Eracken and Eracken (No. 2)
[2019] FamCA 942
•6 December 2019
FAMILY COURT OF AUSTRALIA
| ERACKEN & ERACKEN (NO. 2) | [2019] FamCA 942 |
| FAMILY LAW – PROPERTY – application to set aside Consent Orders – where the Husband seeks a review of the Consent Orders made by the Registrar – where such a review would require an extension of time to be granted – where the Husband seeks, in the alternative, that the Consent Orders be set aside pursuant to s 79A of the Family Law Act 1975 (Cth) – where the Husband’s applications centre on allegations of fraud perpetrated by the parties – where an extension of time should be granted for the review of the Registrar’s decision – where the application would have been set aside pursuant to s 79A of the Family Law Act 1975 (Cth) – where it is just and equitable to alter the property interests of the parties – referral to the DPP (Cth) |
| Family Law Act 1975 (Cth) ss 74, 75, 79, 79A Family Law Rules 2004 (Cth) rr 1.1.4, 18.08 |
| Badawi & Badawi (2017) FLC 93-784 Bevan v Bevan (2013) 49 FamLR 387 Gallo v Dawson (1990) 93 ALR 479 Greetham & Greetham [2010] FamCA 246 Harris v Caladine (1991) FLC 92-217 In the Marriage of Gilbert v Estate of Gilbert (decd) (1990) FLC 92-125 McDonald v McDonald (1965) 113 CLR 529 Meyers v Casey [1913] 17 CLR 90 Pearson v Coli (2018) FamCA 295 Stanford v Stanford (2012) 247 CLR 108 Steinbrenner v Steinbrenner [2008] FamCAFC 193 |
| APPLICANT: | Mr Eracken |
| RESPONDENT: | Ms Eracken |
| FILE NUMBER: | MLC | 10141 | of | 2016 |
| DATE DELIVERED: | 6 December 2019 |
| PLACE DELIVERED: | Canberra |
| PLACE HEARD: | Melbourne |
| JUDGMENT OF: | Gill J |
| HEARING DATE: | 4 - 7 December 2018 |
REPRESENTATION
| COUNSEL FOR THE APPLICANT: | Mr Williams |
| SOLICITOR FOR THE APPLICANT: | Carew Counsel Pty Ltd |
| COUNSEL FOR THE RESPONDENT: | Mr Sweeney |
| SOLICITOR FOR THE RESPONDENT: | Clancy and Triado |
Orders
That pursuant to rule 1.14 of the Family Law Rules 2004, an extension of the time fixed pursuant to rule 18.08, for the filing of a review of the Final property orders of Registrar Riddiford made 26 October 2016 is granted, extending the time to the trial of this matter on 4 December 2018.
That pursuant to rule 18.08 of the Family Law Rules 2004, there be a review of the Final property orders made by Registrar Riddiford on 26 October 2016.
That the requirement for a review to be brought by an Application in a Case pursuant to rule 18.08 of the Family Law Rules 2004 is dispensed with.
That within 7 days of the making of these Orders, the funds held in trust by Clancy and Triado solicitors on behalf of both parties be paid in the following manner and priority:
(a)In payment of $413,000 in respect of outstanding amounts owed by the Husband to U Bank pursuant to the Deed of Settlement dated 16 November 2016;
(b) The balance to the Wife.
Other than in respect of Order 4(a) above the Husband shall be solely liable for and shall indemnify the Wife and hold her harmless in respect of outstanding amounts owed by the Husband to U Bank pursuant to the Deed of Settlement dated 16 November 2016
That the Husband retain all of his right title and interest in B Pty Limited (“the company”) and any associated entities.
The Husband shall be solely liable for and shall indemnify the Wife and hold her harmless against any and all manner of past, present and future debts, actions, suits, causes of action, arbitrations, dues, costs, interest and demands whatsoever both at law and in equity in relation to the company and/or which the company now has or may have at any time hereafter against the Wife whether by reason of the Wife having been an employee of the company and/or pursuant to any guarantee given by the Wife in respect of any obligation of the company to any person or entity.
The Husband retain sole use and control of D Pty Limited ATF Eracken Family Trust No. 2 Pty Limited and any other associated entities and trusts (“the entities”) and any and all income, investments, assets and tax credits (if any) therefrom, for his sole use and benefit (or at his discretion) absolutely.
That the Wife forthwith at the expense of the Husband do all acts and things and sign or cause to be signed any necessary documents to:
(a)Assign to the Husband any loan account standing to her credit and provide a full release and discharge from and against any claim, right, entitlement or interest in any such loan account in the entities; and
(b)Renounce and forego any power, right, interest or entitlement (legal and beneficial) in or to the entities and sign all documents required (at the Husband’s expense) to give effect to this clause, including but not limited to Resignation as Director and Transfer of shares forms.
The Husband shall be solely liable for and shall indemnify the Wife and hold her harmless against any and all manner of past, present and future debts, actions, suits, causes of action, arbitrations, dues, costs, interest and demands whatsoever both at law and in equity in relation to the entities and/or which the entities now have or may have at any time hereafter against the Wife whether by reason of the Wife having been an employee of the entities and/or pursuant to any guarantee given by the Wife in respect of any obligation of the entities to any person or entity.
Unless otherwise specified in these orders and save for the purpose of enforcing any monies due under these or any subsequent orders:
(a)Each party be solely entitled to the exclusion of the other to all other property (including choses-in-action) in the possession of such party as at the date of these orders.
(b)Each party forego any claims they may have to any superannuation, long service leave, redundancy, retirement, retrenchment and like benefits belonging to or earned by the other.
(c)Insurance policies remain the sole property of the names owner.
(d)Each party be liable for and indemnify the other against any liability encumbering any item of property to which that party is entitled pursuant to these orders; and
(e)Any joint tenancy of the parties in any real or person property is hereby expressly severed.
The Husband pay to the Wife for the maintenance of the Wife the sum of $500 per week until 9 February 2020 with such amount to be paid to an account nominated by the Wife and be paid each Monday.
It is requested that the Marshall of the Family Court of Australia forward to the Director of Public Prosecutions (Cth) for consideration:
(a) This judgment;
(b) Copies of:
(i)The documents associated with the application for consent orders made 26 October 2016;
(ii)The parties trial documents; and
(iii)The transcript of the trial proceedings.
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 Eracken & Eracken 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 CANBERRA |
FILE NUMBER: MLC 10141 of 2016
| Mr Eracken |
Applicant
And
| Ms Eracken |
Respondent
REASONS FOR JUDGMENT
Background
The Applicant Husband in these proceedings is Mr Eracken; the Respondent Wife is Ms Eracken. The parties commenced a relationship and were married in 1986. There are three children of the relationship: Mr X (aged 22); Ms Y (aged 20); and Z (born in 2005). The parties separated under the one roof in June of 2014.
The current proceedings to the Husband’s application to set aside Consent Orders made by Registrar Riddiford on 26 October 2016 (‘the Consent Orders’). The Consent Orders purported to finalise the property distribution between the parties, and made provision for the Husband to pay spousal maintenance.
The Husband proposes two alternative methods for dealing with his application:
a)The Husband seeks an ab initio review of the consent orders under r 18.08 of the Family Law Rules 2004 (Cth) (‘the Rules’). This review would require an extension of time to be given (‘the Review Application’).
b)The Husband contends that the Consent Orders should be set aside under s 79A(1)(a) of the Family Law Act 1975 (Cth) (‘the Act’), which would deal with the property but not the spousal maintenance aspects of the Consent Orders (‘the Setting Aside Application’).
