DENNELL & GARRON
[2018] FCCA 3548
•5 December 2018
FEDERAL CIRCUIT COURT OF AUSTRALIA
| DENNELL & GARRON | [2018] FCCA 3548 |
| Catchwords: FAMILY LAW – Interim parenting and property proceedings – wife seeks order to enable relocation of child aged 7 from Adelaide to Sydney pending final hearing – husband asserts he is currently impecunious and without employment and reliant on his father for financial support which is about to be withdrawn – wife currently homemaker and without access to paid employment – wife seeks spousal maintenance and interim property settlement to fund her litigation and current living expenses – nature of an interim hearing – is it just and equitable to make interim property order – best interests – other matters to be considered – assessment of complexity of proceedings – matter transferred to Family Court. |
| Legislation: Family Law Act 1975 (Cth), ss.4(1), 60B, 60CA, 60CC, 60DA(4), 61DA, 65DAA, 72, 74(1), 75(2), 79, 80 |
| Cases cited: Mazorski v Albright (2007) 37 FamLR 518 B v B: Family Law Reform Act 1995 (1997) FLC 92-755 Russell & Russell & Anor [2009] FamCA 28 Mansfield & Mansfield [2017] FCCA 13 Mansfield & Mansfield (No 3) [2018] FCCA 970 Strahan v Strahan (2010) 42 Fam LR 203 Harris & Harris (1993) FLC 92-378 In the Marriage of DJM and JLM (1998) 23 Fam LR 396 |
| Applicant: | MS DENNELL |
| Respondent: | MR GARRON |
| File Number: | ADC 2552 of 2018 |
| Judgment of: | Judge Brown |
| Hearing date: | 26 November 2018 |
| Date of Last Submission: | 26 November 2018 |
| Delivered at: | Adelaide |
| Delivered on: | 5 December2018 |
REPRESENTATION
| Counsel for the Applicant: | Mr McGinn |
| Solicitors for the Applicant: | Andersons Solicitors |
| Counsel for the Respondent: | Ms Pyke QC |
| Solicitors for the Respondent: | Martin Robinson Solicitors |
ORDERS
The parties take all necessary steps to commission a Family Assessment Report by Ms A at the joint cost of each party.
By way of interim property settlement the proceeds of sale of the Property A property be disbursed as follows:
(a)The sum of $50,000.00 to the husband;
(b)The sum of $50,000.00 to the wife;
(c)A further sum of $25,000.00 to the wife on account of her legal fees and related costs;
(d)The balance remaining to be placed in an interest bearing account in the joint names of the parties pending the resolution of these proceedings.
The parties jointly instruct [Real Estate Agent] to value the wife’s property situated at Property B in the state of New South Wales at their joint expense no later than 28 February 2019.
In the event the parties are unable to agree on the value of their former matrimonial home located at Property C in the state of South Australia they are directed to jointly instruct a valuer, the identity of whom is to be agreed between them and failing agreement as appointed by the Court to value the property at their joint expense with the valuation to be completed no later than 28 February 2019.
The parties jointly instruct [Real Estate Agent] to value each of the various items of personalty, furniture and effects in each of their respective possession and to this end each party is directed to cooperate with all reasonable requests and directions of the nominee of [Real Estate Agent] to ensure such valuations are completed no later than 28 February 2019 with the cost of such valuation to be jointly borne by each of them.
The parties jointly instruct [Valuer] to value the wife’s engagement ring no later than 28 February 2019 with the cost of such valuation to be jointly borne by each of them.
In the event the wife wishes to photocopy any documents disclosed by the husband she shall do so at her own expense unless such documents can be supplied to the wife in digital form.
Until further or other order:
Orders 2.1 & 2.2 of the orders of 6 August 2018 continue and in addition thereto, the child [X] spend time with the father in the school holidays from 16 December 2018 to 26 December 2018 and 10 January 2019 to 17 January 2019 but the undertaking in respect of this period regarding the father’s consumption of alcohol is discharged.
The husband continue to pay [X]’s school fees and all other of his extramural activities which the husband has hitherto paid.
The proceedings be transferred to the Family Court of Australia and be listed for further directions at a date and time to be determined by a Registrar of that Court.
IT IS NOTED that publication of this judgment under the pseudonym Dennell & Garron is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT ADELAIDE |
ADC 2552 of 2018
| MS DENNELL |
Applicant
And
| MR GARRON |
Respondent
REASONS FOR JUDGMENT
Introduction
Ms Dennell and Mr Garron are the parents of [X] born [date] 2011. The proceedings are concerned with interim arrangements for [X]’s parenting and the management of the parties’ financial affairs pending trial.
The interim property issues focus on matters relating to Ms Dennell’s on-going financial support and whether there should be any interim or partial settlement of property made and, if so, what form it should take. It is the wife’s position that she is currently in a precarious financial and emotional situation, which requires the court’s prompt intervention.
Other issues arise regarding the on-going management of the case, particularly whether it should remain in this court or be transferred to the Family Court, which is more specifically orientated to dispose of complex family law proceedings.
The various financial controversies, occurring between the parties, arise at an early stage of the proceedings. It is the wife’s position that the husband has access to considerable financial resources controlled by others, who are not parties to the current proceedings. The husband’s position is that he may have a wealthy father but cannot demand anything from his father, who is in any event no-longer willing to subsidise him financially.
In this context, issues are likely to arise regarding the discovery of documents and whether third parties should be compelled to provide them. These third parties are likely to be either relatives of the husband or entities controlled by them. These issues are potentially both complex and time consuming.
It is the wife’s position that the husband is likely to have ready recourse to the necessary funds required to fund complex commercially based litigation, through such third parties, whilst she does not. She also contends that her personal situation is deleterious for [X] and on this basis the final hearing of the case should be expedited if her application for interim orders is not successful.
In my early assessment, the issues raised by the parties are not ones which can be easily accelerated. Rather, it is my provisional impression, as I observed to the parties during the interim hearing, that it will be necessary for the court to approach the various matters raised in the case on an incremental basis.
In the longer term, the major controversy between the parties centres on whether [X] should live in Sydney, with his mother or continue to live in Adelaide, so that he can live equally with each of his parents.
Accordingly, this is what lawyers commonly refer to as a relocation case. Relocation cases arise when one parent wishes to live far away, with any child concerned, from the other parent, who is either unable or unwilling to move, in tandem, with the other parent.
In this context, the positions of the parties are polarised in the extreme and they agree about practically nothing. Against this background, the court is called upon to make potentially far reaching interim orders. The obvious difficulty arising being the limited evidence currently available and the lack of preparedness of what evidence is available.
Interim orders sought
The wife seeks the following interim orders in her amended application:
·A dollar for dollar award of costs to be paid to her for her legal costs to equate to the amount paid by the husband for his;
·Payment to her of the sum of $50,000.00 in the event of the sale of the former family home at Property C;
·Spousal maintenance in an amount of $1,500.00 per week, if she and [X] continue to live at Property C on the proviso the husband continues to meet the outgoings and mortgage related to the property;
·If she vacates Property C, spousal maintenance in an amount of $2,500.00 per week;
·Permission to relocate [X] to Sydney forthwith;
·In this eventuality, the child spend alternate weekends with his father subject to the husband not consuming alcohol.
