Elsen & Argento

[2021] FamCA 267

FAMILY COURT OF AUSTRALIA

Elsen & Argento [2021] FamCA 267

File number(s):	NCC 1915 of 2020
Judgment of:	AUSTIN J
Date of judgment:	7 May 2021
Catchwords:	FAMILY LAW – SPOUSAL MAINTENANCE – Where the parties made competing applications to vary existing de facto spousal maintenance orders – Where the applicant was not complying with the existing orders – Where the applicant sought a decrease in amount – Where the respondent sought payment in a different form – Where the applicant has surplus income and capacity to pay – Previous interim maintenance orders varied – Ordered the applicant pay the respondent maintenance of $465 per week until 18 June 2021 and thereafter $500 per week.
Legislation:	Family Law Act 1975 (Cth) Pts VII, VIIAB, Div 2, ss 74, 77, 90SB(b), 90SD, 90SE, 90SF, 90SG, 90SI
Division:	General Division
Number of paragraphs:	38
Date of hearing:	19 April 2021 and 4 May 2021
Place:	Newcastle
Counsel for the Applicant:	Litigant in person
Counsel for the Respondent:	Litigant in person (Mr Murray on 19 April 2021)
Solicitor for the Independent Children's Lawyer:	Legal Aid NSW (Did not participate)

ORDERS

NCC 1915 of 2020

BETWEEN:

MR ELSON

Applicant

AND:

MS ARGENTO
Respondent

INDEPENDENT CHILDREN’S LAWYER

ORDER MADE BY:	AUSTIN J
DATE OF ORDER:	7 MAY 2021

THE COURT ORDERS THAT:

1.All former interim maintenance orders are discharged on 7 May 2021.

2.Pending further order, the applicant shall pay maintenance to the respondent:

(a)in the sum of $465 per week as and from 7 May 2021; and

(b)in the sum of $500 per week as and from 18 June 2021.

3.The applicant shall pay such maintenance by direct deposit each Friday, commencing on Friday 7 May 2021, into the respondent’s Commonwealth Bank account, being BSB number … and account number …98.

4.Otherwise:

(a)The Application in a Case filed by the applicant on 3 March 2021 is dismissed;

(b)The Response to an Application in a Case filed by the respondent on 12 March 2021 is dismissed;

(c)The Application in a Case filed by the respondent on 9 March 2021 is dismissed;

(d)The Response to an Application in a Case filed by the applicant on 12 March 2021 is dismissed; and

(e)Any and all other applications for interim relief under Part VIIIAB of the Family Law Act 1975 (Cth) are dismissed

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

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

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

REASONS FOR JUDGMENT

AUSTIN J:

1. At hand for determination are reciprocal applications filed by the parties to vary de facto spousal maintenance orders made between them on an interim basis by the Federal Circuit Court of Australia, initially on 4 August 2020 but then again on 2 October 2020.

2. The orders of 4 August 2020 state they were made pursuant to s 77 of the Family Law Act 1975 (Cth) (“the Act”) as an urgent measure, but that is not so, since the parties were never married. The power to make the order lay under s 90SG of the Act.

3. The orders of 2 October 2020 state they were made pursuant to s 74 of the Act, but that too is incorrect. The power to make the order lay under s 90SE of the Act.

4. In each case, the orders required the applicant to pay de facto spousal maintenance to the respondent in two components: a weekly cash sum of $250, plus the rent and outgoings in respect of rental accommodation at B Town then occupied by the respondent and the parties’ child, roughly amounting to another $700 per week. The total weekly commitment under the orders therefore approximated $950 per week.

5. In or about early 2021, the applicant ceased paying the respondent’s rent and outgoings due to an alleged decrease in his income and the respondent was consequently evicted from those rental premises. By reason of changed circumstances, both parties now want the existing orders varied.

6. The jurisdiction of this Court to entertain the parties’ dispute follows from the transfer of the proceedings from the Federal Circuit Court in November 2020 for reasons associated with the parties’ underlying parenting dispute under Part VII of the Act.

7. The following interim applications between the parties now require determination:

   (a)The Application in a Case filed by the applicant on 3 March 2021 (proposed Order 1);

   (b)The Response to an Application in a Case filed by the respondent on 12 March 2021 (proposed Order 1);

   (c)The Application in a Case filed by the respondent on 9 March 2021 (proposed Orders 1 and 2); and

   (d)The Response to an Application in a Case filed by the applicant on 12 March 2021 (proposed Order 1).

