December 2021;
(4)Financial Statement of the husband filed 16 December 2021; and
(5)Case Outline document.
Neither of the parties complied with court directions for the filing of affidavits; both were late, and in the case of the husband, his affidavit material was filed very late. Senior counsel for the wife sought that the Court not permit the husband to rely upon his affidavit, but in circumstances where he were to be granted leave, that certain objections be taken to it. The Court granted the husband leave to rely upon his affidavit subject to objections, and the Court also dealt with various objections.
BRIEF BACKGROUND FACTS
The parties commenced living together in March 2000 in Country E and were married in 2000 in Country F.
The parties have two children aged 20 and 16; the youngest child is in Year 10 at school.
The children reside with the parties in the former matrimonial home at Suburb C.
The parties initially separated between February 2011 and December 2012 according to the wife, and between January 2011 and September 2012 according to the husband. Nothing turns on the difference in the dates for the purposes of this application.
The wife says the parties separated on a final basis in March 2021; the husband contending in September 2020. Again, for the purposes of this application, it is clear that as at March 2021, both parties were of the view that the relationship was at an end.
The parties arrived in Australia in 2010 and the wife says that she returned to Country F in February 2011 with the children. In December 2012, she says she returned to Australia and the parties resumed cohabitation.
Following her return, the wife states that she became depressed and consulted a psychiatrist, and has since April 2013 been under her care. Dr D is the wife's psychiatrist and in a number of reports, one annexed to her affidavit sworn 7 September 2021, being a report dated 31 August 2021, and another being a report dated 19 October 2021 attached to the wife's affidavit sworn 29 October 2021. Dr D opines that the wife suffers from bi-polar disorder. In her affidavit at [6] she states: "I believe her mental health will benefit from her not having to relocate at the current time having regard to her stress as a result of the separation."
In her report dated 31 August 2021 report, Dr D records the following at [3]:
…Given her improvement with the recommended medication and her capacity to maintain normal activities of daily living and improve her relationship with both her children, the prognosis is optimal for her position. People who have any bi-polar disorder are more likely to feel emotions, both positive and negative in a much more heightened way. Thus it is highly probable that she would be more emotionally impacted by the process. I would strongly recommend that she be placed in a room separate from the court with verbal access between her solicitor and herself.
The process the doctor referred to was the current proceedings. In the same report, the doctor identifies at [4]: "During the period of time she has been a patient (8 years) she has not indicated that there has been any risk of harm to herself or others."
Finally, in the last paragraph, Dr D states:
Her current state of mental health can be described as stable regarding her mood disturbance. However, there is a constant background of apprehension and anxiety regarding the procedures before the court.
In her report dated 19 October 2021, Dr D opined at [4]:
Apart from the initial few appointments I have continued to see Ms De Silva on her own. She has remained stable, she has acquired good employment positions, has managed to raise her two children and attended to their health needs appropriately. This has all been without her husband's involvement. This is testament to her recovery and the effectiveness of accurate diagnosis and treatment.
In March 2013, the parties entered into the Agreement. The wife contends at [45]- [46] of her affidavit, the circumstances in which she entered into the Agreement. One of the issues in the proceedings is whether the Agreement is binding on the parties or liable to be set aside. That is not a matter which I am asked to determine in the proceedings. It does, however, have relevance to the application for interim spousal maintenance.
The wife contends that she was the victim of family violence and controlling behaviour during the course of the marriage. The husband concedes that the parties argued but denies that he perpetrated family violence or was controlling. I am unable in this hearing to make any findings about these matters.
The evidence of the husband contained in his affidavit appears to indicate that since September 2020, the parties have continued to reside together in the same home, albeit separated. He identifies that since September 2020, the parties have attended a number of social events together, including birthday parties. He implies by description that the home is large. It has five bedrooms, three bathrooms, three living areas and each party has their own bedroom. He says that the wife continues to maintain her own wardrobe in his bedroom and use the en suite in his bedroom. He says that when the wife wakes up before him, she will come into his bedroom and use the shower and toilet and then get dressed in his bedroom before leaving to go downstairs. He says that the wife continues to prepare meals and undertake other domestic activities in the home.