The Husband pursued a multi-pronged approach to these applications.
In relation to the Review Application, the first basis set forward by the Husband was as to fraud. The description of that fraud is set out below. The second basis was that the Consent Orders made were not just and equitable, thereby constituting a miscarriage of justice.[1]
[1] Transcript 4.12.18 p. 26.
In relation to the Setting Aside Application, the main basis set forward by the Husband was that the Consent Orders amounted to a miscarriage of justice caused by the alleged fraud, or by the suppression of evidence and giving of false evidence whether or not such constituted a fraud.[2]
[2] Transcript 4.12.18 p. 27.
The Husband particularised his case as to fraud (or as he described it fraud upon the Court) in the following manner:[3]
a)That the parties entered into an agreement to enter into the Consent Orders, to minimise their exposure to a debt (in the Husband’s name) that was owed to the U Bank, with the intention of later revisiting those Consent Orders following the compromise of that debt (‘the alleged collateral agreement’); and
b)That the parties misrepresented their liabilities and assets, amounting to a suppression of evidence, a failure to disclose relevant information and a presentation of false evidence for the approval of the Consent Orders by the Court (‘the alleged misrepresentation to the Court’).
[3] Transcript 4.12.18 p. 24.
During the Husband’s cross-examination it emerged that he was also alleging that the Wife’s solicitor was complicit in the fraud,[4] however this was not a matter that was pressed at the end of the case.
[4] Transcript 5.12.18 p. 4.
Material Relied Upon
The Husband relied upon the following:
a)Amended Initiating Application filed 31 July 2018;
b)Affidavit of Mr Eracken filed 31 July 2018;
c)Financial Statement of Mr Eracken filed 31 July 2018;
d)Affidavit of Mr E filed 31 July 2018;
e)Affidavit of Ms F filed 24 August 2018;
f)Affidavit of Mr Eracken in reply filed 25 October 2018;
g)Affidavit of Mr G filed 6 July 2017; and
h)Affidavit of single expert Mr H filed 16 November 2018.
The Wife relied upon the following:
a)Response to Initiating Application filed 30 June 2017;
b)Affidavit of Ms Eracken filed 1 October 2018;
c)Financial Statement of Ms Eracken filed 1 October 2018; and
d)Affidavit of Ms J filed 1 October 2018.
Exhibit C1 contained the affidavit material with the agreed objections marked. No further objections were pressed.
Orders Sought
As stated above, the Husband sought that leave be granted for an out of time review of the Final Orders made by Registrar Riddiford dated 26 October 2016 and in the alterative, that the Final Orders made by Registrar Riddiford be set aside pursuant to s 79A(1) of the Act.
The Husband’s position (generally stated), if successful at this first stage of his Application, was that there should then be a division of the property in the following manner:[5]
a)That the monies currently held on trust, being the proceeds of the sale of the family home, be used to pay out the U Bank debt at $503,000 and to reimburse the Husband for the payments he has already made in relation to the U Bank debt at $117,000, to pay out various other credit card debts at $53,000, and the remaining balance to the Wife;
b)That the Husband would retain B Pty Ltd, along with other corporate entities and trusts, and thereby his superannuation;
c)That the Husband receive various chattels.
[5] Outline of Case Filed on Behalf of the Applicant Husband, filed 3 December 2018.
The Wife sought that that the Husband’s Initiating Application filed 16 May 2017 be dismissed and that the Husband pay the Wife’s costs.
The Wife’s position (generally stated), if the Husband is successful in reviewing or setting aside the Consent Orders, was:[6]
a)That the Wife receive the monies currently held on trust from the sale of the family home, and indemnify the Husband in respect of outstanding utilities, a debt to her brother and sister in law, and a debt in relation to orthodontics;
b)That there be a departure from the administrative assessment of child support for their child Z, at $415 per week;
c)That the Husband pay to the Wife, for the maintenance of their adult children Mr X and Ms Y, the sum of $400 for each per week;
d)That the Husband pay to the Wife for her maintenance the sum of $500 per week; and
e)That the Wife would then be responsible for the payment of school fees.
[6] Outline of Case Filed on Behalf of the Respondent Wife, filed 29 November 2018.
Litigation History
On 19 October 2016 the parties filed an Application for Consent Orders, Minute of Consent Orders and a Statement of Agreed Facts with the Family Court of Australia (at the Melbourne Registry), seeking final orders by consent regarding property and spousal maintenance issues.
Final Consent Orders were made by Registrar Riddiford on 26 October 2016.
In early March 2017, the Husband consulted a lawyer in relation to the Consent Orders.[7]
[7] Transcript 5.12.18 p. 33.
In March 2017, the Husband’s solicitors wrote to the Wife’s solicitors seeking the Wife’s consent to set aside the Final Consent Orders. The Wife’s solicitors responded that the Wife did not consent to setting aside the Final Consent Orders.
On 16 May 2017, the Husband filed an Initiating Application and Affidavit with the Family Court of Australia (at the Melbourne Registry), in which he sought orders, inter alia, that leave be granted for an out of time Review of the Final Orders and in the alternative that the Final Orders be set aside pursuant to s 79A(1) of the Family Law Act 1975 (Cth).
In July 2017, interim consent orders were made by Justice Cronin. The July 2017 consent orders dealt with, inter alia, the distribution of the proceeds from the sale of the matrimonial home.
In December 2018, the matter proceeded to a final trial.
In November 2019, further orders were made by consent releasing $70,000 of the proceeds from the sale of the matrimonial home to the Wife and categorising this as a partial property distribution.
What did the Registrar’s Orders provide for?
Registrar Riddiford’s orders provided for a property distribution that the parties asserted represented a 50-50 division of the total property pool.
Each party retained their own superannuation.
In relation to the Wife, the Consent Orders provided for the Wife to receive the former matrimonial home, subject to mortgage, and therefore to receive the sale proceeds after the home was sold. The Orders also stipulated that the Wife would take responsibility for a debt to Mr K, receive two motor vehicles, retain the two bank accounts in her name and retain her 50 per cent share of L Pty Ltd.
In relation to the Husband, the Consent Orders provided for the Husband to retain his interest in B Pty Ltd and C Pty Ltd as well as the bank accounts in his name, an investment scheme and Qantas frequent flyer points in his name. The Husband was also to be held liable for a debt relating to the U Bank.
The Husband agreed to pay the Wife $5,000 per month by way of spousal maintenance. Although unstated in the Consent Orders, the parties agreed that this amount incorporated the support of the children in lieu of a Child Support Assessment.
Background to the alleged collateral agreement
The Husband’s first fraud allegation, the alleged collateral agreement is best understood by reference to the particular financial context of the parties at the end of their relationship.
During the parties’ relationship, the Husband entered into an investment for tax reduction purposes.[8] As part of the scheme, a sum of money was borrowed from U Bank. The underlying investment failed, leaving the Husband with the associated debt, which was ultimately assigned to a third party, being the investment scheme.
[8] Affidavit of Mr Eracken, sworn 25 October 2018, [29].
The parties struggled financially toward the end of the relationship, particularly in relation to cash flow. The parties separated under the one roof in about June 2014.
The Husband defaulted on the U Bank loan and was served with a default notice on 26 May 2016. He engaged a lawyer, Mr G, in relation to this matter.
