Dittmar and Dittmar

[2018] FamCA 1021

FAMILY COURT OF AUSTRALIA

DITTMAR & DITTMAR [2018] FamCA 1021

FAMILY LAW – PROPERTY – Interim – Where the husband and wife each seek different sums by way of interim property distribution and periodic monthly payments – Where orders are made for certain funds to be distributed from the Trust pending further order.

Family Law Act 1975(Cth)

Gollings & Scott (2007) FLC 93-319

APPLICANT: Ms Dittmar

RESPONDENT: Mr Dittmar

FILE NUMBER: SYC 6068 of 2015

DATE DELIVERED: 22 June 2018

PLACE DELIVERED: Parramatta

PLACE HEARD: Sydney

JUDGMENT OF: Le Poer Trench J

HEARING DATE: 24 November 2017

REPRESENTATION

COUNSEL FOR THE APPLICANT: Mr Campton SC

SOLICITOR FOR THE APPLICANT: SWAAB Attorneys

COUNSEL FOR THE RESPONDENT: Mr Richardson SC

SOLICITOR FOR THE RESPONDENT: Antunes Lawyers

Orders

(1)By way of interim property distribution the husband is to cause the payment to each of the husband and the wife of $200,000 from the D Trust.

(2)In the event of the husband being able to provide to the wife evidence of the requirement for the payment of a taxation invoice/assessment for himself and in the event the wife provides consent, the husband is to cause funds to be paid to meet the said invoice/assessment from the D Trust funds. The wife is not to unreasonably withhold consent.

(3)The husband is to cause payment, from the D Trust funds, of any tax liability of the wife and any beneficiary (being a child of the parties) under the D Trust ONLY where the tax liability arises from distributions which stand with an unpaid present entitlement.

(4)The husband is to cause payment, from the D Trust funds, of invoices issued for accountancy services provided to the husband, the wife, and any other beneficiary (being a child of the parties) of the D Trust for the preparation of tax returns for the 2017 and 2018 tax years, which include a distribution from the D Trust which sit as an unpaid present entitlement.

(5)The husband is to cause payment, from the D Trust funds, to the wife in the sum of $9,139 per month, and $15,700 to himself per month. Such funds to be paid on the 7th day of each calendar month.

(6)The husband is to cause payment, from the D Trust funds, of the legal costs incurred by him (to a maximum of $15,000) through engaging solicitors to act upon his behalf in relation to the settling of the separation deed entered into with his former employer K Ltd.

(7)In the event of the matter being resolved at the mediation in February 2018 the parties may provide signed terms of settlement to Justice Le Poer Trench for consideration and if appropriate for orders to be made in the absence of the parties.

(8)Should the matter not be resolved following the mediation the matter is listed for further hearing of any interim issue at 10.00 a.m. on 9 March 2018 before Justice Le Poer Trench. Should the date not be suitable to the parties legal representatives they may jointly contact the Associate to Justice Le Poer Trench to arrange an alternative date.

(9)The Court Notes: The parties agree that their son Mr L is to be paid $250 per week from the D Trust until he becomes eligible for a Centrelink benefit.

Note: The form of the order is subject to the entry of the order in the Court’s records.

IT IS NOTED that publication of this judgment by this Court under the pseudonym Dittmar & Dittmar has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).

Note: This copy of the Court’s Reasons for Judgment may be subject to review to remedy minor typographical or grammatical errors (r 17.02A(b) of the Family Law Rules 2004 (Cth)), or to record a variation to the order pursuant to r 17.02 Family Law Rules 2004 (Cth).

FAMILY COURT OF AUSTRALIA AT SYDNEY

FILE NUMBER: SYC 6068 of 2015

Ms Dittmar

Applicant

And

Mr Dittmar

Respondent

REASONS FOR JUDGMENT

Introduction

1. Before the Court is an Amended Application in a Case filed by Ms Dittmar (“the wife”) on 20 November 2017 in respect of property proceedings between herself and Mr Dittmar (“the husband”). 

2. That wife’s application was further amended by the tender of a minute of order on 24 November 2017 when the matter came before the Court in a duty list. The majority of the orders sought by the wife were resolved, however, there remained outstanding matters which required determination before the 2017 Christmas period. I reserved judgment following the interim hearing on 24 November 2017 and made orders on 7 December 2017 as set out above. I now provide the reasons for those orders.

3. The disputes remaining from the orders sought by the wife (marked as Exhibit W1) and the orders sought by the husband in his Amended Response to the Wife’s Application in a Case filed 21 November 2017 can be stated as follows:

   ·What monthly periodic payment should be required and/or permitted in respect of each party?

   ·What lump sum interim property settlement payment should be ordered in relation to each party?

   ·What other expenses of the parties should be met from the funds of the D Trust pending further order?

4. The hearing took place with the background of information provided by the parties that they intend to participate in a mediation in February 2018.