All of the real property in Australia is in the sole name of the husband. The husband describes himself as a retired person and receives rental income of $1,672 per week. He identifies in his Financial Statement that he has bank account balances of approximately $163,000 and interest in a business, which has a value of $298,137. Senior counsel for the wife pointed to the conduct of the husband in November 2021 seeking to withdraw from an offset account the sum of $325,000 and placing the same against the mortgage. It was suggested that in doing so, the husband sought in some way or other to frustrate the wife's relief.
The wife is the owner of property in Country F. There is an issue in the proceedings as to the extent to which the wife has access to and control of real estate in Country F. The wife contends that whilst she might be the legal owner, that in some way or other, there is a restriction on her capacity to deal with the real estate either in a legal sense or alternatively in a moral sense. She asserts that this property, whilst in her name, is not hers to deal with and will form part of her inheritance.
The wife is in employment, earns $750 per week, and according to her Financial Statement receives what she describes as spousal maintenance of $250 per week from the husband.
According to her Financial Statement she has approximately $80,000 in the bank as well as accounts in Country F which she describes as a financial resource with a total balance of approximately $560,000 Australian dollars. Her Financial Statement consistent with her affidavit states that she does not have access to the funds and that the accounts are controlled by her father and he has a Power of Attorney over those accounts. It was put to me by her senior counsel that the wife feels morally bound by an arrangement that has been in place for a number of years in relation to the use of those funds.
EXCLUSIVE OCCUPATION
The power of the Court to grant an injunction for exclusive use and occupation rests in s 114 of the Act. It involves the exercise of a discretion and an order will be made if it is proper to do so.
Section 114 of the Act relevantly provides that:
(1) In proceedings of the kind referred to in paragraph (e) of the definition of matrimonial cause in subsection 4(1), the court may make such order or grant such injunction as it considers proper with respect to the matter to which the proceedings relate, including:
…
(f)an injunction relating to the use or occupancy of the matrimonial home.
…
(3) A court exercising jurisdiction under this Act in proceedings other than proceedings to which subsection (1) applies may grant an injunction, by interlocutory order or otherwise (including an injunction in aid of the enforcement of a decree), in any case in which it appears to the court to be just or convenient to do so and either unconditionally or upon such terms and conditions as the court considers appropriate.
In Mullane v Mullane (1983) 158 CLR 436, the High Court distinguished between "an interest in property [that] is a right of a proprietary nature, ... [and] a mere personal right". The High Court continued: "An order which merely excludes one spouse from the enjoyment of property, albeit for many years, in order to permit its better enjoyment by the other does not alter an interest in that property…"
In Naylen & Naylen [2021] FamCA 392, McEvoy J canvassed the authorities relevant to this type of application and observed:
[29] The principles to be applied in making an order for sole use and occupancy of the former matrimonial home pursuant to s 114(1) of the Act are to be understood in light of the observations about the general nature of the s 114(1) injunction power in Sieling v Sieling. These principles have been the subject of frequent exposition in the Full Court and application by primary judges. They may be summarised as follows:
(a) the Court may make such an order as it thinks proper: Davis & Davis (1976) FLC 90-062, 75,309 (Evatt CJ, Pawley and Ellis JJ);
(b)there are no words of limitation in s 114(1) other than the requirement that the grant of an injunction must be "proper". A grant of an injunction is unlikely to be proper unless there is an appropriate factual basis supporting it: S & S [2002] FamCA 59, [40] (Kay, Holden and Monteith JJ);
(c)an injunction that prohibits a person from living in their own home is of such gravity that it ought only be granted in restricted and exceptional circumstances: S & S, [38];