The Wife consulted the firm of solicitors who have represented her in this action, Clancy and Triado. The Husband consulted a family lawyer, Mr W in September 2016.
On 19 October 2016, the parties entered into the Consent Orders that are the subject of the current proceedings.
On 16 November 2016, the Husband resolved the dispute in relation to the U Bank loan at mediation, resulting in a Deed of Settlement and Release being entered into that provided for the repayment of the sum of $500,000, along with interest at 8.75 per cent per annum, via $50,000 annual payment for a period of 5 years followed by a final balloon payment of $461,406.76 due 1 February 2022. This did not appear to ameliorate the debt owned by the Husband, but rather put into place a payment arrangement.
The Husband moved out from the family home on 25 November 2016.
On 22 February 2017 the Husband sought to repudiate the Consent Orders and on 29 March 2017 indicated, through his solicitors, that he sought to reopen the proceedings.
Entry into the alleged collateral agreement
The Husband stated that the parties agreed to enter Consent Orders prior to the mediation with the U Bank, in order to protect the former matrimonial home, his superannuation, business and his income from the pending U Bank litigation, and that the Consent Orders would be renegotiated at a future time.[9]
[9] Affidavit of Mr Eracken, filed 31 July 2018, [55] and [58].
The Wife denied such conversations, the alleged agreement, and even denied being concerned for the family home as a result of the U Bank litigation. She also denied that the Consent Orders were entered into in contemplation of their impacting the soon approaching mediation involving the U Bank debt.
The Husband stated that the parties had a number of discussions between July 2016 and August 2016 directed to this issue. The Husband stated that these conversations would include words to the effect of:[10]
Husband: We need to keep the house (Suburb N), at least until Z turns 18.
Wife: I agree. We need to protect the house. We need to make sure that we are not forced to sell it by you going bankrupt or the U Bank forcing a sale.
[10] Affidavit of Mr Eracken, filed 31 July 2018, [54].
Although the home was in the name of the Wife, it was subject to a mortgage that was reliant on the Husband for servicing.
The Husband further stated that the following conversations took place at this time:[11]
Wife: I’m against any sale of the home.
Husband: Let’s just get the consent orders made to protect the home first, then let’s get through the Supreme Court action and we will sort out how we can keep the home and payout our debts after the U Bank threat has been seen off.
Wife: Okay. I’ll get advice on getting the Consent orders in place.
Husband: From whom?
Wife: Mr O.
[11] Affidavit of Mr Eracken, filed 31 July 2018, [55].
The Husband described a further conversation relating to the parties’ prior agreement:[12]
Wife: I agree that it’s only fair that after we pay out all of our joint debts including U Bank from the house, that we divide all of our assets between us and we can deal with this later.
[12] Affidavit of Mr Eracken, filed 31 July 2018, [57].
Mr E, the parties’ financial advisor gave evidence that he had a discussion in 2016 with the Wife where she said, in relation to the U Bank litigation, “I’m concerned that we might lose the house.”[13] The Wife denied such an interaction. Mr E was not cross-examined.
[13] Affidavit of Mr E, sworn 31 July 2018, [15].
Ms F, the Husband’s sister in law, gave evidence that in the second half of 2016 she had a discussion with the Wife to the effect of:[14]
Mr Eracken and I are working on a property settlement. Mr Eracken will continue to live under the same roof as me and the children – using the guest bedroom (ie in their house in Suburb N). The property settlement will assist us to preserve the house from claims by the U Bank. Mr Eracken will continue to live in the family home until the children are through school, at which time the house can then be sold and the property settlement revisited.
[14] Affidavit of Ms F, filed 24 August 2018, [13].
In her affidavit material the Wife disputed this conversation. Ms F was not cross-examined.
The Husband described a conversation where the parties agreed to structure the Consent Orders to protect the Husband’s income:[15]
Husband: [Mr Q] thinks there is a way we can protect my income in the orders. Can you work out [with] [Mr O] how we can protect $5000 per month?
Wife: Okay, leave it with me. I will talk to [Mr O]. I will get the orders adjusted to allow for $5,000.
[15] Affidavit of Mr Eracken, filed 31 July 2018, [61].
On 6 September 2016, the Husband emailed the Wife, telling the Wife to work with her lawyers to put the house on her side of the deal, the superannuation and business on his referencing the need to protect “all key three assets.”[16]
[16] Exhibit H8.
Mr Q, the parties’ accountant, gave evidence that he had been liaising between the Wife’s solicitors and the Husband,[17] and was sent draft consent terms. Mr Q said that he both read the draft terms to the Husband, and spoke to the Husband about the proposed terms and advised of changes that he sought in relation to how the corporate entities were to be dealt with.[18]
[17] Transcript 5.12.18 p. 76.
[18] Exhibit H3.
When the redraft was prepared, Mr Q said that he discussed the changes with the Husband,[19] and that they had a specific conversation regarding the spousal maintenance provision, to which he describes the Husband as reluctantly agreeing. Mr Q said that he did not receive the final version of the proposed consent terms.
[19] Transcript 5.12.18 p. 78.
Mr Q recalled that at about the time of the discussion of the consent terms the Husband represented to him that he and the Wife had an agreement that he would get some money from the future sale of the family home to assist in the payment of some of the debts. Mr Q was, however, unable to say whether this conversation had occurred before or after the entering into the consent terms by the Husband.[20] He did not have a conversation like this with the Wife.
[20] Transcript 5.12.18 p. 80.
The Husband stated that, on 17 October 2016 when the parties signed the Consent Orders and related documentation, the Wife stated:[21]
Wife: Here are the consent orders. They are drafted as we wanted them with a 50/50 split. Can you sign them straight away so I can get them back to my lawyers ASAP as we must get them stamped by the court as soon as possible before the Supreme Court mediation?
[21] Affidavit Mr Eracken, filed 31 July 2018, [63].
The Wife asserted that the parties signed the documents separately, she signing first, the Husband taking the documents away and then returning to sign them in front of the Wife. The documents included the terms, the application for consent orders and a statement of agreed facts. She drove the documents to her lawyer that same day.
The Husband also stated that, when the parties were signing the consent application and minutes, the following conversation took place:[22]
Husband: It’s not a big deal if the split as per the orders isn’t exactly 50/50, as we just need to get the orders in place prior to the Supreme Court litigation. We will revisit everything once the Supreme Court matter is sorted so our joint debts including U Bank are paid out, the net assets are then divided fairly between use and we can sort out what to do with the house.
Wife: I agree. We can’t lose the house under any circumstances.
[22] Affidavit of Mr Eracken, filed 31 July 2018, [65].
The Husband was asked under cross-examination what the terms of the agreement that he alleged to revisit the orders were:[23]
Was it just a general agreement to look at it down the track somehow?‑‑‑Yes.
I see?‑‑‑Revisit it. Yes. Revisit the orders.
And everything was up for grabs? Everything ‑ ‑ ‑?‑‑‑There wasn’t a date put on it.
Mr Eracken, just hold on. Everything was up for grabs when you came back to negotiate it, was it?‑‑‑On 22 February?
Mr Eracken, yes. On 22 February, when you raised it with your wife ‑ ‑ ‑?‑‑‑Yes.
‑ ‑ ‑ you believed everything else was up for grabs?‑‑‑Yes.