5. Following that mediation event the court was advised no resolution was achieved.

BACKGROUND

1. These parties were previously before me for an interim hearing for which I delivered reasons for judgment on 31 March 2017. I here set out the background as set out in my earlier reasons.

2. The parties were married in 1989 and separated in late 2012 or early 2013. The parties were divorced in December 2015. There are three children of the marriage all of whom are adults. The youngest of the parties’ children attends university and the husband has agreed to make payment for his support until he is eligible for a government payment (pension or allowance).

3. The husband has re-partnered. He and his partner reside in a property at Suburb G which the husband has acquired post separation. The wife resides in the former matrimonial home at B Street, Suburb C. The wife seeks to be able to retain that property as part of final property distribution between the parties.

4. The wife is not in employment. The husband asserts the wife does have a capacity for employment. The husband has been employed however that employment was terminated late in 2017.

The wife’s case

1. The wife relied on her affidavits filed 12 October 2017, 9 November 2017 and 20 November 2017, and her Financial Statement filed 9 October 2017.

2. The wife stated a number of complaints about the husband’s actions or inactions in relation to the proceeding. She asserted he had failed to make disclosure as required by the Family Law Rules. She asserted he had failed to comply with orders of the Court. She claimed such failures had caused her to expend funds in order to hunt out relevant financial information which should have been provided by the husband.

3. It is asserted by the wife that the husband has expended matrimonial property post‑separation to a level where there is real doubt that the wife will be able to achieve the property order which she says are proper, namely 70 per cent of the matrimonial pool of assets.

4. The wife asserted that the payment of partial property settlement sought by the husband should be limited to $200,000 rather than $250,000 as sought by him. The wife said that the extent to which the husband has allegedly reduced the pool of matrimonial assets post separation is so great that to provide for a payment to him, at this time, of greater than $200,000, will seriously put at risk the ability of the wife to achieve a just outcome in her final property distribution.

5. The wife has exhausted almost all of her savings. When the matter was before the court in late 2016 the wife had $286,692 in her savings account. That stands at close to $35,000 now.

6. The wife submits that the husband’s evidence about his financial needs on a weekly basis has grown “exponentially” since the matter was before the Court in late 2016. The wife says each party should be required to live at the same level until the matter is concluded. This submission is made in circumstances where the wife is seeking the payment of $9,139 each month from the controlled monies account containing the parties’ capital. She seeks the husband receive the same amount. The husband is seeking a payment of $15,700 per month from that fund.

7. Part of the complaint made by the wife about the manner in which the husband has exercised his control of the parties’ assets is a complaint that he paid $160,000 to the Australian Tax Office in respect of a liability which would not accrue until the conclusion of the 2018 tax year.

8. In relation to the husband’s case which urges the Court to enable a payment of capital to the husband of $200,000 and a payment of $100,000 to the wife, the wife says there is no basis for the Court to distribute disproportionate amounts between the parties. Justice and equity would require an even handed distribution of funds between the parties.

9. The wife opposes any of the orders sought by the husband in paragraphs 3.2, 3.3 and 4.2 of his Response to the wife’s Application in a Case.  

10. The wife submitted that when the Court is assessing the husband’s weekly expenses as stated in his Financial Statement it would conclude that the expenses stated by the husband are exaggerated and are significantly greater than the expenses he listed in the Financial Statement presented prior to November 2016. It was further submitted that the Court should disregard an expense of $1,500 per week for legal costs.

11. The wife opposes the order the husband seeks that she transfer any funds held by her in excess of $20,000 to a controlled monies account.

The husband’s case

1. The husband relied on his affidavits filed 8 November 2017 and 21 November 2017. He also relied on his Financial Statement filed 21 November 2017. In his affidavit the husband also sought leave to rely on his affidavits filed 2 December 2016 and 7 November 2017. I have granted that leave.

2. In his affidavit, the husband set out a summary of his income and non-living related expenses from the orders made on 31 March 2017 until 16 November 2017. In this period his income was $564,779.51. Taking into account his expenses, he calculated his net remuneration used for living expenses to be $81,370.

3. The husband deposed that he has complied with the orders of the Court and made payments as required to the D Trust from his income as at November 2017.

4. The husband also deposed that there are various costs which he has had to meet in relation to his de facto partner Ms M, including legal fees for her parenting proceedings in Country V and her outstanding education loans. The husband anticipates that Ms M will have additional substantial expenses in the future in relation to her legal proceedings.

5. The husband asserts that the wife has had the benefit of living in the Suburb C property mortgage free. The husband says he has continued to pay the mortgage payments since separation, not just over the Suburb C property but also the properties at Suburb G and Suburb Q. He claims the wife held savings of over $1.4 million in bank accounts.

6. The husband deposed that his employment with K Limited was to be terminated on 24 November 2017. He deposed that he will not be in a position to continue to meet Mr L’s living or educational expenses in the future.