In her application in a case filed on 21 November 2018, the wife seeks the following orders:
·Production of financial documents, particularly documents relating to a trust controlled by the husband’s father and details of all loans made by the trust to the husband;
·The husband’s credit card statements;
·A joint valuation of a property owned by the wife in Property B, NSW;
·A joint valuation of her engagement ring and furniture controlled by the husband;
·A family report be prepared by Ms A;
·The photocopying of extensive financial documents disclosed by the husband with the photocopying to be at the husband’s expense;
·An urgent final hearing.
In his amended response filed on 19 November 2018, the husband seeks the following interim orders:
·Alternate weekend time with [X] and half of each school holiday period;
·Valuation of the wife’s property at Property B;
·The immediate sale of the Property C property;
·Distribution of $50,000.00 to each party of the proceeds of sale of a property at Property A, with the nature of the payment to be characterised at trial;
·Any balance remaining to be utilised to pay down the Property C mortgage.
It is implicit in Mr Garron’s response that he opposes the immediate relocation of [X]; the payment of on-going spousal maintenance to the wife; and any formal interim settlement of property. It is essentially his position that he is currently financially bereft.
He concedes that he has hitherto paid significant recurrent sums to the wife amounting to around $1,357.00 per week. These have included the following:
·$500.00 living expenses per week;
·$392.00 mortgage payment per week for Property C;
·Gas, electricity, rates and other outgoings for Property C;
·Weekly health insurance and other insurance.
He proposes the transfer of health insurance and the Property C utilities into the wife’s name and she pay the other outgoings on the property, including the mortgage. He is willing to continue to meet [X]’s private school fees.
Underpinning the position adopted by him in the current proceeding - namely that his on-going capacity to meet these payments is now at an end – is his assertion that his father has recently told him that he (Mr Garron Senior) is now only prepared to meet his (the husband’s) immediate living expenses.
Background
Ms Dennell and Mr Garron actually met on an aeroplane, whilst travelling from Sydney to Adelaide, in [date] 2009. At the time, Ms Dennell was based in Sydney, where she had employment and owned a home in Property B. Mr Garron was based in Adelaide, where he had his own property, employment and where his children, from an earlier relationship were based.
Ms Dennell now wishes to return to live in Sydney, with [X]. It is her position that she has been his main provider of care since he was born and she left the workforce and moved to Adelaide, when she was pregnant with [X], in order to accommodate Mr Garron’s priorities in life, but on the understanding that the family would move to Sydney at some time in the future.
The parties married on [date] 2011. They separated, initially under the one roof, in December of 2012. Until mid-2017, Mr Garron was employed as general manager at [Business], receiving a comfortable salary of around $400,000.00 per annum and other bonuses from time to time. The overall economic health of the [Business] group is contentious and largely unexamined at this time.
Mr Garron has expertise in the field of [occupation omitted]. He has been self-employed since [date] 2017 and engaged in a consultancy with a [industry omitted] enterprise in which he has invested. It is his position that his income is now effectively nil until such time as his consultancy and investment in the firm bears fruit, possibly some time in 2020.
The Garron family, including the husband’s father, have valuable business interests. It is the wife’s case that Mr Garron Senior (the husband’s father) is an extremely wealthy person, who controls trusts of which the husband is a discretionary beneficiary.
It is also Ms Dennell’s position that Mr Garron Senior has been funding the husband’s not inconsiderable living expenses and indirectly those of her and [X], both since the husband ceased employment and more recently after the parties’ separation.
Mr Garron asserts that he has, in fact, borrowed significant sums from his father, which he is obliged to pay back. In addition Mr Garron Senior has categorically advised him that he is no longer willing to continue to provide financial support to his son to the same generous extent as previously. The husband disputes that any discretionary trusts are involved. Rather his father has lent him money and wants it back.
It is in this difficult and controversial financial matrix that the issue of interim relocation arises. It is the wife’s position that she cannot afford to live in Adelaide with [X], without significant financial support from the husband. If that support is not forthcoming, she seeks to return to live at her property in Property B. The father has indicated that his own father will not be willing to provide any form of support for [X], if the child lives permanently in Sydney.
Besides the Property B property (estimated by the wife to be valued at $850,000.00 but subject to a mortgage of $265,000.00) other relevant properties include the parties’ former family home located at Property C and a half-share, which Mr Garron owned with his brother, in a shack at Property A.
The Property C property is registered in Mr Garron’s name and was owned by him prior to the commencement of the parties’ relationship. It is worth somewhere between $1.5m and $1.8m and is subject to a mortgage in the sum of $282,904.00. Ms Dennell and [X] are currently living in the Property C property. As previously indicated, the sum required to fund the outgoings on the property are approximately $660.00 per week.
Mr Garron concedes that he is currently living in a property at Property D, which was purchased in [date] 2018. He also accepts that he signed the necessary contract of sale, although he asserts that he did so as a nominee for his father’s company, [Company A] Pty Ltd, which is the actual owner of the property.
He further asserts that this company is renting the Property D property to him at a rental of $2,400.00 per month, which he cannot currently afford to pay, leading to his additional indebtedness to his father and/or companies controlled by him, again trying his father’s patience.
[X] attends School 1. The husband’s children from his earlier relationship ([A] aged 17 and [B] aged 15) also attend private schools. It is Mr Garron’s contention that his father has also paid these fees, but only on the basis that they are loans and he (Mr Garron Senior) is “becoming quite vocal in his demands for repayment”.
Although Mr Garron has investigated the possibility of selling the Property C property, he concedes that it must remain in his ownership, whilst it provides accommodation for Ms Dennell and [X]. Whether either of the parties have the capacity to retain this property in the longer term is unclear. Presumably, given her wish to move to Sydney, Ms Dennell has no long term wish to keep the property but if she has to continue living in Adelaide, particularly in the short to medium term, she will need somewhere to live.
For her part, Ms Dennell is critical of Mr Garron for concealing his earlier plans to sell the Property C property and for not being candid with her regarding the circumstances surrounding his occupation of the Property D property. The issue is emblematic of the current level of mistrust between the parties.
Essentially, Ms Dennell asserts that Mr Garron conducts his financial affairs opaquely, so far as she is concerned. The implication being that he is intent on concealing his true financial position from her, particularly the financial resources available to him, either directly from his family or indirectly through trusts of which he is a discretionary beneficiary. She contends that he is now playing financial hard ball with her for tactical reasons.
Ms Dennell has disclosed having a net asset backing of $645,000 and accrued superannuation of $85,000.00. Her only personal source of income is the rent which she receives from the Property B property. She has been reliant on Mr Garron for ostensibly paying the mortgage and outgoing on the Property C property; [X]’s school fees and extramural expenses; health insurance and providing some cash for her.
Mr Garron has calculated the gross value of property owned by him, largely consisting of the Property C property to be around $1.8 million. He estimates his superannuation, in a self-managed fund to be $340,000.00. Most significantly, in the context of these proceedings, he has deposed that he owes his father the sum of approximately $1.2 million. He characterises this sum as a family loan. Accordingly, in net terms, he ascribes an asset pool of around $100,000.00. Needless to say, the wife meets the alleged loans with some incredulity.