All right. So it was a case that you started with a blank canvas, your wife didn’t have a right to the house, you didn’t have a right to your super, you didn’t have a right to your frequent flyer points – it was all up for grabs?‑‑‑We never got to a blank canvas.
It was all up for grabs, was it?‑‑‑Yes.
[23] Transcript 5.12.18 p. 49.
The Husband stated that on or about 22 February 2017 the parties met to discuss a renegotiation of the Consent Orders.[24] At this time, the Wife reportedly said, “You have signed off on the final orders Mr Eracken and there will be nothing changing from there and you should have thought of this before you signed.”
[24] Affidavit of Mr Eracken, filed 31 July 2018, [71].
While the lawyer for the Husband in the U Bank proceedings, Mr G had, in his affidavit, indicated that the parties had intended to revisit the division of matrimonial assets in the future, he qualified this in his oral evidence. He said that he was not told that there would be a revisiting of the orders. He said that what he meant by his affidavit was that he anticipated that the parties would be cooperative with each other in the future.[25]
[25] Transcript 5.12.18 p. 45.
The Husband repeatedly asserted that he had not read the information that was provided in support of the consent terms, asserting that he could have given correct information if asked, or given the opportunity, but that he had simply trusted the Wife while he focussed on the litigation in relation to the investment debt.[26]
[26] Transcript 5.12.18 p. 28.
The Husband asserted that his representation in signing the form that he had read them was a false representation.[27] Similarly, he asserted that his representation in the application that he had obtained independent legal advice was also untrue. However, he also accepted that he had received independent advice from Mr W, as a specialist family lawyer, as to his relevant rights under the Act.[28]
[27] Transcript 4.12.18 p. 37.
[28] Transcript 4.12.18 p. 38.
In relation to the statement of agreed facts (presented with the application for Final Consent Orders), the Husband accepted that he knew the content of the document, having read it before he signed it, and that it was also false. He said that it was deliberately false evidence that he had given to the Court.[29]
[29] Transcript, 4.12.18 pp. 42-43.
The Husband asserted that the value that he placed on his business in the application of $650,000 was also inaccurate, but again asserted that he had not read the document in detail.
The Husband also asserted that the Wife had fabricated the statement made in the agreed facts in relation to the investment debt that:[30]
There is no known liability arising from the husband investing in an investment scheme. Solicitors are acting for the husband and he has been advised that he has a good defence to proceedings arising from the lack of governance and adequate paperwork.
[30] Transcript 4.12.18 p. 68.
At the same time, the Husband accepted that he was the person in the best position to say what the true position was in relation to the debt.[31]
[31] Transcript 4.12.18 p. 79.
After entering into the Consent Orders, the Husband initially continued to deposit all of his income into the parties’ joint account to help with the retention of the family home.[32]
[32] Transcript 7.12.18 p. 29.
The Husband accepted that he treated the superannuation as his own since the making of the Consent Orders because the Consent Orders provided for him to receive the superannuation.[33]
[33] Transcript 5.12.18 p. 29.
What was the factual basis put forward for the orders?
As noted above, a statement of agreed facts and an application for consent orders were executed by the parties. They set out what the Wife would receive, namely the matrimonial home valued at $3.5 million, the cars worth approximately $16 000 and the contents of the bank accounts consisting of $13,000. Against that the Wife either had debts or took responsibility for debts of about $1,600,000 and $530,000, secured against the matrimonial home. The Wife also took responsibility for the debt to Mr K of $300,000. The Wife was to retain her superannuation of about $48,000.
The Husband was to receive the B Pty Ltd worth $650,000 and superannuation of $524,000. Against that he had credit card debt of $30,000 and agreed to take on the debt relating to the investment, although the parties asserted that he had a good defence against this. The Wife asserted that there was a basis in communications received from lawyers to suggest that there was a good defence.[34]
[34] Exhibit H9.
Added together the parties asserted that these distributions of assets and liabilities equated to each receiving approximately $1.1 million. The parties asserted that this equated to a 50-50 split.
The parties also had further interests or directorships in the businesses P Pty Ltd, R Pty Ltd and D Pty Ltd. The values of these entities were expressed as unknown.
What is the factual basis now asserted to have been in existence at the time of the making of the orders?
The Husband asserted that at the time of entry into the Consent Orders, the position was as follows:
a)The matrimonial home was worth $5 million;
b)B Pty Ltd was worth $350 000;
c)The investment debt was $500 000; and
d)The Husband had other debts relating to credit cards, legal fees regarding the investment, and school fees totalling $140 000.
Despite these assertions, the Husband accepted that in June 2015 a bank valuation of the home had been completed, assessing the value as then at $3.5 million.[35] He accepted also that he had no documentary evidence, nor expert evidence to establish the value that he now asserts.[36] His contention that the true value was $5 million should not be accepted. Similarly, his assertion that the business was worth $350,000 lacked any sufficient explanation or support as to establish that the value was not the $650,000 he had previously represented to the court.
[35] Transcript 5.12.18 p. 25.
[36] Transcript 5.12.18 p. 26.
The Husband also failed to establish the proposition that his other assorted debts amounted to $140,000 that were not taken into account. Credit card debt of $33,000 was identified as taken into account in the application for consent orders. The school debt was in fact only $21,000, as opposed to the $70,000 asserted by the Husband. There was a debt of $10,000 to the Husband’s solicitor in the U Bank litigation, Mr G. Rather than there being an undisclosed debt held by the Husband of $140,000, the undisclosed amount should be taken to incorporate the Mr G debt of $10,000 and the school debt of $21,000, totalling $31,000.
The Wife accepted the Husband ultimately retained a debt of about $500,000 in relation to the investment. No material was produced that supported the notion that the parties had been told that there was a good defence.
How were the orders inadequate?
Part of the Husband’s complaint, as identified above, was that the Consent Orders were not just and equitable. He asserted that, even on the figures provided for the application, a 50-50 split was not obtained, despite that being the expressed outcome of the terms.[37] He subsequently accepted that on their face he was to receive 49.92 per cent.[38] He further accepted that, on the figures that he had provided, that even taking into account the investment debt the split would then become about 64-36 to the Wife.
[37] Transcript 4.12.18 p. 44.
[38] Transcript 4.12.18 p. 45.
The Husband also complained that he had not received under the Consent Orders the superannuation that had been anticipated on the making of the Consent Orders. He asserted that rather than receiving approximately $534,000, he received approximately $484,000. He conceded, in his affidavit, that there had not been such a shortfall, and that the shortfall should rather be reckoned at $39,000
The Husband also pointed to the failure of the Consent Orders to unravel the jointly held corporate interests of the parties as being a marker of the inadequacy in the Consent Orders to do justice and equity between the parties.[39]
[39] Transcript 5.12.18 p. 92.
What is the current factual basis?
In dealing with the current position, the figures used will be rounded figures. Given that the discretionary exercise is not an exercise in accounting, the significance of the various figures to the exercise of the discretion is not altered by using a rounded amount rather than the precise figure.
There is a lack of clarity as to the balance of the proceeds of sale held by Clancy & Triado at the December 2018 trial, as the parties disagreed as to the balance in the account, the Husband asserting $1,420,000, the Wife $1,406,000. The Husband’s assertion is supported by sworn testimony, the Wife’s is not. Under that circumstance the Husband’s assertion should be adopted.
Orders permitting some draw down prior to the trial were made by Cronin J on 5 July 2017.