7. In relation to the loans over the Suburb C property, the husband asserted that he has been making those payments from his personal bank account, however, he is no longer able to meet those payments. He is also no longer able to make the loan repayments for the Suburb G property of $2,808 per week. The husband deposed that he is unable to lease the Suburb G property until some urgent maintenance work is completed.

8. The husband asserts that he believes the wife is wasting assets or not disclosing assets.

9. In submissions, counsel for the husband submitted that it would be controversial for the Court to approach this matter on the basis that the husband has not inherently complied with orders, or machined his way around the court’s orders as suggested by the wife.

10. As a consequence of the arrangements consented to at the hearing by the husband, the sum of over $1 million that is referable to his employment income post-separation is being transferred to a fund to discharge mortgages. It was submitted that the husband’s employee share scheme, bonuses and his termination package all relate to employment that did not exist at the time these parties separated and as such that income should be seen as being available for him to use in such a manner as he sees fit (in accordance with the principles in Gollings & Scott (2007) FLC 93-319), provided he is making reasonable contribution to any maintenance obligations.

11. The husband submitted that he asserts the wife has dissipated some $1.4 million worth of the parties’ property during the course of the proceedings, without any real explanation as to how the funds have been utilised. He conceded that both parties are making allegations about non‑disclosure.

12. In relation to the order sought by the husband that the wife transfer any funds held by her in excess of $20,000 into a controlled monies account, the husband submitted that this stems from his assertion that the wife has funds in offshore accounts.

13. As to the amounts to be paid from the D funds, the husband sought leave to amend order 3.2 sought in his Response to the effect that the funds be used in payment of any tax liabilities of the wife and any beneficiary under the D Trust and the E Family Fund, but only to the extent that the liability arises on unpaid present entitlements, that is, where there has been declared a distribution that has not been followed by a payment of cash.

14. The husband then directed his submissions towards the monthly periodic payment each party should receive. It was submitted that there is no issue that the sum of $9,139 for the wife is appropriate. However, it was submitted that such a sum would not be appropriate for the husband having regard to his circumstances. The husband submitted that his weekly expenses, removing the two mortgage payments, legal expenses and the weekly provision for the child Mr L, are $5,860 per week which is in excess of $20,000 per month, whereas the husband seeks only $15,700 per month.

Determination

What monthly periodic payment should be required and/or permitted in respect of each party?

1. I determine a monthly payment to the wife of $9,139 should be made as well as a monthly payment to the husband of $15,700.

2. It is the wife’s case that she should receive the monthly payment of $9,139 and that the husband should receive the same. I am satisfied that the wife does have a need for that quantum and no argument to the contrary is made.

3. The wife argues that the husband should be required to live at the same level as the wife and therefore should be limited to receiving the same sum as she receives.

4. The husband has provided a Financial Statement in which he shows a need for the sum he has asked for. The wife submitted that the husband’s expenses are exaggerated, however, I am not in a position to determine that. It may be with the benefit of a full hearing the wife can establish that is the case and the Court can make an appropriate adjustment.

5. Given the size of the predicted asset pool, I am reasonably comfortable in making the order as sought by the husband in terms of his monthly payment. I consider there will be sufficient assets in the property pool to recompense any injustice which might arise to the wife from this order.

What lump sum interim property settlement payment should be ordered in relation to each party?

1. I have determined to order each party receive a payment of $200,000 as a lump sum. That sum seems, on each parties’ case, to be sufficient to meet their needs at this time. Further it is not possible at this time to determine the wife’s argument that if the husband receives $250,000, the sum sought by him it will defeat the wife’s claim of 70 per cent of the matrimonial assets.

2. Further, it is not possible at this time to form a real view about the likely range of orders the court might make at the conclusion of the hearing. Prima facie, a division of assets between parties at the conclusion of a lengthy marriage which sees one of the parties with 70 per cent of available assets and superannuation would seem outside of the expected range, however, there may well be good reasons why in the circumstances of this marriage the court would stretch to that outcome.

What other expenses of the parties should be met from the funds of the D Trust pending further order?

1. I conclude that the husband’s tax liability should be met from the D Trust. The wife should, however, be first required to give her consent to the payment of same. Should she refuse then she will be at risk as to costs.

2. The wife also seeks that her tax liability should be met from the trust. That is appropriate where the liability arose as a result of a distribution of funds to the wife from the D Trust.

3. The husband should also be able to meet the accounting fees for services provided to each of the husband and wife for the preparation of tax returns for the 2017 and 2018 tax years.

4. Additional deductions should be permitted from the trust by the husband to meet legal costs incurred by him in the settling of the separation deed entered into by him with his prior employer. The husband is prepared to limit that payment to $15,000.

5. Given that a considerable quantum of funds received from the husband’s settlement deed payment were deposited to the account of the trust that payment, I consider, is appropriate to make.

I certify that the preceding forty-six (46) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Le Poer Trench delivered on 22 June 2018.

Associate:

Date:  22 June 2018