In the circumstances of having no personal income, Mr Garron deposes that his weekly level of expenditure is around $3,000.00, the major component of which is school fees. He has specified having some form of interest in various nominated trusts but asserts the value of these interest is “nil”.
He utilises the same terminology in respect of his business. In these circumstances, he contends that he has no capacity to pay spousal maintenance to Ms Dennell other than in the manner which he proposes through the allocation of the proceeds of the sale of the Property A shack. As a consequence, he asserts that he is effectively insolvent.
In addition, Mr Garron disputes that Ms Dennell is not capable of providing some level of her own financial support through a return to the paid workforce. He is concerned that any move of [X] to Sydney will prevent the child from having a meaningful level of relationship, not only with his father, but also his half-siblings. Finally, he asserts that although his financial position may not be orthodox, it is as he has deposed it to be.
In this context, Mr Garron has deposed that although his financial position is difficult, he remains aware that he continues to have financial obligations towards both the wife and [X], which he has discharged largely through borrowings from his father, since separation. In these circumstances, issues surrounding the Property A property arise.
It has recently been sold realising the husband the sum of approximately $200,000.00 for Mr Garron. He proposes that each party receive an interim distribution of $50,000.00, from the proceeds, with the balance to reduce the Property C mortgage.
He would propose that Ms Dennell use her $50,000.00 to provide for her and [X]’s living expenses; her vehicle expenses; health insurance; and mortgage repayments and other outgoings on the Property C property. He calculates these sums to come to $1,357.00 per week, which hitherto he has been paying, albeit through moneys advanced by his father.
In regards to his $50,000.00, Mr Garron proposes that he would use it to fund his legal fees; [B] and [A] and [X]’s school fees; and some of his living expenses. He would not want the court to characterise these distributions, at this stage, but would want any such necessary categorisation to be made, by the court, following trial.
The parties’ competing applications first came into court on 6 August 2018. On this occasion, it was agreed between them that [X] should continue to live with his mother but spend regular alternate weekends and one overnight per fortnight, in the care of his father.
At this early stage, the parties were also referred to a child dispute conference convened by Family Consultant Ms B. Her resulting memorandum provided some independent background of the dynamic of the parties’ parenting relationship, which Ms B described as being “particularly strained”.
Significantly, the parties also agreed that they would attend a financial mediation, at their ultimate joint expense but with the husband to pay the mediator’s costs initially. The anticipated mediation has not occurred and no date has apparently been fixed for it. No doubt, the controversy surrounding the husband’s financial resources has led to this deferral.
Ms Dennell alleges that during the parties’ relationship, she was subject to coercive and controlling behaviour. It is her case that Mr Garron has problems related to excess alcohol consumption and a history of serious depression.
Although she concedes that [X] has a significant relationship with his father and indeed with his half-siblings, she does not believe that Mr Garron is in a position to discharge parenting duties for [X] safely for any extended period of time.
In this context, she has issued subpoenae to the husband’s doctor and psychologist with a view to ascertaining what is the extent of his alcohol use and the nature of any other psychological issue he may have, which is relevant to issues of [X]’s care.
It is also her case that, with the demise of the parties’ marriage, she has no sources of emotional support available to her in Adelaide, as her family live in Sydney. It is on this basis that she wishes to relocate [X] from Adelaide to Sydney sooner rather than later, particularly if remaining living in Adelaide forces her to live hand to mouth, whilst being financially beholden to Mr Garron.
It is in these emotionally laden circumstances that an issue has arisen about the appropriate Christmas arrangements for [X]. The husband wishes to spend a period of three weeks, with [X] which he can enjoy with members of his family at a beachside shack. The days he wants are from 15 December 2018 to 5 January 2019. It is his perception that this would be fair, as Ms Dennell enjoyed Christmas with [X] last year.
On the other hand, Ms Dennell proposes [X] spend time with his father in two blocks between 16 December and 26 December 2018 and from 10 January until 17 January 2019. This arrangement would allow her to take [X] to Sydney, where he could spend time with his maternal family.
Given the complexity of the issues surrounding [X]’s care and the inability of the parties to be able to reach agreement in respect of them, it seems axiomatic that there is a need for some independent and expert assessment of the family, which would include an examination of [X]’s relationship with each of his parents and others who are significant to his development.
The parties agree that Ms A is an appropriately qualified person to provide this assessment. However, due to professional constraints, Ms A is not likely to be able to provide such a report until the middle of 2019. This is not helpful in terms of any expedited hearing of the case. The parties are also at odds regarding how Ms A’s report is to be paid for.
The parties disagree about other procedural issues, particularly how the valuation of the various remaining pieces of real estate and some items of personalty are to be valued, particularly again regarding how such valuations are to be funded. They also disagree about the cost of photocopying documents relating to Mr Garron’s financial situation sought by Ms Dennell.
The husband’s solicitor has indicated that there are 640 pages of documents in these documents, which Mr Robinson has indicated can be copied at a cost of $0.30 per page. The potential disbursement amounts, on my calculations to a sum of $192.00. I am concerned that the legal costs of arguing this issue are likely to be greater than the sum at stake.
All these various intricate disputes are related to the essential evidentiary controversy arising in this case – does Mr Garron have access to significant funds, through his father, as Ms Dennell contends or is he essentially financially bereft, as Mr Garron contends.
If it is the former, as the wife contends, Mr Garron should pay all the various sums sought by her; if the latter, Ms Dennell’s application should be dismissed and orders made as Mr Garron proposes, as this is the only mechanism through which financial support can be provided to the wife in the short to medium term.
Applicable legal considerations
The nature of an interim hearing
Interim hearings very often arise against a background of serious family crisis and controversy. Obviously this is the situation in the present matter. Given the nature of the particular crisis involved, the court may be required to make any necessary determination expeditiously but the nature of the hearing involved also requires that the court exercise a degree of caution to avoid the potential danger of abrogating the proper outcome of any final hearing.
The need for such expedition dictates that the hearing concerned should be truncated. As a consequence, such a shortened hearing does not allow any extensive examination of the relevant evidence, particularly through a process of cross-examination. As the parties in the present case will be aware, neither of them entered the witness box and neither was subject to the cross-examination of the other’s very experienced counsel. As such, I am not in a position to make findings regarding their respective credit.
As a consequence, none of the various factual issues in dispute, between the parties concerned, can be resolved in the context of these truncated interim proceedings. In addition, at this stage, apart from the parties themselves, no other witnesses have prepared affidavits.
In a case like the present one, it is likely that other witnesses will be crucial to the resolution of the central evidentiary issue in the case, which turns on whether Mr Garron has access to significant financial resources either through his father or any trust of which he is a beneficiary.
As I indicated at the outset, it is likely that both the parties and the court which will ultimately have to decide this issue, are at the start of a long process in this regard involving issues of discovery and subpoena and quite possibly the joinder of other parties. Again, these are factors which call for the court to exercise caution.
In addition, at the interim hearing stage, it is rarely the case that there has been sufficient time for any independent and expert evidence to be prepared, evaluating the case from the perspective of any child concerned, particularly in the context of the nature of their relationship with each of their parents and what is their preferred outcome in the case and if any and what factors are influencing such views.