(d) it would be unlikely that the mere existence of tension in the home, short of evidence of unacceptable conduct, would lead the Court to grant an exclusion order: S & S, [41];
(e) the Court does not need to make a finding that the situation in the former matrimonial home is "intolerable" or "impossible", it must simply be satisfied that it would not be reasonable or sensible or practicable to expect both parties to continue to reside in the premises together: Rowe & Rowe (1980) FLC 90-895, 75,639-75,640 (Evatt CJ), 75,644 (Pawley SJ), (cf Wood SJ at 75,643); Davis & Davis (1983) FLC 91-319 , 78,170 (Baker J, with whom Evatt CJ and Underhill J agreed);
(f) the matters which should be considered include the means and needs of the parties, including the availability of alternative accommodation and the suitability of that accommodation along with the financial circumstances of the parties, the needs and welfare of any children, the hardship to either party if an exclusion order is made or not made, and, where relevant, the conduct of one of the parties justifying an exclusion order: Davis & Davis (1976), 75,309; Rowe & Rowe, 75,640 (Evatt CJ), 75,644 (Pawley SJ);
(g) the test for making an order for exclusive occupation is an objective one, Rowe & Rowe, 75,644 (Pawley SJ);
(h) the question is what in all the circumstances of the case is fair, just and reasonable, and if it be fair, just and reasonable that one of the parties be excluded from the former matrimonial home, then that is what ought to happen: Walker v Walker (1978) 1 WLR 533 , 536-537, cited with approval in Rowe & Rowe, 75,638-75,639 (Evatt CJ), 75,642 (Wood SJ) (albeit that his Honour appears to have referred mistakenly to Phillips v Phillips (1973) 1 WLR 615 , in circumstances where it may be inferred that, like Evatt CJ, he meant to refer to Geoffrey Lane LJ in Walker v Walker );
(i) the Court will consider the accommodation available to both parties and the hardship to which each will be exposed if an order is granted or refused, and will then consider if it is sensible to expect the parties to remain living in the premises together: Bassett and Bassett [1975] Fam. Law 76 , 87, cited with approval in Rowe & Rowe, 75,639 (Evatt CJ), 75,642 (Wood SJ);
(j) while the decision ought not be made merely on the balance of convenience: Davis & Davis (1976), 75,309, in practice the case will often rest on what the balance of convenience requires, and in cases of intense marital disharmony, frequently coupled with assaults by one party upon the other, the Court may require little persuasion to take the view that the balance of convenience requires that one party have the sole occupation of the home: Dean & Dean (1977) FLC 90-213 , 76,097 (Wood J), referring to Davis & Davis (1976);
(k)it should only be compelling circumstances which would justify the making of such an injunction (in effect, excluding a party from the former matrimonial home) against a party who is not to blame for the breakdown of the marriage, or who, of the two partners, is demonstrably the less responsible for what has happened: Dean & Dean, 76,098.
[30] In Fedele & Fedele (1986) FLC 91-744, 75,431, the Full Court (Fogarty, Murray and Nygh JJ) emphasised that these principles should properly be treated as guidelines to assist in the exercise of the important discretion given under s 114(1), and that they should not be seen as laying down any fixed list of criteria which must be established for the application to be successful. A judge must exercise his or her own discretion in the matter, informed by the Court's previous consideration of the issues.
These are interim proceedings and there has been no cross examination. There are numerous factual controversies, which I am in the circumscribed nature of these proceedings unable to resolve. I am left to determine the matter on the basis of the undisputed facts and consistent with the guidance provided by the authorities referred to above.
In Dickinson & Packam [2021] FamCA 298, McClelland DCJ observed:
In my view, it is appropriate for the Court to consider an application for orders for the exclusive occupation of a property in two stages. The first stage involves considering whether the circumstances of the parties are such that an order for exclusive occupation is necessary. If the answer to that first question is in the affirmative, the second question involves considering which party should have the right of exclusive occupation.