8. In effect, the applicant contended the existing orders should be varied to require his payment of only $250 per week to the respondent, whereas the respondent contended the existing orders should be varied to require the applicant’s payment of $950 per week to her.

9. The hearing began on 19 April 2021, but was adjourned part-heard and completed on 4 May 2021. The applicant was self-represented throughout and, while the respondent was legally represented on the first day, she was not on the second day. Unfortunately for the parties, their lack of legal representation hampered their overall efforts to prepare and present cohesive and persuasive cases. The evidence had to be re-opened twice, the parties’ cross-examination did not elucidate various discrepancies in the evidence, and their submissions were not always directed to salient considerations.

   EVIDENCE

10. The applicant relied upon:

    (a)his affidavit filed on 12 March 2021;

    (b)his financial statement filed on 12 March 2021; and

    (c)some documents tendered in evidence (Exhibits A1 to A4 inclusive).

11. The respondent relied upon:

    (a)her affidavit filed on 17 March 2021; and

    (b)her two financial statements filed on 16 March 2021 and 27 April 2021.

    LEGAL PRINCIPLES

12. Although the existing orders of 2 October 2020 wrongly purport to be made between spouses pursuant to s 74 of the Act, it was not submitted at this hearing that the orders were invalid, despite Div 2 of Pt VIIIAB of the Act importing quite different conditions for entitlement to de facto spousal maintenance.

13. The parties have a child together (s 90SB(b)) and at all relevant times they were both ordinarily resident in NSW (s 90SD), in which case the jurisdictional basis existed for maintenance orders to have been made between them.

14. The power to vary de facto spousal maintenance orders under s 90SI(1)(f) of the Act, either by the increase or decrease of the amount payable, is only available if the pre-conditions prescribed by s 90SI(3) are met.

15. The parties, explicitly or implicitly, accepted that the applicant’s circumstances had changed (s 90SI(3)(a)(ii)) and also that the respondent’s circumstances had changed (s 90SI(3)(a)(i)), though they disagreed over the extent of the change in each case. The applicant thought the respondent needed less money and the respondent thought the applicant could afford more than he admitted.

16. Although certain statutory criteria must be considered (s 90SF), the parties’ evidence and submissions only broadly addressed the applicant’s capacity to support the respondent (s 90SF(1)(a)) and the respondent’s need for such support (s 90SF(1)(b)). They did not descend to details (s 90SF(3)) and so, as a consequence, nor do these reasons.

    The respondent’s need

17. The respondent is not a citizen of Australia. She only lives in this country pursuant to the grant of a visa. It was common ground she is not entitled to any Centrelink benefits, so far as that could be a relevant consideration (ss 90SF(3)(f) and 90SF(4)).

18. The respondent has made many applications to secure gainful employment without success, though on the day the hearing finished she conceded she was recently interviewed for a position and held out hope she would soon be offered contract employment for a period of 14 months at an annual gross salary of about $70,000. The applicant submitted it should be presumed she will successfully secure that employment and so she therefore has no need for maintenance, but the submission is rejected. The parties have a right to apply to vary any maintenance orders if and when the respondent secures employment which materially alters her financial circumstances. For the moment, the respondent has no income despite her best efforts.

19. Without her own income, the respondent has only been able to survive by a combination of lucky circumstances: the willingness of her family to send her some money from overseas and the willingness of a friend to allow her and the child to live rent-free with him. The meagre sum of maintenance paid to her by the applicant since February 2021 has not been enough.

20. The respondent deposed she receives, on average, $300 per week from her family, which amounts to about $15,000 per annum. In cross-examination, the applicant posited that she received some $25,000 from her family during 2019, but she denied it was more than $10,000. Inferentially, the respondent can probably continue to rely upon that gratuitous income stream, but it ought not diminish the applicant’s obligation to maintain the respondent according to law.

21. Presently, the respondent’s mother is visiting from overseas and lives in rental accommodation. The respondent and the child are living with her rent-free, but the respondent’s mother must depart the country by mid-June 2021, at which point the respondent must find alternate accommodation. Her stated preference is to find her own rented home rather than return to live with the friend with whom she was living until last week. If she cannot afford it, she will be forced to again accept her friend’s largesse, if it is still available, or find refuge accommodation for herself and the child. The respondent said, without contradiction, that the market rent for two-bedroom homes in the D Region of NSW fluctuates between $450 and $550 per week.

22. Aside from the cost of accommodation, the respondent’s weekly financial need is quantified in her financial statement at $465.[1] That quantification was not challenged.