How the court determines a child’s best interests
At the outset, it is to be noted that, although the nature of the hearing is different at the interim stage, as opposed to the final hearing stage, the legal principles to be applied are the same.
In deciding whether to make any particular parenting orders, in relation to a child, the court must regard the best interest of that child as the paramount or most important consideration [Family Law Act 1975, section 60CA].
The matters which the court must take into account, in deciding how a child’s best interests are to be served, are set out specifically, in list form, in section 60CC.
The section creates two classes of considerations which are relevant – primary considerations and a longer list of additional considerations. Generally speaking, the court should give greater weight to the primary considerations, which closely tie in with the overall objects and principles of the Family Law Act 1975 set out in section 60B.
There are two primary considerations, which are as follows:
a) the benefit to the child of having a meaningful relationship with both of the child’s parents; and
b) the need to protect the child from physical or psychological harm, from being subjected to, or exposed to, abuse, neglect or family violence.
As a result of the insertion of section 60CC(2A) into the Act, the court is now directed in applying the primary considerations “to give greater weight” to the primary consideration relating to protective concerns applicable to the children who are the subject of the relevant proceedings.
In the words of the relevant explanatory memorandum “where child safety is a concern, this new provision will provide the court with clear legislative guidance that protecting the child from harm is the priority consideration.” Future protective issues for a child are the court’s priority.
The expression meaningful is not specifically defined in the Act. It is an ordinary English word. In Mazorski v Albright[1] Brown J indicated that a meaningful parental relationship is one which is “important, significant and valuable to the child” concerned.
[1] See Mazorski v Albright (2007) 37 FamLR 518 at 526 [26]
The expression meaningful is also used in section 60B(1)(a). The court is directed to ensure that a child’s best interests are met by ensuring the children have the benefit of both their parents having a meaningful involvement in their lives. As a verb, involve means to participate or share experience.
Accordingly, in my view, the rationale of Part VII of the Family Law Act is that children derive benefits from feeling that their parents are involved or participating in their lives. A child’s life is, by necessary definition, every activity in which the child takes part. Literally, it means the child’s existence, as an individual.
Other specific criteria relating to how the court is directed to consider how the best interests of any children concerned may be served, by any order which is made, are set out in section 60CC(3). There are fourteen such criteria, which are categorised as being additional considerations. Depending on the circumstances of the case concerned, one or more of these factors may come to the fore.
Pursuant to section 60CC(3)(m), the court is empowered to have regard to any other fact or circumstance, which it considers relevant. This ensures that the infinite variety of individual children’s circumstances may be addressed in any order which the court makes.
There is no section in the Act which deals specifically with the allocation of how a child spends time with parents and significant others at Christmas time or on other special occasions. As with all matters to do with children, such issues are to be determined by a consideration of how the best interests of the child concerned are best met by reference the criteria delineated in section 60CC. It is not a case of equity being accorded to the individual parents involved.
In this particular case, criteria relevant to the issue of how [X] spends the Christmas period are likely to turn on how he can benefit from spending time with those who love him at Christmas; the nature of his relationship with his parents and others of importance to him, including grandparents and siblings. On the wife’s case, she contends that there are protective concerns relating to the husband’s alcohol consumption, which she alleges was particularly high during a past visit to the Garron family holiday home.
Although the court is directed to consider many factors, in discharging its duties under Part VII of the Act, the best interests of the children concerned remain paramount. The court’s duty is to deliver individual justice, for the child affected, in every case.[2]
[2] See B v B: Family Law Reform Act 1995 (1997) FLC 92-755
In this sense, the court’s inquiry is a “positive one tailored to the best interests of the particular children and not children in general …”[3] As such the various factors, in section 60CC, are inclusive but not exclusive of one another.[4]
[3] See B v B: Family Law Reform Act 1995 (ibid) at 84,220
[4] See Russell & Russell & Anor [2009] FamCA 28 at [141] per Ryan J
Parental responsibility
The legislation contains a presumption that it is in a child’s best interests for his or her parents to have equal shared parental responsibility for him or her [Family Law Act 1975 section 61DA].
The presumption contained in section 61DA is subject to rebuttal. As such, it is not to be automatically applied in every case. The court is directed to apply only if it considers that it has not been negated by other considerations specified in the section.
The presumption of equal shared parental responsibility is rebutted if it is found, on reasonable grounds, that one of the child’s parents has abused the child concerned or exposed him or her to family violence [section 61DA(2)].
The presumption is also rebutted if evidence is provided which satisfies the court that it would not be in the child’s interests for his or her parents to have such equal shared parental responsibility for the child concerned [section 61DA(4)].
Significantly, at the interim stage, the court has a discretion not to apply the presumption if it considers it would not be appropriate to do so, in all these circumstances prevailing [section 61DA(3)].
Section 61DA deals with the allocation of parental responsibility in respect of a child. It does not deal directly with more practical aspects of a child’s life, particularly the amount and type of time a child spends with his or her parents or where a child is to live. Such matters are dealt with by section 65DAA.
By application of section 65DAA, if the presumption of equal shared parental responsibility applies in respect of a child, the court is required to consider firstly whether the child concerned should spend equal periods of time with both his or her parents, provided such an outcome is both likely to be in the child’s best interests and reasonably practicable.
If the court rejects equal time, it is then required to consider the child spending “substantial and significant” periods of time with each of his or her parents. Again, this outcome is subject to consideration of the child’s best interests and reasonable practicality.
Issues of practicality are dealt with by section 65DAA(5). The court is required to consider how far apart are the parties’ homes; the parties’ current and future capacity to implement shared care type arrangements; the parties’ ability to communicate with one another and solve parenting problems consensually; and most importantly, the likely impact of such an arrangement on the child concerned.
Mr Garron’s preferred outcome for the case appears to rely on the application of the presumption and then the implementation of an equal time regime based in Adelaide. Necessarily, this would require Ms Dennell to remain indefinitely in Adelaide, an outcome which, given her present evidence, is calculated to be against her wishes and liable to make her potentially both resentful and unhappy, as she is likely to perceive that her personal aspirations and priorities in life have been rendered subservient to those of Mr Garron. These factors are likely to have implications for the feasibility of any equal time arrangement.
Relocation
Relocation cases arise when one parent of a child wishes to move far away from the other parent concerned, taking the child of the relationship with him or her. Such cases are invariably very difficult. Australia is a free country. As such, individuals, including parents, are free to live where and how they like. On the other hand, children have a right to know and to be cared for by both their parents. The competing considerations come into inevitable conflict in every relocation case.
As a consequence of these factors, superior courts in Australia, including the High Court, have indicated that each family law case involving a relocation aspect, requires close and idiosyncratic examination. Such a degree of intricate scrutiny is not possible at the early interim stage of proceedings, given the truncated nature of such hearings.
Accordingly, at the interim stage, the normal approach adopted by the court is not to allow a relocation of a child involving a significant level of distance, unless there is some kind of emergency or personal crisis confronting the relocating parent, which if left unresolved has potentially serious implications for the welfare of the child concerned.