I propose to adopt such an approach.
In the wife's affidavit she identifies at [55]-[61] the matters relevant to her application for exclusive occupation. She also relies upon the earlier paragraphs, where she identifies allegations of family violence and the medical evidence of Dr D, and puts through her senior counsel that it is untenable for the parties to continue to reside together under the same roof and that "someone must go". Notwithstanding the limitations in an interim hearing, the wife's evidence as contained in her affidavit at [55]-[61] are of limited assistance. Sweeping generalisations such as the current living arrangements are untenable or that she continues to feel threatened and intimidated by the husband are of limited probative value without any specific facts supporting the conclusions. Given the nature of these proceedings, I am clearly unable to find that the wife has been the victim of family violence.
The husband gives evidence that the parties have, despite having separated under the one roof, continued to co-exist, to socialise together and to live together in the home. As referred to above, he gives evidence as to the state of the home and the living arrangements of the parties. He invites me to infer presumably from the reference to the evidence that because the wife comes into his bedroom that she is not as afraid of him as she asserts. In circumstances where the affidavit was filed outside directions and the wife has not had an opportunity to respond, I do not draw such inference.
However, I do place weight on the evidence of the wife's psychiatrist in her report of 19 October 2021. That report identifies that the wife has remained stable, is able to undertake employment and care for her children, which the report writer confirms has all been without the father's involvement. That report does not identify that the wife's health has been impacted by continuing to reside in the home with the husband. Whatever might have been the concerns on 7 September 2021 about stress do not appear to be present in the 19 October 2021 report.
Whilst the circumstances of separating parties occupying the same home may be uncomfortable and the wife might find the current living arrangements tense, I am not satisfied that it is proper to grant the injunction in light of all of the evidence in the proceedings. I am not satisfied that it would be proper to exclude the husband from the home. There has not been established in my view, a proper factual basis to do so. The home is large and each party has their own room in the home. The most recent evidence from the wife's psychiatrist, being the report of 19 October 2021, does not establish that the wife's health has been compromised by continuing to remain living in the home together. Indeed, quite to the contrary. It identifies that the wife's mental health has remained stable.
The authorities state that I should not lightly interfere with the rights of an owner of a property. I will not do so. I decline to make an order for exclusive occupation of the home. I am comforted in doing so in circumstances where the husband agrees to a non-denigration order and agreed that he would not take steps to remove the wife from the home.
INTERIM COSTS
The wife seeks an order described as an interim costs order in the sum of $100,000. The wife's senior counsel submitted that the head of power available to make that order arose either under s 74 (the spousal maintenance power) or alternatively under s 117 (the costs power)
The parties entered into the Agreement on 7 March 2013. The wife's final relief contends the Agreement is not binding or should be set aside. To be able to make a spousal maintenance order, I would need to be satisfied that the provisions in the Agreement as to maintenance are void. The matter was the subject of very limited argument before me, it being contended by senior counsel for the wife that the provision was void and contended by Queen's Counsel for the husband that the provision was valid. To the extent that there is a controversy about these matters calls for consideration of clause 14 of the agreement.
Clause 14 provides as follows:
14. Ms De Silva acknowledges and agrees that:
(i)this Agreement makes no provision for the payment of spousal maintenance to her by Mr Ratnayake should the parties separate;
(ii)no funds or property will be paid or made available by Mr Ratnayake for her maintenance should the parties separate; and
(iii)she will not make, at any time in the future, any application for the payment of spousal maintenance by Mr Ratnayake.
There is a mirror clause in relation to the husband.
Section 90E of the Act provides:
A provision of a financial agreement that relates to the maintenance of a spouse party to the agreement or a child or children is void unless the provision specifies:
(a) the party, or the child or children, for whose maintenance provision is made; and
(b)the amount provided for, or the value of the portion of the relevant property attributable to, the maintenance of the party, or of the child or each child, as the case may be.