The Husband alleged,[40] and the Wife accepted[41] that the following amounts were drawn, although they are in conflict regarding the description in relation to the drawings and whether all of the drawings were authorised by the Cronin J orders.
[40] Affidavit of Mr Eracken, sworn 31 July 2018, [114].
[41] Affidavit of Ms Eracken, sworn 1 October 2018, [114].
What was permitted from those orders after the payment of all sale related costs and payment out of the mortgage was:
a)$15,000 to Mr G;
b)$71,000 to T School for school fees;
c)$320,000 to Ms J and Mr K; and
d)$200,000 to the Wife by way of interim distribution.
The Husband asserted, and the Wife agreed, or did not dispute that the following were paid out:[42]
a)$15,000 to Mr G
b)$98,000 to T School for school fees;
c)$320,000 to the Wife’s brother, Mr K;
d)$200,000 to the Wife by way of interim distribution; and
e)$132,000 to the Wife ($32,000 described as reimbursement of expenses of sale met by the Wife).
[42] Affidavit of Mr Eracken sworn 31 July 2018 [114], [115], [117]; Affidavit of Ms Eracken, sworn 1 October 2018, [107], [114], [115].
While there was some contest as to whether the costs of sale paid by the Wife were legitimate, this contest was not prosecuted with the Wife during the trial.
The net proceeds have been further reduced by the Wife being permitted, by consent orders made on 26 November 2019, to draw a further $70,000 from the frozen funds. These have been characterised as a partial distribution (either of what the Wife is entitled to under the current consent orders, or will receive should they be revisited.
It may be taken that the balance held on trust, following the November 2019 order is approximately $1,350,000.
The parties each hold sums in bank accounts. The Husband conceded his bank accounts totalled $5,000.[43] The Husband asserted the Wife’s bank accounts to be $2,700.[44] The Wife described hers as “nominal.”[45] Absent concession or other evidence no significant balance in the Wife’s accounts has been established.
[43] Affidavit of Mr Eracken sworn 31 July 2018 [83].
[44] Outline of Case Filed on Behalf of the Applicant Husband, filed 3 December 2018.
[45] Outline of Case Filed on Behalf of the Respondent Wife, filed 29 November 2018.
The parties agree that the Wife holds two motor vehicles valued collectively at $14,000.[46]
[46] Outline of Case Filed on Behalf of the Applicant Husband, filed 3 December 2018; Outline of Case Filed on Behalf of the Respondent Wife, filed 29 November 2018.
The Wife values her business, L Pty Ltd as of no value. The Husband describes the Wife as receiving little income from the business. He asserts L Pty Ltd Bank accounts in total at $12,000. Absent concession or other evidence no significant balance in the accounts has been established.
The parties agree the Wife holds shares valued at $2,300.[47]
[47] Outline of Case Filed on Behalf of the Applicant Husband, filed 3 December 2018; Outline of Case Filed on Behalf of the Respondent Wife, filed 29 November 2018.
The parties agree that the current value of the Husband’s interest in his business, B Pty Ltd is $356,658.[48]
[48] Outline of Case Filed on Behalf of the Applicant Husband, filed 3 December 2018; Outline of Case Filed on Behalf of the Respondent Wife, filed 29 November 2018.
The parties agree that the Husband holds frequent flyer points, but do not assert a particular value for them.
The Wife holds home contents that she had previously conceded were worth $15,000. The Husband does not nominate a value. On the basis of the Wife’s concession it may be taken that she holds household goods to that value.
The parties agree that the Wife holds $52,000 in superannuation with Super Fund 1, the Husband $362,000 in superannuation with the Eracken Superannuation Fund.[49]
[49] Outline of Case Filed on Behalf of the Applicant Husband, filed 3 December 2018; Outline of Case Filed on Behalf of the Respondent Wife, filed 29 November 2018.
The Husband also concedes that he has drawn against his superannuation between $110,000 and $120,000.[50] This concession should be taken at its full value of $120,000.
[50] Transcript 5.12.18 p. 54.
It may be taken then, that the assets currently held by the parties, incorporating superannuation are $724,000 to the Husband and $1,503,000 to the Wife, totalling $2,227,000. Disregarding debts provided for by the Consent Orders, and paid under the interim orders, the Wife has taken $370,000 from the proceeds of sale (being $132,000 less $32,000 reimbursement, $200,000 and $70,000). The Wife has also paid school fees from the proceeds. The Husband has taken $120,000 from his superannuation. He has also taken tax benefits from the investment of approximately $62,000. At the same time he has paid approximately $100,000 toward the U Bank debt.
In relation to liabilities, the major asserted liability related to the U Bank debt, which the Husband deposed to being at $499,000.[51] While he asserted a slightly different figure of $503,000 in his case outline, the different figure was not supported by evidence. Nothing turns on the difference in any event.
[51] Affidavit of Mr Eracken, sworn 31 July 2018, [83].
The Husband deposed to credit card debt of $35,000. [52] This was not conceded by the Wife and no evidence was led to support the assertions contained in his affidavit and financial statement. Where a significant assertion is reliant on the Husband’s testimony alone, his case being reliant upon him perpetrating fraud upon the court deprives his testimony of probative force. The assertion was insufficient to support the finding of the debt.
[52] Affidavit of Mr Eracken, sworn 31 July 2018, [83].
The Husband finally deposed to a debt to the business of $306,000.[53] His evidence as to this was scant, being asserted at [94] of his affidavit, but without even an explanation of when or how the loans came about, or any corroboration for their being made. This formed an insufficient basis to establish the loans as in existence.
[53] Affidavit of Mr Eracken, sworn 31 July 2018, [83].
The Wife asserted a number of debts in her case outline document. Of those only a few were supported by any evidence.
The Wife asserted various debts to T School, credit cards, for orthodontics and for utilities for the former family home. These were without evidential support other than their mere description at Part O of her financial statement. They were not conceded by the Husband. The evidence is insufficient to establish on the balance of probabilities the existence of the debts.
Some evidence was led to support a debt that she alleged to her Mother, or a debt owed to the parties’ daughter Z, referred to in the Wife’s case outline document together as $55,000. The Wife led no evidence as to the quantum of either of these loans, other than contained at Part O of her financial statement, which did not match her assertions in her case outline document in any event. These debts have not been established by her.
The Wife asserted a debt still owed to her brother and sister in law, Mr K and Ms J, purported to be outstanding interest in relation to a loan that was repaid in the sum of $320,000 following the orders made by Cronin J. The key evidence in relation to this came from Ms J, who deposed to loaning the Husband $250,000 in about August 2011, by taking out an interest only loan on their home. She deposed to an agreement to be repaid, including the interest that was incurred. She and her Husband requested that the loan be repaid in full in February 2016. Ms J deposed to an offer by the Husband, on 14 September 2016, to pay at an “investment interest rate” to give them a higher rate of return. She says that she and her husband nominated a 7 per cent rate, backdated to November 2016. She says that she received no response from the Husband. Despite the payment of $320,000, she asserts that on this basis she and her Husband are still owed $38,548.04. Ms J accepted that there was no agreed rate with the Husband.[54] She also accepted that the payment figure of $320,000 was arrived at in a conversation between her husband and the Wife prior to the Cronin J orders being made.
[54] Transcript 7.12.18 p. 51.
The evidence does not establish a remaining debt to Mr K and Ms J.
It may be taken then that the remaining debt is that related to the U Bank debt, at $499,000.