Disclosure
The parties to property proceedings brought under the Family Law Act, in this court, are under a duty to make a “full and frank disclosure” of their financial circumstances and resources.[5] The relevant rule provides a list of categories of financial document which are required to be disclosed. The list includes details of what are taken to be financial resources. The list includes trusts of which a party is an eligible beneficiary.
[5] See Federal Circuit Court Rules (2001) at Rule 24.03
I have been provided with correspondence passing between the parties’ respective legal advisers regarding discovery issues. It is in this context that the issue of photocopying expenses has arisen. Although, it was not specifically ordered by the court, Mr Garron has provided an affidavit of documents, which does not include any trust documents.
Mr Garron has however disclosed an interest in six trusts specified in his statement of financial circumstances. As I understand matters, he has not provided any documents evidencing the nature of his relationship with each of these trusts and what monies, if any, he has received.
I have been told by his senior counsel that he has requested his father provide the relevant documents but his father has declined to do so through solicitors. As such, from Mr Garron’s perspective, he has gone as far as he can in respect of his disclosure obligation vis-à-vis the trusts concerned.
Ms Dennell is entitled to issue subpoenae to the various trustees concerned requiring production of documents. Whether she will do so or not has not been indicated to me but it seems probable that she will given the current stance she has adopted in the case.
The trustees in question are entitled to object. This, of itself, has the potential to be time consuming, costly and complex. I had cause to consider analogous issues in Mansfield & Mansfield.[6] The issue being whether the party seeking third party disclosure of documents had a legitimate forensic issue in those documents.
[6] Mansfield & Mansfield [2017] FCCA 13
In Mansfield I determined that the party concerned did have such a legitimate forensic purpose, which justified production and inspection prior to trial of trust documents. This, in turn, led to protracted and complex litigation involving whether the trusts concerned provided the opposing party with any form of financial resources. In the course of delivering judgment, I had cause to express regret at the sums of money expended by all the parties concerned in pursing the issue and my view that this court was not suited to such litigation.[7]
[7] Mansfield & Mansfield (No 3) [2018] FCCA 970
Notwithstanding the fact that each party has currently indicated that they are bereft of the necessary funds to fund such complex litigation, factors such as these are germane to the determination of whether the proceedings should be transferred to the Family Court and whether that transfer should occur sooner rather than later.
In this context, I am concerned that the parties have not as yet had an opportunity to take part in any process of alternative dispute resolution, as they earlier and sensibly agreed. It would seem to be the case that since the first mention of the case, the attitude of each party towards the other has hardened.
However, at least until there has been some forensic examination of the nature of [X]’s relationship with each of his parents and some of the issues relating to Mr Garron’s financial relationship with his father have been crystallised, it would seem premature to refer the parties either to conciliation or mediation, notwithstanding the obvious fact that an agreed outcome would spare the parties potentially great expense and perhaps avoid further damage to their currently strained relationship as parents.
Interim property proceedings
Part VIII of the Family Law Act is the part of the Act dealing with property, spousal maintenance and maintenance agreement. The major provisions relating to marital property division are contained in sections 79(1); 79(2); 79(4); & 75(2) of the Act.
Pursuant to section 79(1), the court is authorised to make such order as it considers appropriate in order to alter the interest of the parties to a marriage in relevant property.
The expression “property” is defined in section 4(1) in relation to the parties to a marriage or either of them as meaning “…property to which those parties are, or that party is, as the case may be, entitled, whether in possession or reversion.”
Pursuant to section 79(2), the court is actively prevented from making such an order unless it is satisfied that it is just and equitable to do so in all the circumstances prevailing. This follows from the use of the prohibitive words “shall not” in the relevant section.
Section 79(4) provides the mechanics of how a court is to make an order altering de facto property interests. In general terms, it provides a multi-step process.
Firstly, it is necessary for the court to identify the extent of the property to which any order made pursuant to section 79 will apply. Very often this is difficult to do at an early stage in property proceedings, as items of property have not been formally valued and there is very often a dispute as to what items should be considered marital property and what should be excluded.
These considerations are applicable to the current matter. On Mr Garron’s case, the pool of marital property is extremely small, given his level of indebtedness to his father and the failure of an earlier business venture associated with [Business], which resulted in him incurring a loss of capital in excess of $1m.
From the wife’s perspective, the husband has access to significant financial resources via his father and the trusts controlled by him. The exact nature of his current business venture is also unknown, particularly what is its current and potential value.
These considerations add not only to the potential complexity of the matter but are also factors which are likely to inhibit the court from exercising its jurisdiction under section 79(4) at an early stage of proceedings, when the extent of the asset pool is clouded with uncertainty. Necessarily, the court must be careful not to skew any further alteration of property interests required when issues currently inchoate come clearer into focus.
Secondly, the court must ascertain the varying contributions, which each party has made towards the assets so identified. Contributions fall into two broad categories:
·The first kind is contributions to the property: financial contributions and non-financial contributions, made directly or indirectly, by or on behalf of a party to the marriage to the acquisition, conservation or improvement of any of the property.
·The second kind is contributions to the welfare of the family: in the words of the section, “the contribution made by a party to the marriage to the welfare of the family constituted by the parties to the marriage, including any contribution made in the capacity of home maker or parent.”[8]
[8] See Family Law Act s79(4)(c)
It is clear from the authorities that this second kind of contribution must be given appropriate weight and is not to be treated as a token matter or as a contribution which is inherently less valuable or important than a financial contribution to property.
The third step involves the assessment of the parties’ prospective needs, by reference to the factors set out in section 75(2) of the Family Law Act 1975. Pursuant to section 75(2)(o), the court is entitled to take into account “any fact or circumstance which, in the opinion of the court, the justice of the case requires to be taken into account”.
Matters relating to the husband’s financial relationship with his father may ultimately prove to be considerations falling within the rubric of section 75(2)(o) but again, in my view, it is currently premature for any such conclusion to be drawn.
Section 80 of the Act provides the court with what are described as general powers. In particular section 80(1)(h) empowers the court to make an order pending the disposal of proceedings. However, it is clear that the same principles, set out above, apply both at the interim and the final hearing stage.
In general terms, bearing in mind the limited nature of an interim hearing, the court is required to follow the process outlined above, in respect of both final and interim de facto property proceedings. Accordingly, it is necessary for the court to consider whether it is just and equitable to make any such order and whatever order is made must be referrable to the considerations set out in section 79(4).
Accordingly, the court must make some assessment of the parties’ various contributions to the pool of assets in question and importantly must have regards to any applicable factor arising under section 75(2). Necessarily, any interim order must be referrable to the final order made in the case concerned, as both depend on the exercise of the same power.
Given these circumstances, the Full Court of the Family Court has pointed out that, as there can be only one exercise of the power under section 79 of the Act, it is usually preferable that there be only one final hearing of section 79 proceedings, rather than a succession of subsidiary provisional hearings.[9]
[9] See Strahan v Strahan (2010) 42 Fam LR 203 at 230 [114]
In Strahan apropos the making of an interim property order, the Full Court rejected any notion that it was necessary for an applicant to establish compelling circumstances to justify the making of such an order. Rather, the court’s deliberations, which need not be particularly extensive, required a determination of whether it was appropriate to make such an order, within the over-arching consideration of whether it was in the interests of justice between the parties concerned for it to occur.