Thus, there are two elements, namely specification of the party for whom maintenance provision is made and the amount of such provision.
There is limited authority for guidance on this topic. Neither counsel took me to any authority.
In Ellerton & Jennings [2021] FedCFamC1A 39, Strickland J sitting as the Full Court heard an appeal from a decision of the then Federal Circuit Court of Australia. At first instance, the Court dealt with a provision in a financial agreement that stated:
[29] The relevant clauses of the BFA in relation to spousal maintenance are:
19.The parties acknowledge that they are currently self-sufficient and capable of supporting themselves, and that no provision of spousal maintenance is necessary or desired.
…
His Honour at [30] of the judgment observed the findings by the trial judge as follows:
…I agree with Ms Boyle. The phrase "no provision of spousal maintenance is necessary or desired" must be read at face value. It includes a clear intention that no amount of spousal maintenance is to be paid. This does not require that the parties' intention be further defined as "zero spousal maintenance", "nil spousal maintenance" or any other similar phrase…
Further on, Strickland J, referred to the trial judge’s observations as follows:
…This contrasts with clause 19, which makes it clear that there is to be no provision of spousal maintenance – and no provision must mean nil, zero, none. I conclude that clause 19 in relation to spousal maintenance does meet the requirements of s.90E and is not void for that reason.
In his Honour's judgment at [37], he said: "There is a clear difference between a clause that provides for no claim to be made, and a clause that in effect specifies that there is no provision for spousal maintenance".
At [38], his Honour asserted: "For example, there is 'an identifiable quantum', namely 'no provision', and there is 'precise reference to an amount', namely, again, 'no provision'".
Again at [40], his Honour said:
As the primary Judge implied in [10], and observed in [12], it means the same as the words "zero", "nil", or "none", but it is unnecessary to use those words. An amount can be "zero", "nil" or "none", or as here, "no provision", and still be "an amount".
Clause 14 specifies the party for whose provision maintenance is to be made, namely the wife and the amount of the provision is no provision. In my view, the clause is not void. I am fortified in reaching my conclusion by the observations of Strickland J sitting as the Full Court. In view of my finding, I cannot make a spousal maintenance order.
The alternative head of power for interim costs was said to be s 117. Senior counsel for the wife argued that the circumstances justified the Court departing from the usual order that each pay their own costs. Submissions were put as to the superior financial position of the husband compared to that of the wife and in particular that he had more cash at bank than the wife and that he had in November 2021 in the face of the wife's application paid $325,000 from an offset account in reduction of a mortgage. Submissions were also made that the husband had failed to give disclosure and had failed to comply with the rules and directions in relation to filing of affidavits and a Financial Questionnaire. All of these factors were said to warrant the making of an order.
Queen's Counsel for the husband argued that there was not a great disparity between the parties in relation to their cash position and that the wife had funds in her name standing in an account in Country F having a value of approximately $560,000. Queen’s Counsel also argued that there was no evidence that the wife could not revoke the Power of Attorney that she had given to her father and therefore she had access to funds. Further that, the wife had not explained the source of funds in her account given her expenses exceeded her income. Queen's Counsel submitted that there was no basis to depart from the usual rule encapsulated in s 117(1) of the Act. He initially submitted that the absence of a signed Costs Agreement was fatal to the Application. Belatedly a signed Costs Agreement became Exhibit "B". The Case Outline contended that the amount ordered needed to be "logical, fair and reasonable".
At this stage of the litigation and in view of the factual controversies particularly identified by the wife at [17] of her affidavit, I cannot find that the funds in Country F are immediately available to the wife. I accept that they are in an account in her name but in light of her evidence at [17] that the funds represent rental monies from her parents' property and that it represents part of her yet to be received inheritance, I cannot be satisfied that these are funds that would be available to meet the wife's litigation expenses. I cannot in the absence of cross-examination reject the wife's evidence. Likewise, whilst the monies paid by the husband in reduction of the mortgage may ultimately be viewed by another court after cross examination as an attempt to frustrate the wife's application, there is no evidence before me that the husband can re-draw the funds from the mortgage, nor was it put to me that he could.
