Emmerton & Manwaring - [2023] FedCFamC2F 476

FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 2)
Emmerton & Manwaring [2023] FedCFamC2F 476

File number: ADC 4841 of 2017

Judgment of: JUDGE BROWN

Date of judgment: 28 April 2023

Catchwords: FAMILY LAW – PROPERTY – marriage of 28 years – during marriage parties operated a small business and were primary producers – during business husband attended to technical aspects of business whilst wife attended to administration and accounts – business incorporated – parties had associated family trust which acquired real properties – wife trustee of trust – during the parties’ marriage company made loans to each spouse – whether loans compliant with provisions of Income Tax Assessment Act – Part 7A tax liability – since separation company has continued to make loans to the husband – husband has allegedly failed to pay other tax assessed as due to the company – ATO has made a statutory demand – following four day trial is it possible to assess parties’ liabilities to ATO – should liabilities be considered in general terms pursuant to section 75(2)(o) – just and equitable – matters to be considered

Legislation:
Family Law Act1975 (Cth) Pt VIII, ss 75(2), 79, 80

Income Tax Assessment Act 1936 (Cth) Div 7A

Cases cited:
Bevan & Bevan [2013] FamCAFC 116

Biltoft & Biltoft (1995) FLC 92-614

NHC & RCH (2004) FLC 93-204

Clauson v Clauson (1995) FLC 92-595

DJM v JLM (1998) FLC 92-816

Ferraro v Ferraro (1993) FLC 92-335

Hickey & Hickey & Attorney-General (Intervener) (2003) FLC 93-143

Lee Steere v Lee Steere (1985) FLC 91-626

Prince & Prince (1984) FLC 91-501

Rodgers & Rodgers (No 2) [2016] FamCAFC 104

Russell & Russell [1999] FamCA 1875

Stanford v Stanford [2012] HCA 52

Strahan v Strahan (2010) 42 Fam LR 203

Trevi & Trevi [2018] FamCAFC 173

Wardman & Hudson (1978) FLC 90-466

Division: Division 2 Family Law

Number of paragraphs: 156

Date of hearing: 17, 18, 19, 20 April 2023

Place: Adelaide

Counsel for the Applicant: Mr Dillon

Solicitor for the Applicant: Tindall Gask Bentley

Counsel for the Respondent: Mr Heinrich

Solicitor for the Respondent: Starke Lawyers
ORDERS

ADC 4841 of 2017

FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 2)

BETWEEN:
MS EMMERTON

Applicant

AND:
MR MANWARING

Respondent

order made by:

JUDGE BROWN

DATE OF ORDER:

28 April 2023

THE COURT ORDERS THAT:
1.That within 21 days each party do instruct their accountant, as soon as is practicable and in any event within 14 days, to advise the Australian Taxation Office of their personal non-current and non-compliant Division 7A loan balances within B Pty Ltd.
2.All correspondence between the ATO and the parties (and/or their advisors and solicitors) be in writing and the solicitors for the other party be copied into that correspondence.
3.In the event the correspondence (as referred to herein at paragraph 2) is not in writing, the other party’s solicitors be notified in writing of any conversations between the tax office and the party (and/or his advisors and solicitors) within 7 days of…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Emmerton & Manwaring

Details

AGLC: Emmerton & Manwaring [2023] FedCFamC2F 476
Case: [2023] FedCFamC2F 476
Decision Date

CaseChat Overview and Summary

The case of Emmerton & Manwaring involved a protracted dispute between the parties over the division of their substantial assets, which arose from a marriage of 28 years. The Court was required to determine the extent to which the parties' liabilities to the Australian Taxation Office (ATO) should be considered in the division of their assets, particularly in light of the uncertainty surrounding these liabilities. The Court also had to decide whether it could fairly assess the parties' liabilities to the ATO, and if not, how the division of their assets should be approached in the interests of justice and equity. Furthermore, the Court needed to consider whether an interim property settlement was warranted and, if so, what form it should take. The Court concluded that, due to the uncertainty regarding the parties' liabilities to the ATO, it was not possible to fairly assess their assets and liabilities. The Court directed the parties to jointly approach the ATO to determine the current extent of their liabilities, and to provide detailed submissions on the implications of these liabilities for the division of their assets. The Court also made orders regarding the sale of certain properties, the division of the proceeds from the sale of livestock, and an injunction restraining the parties from further encumbering their assets. The Court further set a timeline for the parties to provide detailed written submissions on their proposed property division and other relevant issues. The final orders of the Court aimed to address the uncertainties surrounding the parties' liabilities, ensure transparency in their dealings with the ATO, and provide a framework for the eventual division of their assets in a fair and equitable manner.

Orders