Dynones and Dynones

[2010] FamCA 993

FAMILY COURT OF AUSTRALIA

DYNONES & DYNONES [2010] FamCA 993

FAMILY LAW – PROPERTY – Interim distribution

APPLICANT:  Ms Dynones

RESPONDENT:  Mr Dynones

FILE NUMBER: SYC 5994 of 2010

DATE DELIVERED: 5 November 2010

PLACE DELIVERED: Sydney

PLACE HEARD: Sydney

JUDGMENT OF: Stevenson J

HEARING DATE: 2 November 2010

REPRESENTATION

COUNSEL FOR THE APPLICANT: Mr Campton

SOLICITOR FOR THE APPLICANT: Anne Einfeld Solicitor

SOLICITOR FOR THE RESPONDENT: Delaney Lawyers

Orders

1. That, within 14 days, each of the parties do all things and execute all documents required to effect the payment to the wife the sum of $30,000 and to the husband the sum of $15,000 from the net proceeds of sale of the former matrimonial home.

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

FAMILY COURT OF AUSTRALIA AT SYDNEY

FILE NUMBER: SYC 5994  of 2010

MS DYNONES

Applicant

And

MR DYNONES

Respondent

REASONS FOR JUDGMENT

The proceedings

1. By an Application in a Case filed on 21 September 2010 the wife, Mrs Dynones, sought interim orders to the effect that she receive the whole of the proceeds of sale of the former matrimonial home and spouse maintenance of $400 per week.  By a Response filed on 29 October 2010 the husband, Mr Dynones, sought an interim order that each party receive $20,000 from the sale proceeds.

2. The wife amended the relief which she sought at the commencement of the interim hearing.  It was then indicated that she sought payment to herself of 60% of the proceeds of sale of the former matrimonial home as an interim or partial property settlement and, if she received that amount, she would not pursue her application for spouse maintenance. 

Background

1. The parties, who are both 33, married in 2000 and separated on 25 December 2009.  They have two children, a daughter who is 7, and a son who is 6 years old.  The children live with their mother from Wednesday afternoon until Sunday evening and with their father for the rest of each week.

2. At the date of marriage the wife owned a house at B which she had purchased approximately one year earlier, with the assistance of her family.  The parties renovated this property after their marriage.  There was a dispute as to the cost of this work and the source of the funds. 

3. The B property was sold in September 2006 and the parties purchased the former matrimonial home at P for $478,000 in August 2007. When this property was sold for $559,000 in March 2010, the net proceeds amounted to $156,438.    

4. The husband paid $138,500 to purchase a business known as “E Business” in August 2005.  There was a dispute as to whether the purchase money formed part of the mortgage debt or was a separate liability secured on the former matrimonial home. 

5. The husband ceased operating his business in March 2010. His sister established a company known as E (New South Wales) Pty Limited, which now operates this business and employs the husband on a wage of $780 gross per week.

6. The wife alleged that, at the date of separation, this business had a value of “over $150,000” and that the husband owned motor vehicles worth “over $100,000”.Essentially she alleged that the husband disposed of assets to the value of about $250,000 after separation.

7. There was no evidence as to the value of the business or these motor vehicles.  I was asked to draw an inference as to the value of the business, as at separation, from the 2005 purchase price of $138,500.  It seems to me that it would be dangerous indeed to adopt this course. 

8. I was also asked to draw an inference as to the value of the motor vehicles owned by the husband at separation. The wife relied upon eBay documents, in which the husband apparently offered the Toyota for sale at $20,000 and refused to accept $10,000 from a potential purchaser.  She also relied on RTA documents which showed that the Holden was transferred at a “buyers market value” of $41,990 on 9 February 2010.  The same document showed that the Toyota was transferred on 22 March 2010 at a “buyers market value” of $2,000.  In my view none of these documents assist the wife in establishing the value of the husband’s motor vehicles.  There was thus no evidence that the husband disposed of assets with a value in the vicinity of $250,000 after the separation.

9. The wife’s unchallenged evidence was that she works for two days per week and earns $240. Her Financial Statement sworn on 6 September 2010 disclosed a total weekly income from all sources, including Centrelink benefits, of $765 per week. 

10. At present the wife and the children, when they are in her care, live with the maternal grandparents.  Her unchallenged evidence was that conditions are cramped in the three bedroom house, which is occupied by six people.  It is entirely reasonable that the wife wishes to obtain her own accommodation. 

11. The husband lives with his parents, apparently on a rent-free basis.  There was no suggestion that he is unable to continue living in their home.

Consideration

1. The first step is to determine whether the power to make an order for interim or partial property settlement should be exercised prior to a final hearing.  In my view the circumstances in which the wife and the children, while in her care, are currently living justify such an exercise of power.  Release of some part of the sale proceeds to the wife would enable her to obtain suitable accommodation for herself and the children.  I am mindful also that the husband consented to the release of part of these funds to the wife, provided that he too receives some portion of the sale proceeds.  The husband did not insist that the parties receive an equal amount and was content for the wife to receive a larger sum.

2. The next question is what interim or partial orders would be just and equitable in all the circumstances.  It seems to me that justice and equity would not be served by the wife’s amended position, whereby she receives 60% of the sale proceeds and the balance of the funds remain in a controlled money account pending a final hearing.

3. The husband’s Financial Statement sworn on 29 October 2010 shows that he receives a limited income and has little net property.  He has an overdraft of about $31,000 and a credit card debt of around the same figure.  On the face of his Financial Statement, the husband does not enjoy favourable financial circumstances. 

4. By inference, the wife’s case was that the husband deliberately lessened his income and disposed of assets after the separation.  I would note, however, that his gross taxable income in 2008 and 2009 was $25,184 and $24,637 respectively (exhibit 3).

5. I would not regard an outcome in which the wife receives some financial relief, and the husband none whatsoever, from joint funds prior to a final hearing to be just and equitable.  The selection of an amount which each party should receive is to some extent an arbitrary exercise but consideration of the matters in section 79(4) assists in making that determination.

6. The husband’s Response and Financial Statement suggest that he acknowledges that there should ultimately be a finding that the wife receive a larger proportion of the net matrimonial assets.  Of course, this concession is based on his assertion as to the composition and value of the net pool of property.

7. Section 75(2) factors currently favour the wife, if for no other reason than that she receives only $14 per week in child support.  The children are in her care for four nights per week.

8. If the wife receives $30,000 from the sale proceeds she will be able to rent suitable accommodation for herself and the children when they are in her care. For the purpose of the present exercise I will adopt her estimate of establishment costs at $3,500 and accept her figure of likely rental of approximately $500 per week.  After payment of establishment costs she would be left with about 53 weeks rental at $500 per week.

9. If the husband receives $15,000 from the net sale proceeds he would be able to reduce his current level of debt, to some extent.  As noted, he did not suggest that he needs to establish accommodation.

10. $30,000 and $15,000 equate to about 19% and 9% respectively of the net sale proceeds. After these payments there would remain an amount of approximately $111,000 for ultimate distribution between the parties. I can see no reason why a further distribution of this amount, together with interest, will ultimately fail to achieve justice and equity between the parties.

I certify that the preceding twenty three (23) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Stevenson delivered on 5 November 2010.

Associate:     

Date:              November 2010