Dunne and Dunne

[2007] FamCA 1031

FAMILY COURT OF AUSTRALIA

DUNNE & DUNNE [2007] FamCA 1031

FAMILY LAW – PROPERTY – Interim partial property order

Family Law Act 1975 (Cth)

APPLICANT: MRS DUNNE

RESPONDENT: MR DUNNE

FILE NUMBER: MLF 2056 of 2006

DATE DELIVERED: 3 SEPTEMBER 2007

PLACE DELIVERED: MELBOURNE

PLACE HEARD: MELBOURNE

JUDGMENT OF: YOUNG J

HEARING DATE: 3 SEPTEMBER 2007

REPRESENTATION

COUNSEL FOR THE APPLICANT: MR HAMMET

SOLICITOR FOR THE APPLICANT: SAM HOLT

COUNSEL FOR THE RESPONDENT: MRS HOOPER

SOLICITOR FOR THE RESPONDENT: VICKI SWEET FAMILY LAW

ORDERS

1. THAT within twenty-one (21) days the husband produce or cause to be produced to the solicitors for the wife all documentary evidence of the assets, monies and investments held by him as at February 1997 and in particular make available true copies of all of his personal taxation returns and superannuation taxation returns as have not been previously disclosed.

2. THAT within twenty-one (21) days the wife produce or cause to be produced to the solicitors for the husband documents as are described in paragraph 1 of the husband’s Form 2A response but with the exclusion of sub-paragraphs (d) and (k) thereof.

3. THAT the orders sought in paragraph 2 of the husband’s response be dismissed.

4. THAT the husband forthwith deliver up to the wife all spare keys and other accessories for the Honda Accord motor vehicle.

5. THAT as and by way of a partial settlement of property, and in addition to the monies paid by the husband to the wife pursuant to the order dated 1 August 2006, and within twenty-one (21) days the husband pay to the wife a further lump sum of $150,000 and in default thereof pay interest, quarterly in arrears, at the rate prescribed in the Family Law Rules.

6. THAT until further order the husband be restrained from selling, encumbering or otherwise dealing with any real property held by him within his superannuation fund save that he be at liberty, upon proper documentation filed and served, to approach the Court as to the sale of any particular property that may be properly required to fund the partial payment to the wife made pursuant to these orders.

7. THAT there be no restraint upon the husband or the wife as to their dealings in or sale or purchase of publicly listed shares save that they hereafter provide a quarterly printed account to the solicitors for the other party of all such transactions.

8. THAT otherwise the orders sought by the wife in paragraph 5(a) and paragraph 6 of her application be dismissed.

9. THAT within twenty-one (21) days each of the parties make, file and serve an updated Form 13 financial statement.

10. THAT otherwise the Form 2 application of the wife filed 18 June 2007 and the Form 2A response of the husband filed 30 August 2007 be dismissed.

11. THAT the matter be referred to the trial notice list for fixing at a date and time available.

12. THAT the extempore reasons for judgment be transcribed, be placed upon the Court file and be made available to the parties.

13. THAT there be no order as to costs.

14. THAT the parties and their solicitors forthwith confer and engage a single expert valuer for all real property, such valuer to have the benefit of a prior written report from a town planner or rural consultant, or other expert as may be appropriate.

15. THAT the costs of and incidental to any such reports and the evidence of the single expert valuer are to be shared equally by the husband and wife save that any account rendered and required to be paid prior to trial be then paid by the husband with reimbursement of the wife’s share to be paid as an adjustment to the settlement or judgment sum.

IT IS CERTIFIED

1. THAT pursuant to Rule 19.50 of the Family Law Rules this matter reasonably required the attendance of Counsel for each of the husband and wife.

IT IS NOTED

A.THAT the previous restraining order contained in paragraph 6 of the orders of 1 August 2006 continue in full force and effect.

B.THAT liberty be reserved to either party to apply to the Court for the removal of the exhibit to the affidavit of the wife’s solicitor Mr Holt filed 18 June 2007.

IT IS NOTED IN CONNECTION WITH THESE ORDERS that the judgment of the Honourable Justice Young delivered this day will for all publication and reporting purposes be referred to as Dunne & Dunne.

FAMILY COURT OF AUSTRALIA AT MELBOURNE

FILE NUMBER: MLF 2056 of 2006

MRS DUNNE

Applicant

And

MR DUNNE

Respondent

REASONS FOR JUDGMENT

1. The matter has proceeded by way of submissions though I freely record in these extempore reasons for judgment that I have been somewhat interventionist in my approach in this very busy Judicial Duty List.