If the Consent Orders remain in place, the Wife will on a net basis receive, or have received from the proceeds of the sale of the home $1,720,000, along with cars and bank accounts at $29,000, $15,000 in household goods, and superannuation totalling $48,000. This amounts in total to $1,812,000.
Funds will also have been applied toward the payment of school fees in excess of $90,000. I was not addressed as to the significance of such and whether it should have been taken as to the benefit of the Husband or the Wife. There is not a clear basis to add this back to either of the parties.
If the orders remain in place the Husband will receive, or have received his business at $650,000 (although now reduced in value to $357,000), superannuation at $480,000 (although now reduced following drawings from it), and assorted debts at $64,000, although the $10,000 debt to Mr G was presumably dealt with by the payment of $15,000 to him per the orders of Cronin J, reducing this amount to $54,000. He also took the investment debt at $500,000. This leaves his net position at $1,130,000 less $554,000, leaving $576,000. If taken at the current value of his business and superannuation, this reduces to a net figure of $163,000.
Review of the Registrar’s Decision
The Husband seeks relief from the orders that were entered into by consent. The first relief he seeks is by way of review of the orders made by the Registrar. The scheme and basis for a Registrar both making orders and being subject to review was set out by Macmillan J in Pearson & Coli:[55]
The Registrar in this case was exercising the power delegated to him pursuant to s 37A(1)(g) of the Act, being the power to make orders in proceedings under the Act, the terms of which have been agreed upon by the parties to those proceedings.
Subsection 37A(9) of the Act provides that a party to proceedings in which a Registrar has exercised any of the powers delegated pursuant to this section, may within the time prescribed by, or within such further time as is allowed in accordance with the Rules of Court, apply to the Court to review the Registrar’s exercise of power.
It is this ability to review the exercise of the delegated power, as exercised by the Registrar in this case, whether on the application of one of the parties or the Court’s own motion, which lies at the heart of the validity of the Court’s delegation of its powers. In Harris v Caladine (1991) 99 ALR 193 (“Harris & Caladine”) the High Court upheld the constitutional validity of the delegation of this Court’s powers pursuant to s 37A of the Act. Mason CJ and Deane J said at 198 as follows:
…the delegation of some part of the jurisdiction, powers and functions of the Family Court…to its officers is permissible and consistent with the control and supervision of the Family Court's jurisdiction by its judges.
Their Honours identified two conditions that must be satisfied in order for there to be a valid delegation of power. The first condition is that the judges must still be said to constitute the Court, meaning that they bear major responsibility for the exercise of power and secondly, officers in the exercise of their delegated power must be subject to review by judges on questions of fact and law.
[55]Pearson & Coli [2018] FamCA 295.
That is, the availability of substantive review is an essential part of the delegation of authority to the Registrar. That review is subject to time constraints, imposed by Rule 18.08. In this instance the time permitted to seek review pursuant to the Rules was 28 days from the making of the orders on 26 October 2016. Review was not sought until 16 May 2017. This requires the Husband to obtain an extension of time so that he can pursue this relief. Extension of time is dealt with at Rule 1.14, which provides that a party “may apply to the court to shorten or extend a time that is fixed under these Rules.” Rule 1.14 is to be understood in the context of Rule 1.04 which provides that:
The main purpose of these Rules is to ensure that each case is resolved in a just and timely manner at a cost to the parties and the court that is reasonable in the circumstances of the case.
In Greetham & Greetham,[56] Strickland J provided a useful summary of the relevant authorities to the determination of an application for an extension of time, as follows:
The principles with respect to the grant of an extension of time, are well settled (see Gallo v Dawson (1990) 93 ALR 479, In the marriage of McMahon (1976) FLC 90-038 and In the marriage of Tormsen (1993) FLC 93-392). Gallo v Dawson is, of course, a High Court decision, and McMahon and Tormsen are two Full Court decisions of this Court.
The authorities mainly address extensions of time in the context of appeals. However, the principles are also largely applicable to applications for an extension of time to seek a review of the exercise of Registrar’s powers. In Tormsen (above) the Full Court said at 80,017 that:
[t]he fundamental issue in application for extension of periods of time prescribed by rules of court is whether this will enable the court to do justice between the parties …[and that a] failure to explain the delay adequately can certainly lead to a conclusion that justice demands that the application be dismissed.
However, the Full Court did indicate that:
…in appropriate cases the interests of justice may outweigh the absence of an adequate explanation
[56]Greetham & Greetham [2010] FamCA 246.
In Gallo v Dawson,[57] McHugh J stated:
The object of the rule is to ensure that those Rules which fix times for doing acts do not become instruments of injustice. The discretion to extend time is given for the sole purpose of enabling the court or justice to do justice between the parties: see Hughes v National Trustees Executors & Agency Co of Australasia Ltd[1978] VR 257 at 262. This means that the discretion can only be exercised in favour of an applicant upon proof that strict compliance with the rules will work an injustice upon the applicant. In order to determine whether the rules will work an injustice, it is necessary to have regard to the history of the proceedings, the conduct of the parties, the nature of the litigation, and the consequences for the parties of the grant or refusal of the application for extension of time: see Avery v No 2 Public Service Appeal Board[1973] 2 NZLR 86 at 92 ; Jess v Scott (1986) 12 FCR 187 at 194 5 ; 70 ALR 185. (emphasis added)
[57]Gallo v Dawson (1990) 93 ALR 479.
The Husband relied on a number of factors to justify the extension of time, as well as to justify, if that application is not successful, his application pursuant to s 79A:
a)The alleged collateral agreement to revisit the Consent Orders;
b)Falsity in the information provided to the Registrar to support the Consent Orders;
c)That the Consent Orders are not, and were not at the time, just and equitable;
d)That the Consent Orders, on their terms, did not achieve the split that they were represented to achieve;
e)That the Consent Orders failed to deal with various entities held by the parties;
f)That the Registrar did not specifically refer to whether the orders sought were just and equitable.
Each of these matters will be examined below.
The alleged collateral agreement?
The existence of a collateral agreement to revisit the orders following the resolution of the U Bank litigation was, as indicated above, a disputed matter.
In assessing the evidence as to this aspect, and the case more generally, I was urged to take into account the fact that, on the Husband’s case, he has admittedly perpetrated a fraud on the court, and has deceived the court by providing false information to the court. These matters weigh heavily in considering his credibility.
Where the existence of the collateral agreement is reliant on the Husband’s testimony as to what was said or done, significant caution should be exercised prior to accepting that testimony, particularly where it is under challenge. However, there are a number of factors that lead to the conclusion that the parties did in fact agree in advance to revisit the orders that they asked the Registrar to make.
Firstly, while the Wife denied being concerned for the preservation of the family home at the time of entering into the orders, this denial was at odds with what she said to their financial advisor Mr E, as set out above. She directly expressed such concerns for their home to him. This provides a sufficient foundation as to establish that, contrary to her testimony, she was, at the time of the entry into the orders, concerned regarding the possible loss of the home.
Secondly, and more importantly, the evidence of Ms F as to the Wife telling her that there would be such a revisiting once the U Bank matter was resolved should be accepted. Although the Wife contradicted this evidence, in the absence of cross-examination on the point, the evidence held no aspect that called for its rejection.
Further, although of lesser weight, the report by Mr Q that around the time of the execution of the consent terms the Husband had represented to him that there would be a revisiting of the orders was indicative that this was not a matter invented more recently by the Husband.