The wife states she needs $100,000 by way of interim costs. I accept that she had approximately $80,000 in bank accounts as at 29 October 2021. She has not provided any more recent evidence of the balance. In view of the shortfall in her Financial Statement, I infer the balance is less but do not know by how much.
Exhibit "A" is the Wife's Costs Notice. It indicates that the wife needs approximately $81,000 to conduct the litigation after allowing for moneys in trust.
To make an order under s 117, I need to be satisfied that there are circumstances that justify me doing so to enable departure from the usual order that each party pays their own costs.
In Salvage & Fosse (2020) FLC 93-966, the majority of the Full Court identified that s 117 empowers the court to make orders as to costs and at [14] stated:
The critical question therefore is whether the applicant has any real prospects of obtaining justice unless the order sought is made (Parker v Parker 16 FamLR 458 at 461) or in terms of section 117(2) of the Act whether in all the circumstances the costs order is just. The question raises at least consideration of the strengths of the applicant's case and the effect of the order upon the respondent.
In the present case, the wife faces the burden of establishing that the Agreement entered into between her and the husband is not binding or should be set aside. The factual controversy around the entering into of the Agreement is not one I can resolve.
Justice Gill in Ryder & Bonham [2017] FamCA 979 held:
[97] Before allowing a departure from the general rule expressed in s 117(1) that each party bear their own costs, it is necessary to establish that there are, pursuant to s 117(2), circumstances that justify the departure. It is at that point that the discretion to make an order is enlivened. Until that point there is no power to make an order departing from the general rule.
[98] Once enlivened, the discretion to make an order is governed by the requirement that the order, if made, be just, and that the determination as to whether any order should then be made, and the terms of that order, are governed by the considerations contained at s 117(2A).
There is no authority that contends that more than one of the subsections in s 117(2A) need be present. Indeed, any one factor may be determinative.
I find there is a financial disparity between the parties. The husband owns real estate in Australia having a net value of $3,633,000. He has an interest in a business having a value of $298,137. He has retired and has a superannuation interest having a value of $396,400, albeit, given his age, he probably cannot access them. He has cash savings of approximately $163,000. This is compared with the wife's position, where she has no real estate in Australia, cash savings of approximately $80,000 and superannuation of $44,584.
For reasons stated earlier, I am unable to make findings in relation to the Country F assets. Whilst both parties did not comply with directions, there is no satisfactory explanation for why the husband's affidavit and Financial Statement was filed on 16 December 2021.
I am conscious of what Austin J observed in Ming & Dao [2020] FamCA 726 at [28], where his Honour said:
Lest it have been overlooked, the courts do not entertain these interlocutory applications for litigation funding to ensure the convenience of regular cash flow for legal firms. They are entertained to accommodate disadvantaged litigants, by levelling the litigious playing field for them.
I am concerned, however, that the wife's capacity to obtain justice may be compromised if no order is made. In the end, it amounts to a balance between the parties competing claims and an amount that is not so large as to affect the husband, but still provides some funds to the wife to enhance her prospects of obtaining justice and to some extent levelling the playing field. I am satisfied that there are circumstances that justify the making of an order.
In light of those matters, I propose to make an order that the husband pay to the wife within 28 days the sum of $40,000. That would have the effect of approximately equalising the bank account balances of the parties and would provide the wife with sufficient funds to get the matter to at least a conciliation conference. In my view, such an amount would be logical, fair and reasonable.
I certify that the preceding sixty-five (65) numbered paragraphs are a true copy of the Ex Tempore Reasons for Judgment of the Honourable Justice Schonell delivered on 24 December 2021. Associate:
Dated: 10 January 2022
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