2. The Form 2 application before the court was filed 18 June 2007 by the wife.  Orders are sought as to the production of documents, as to valuation of property and as to an additional partial property settlement, with an amount being paid forthwith to the wife. 

3. The balance of the application seeks various restraining orders, which I will briefly deal with in these reasons. 

4. The wife's application is supported by an affidavit of her solicitor, Mr Holt, and a letter as an annexure to that affidavit.  I record that I have read the affidavit of the solicitor, which is of 16 paragraphs.  I have been reluctant to read and indeed stopped at the second sentence of the annexure letter because it refers to a mediation conference, which I now understand from counsel was held before an experienced barrister, Mr Rosen. 

5. The court should not know of the particulars of that mediation conference, which was intended to be privileged and I have accordingly refrained from reading that annexure.  I ask counsel to give immediate consideration to whether that document should remain on the court file or whether it could be taken to prejudice any other future hearing.  I do not make any ruling in this regard on this occasion.

6. The husband has before the court a Form 2A response wherein he seeks production of documents by the wife to better understand her financial circumstances, seeks permission to inspect her business premises in B and otherwise opposes all of the orders sought by her in her application. 

7. As an overview of this case, the parties commenced the relationship in February of 1997.  They married in September of 2001 and separated in mid‑2006.  The proceedings in this case commenced in about June 2006 when the wife then filed her initial Form 2 application and the Form 1 application for final orders. 

8. There is a very real level of dispute as to the valuation and quantum of assets.  What is starkly apparent to me, but surprisingly perhaps not readily understood by the parties, is the level of wealth in this case.  Counsel have initially asked me to proceed on the basis that there is no less than $15 million in the total pool, subject to proper valuation. 

9. In reality, Mrs Hooper has identified a sum of $20 million as the likely pool of assets, but that is said subject to all valuations and the effluxion of time.  Mr Hammet, on the basis of a different valuation process and evidence of rezoning of rural property and other property, believes and informs the court of his client's estimate of value to be in excess of $30 million and perhaps considerably more.  These are not small figures. 

10. What is equally clear in this case is the initial contribution which the husband has made to the current level of wealth of the parties.  I carefully make no finding whatsoever as to those matters which may be in dispute, but I am rightly directed by Mrs Hooper to paragraph 15 of the wife's primary affidavit of 29 June 2006 where it is said that the assets that the husband had today are substantially those which he had as at the date of the relationship, though individual shares may have been traded.  That of course is not to say the value was then the same because clearly there has been a vast increase in the value of land and shares in accordance with both the real estate market and movements on the Australia Stock Exchange.

11. The order previously made in this case is dated 1 August 2006 and that was by consent.  The wife then received a partial settlement of property of $408,000.  Upon receipt of those moneys she vacated the home where the parties were then living and, I now know, has purchased another home for approximately $400,000.  One of the matters in conflict between counsel today was as to the wife's ownership of other properties, encumbered by mortgages, and likely as part of her negative gearing strategy.  Those matters will be before the court and both parties will be required to make full and proper disclosure.

12. I return to the reality of this case which is the very large pool of assets.  Any orders that are made need to be considered within this fact and a relationship of 10 years.

13. I am also directed to the fact that in those prior consent orders each party is restrained from selling, encumbering or otherwise dealing with real property in their respective names.  Clearly that is a very substantial injunctive, to which consent was earlier given, because, on one view, Mr Hammet would contend that the husband owns or controls real property of very significant value. 

14. I do not estimate on the material before me, because it is incomplete, but certainly suggestions have been made in court of a value of up to $20 million in real estate, if rezoned and if the wife is correct in her forecasts.  The court of course will not merely accept the evidence of the wife and there will need to be independent properly qualified expert valuation both as to land, as to rezoning, if appropriate, as to town planning and like issues.  Therein lies part of the dispute today. 

15. My understanding is the husband has obtained a valuation, but that was not on a single expert mutually-agreed basis.  Mrs Hooper concedes there will be another valuer engaged, and it is imperative that be on a single expert basis.  That valuer must have current and accurate information as to all relevant information, including current market sales, zoning, town planning issues and otherwise as may be relevant. 

16. I do not limit these issues I know they are a very real issue between the parties, but the simplistic approach is not tactical, it is to determine what is the best and most accurate valuation of property. How that property is then divided between the parties pursuant to section 79 of Family Law Act 1975 ("the Act") is in the context of section 79(4) and section 75(2) issues and factors, and the overriding requirement is that it be just and equitable within section 79(2) of the Act.