The Husband’s conduct in continuing, post the entry into the orders, to deposit his pay into the joint account also lends minor support to the notion that the parties did not regard the orders as the finalisation of their financial matters.
The evidence of Ms F is sufficient to persuade that there was an agreement between the parties, prior to entry into the orders, that they would revisit the orders once the dangers presented by the U Bank litigation had subsided. That conclusion is rendered more certain by the accumulation of the other matters described above.
The false information?
The Husband alleged four falsehoods in the information provided to the Registrar, as set out above.
His challenge regarding the information provided in respect of the value of his business and the family home fails for lack of evidence.
The Husband’s assertion that there was $140,000 of undisclosed debt, for which he was responsible is likewise not made out in its entirety. It may be accepted that some debt, amounting to $31,000, comprised of school fees and fees for Mr G, was not disclosed in the application for Consent Orders.
It has not been established that these amounts were deliberately withheld, or merely overlooked. They represent a small portion of the overall pool.
More significant was the information provided in relation to the U Bank litigation/investment debt. It was represented that the liability was unknown when it was known at the time. What was not known was the outcome of the pending mediation. The assertion that there was a good defence does not find support in the evidence in these proceedings. The notion that the parties had confidence in a defence as being good is undermined by their entry into the consent terms to protect the home and other assets from the U Bank litigation, and their intention to revisit the terms at a later date. The information provided was less than frank, and was misleading. It formed a serious misstatement of the parties’ actual financial positions.
Were the orders just and equitable?
The Husband argued that the result of the Consent Orders was not just and equitable, leading to a conclusion that there has been a miscarriage of justice.
Crudely put, rather than constituting a 50-50 split, as was described to the Registrar, the division, as now described by the Husband, was 64-36 split in favour of the Wife.
As to whether this was just or equitable at the time, the Husband said the following under cross examination:[58]
MR SWEENEY: Now, just in terms of what your current application is, you say to the court, do you, that what has to happen in this case is you re-look at the case today and give you 50 per cent?‑‑‑No. Not at all.
All right?‑‑‑The case outline said 70/30.
Do you accept – do you accept ‑ ‑ ‑?‑‑‑In my wife’s favour.
Sorry?‑‑‑The case outline said 70/30 in my wife’s favour.
Well, do you accept that 70/30 was about the right percentage? That’s the right percentage now?‑‑‑All along.
All along? So what you want the court to accept is that 70/30 would have been – all along would have been the right percentage to apply; correct?‑‑‑I think it would be. Yes. (emphasis added)
[58] Transcript 5.12.18 p. 55.
This comes in the context that the parties, at the commencement of the relationship, brought in little. They each contributed their income. The Wife primarily cared for the children, but not without the assistance of the Husband. The Husband’s strongest contribution was financial, the Wife’s as the primary carer. The Husband’s case speaks to an equivalence in contribution during the relationship.
Following the end of the relationship, on the Husband’s case, the Wife has continued with the primary care of the children as the eldest moved into adulthood. He has continued strong financial contributions, continuing to contribute his income to family purposes.
The history recited by the Husband points, at best for his case, toward equivalent contributions by the parties post separation.
The current application comes in the context of the Wife having the primary care of their children, two now being adults, one aged 13 at the time of the proceedings. The Husband conceded that it would take time for the Wife to re-establish her income in the workforce, but did not concede that she was unable to. He asserted that, as he is older than the Wife (now aged 60), he has less working life ahead than the Wife (now aged 55). He however has an undisputed history of far greater remuneration than the Wife. He explained that his salary is approximately $180,000 gross per year, plus dividends and distributions. There was little dispute that the Wife’s business at present affords her little income.
The Husband’s financial position, in terms of income, is markedly better than the Wife’s. At 60 he still derives strong income. It must be anticipated that, despite her previous work history, re-entry into employment for the Wife at 55 presents a far less rosy picture.
These factors do not point to a 64-36, or a 65-35 split to the Wife as being, at face value, an unjust, inequitable division of property. This is particularly so given the Husband’s stated position that a division at 70-30 would have been a proper outcome at the time of the entry into the orders.
Failure to deal with various entities?
At schedule B to the application for consent orders the parties disclosed that they had interests in a number of entities. The Consent Orders made no specific provision in relation to these entities, although, to the extent that the entities related to the superannuation interests of the Wife, provision was made to deal with such.
It was not established in these proceedings that the failure to deal with these entities had any effect in substance on the division of property. While it may be preferable to enter into orders that deal the exit of parties from various entities, particularly to end the financial relations of the parties, the failure to do so does not necessarily render orders unjust or inequitable. It has not been established that the failure to deal with the exit in this case means that the orders were not just and equitable.
Failure to refer to whether the orders were just and equitable?
This issue was a matter addressed Macmillan J in Pearson & Coli where her Honour applied what was said by the High Court in Harris & Caladine (1991) FLC 92-217. The High Court observed that the fact that orders are sought by consent does not relieve the Court from determining that the orders are, in all the circumstances, just and equitable. The High Court also observed that the fact that the orders are sought by consent, particularly in the context of the parties being represented, at arm’s length, and with the Registrar being “adequately informed” may mean that little more than the consent may be required.
Here, the parties asserted that they had received independent legal advice as to the terms of the agreement. They represented to the Registrar that the division of the property as a result of the orders would be 50-50. They represented that the Wife had made the greater of the financial contributions, that they had made the same non-financial contributions, and that the Wife had made the greater homemaker/parent contributions. They further represented that the Husband has the greater income and financial resources while the Wife had the primary care of the children, including the eldest who was anticipated to remain living at home until he completed his degree. These were the circumstances of 30 years of cohabitation. Their representation to the Registrar, at face value, was of greater contributions made by the Wife, along with a greater call on the s 75(2) factors. Under those circumstances, orders providing for a 50-50 split do not appear to be just and equitable, and are not suggestive that consideration was given to this matter.
Absent other reasons to identify that such consideration was given, the criticism made for the Husband appears good.
At first blush it may be thought that there is some tension between this conclusion, as to whether there was consideration of whether the orders were just and equitable, and the earlier conclusion that the orders were just and equitable. However, the conclusions deal with two different perspectives on the making of the order. The first deals with what was represented to the Registrar on the face of the material presented. The second deals with a conclusion drawn from determinations as to the actual state of the property at the time. For this reason it is not inconsistent to consider that, on presentation to the Registrar it could not appear to be just and equitable, whereas, based on an understanding of the true underlying position, it was just and equitable.
The spousal maintenance
A further matter raised by the Husband related to the order for spousal maintenance. He asserted, and the Wife conceded that the $5,000 spousal maintenance that the orders specified he is to pay, incorporated his support of the children. That is, in truth, the parties recognised that this amount was also child maintenance, and the parties’ representation that this was spousal maintenance was a mischaracterisation.
The Husband also complained that the order is open ended. However, as was pointed out by the Wife, such an order may be subject to further application to vary or to discharge the order under s 83 of the Act. The fact of it being open ended does not, of itself, render the order unjust.
Should an extension be granted for review of the Registrar’s decision?
It may be seen that there are matters that pull in different directions. The apparent failure to consider whether the orders were just and equitable, the wrong information being provided, and the collateral agreement are matters that favour the grant of the extension, as does the mischaracterisation of the spousal maintenance.
There are however, a number of matters that pull in the other direction.