In reaching this conclusion, the Full Court noted the idiosyncratic nature of litigation, under the Family Law Act, when compared with other civil litigation. In the former, there was often a marked imbalance in the power of the parties concerned and artificialities in how property available to be divided was legally controlled in the period leading up to final hearing.
Examples of where it may be appropriate to use the power to make an interim property order include where both the parties agree to the disposal of some assets pending trial; urgent situations to avoid injustice being wreaked upon one party if the power was not exercised; and where one party requires funds to assist in the defrayal of legal costs arising from the litigation involved.[10]
[10] See Strahan (ibid) at [133]
The discretion to make an interim property order must be closely considered, bearing in mind the different nature of an interim, as opposed to a final hearing, which nonetheless involves the exercise of the same power. In particular, the court must ensure that any interim outcome is a just and equitable one and be careful to ensure that any such interim order does not prevent a similar equitable outcome at the final hearing stage.
Considerations of this type led the Full Court in Strahan to say as follows:
“We also emphasise that in order to establish an appropriate case for an interim property settlement order more is required than the mere fact that upon a final hearing the applicant would receive the property being sought (or an amount in excess of the funds being sought) from the other party. [11]
[11] See Strahan (ibid) at [139]
Spousal maintenance
The operative section of the Family Law Act dealing with spousal maintenance is section 72. In summary, it provides that a party to a marriage is liable to maintain the other party only if that party is reasonably able to do so and only if the other party cannot support him/herself adequately because of:
· the responsibility to care for a child of the marriage under 18;
· age or physical or mental incapacity for work;
· any other adequate reason.
Two salient or threshold issues, arising from section 72, relating to spousal maintenance, need to be emphasised :
· firstly, one party is reasonably able to maintain the other; and
· secondly, the other party is unable to support him or herself adequately.
The actual jurisdiction of the court to make a spousal maintenance order stems from section 74 (1). It provides that the court with a discretion to make an order for spousal maintenance, which it considers proper by reference to the other applicable provisions contained in Part VIII, particularly section 75(2).
The Full Court of the Family Court in Bevan & Bevan[12] determined that the approach to be taken in respect of applications for spousal maintenance involved a four step process as follows:
· a threshold finding under section72;
· consideration of section 74 and section 75(2);
· no fettering principle that a pre-separation standard of living must automatically be awarded where the respondent’s means permit;
· the discretion exercised in accordance with the provisions of s.74 with “reasonableness in the circumstances” as the guiding principle.
[12] Bevan & Bevan (1995) FLC 92-600 at 81,981-2
In the current matter, apart from the funds liberated by the Property A property, it is Mr Garron’s position that he has no capacity to provide financial support for Ms Dennell. It is his case, which the wife greets with incredulity, that he is entirely financially beholden to his father who is at liberty to decline to provide him with any more funds. The legislative provisions are clear that Mr Garron Senior has no obligation to provide any financial support for either Ms Dennell or his grandson.
In addition, although Mr Garron concedes that Ms Dennell has significant responsibility to provide care for [X], his senior counsel contends that there is no evidence currently before the court to indicate what is or is not Ms Dennell’s capacity to provide some measure of her own financial support. Thus, at this stage, the threshold has not been crossed in this case.
Conclusions
In my assessment, the situation currently confronting Ms Dennell is not one characterised by such an extreme state of emergency that it is sufficient to justify the immediate relocation of [X] to Sydney. The evidence is that, although her financial situation is far from assured, she does currently have accommodation for herself and [X]. She remains living in the property, which has been [X]’s home for the whole of his life to date.
In addition, although her principle sources of emotional support are likely to be her family based in Sydney, she has lived in Adelaide for the past seven years. At this juncture, there is no expert evidence to indicate that she is at psychological risk if she remains living in her current situation in the medium term.
Accordingly, in my provisional assessment, it cannot be said that she is so psychologically and socially bereft that her capacity to properly parent [X] is significantly compromised. In addition, the issue of there being possible adverse consequences for [X] in terms of the level of his relationship with his half siblings being changed and his current place of education being disrupted remain live issues in the litigation. In addition, it is not clear how the parties would manage the logistical difficulties of spending time arrangements over distance [see Family Law Act at section 60CC(3)(b), (d) & (e)].
More significantly, at this stage, Mr Garron seeks for the court to consider an equal time regime for the future parenting of [X]. It would seem to be his position that he is not prepared to move, in tandem with Ms Dennell to Sydney, so that this outcome can be achieved.
Rather, by necessary implication, he seeks the court to either directly or impliedly restrain Ms Dennell from leaving Adelaide so that what he regards as the optimal regime for the parenting of [X] can be inaugurated, given that at this juncture it appears improbable that Ms Dennell would opt for her own relocation in preference to maintaining a close bond with [X].
If the court grants the wife’s application to move [X] to Sydney pending trial, this aspect of his application may be rendered otiose. It would also be obviously extremely unsettling, for [X], if having left Adelaide, it is ultimately determined that his best interest are served by returning there. Such considerations militate in favour of the court exercising caution, at the interim stage.
In my view, the parenting issues thrown up by this case are complicated. As such, it would be impudent of the court to endorse an outcome, on the basis of provisional and incomplete evidence, in the face of fervent opposition from one of the parties. In these circumstances, I am clearly of the view that the relocation aspect of the case is one which must be left to final hearing.
It is also, in my view, clearly the case that an expert family assessment report will be indispensable to the resolution of the relocation issue and indeed the other parenting aspect of the case. Ms A is well qualified to provide such a report.
I will direct that the parties take all necessary steps to commission Ms A to prepare the report required. I appreciate that Ms A’s report is not likely to be available for some months. This factor, along with the general uncertainty surrounding the property aspects of the case, militates against there being any expedited final hearing set at this point, notwithstanding the urgency identified by the wife and the difficulty surrounding her current circumstances. These factors are also germane to whether the case should remain in this court or be transferred to the Family Court.
Issues arise in respect of how Ms A is to be reimbursed for her report. Similar issues arise in respect of the payment of the valuation fees which are anticipated to be incurred in respect of the valuation of the parties’ two real properties and their major items of personalty, particularly artworks, a boat, jewellery and significant household items. The identity of the valuers required has been agreed but not how the individuals concerned should be paid.
In my view, the equitable resolution of this issue turns on the factual dispute, which is central to this case. Essentially, Ms Dennell contends that because of his familial situation, Mr Garron has effectively bottomless pockets in order to fund this litigation and therefore he should pay all disbursements jointly required for the proper disposal of the litigation concerned together with the photocopying expenses relating to the documents provided by him.
On the other hand, Mr Garron contends that he is effectively insolvent and with no guaranteed source of income and therefore considerations of equity dictate that the various valuation/family report expenses should be shared. In this context, he also asserts that the cost of photocopying documents sought from him should be borne by the wife.
At this juncture, it is impossible for me to resolve the issue regarding the alleged disparity in the parties’ financial resources, particularly whilst the question of Mr Garron’s relationship with the various trusts in question remains unclear. In these circumstances, I propose to order that each party contribute equally towards the cost to be incurred in respect of both Ms A’s report and the payment of the various valuers concerned. I will provide further details in support of why I consider this to be a fair outcome when I come to the issue of partial property settlement shortly.