    [1] Respondent’s second financial statement, items 26, 27 and 60

23. The respondent’s weekly need for maintenance is quantified at $465 until mid-June 2021. Thereafter, it is $1,015 per week (= 465 expenses + 450 rent).

24. The mother deposed to her sole proprietorship of an apartment in her home country worth $250,000,[2] but her evidence in cross-examination revealed her proprietary interest is contingent upon a life estate enjoyed in the property by her mother under the doctrine of usufruct. The applicant did not contradict the respondent’s proposition that she cannot alienate her interest in the real property without her mother’s consent, thereby hindering her ability to extract any equity from it, in which case it does not affect the current quantification of her financial need.

    [2] Respondent’s first financial statement, item 35

25. However, during cross-examination on the first day, it was revealed the respondent owned a share of other real property overseas, her interest in which was not declared in her first financial statement. She did not declare her one-third ownership in four other real properties in her home country, which was inherited from her late father. Her two siblings own the other two-thirds. The omission seemed not to be deliberate deception, because she freely admitted the facts during cross-examination. In any event, the omission was rectified in her second financial statement,[3] though the evidence about the value of her proprietary interest in those properties remains in an unsatisfactory state. The mother said in cross-examination on 19 April 2021 that she considered her one-third shares in the properties were collectively worth about $150,000, but then deposed on 27 April 2021 that her shares were only worth about $20,000. She was not cross-examined about the discrepancy and so there is no evidence to explain it. The respondent admitted in cross-examination there is no impediment to the sale of those four properties which, unlike her apartment, are not subject to the usufruct doctrine.

    [3] Respondent’s second financial statement, item 36

26. Whatever may be the actual value of her fractional share of those other real properties, I accept it would be difficult for her to compel and administer the overseas sale of them while she is presently resident in Australia, particularly if the sales are resisted by either of her siblings. At best, the enforcement process would likely take months rather than weeks, in which event the capital value she can eventually extract from the sales of those properties is not a consideration which affects her current entitlement to maintenance. However, given the respondent is now on notice about the significance of her capital locked in that real estate, she is able to begin the process of liquidating the assets and, after the elapse of some months, the applicant might again consider applying to vary the maintenance orders.

    The applicant’s capacity

27. The applicant’s evidence about his income and expenses was unchallenged.

28. His weekly income averages $2,122.[4]

    [4] Applicant’s financial statement, items 9 and 11

29. His fixed weekly expenses include tax ($490), his one-half share of rent ($250), and child support ($238), totalling $978.[5]

    [5] Applicant’s financial statement, items 19 and 21; Respondent’s second financial statement, item 13

30. The applicant could not explain the discrepancy between his estimates of other discretionary expenditure, in which case the lesser figure of $550 is adopted.[6] Other expenses he claimed totalled about $226.[7]

    [6] Applicant’s financial statement, items 32 and 60

    [7] Applicant’s financial statement, items 26, 28 and 30

31. Accepting the applicant’s evidence at its highest, he has surplus income of about $368 each week, but his claimed discretionary expenditure ($550) can likely be pared back because it generously exceeds the respondent’s ($419). Balancing the parties’ reasonable needs, the applicant’s surplus is probably closer to $500 per week.

32. In final submissions, the applicant was inclined to accept those calculations. While, he earlier deposed he did not have the means to pay any more maintenance than $250 per week, that was clearly incorrect by reference to the evidence he adduced.

33. The applicant is self-employed through a corporate and trust structure. While the respondent suspects the applicant might have greater income and financial resources than he admitted, she failed to prove it. Similarly, she accepted in final submissions that the applicant’s capacity to pay maintenance was capped at around $550 per week on the available evidence.

34. Even though the existing maintenance orders made on 2 October 2020 oblige the applicant to pay the respondent cash of $250 per week and notwithstanding his professed willingness to pay maintenance of that amount each week, he has only been paying the respondent some $62 per week since February 2021. He did not try to explain why.

35. The applicant has the demonstrated capacity to pay maintenance of $500 to the respondent each week.

    CONCLUSION

36. Given the respondent’s need for maintenance is limited to $465 each week until mid-June 2021, the applicant will be ordered to pay that sum to her until 18 June 2021.

37. Thereafter, even though the respondent’s need for maintenance will be greater, the applicant’s maintenance obligation will be capped at $500 per week, which is the limit of his reasonable capacity to pay.

38. These orders are interim in nature. If there is no further application to vary the orders, they will be re-considered when the parties’ substantive applications are heard at trial in October 2021.

I certify that the preceding thirty-eight (38) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Austin.

Associate:

Dated:       7 May 2021