17. Again as background material, I am told - and I do not accept as wholly accurate - that the case has proceeded on the basis that the husband owns and controls shares of $6.7 million and controls a privately‑managed superannuation fund with shares and real property to a value of approximately $6.5 million.  Otherwise, it is said by Mrs Hooper that the wife controls an assets pool of near to $1 million, including shares and negatively‑geared property.  All of those matters will simply have to be valued and property disclosed. 

18. In her application the wife seeks an additional sum of $350,000 as a partial settlement of property.  I regard that sum as excessive.  What I regard as compelling and what in all the circumstances is appropriate is a sum that will enable the wife to meet her legal fees to prepare her case, to have some level of decency and comfort in life and not to be financially disadvantaged in the hearing and presentation of this case to court.  I am particularly aware of the earlier settlement of property made on a partial basis by consent and the fact that those moneys were used to acquire the home in which she now lives. 

19. I propose to order a sum of $150,000 to be paid forthwith by the husband to the wife.  Specifically, that will be as a partial settlement of property.  I find that such a payment is compelling and proper.  That means that it will be part of the sum that the wife receives in this case.  There is no discretion to the trial judge, it is not optional, it is to be included in her settlement.

20. How the husband raises that money is entirely his decision; by way of sale of shares, borrowing, encumbering of assets.  He is already restrained from selling property and that restraint continues.  I do not propose to interfere with the earlier consent order.  What I do require is that if there is any property owned within his superannuation fund it should not be sold without the prior agreement of the wife or further order of the court.  On the evidence before me and the assets of the parties, I see no justification to sell real property.  If I am wrong, the husband will have the opportunity to approach the court and to seek a release from any restraint in that regard. 

21. As to the wife, she must understand, and I clearly record in these reasons, that there is a limit to how often she can approach the court for money.  Unless there are special future circumstances, these moneys are to enable her to prepare and fund the case and thereafter she can await her final settlement of property. 

22. As to the ongoing dispute, and perhaps squabble would be a more accurate description to accompany the disclosure of documents and information, what I propose to do is to require the husband to produce documents that evidence the assets and moneys that he owned or controlled as at the date of the relationship commencing, and otherwise and in particular his personal taxation returns and superannuation taxation returns. 

23. I am mindful, however, of the significant concession that the wife has already made in paragraph 15 of her earlier affidavit and it would be perhaps somewhat inappropriate for her to undergo a very detailed and exhaustive search of documents, given what she has said on her oath in that paragraph.

24. As to the wife's level of disclosure, the husband seeks documents that are set out in paragraph 1 of his response.  Some of those documents are likely to be unnecessary.  I would have thought subparagraph (d) is pedantic in the extreme, requiring production of vouchers, receipts in relation to any credit card or the like.  I find the inclusion of that clause to be unnecessary and I will not order compliance with that subparagraph. 

25. I would urge the solicitors in this case to show a more commonsense and practical approach to this case, rather than being locked in minute detail that is not going to greatly assist their clients in the presentation of their case to court.  Certainly for my own part I could not imagine how some of the documents there sought by the husband in subparagraph (d) could ever be relevant to a case where the pool is of the quantum as is acknowledged.

26. As to the husband's inspection of the wife's business premises, I will wholly dismiss that application.  I regard it to be without merit and simply provocative and it should never have been raised at this stage of the proceedings, irrespective of whether the husband has an interest on title or is the landlord. 

27. As to the further extensive injunctions sought by the wife in paragraphs 5 and 6 of her application, they also are overcautious, aggressive and unnecessary.  It is wholly inappropriate to endeavour to restrain the husband in this case, and with the security of the real property, not to deal with his publicly‑owned shares.  Again, the message needs to be understood by solicitors that that level of detail is unhelpful.  If indeed it is the clients who insist on that level of detail, then they might open their eyes to a little of the reality and to the pool of assets in this case and as to how they want to conduct litigation and at what great financial and emotional cost to them. 

28. As I am delivering this judgment extempore, I intend to otherwise restrict my comments.  I do not intend to provide to the wife the exhaustive detail that she sought in respect of paragraphs 2 and 3.  The bigger picture of this case will be a proper valuation by a single valuer expert, with all information disclosed and all ancillary reports first obtained to assist that expert in getting a correct market value of the properties. 

29. I have moderated the tone and content of what I had contemplated I might say in this case, and I do out of respect to the experienced counsel and the understanding that the message might get through to these clients that they need to be a little more understanding of the case, of the outcome of the case, of the role of their partner and of what might be a just and equitable order in a case with a very large pool of assets and few liabilities. 

I certify that the preceding paragraphs are
a true copy of the reasons for judgment herein
of The Honourable Justice Young

………………………………………………………..
Associate:                   
Date:  7 September 2007