If Ms Dennell wishes copies of Mr Garron’s disclosed financial documents, she should pay for them. In this context, it is necessary for me to indicate that the Federal Circuit Court is not ordinarily one which permits formal discovery or interrogatories. These are litigation tools available in the Federal Court and the Family Court.
The overall objectives of the court are set out in section 3(2) of the Federal Circuit Court of Australia Act 1999. [13] In this section, the court is directed to “operate as informally as possible” in the exercise of its judicial functions and is further directed “to use streamlined procedures”.
[13] Hereinafter referred to as the FCCA Act
Given its imprimatur to be a streamlined lower level Federal court dealing with less complex disputes than are currently dealt with by either the Family or the Federal Court, the Act provides a qualified prohibition against the use of either discovery or interrogatories in the Federal Circuit Court. In particular, section 45(1) of the FCCA Act provides as follows:
(1) Interrogatories and discovery are not allowed in relation to proceedings in the Federal Circuit Court of Australia unless the Federal Circuit Court of Australia or a Judge declares that it is appropriate, in the interests of the administration of justice, to allow the interrogatories or discovery.
Pursuant to section 45(2), in deciding whether to make such a declaration, the court is directed to have regard to the following matters.
“(a) whether allowing the interrogatories or discovery would be likely to contribute to the fair and expeditious conduct of the proceedings; and
(b) such other matters (if any) as the Federal Circuit Court of Australia or the Judge considers relevant.”
In my view, the election of one party to provide an affidavit of documents, without such a declaration or other intervention of the court is indicative of a view that the nature of the current litigation before this court does not easily fall within the purview of a lower level exercise of federal jurisdiction in family law.
The husband has disclosed a number of relevant documents in his affidavit of documents, including his tax returns, self-managed superannuation funds, bank statements and some details of loans between him and trusts. For obvious reasons, the wife wishes not only to inspect these documents but also to copy them for her and her legal advisers to access easily.
The sum currently sought for their copying is not particularly onerous. Perhaps, for all I know, they can be provided in digital form. I will direct the wife pay any necessary copying charges arising. This seems to me to be in keeping with fairness and the normal practices of litigation.
The celebration of Christmas and the surrounding summer festivities are important to the majority of Australians, particularly the parents of children. Christmas is an important time for relaxation, reflection and an appreciation of the importance of familial relationships. Necessarily, the manner in which one family chooses to celebrate Christmas is not to be regarded as superior to the traditions of another family in respect of Christmas and holiday celebrations.
In these circumstances, I would prefer not to be placed in the position where it falls to me to determine how and with whom [X] spends the period of Christmas and the happy and family rich weeks which follow it. Without doubt there are advantages, for [X], arising from spending a couple of weeks in Sydney with maternal family and a longer period by the beach at Town W. It seems clear to me that [X] is part of a close family on both its paternal and maternal aspects and is a much loved child.
I am concerned that I am being presented with what mathematicians refer to as a zero sum game. Essentially, I have to choose between Option A or Option B, from each of which [X] is likely to derive some level of benefit and neither of which is obviously superior to the other.
In this context, I am concerned that having been presented with two such mutually exclusive options, by the necessity to choose one over the other, I will not only exacerbate the current significant acrimony between the parties, but also cause the party who perceives that he/she is the loser in such a selection to feel devalued. That is not my intention.
At this stage, I have extremely limited evidence about the issue. Briefly, Mr Garron has submitted that it is his family’s tradition to spend three weeks together at their beachside holiday home. Ms Dennell agrees that this tradition exists but is chary of it because of her belief that, in the past, Mr Garron has consumed alcohol to excess at this location.
To his credit, Mr Garron concedes that he has, in the past, had issues to do with the excessive consumption of alcohol. However, it is his position that currently these problems are under control and he is able to consume alcohol modestly. In any event, he asserts that the wife has exaggerated her concerns to derive advantage over him in these proceedings.
The recent orders made by the court, in respect of interim arrangements for [X]’s care, nonetheless were marked by the husband’s undertaking that he would not consume alcohol during any period of time that [X] was in his care or twelve hours beforehand. However, notwithstanding this undertaking, Mr Garron did not concede any need for it.
Ms Dennell is open to [X] spending the celebratory days of Christmas with his father and half-siblings, given that [X] spent Christmas with her in 2017. However, thereafter, she wants to be able to take [X] to Sydney from Boxing Day or thereabouts, which would clash with Mr Garron’s plans to spend the post-Christmas/early New Year period, in Town W, with his family, particularly his children and their paternal grandparents.
From my perspective, each of the parties’ positions has validity and I am loathe to choose between them. In my assessment, it is likely to add to the level of meaning [X] has with his father and other significant relatives, if he spends Christmas Day and the period leading up to it with them. In 2019, this arrangement can be reversed, if appropriate.
Up until this point, it would appear to be the case that Ms Dennell has been [X]’s primary provider of care. Currently, she feels isolated in Adelaide. It seems to be the case that the parties’ separation was difficult from both their points of view. This is entirely understandable.
In these circumstances, in my view, there are likely to be some benefits for [X] if his mother is able to re-charge her emotional batteries by taking the holiday, which she proposes. In addition, given the tensions between the parties, it seems to me that two shorter periods of holiday time, involving [X] and his paternal family, are likely to be more appropriate than one longer period, at this early stage.
However, having reached this decision, I concede that it is a finely balanced issue but necessarily given the controversy between the parties, it was necessary for the matter to be resolved. I regret any distress this decision will occasion to the parties, particularly Mr Garron.
As previously indicated, the earlier interim orders of 6 August 2018 were subject to the husband’s undertaking that he would not consume alcohol during any period [X] was in his care or twelve hours beforehand. He concedes that he has previously had issues to do with excess consumption of alcohol but asserts that these problems are now in remission.
The wife is sceptical of this claim, which she asserts is not borne out by the records subpoenaed from the husband’s medical and psychological advisers. Again, this is an issue which cannot be definitively resolved in the context of these interim proceedings. It is a question of assessing any risk potentially arising for [X] of being exposed to his father when intoxicated.
At the same time, there may be risks if [X]’s relationship with his father is unduly constrained. It is Mr Garron’s submission that the sensible consumption of alcohol is part and parcel of the mode in which the adult members of his family enjoy the summer holiday at Town W, particularly over a period of weeks rather than weekends. As such, it would be unreasonable to artificially constrain his time with [X] so that he is not able to do what he would normally do with his family in a relaxed social setting.
I consider that it is likely to be unduly restrictive to impose a zero alcohol order on Mr Garron. At the same time, I consider it artificial in nature and also to have the potential to lead to disagreements about what it means in practice for there to be a restriction to a reasonable level or a consumption which precludes intoxication. I consider that it is a proportionate response to the risk identified by Ms Dennell that I trust to Mr Garron to do the right thing so far as his alcohol consumption is concerned. For that reason I will discharge the undertaking.
At this juncture, in my assessment, given the imprecision surrounding the extent of the parties’ pool of assets, it is necessary for the court to adopt a cautious approach to any issue relating to an interim property settlement. In this context, I nonetheless concede the difficult financial circumstances currently confronting Ms Dennell. She has embarked on complex and potentially expensive litigation, which she has no obvious means of funding, whilst Mr Garron has potentially bottomless pockets, if what she asserts about his relationship with Mr Garron Senior turns out to be true.
As previously indicated, it is Mr Garron’s position that he cannot compel his father, either personally or through any of the trusts of which he is a trustee, to provide him with anything. As such, it is his contention that he is in the same boat as Ms Dennell as he asserts he is without income and is significantly in debt. Although in the past he concedes that he has been well resourced financially through his endeavours with [Business].
At this stage, in respect of both her application for spousal maintenance or for an interim settlement of property in her favour, Ms Dennell’s case depends on the court drawing an adverse inference against Mr Garron – namely, his financial position is not as he has deposed it to be, but rather he has access to financial largesse, from his father, which can be allocated to fund his litigation and potentially towards the support of the wife and [X].
Essentially, the inference is based on the fact that, since the parties separated, Mr Garron, in spite of not having any source of personal gainful employment, has been able to furnish accommodation for himself; pay his children’s school fees; fund litigation; and provide not inconsiderable support for Ms Dennell.
In these circumstances, the wife contends that the court can have no reason to consider anything other than that this situation will continue indefinitely and that therefore it should be formally ratified in some way to provide her with both peace of mind and financial security.
At this juncture, I am uncomfortable with drawing such an inference too readily. Mr Garron Senior has not provided any evidence in these proceedings and, at this point, the nature of his financial relationship with the husband remains both inchoate and highly controversial. He is not a party to these proceedings.
As indicated above, the legal provisions applicable to the making of both an interim and final property order are the same. The court must be satisfied that it is both appropriate and just and equitable to do so. Given the controversy about the extent of the asset pool in the current matter and the uncertainty surrounding Mr Garron’s income and financial resources, both in current and prospective terms, I am not persuaded that it would be just and equitable to make anything other than a conservative property order in the current matter.
One of the factors leading to this conclusion is the potential for difficulty to arise if the husband’s contentions in respect of the extent of the parties’ pool of assets ultimately proves to be correct. In such circumstances it may prove problematic to correct any excessive partial property settlement made in favour of the wife. In this regard, I rely on what was said by the Full Court, of the exercise of the section 79 power, at the interim stage, in Harris & Harris namely:
“Of necessity it is likely to be a somewhat imprecise exercise. Consequently, it must be exercised conservatively and the Judge must be satisfied that the remaining property will be adequate to meet the legitimate expectation of both parties at the final hearing or that the order which is contemplated is capable of being reversed or adjusted if it is subsequently considered necessary to do so.”[14]
[14] Harris & Harris (1993) FLC 92-378 at 79,930
The proposal of the husband will see each party receive a sum of $50,000.00, which will enable the wife to continue her financially constrained lifestyle for a period of around six months. It will also enable Mr Garron to pay [X]’s school fees and some of his other expenses.
The husband’s evidence is that he has been providing the sum of around $1,300.00 per week, which includes the Property C mortgage and outgoings thereon. It also includes living expenses of $500.00. If this sum does roughly supply Ms Dennell’s needs, $50,000.00 will supply her needs for around 35 weeks but this estimate is probably unduly optimistic. It will not provide her with any monies for her legal expenses.
The husband has largely been silent regarding how he has paid his legal fees up to this stage, other than he has indicated the provision of $500.00 per week towards these expenses. Presumably, it is his case that the source of these funds, as with all his other expenditure to date is the largesse of his father, which is about to be withdrawn. How that leaves him to participate in the case remains a matter of conjecture.
What is clear is that the wife has no obvious source of funds to contribute to her legal costs. The sum of $50,000.00 will be earmarked to supply her and [X]’s basic needs for shelter and sustenance. In these circumstances, in my view, the answer to this dilemma is for the wife to be provided with some additional funds from the proceeds of sale of the Property A property to fund her legal expenditure in the short to medium term.
I propose the sum of $25,000.00 in this regard. If necessary, this sum can be later added back into the parties’ pool of assets, at the final hearing stage, to avoid any potential injustice to the husband in circumstances in which matrimonial assets have been utilised to pay one party’s legal fees, thus potentially diminishing the pool of assets available to be distributed between both. This may unwittingly create a situation where the normal rule whereby each party should bear his or her own costs is defeated.[15]
[15] See In the Marriage of DJM and JLM (1998) 23 Fam LR 396
In order to allow scope for this adjustment to be made, if necessary, I propose that the remainder of the proceeds of sale of the Property A property be placed in an interest bearing account in the joint names of the parties pending the resolution of the proceedings.
As I am at pains to point out, it is not possible to ascertain what is the extant of the parties’ pool of assets at present, given the uncertainty of the significant loans which the husband asserts he owes to his father. Necessarily any approach to an interim property order must be cautiously approached.
However, given the wife’s needs to advance these proceedings and her obvious lack of recourse to any financial resources, I am persuaded that it is just and equitable to make the additional order for interim property proceedings in the manner proposed by me.
On the basis of the provision of this sum to the wife and the lack of evidence surrounding the issue of the wife’s capacity to seek gainful employment for herself, I do not propose to make any order in respect of interim spousal maintenance at this juncture. Other than on the assumption that Mr Garron Senior will continue to make payments to the husband, which the husband asserts he will not, there is no other source for these funds.
Mr Garron Senior is apparently willing to continue to pay [X]’s school fees through the provision of financial assistance to the husband. I will make an order that the husband pay [X]’s school fees and the other of his extramural activities in respect of which he currently regards himself liable.
The final issue remaining concerns whether the proceedings should be transferred to the Family Court or stay with this court. At this stage, there has been no formal attempt made by the parties to resolve the issues between them through a process of alternative dispute resolution. It is, in my view, likely to be in the parties’ interests for the case to be consensually resolved, particularly given that they will remain in a relationship, as [X]’s parents, for a very significant period of time indeed.
The lack of mediation/conciliation militates against fixing the matter for final hearing, at this stage, as does the lack of clarity about the anticipated length of the proceedings arising from the controversy about the extent of any financial resources available to the husband from his father. In addition, it is likely to be helpful for the parties if they have Ms A’s report and any recommendation she makes, prior to them attempting any process of alternative dispute resolution.
The assessment of the level of likely complexity in this case requires a degree of prognostication, which cannot be regarded as a certain science. In my view, any case involving trusts and the possible requirement for parties extraneous to proceedings to provide documents to the court or even been joined as parties has the potential to be both complex and time consuming. Cases in which it is asserted one spouse has access to significant financial resources via a discretionary trust not subject to his/her control more so.
These factors are present in the current matter, which also involves a relocation aspect. Relocation cases are invariably difficult for all involved in them as it is impossible for there to be a result which will not be upsetting for someone. In my view, these factors favour the case being transferred sooner rather than later. I will make an order to this effect.
For all these reasons, the orders of the court will be as set out at the commencement of these reasons for judgment.
I certify that the preceding one hundred and eighty eight (188) paragraphs are a true copy of the reasons for judgment of Judge Brown
Date: 5 December 2018
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