One is that the circumstances in which the Husband now seeks relief have come about by virtue of a calculated decision on the part of the parties to secure orders until a time that was convenient to change them, to improve their position in relation to the U Bank debt.
The Wife therefore points to these circumstances having come about by virtue of the Husband’s admitted fraud upon the court process. She asserts that this is a reason to refuse relief to the Husband, on the basis that he does not come with clean hands in seeking relief.
The Husband is seeking relief where he has perpetrated the fraud that he complains of. He falls within the description given in Meyers v Casey [1913] 17 CLR 90 in which Isaacs J said: [59]
It is altogether different from the cases where the right relied on, and which the Court of equity is asked to protect or assist, is itself to some extent brought into existence or induced by some illegal or unconscionable conduct of the plaintiff, so that protection for what he claims involves protection for his own wrong. No Court of equity will aid a man to derive advantage from his own wrong, and this is really the meaning of the maxim.
[59]Meyers v Casey [1913] 17 CLR 90, 124 (‘Meyers’).
Here, the Husband is reliant on his deception of the Court to found the relief that he seeks. In that respect it is an unattractive claim for relief.
However, the circumstances here are somewhat different to those in Meyers, particularly given the role of the Wife in the procuring of the orders.
It was wrong of the parties to represent to the Court that the orders they sought were intended by them to finalise their financial matters, when they did not so intend. It was wrong of the parties to provide false information to the Registrar in support of those orders. It is a further wrong of the Wife to permanently retain the benefits of the orders where, central to the entry into those orders was the representation and intention that they would be no more that temporary.
The circumstances are then that neither party comes with clean hands to the court, and yet the Wife seeks to retain benefits that were never intended to remain solely hers. Those benefits were only procured on the basis that they would be temporary, yet she seeks to hold them permanently. Denying the Husband relief under those circumstances adds a further wrong.
Despite not coming with clean hands, the Husband should not be refused relief on that basis.
To deny the Husband relief on the basis that it is his wrongdoing is to protect for the Wife the fruit of her wrongdoing.
What speaks most strongly against the extension relates to the matter identified as central in Gallo v Dawson. The basis for the exercise of the power was there identified as “for the sole purpose of enabling the court or justice to do justice between the parties.” The corollary of this notion, again as expressed in Gallo v Dawson was that:
It follows that, before the applicant can succeed in this application, there must be material upon which I can be satisfied that to refuse the application would constitute an injustice.
That is, what is central to the exercise of the discretion is the relief of injustice occasioned to the Husband. The difficulty for the Husband is that, in relation to the property adjustment, he has not demonstrated that the outcome achieved by virtue of those orders was unjust.
His concession, firstly that even taking into account the investment debt, the division was 64-36 to the Wife, combined with his concession that he regarded a 70-30 split in favour of the Wife as being at all times the appropriate division, speaks against the notion that an injustice was perpetrated upon him
Even without the concessions made by the Husband, the nature of the contributions, and the s 75(2) factors identified in the case indicate that the distribution achieved by the parties was within the proper range of outcomes.
While that means that there is no apparent injustice visited by the property orders, the Husband, however, demonstrated that the spousal maintenance order is not what it purports to be. The parties intended it to incorporate the support of the children despite expressing it as a spousal maintenance orders. They treated it as a substitution for Child Support. If this true nature of the order was understood at the time, it was not an order that could have been made in such a way, and was not an order supported by s 74.
The collateral agreement in relation to the orders and the wrong information being provided point toward the grant of the extension.
There is, however, a significant matter pointing against the extension. For the Wife it was emphasised that, unlike the property orders, the spousal maintenance orders are amenable to being revisited pursuant to s 83 of the Act. They do not require an extension of time to be discharged, suspended, or varied up or down. That is, there is an alternative remedy.
Despite the availability of the alternative remedy, two matters remain that tip the balance toward extension. The first is the combination of the main purpose of the Rules at Rule 1.04, combined with Rule 1.06(h), which point against requiring the parties to return for another bout of litigation to resolve the issue. The second is that the property orders and the so called spousal maintenance orders formed a unitary scheme. That is, they were agreed in combination with each other to protect the assets and income of the parties from the U Bank litigation. There is an unreality in assessing the justice of the situation to detach them completely from each other in the reasoning process.
Accordingly, an extension will be granted, despite the emphasis placed on finality of litigation in Gallo v Dawson.
Setting Aside under Section 79A
The Husband stated that should his application for review of the Registrar’s decision be unsuccessful, the consent terms should be set aside pursuant to s 79A(1)(a). It should be immediately observed that s 79A is directed to orders made under s 79, not spousal maintenance orders made under s 74 of the Act.
The parties accepted that if an extension of time was granted, that the s 79A application became obsolete. However, there would have been relief granted under s 79A even if an extension of time was not granted.
Section 79A provides, relevantly:
Setting aside of orders altering property interests
(1) Where, on application by a person affected by an order made by a court under section 79 in property settlement proceedings, the court is satisfied that:
(a) there has been a miscarriage of justice by reason of fraud, duress, suppression of evidence (including failure to disclose relevant information), the giving of false evidence or any other circumstance;
…the court may, in its discretion, vary the order or set the order aside and, if it considers appropriate, make another order under section 79 in substitution for the order so set aside.
Badawi & Badawi (2017) FLC 93-784 emphasised that s 79A(1) “is particularly directed to the integrity of the judicial process.”
Section 79A is designed to overcome miscarriages of justice. It is to be construed liberally to give effect to its intended purpose (see In the Marriage of Gilbert v Estate of Gilbert (decd) (1990) FLC 92-125).
While dealing particularly with fresh evidence, the more general significance of fraud upon the judicial process was dealt with by Barwick CJ J in McDonald v McDonald:[60]
The Court’s conclusion upon the fresh evidence before it that the verdict was obtained by fraud, by surprise, or that witnesses were suborned, is sufficient to justify setting aside the verdict and ordering a new trial. Whether or not the Court does so must finally depend on the Court’s view as to whether or not the interests of justice, either particularly in relation to the parties or generally in relation to the administration of justice, require such a course.
[60]McDonald v McDonald (1965) 113 CLR 529.
In the same case Menzies J noted that:
This proposition, which relates only to the granting of a new trial on the ground of the discovery of fresh evidence, leaves untouched the rule that, if by any means it be affirmatively proved that the earlier judgment was tainted by fraud, it will, without more, be set aside. Thus, for instance, to prove the bribery of a witness or a juryman at the earlier trial by a party would require a verdict given in his favour to be set aside without speculation upon the result of the bribery.
McDonald emphasises the strong effects of a fraud that goes to the root of a trial which in turn indicates the significance of such a fraud in determining the exercise of the discretion under s 79A. Such a fraud itself, even without demonstration that it affected the outcome of the trial, because of its impact on the integrity of the trial, is indicative of a miscarriage of justice.
While there is reason to think that the focus in Gallo v Dawson is on the justice as it stands between the parties, miscarriage of justice, as referred to in s 79A and McDonald incorporates considerations that relate to the administration of justice more generally.
In this case the fraud went to the heart of the orders being made. Even if it did not result in property orders that were manifestly unjust, the fraud upon the court processes is indicative of a miscarriage of justice.
Again the issue arises of the Husband seeking relief where he has perpetrated the fraud that he complains of. I adopt what I said in relation to this aspect in respect of the application for an extension of time for review of the Registrar’s decision.
If it were necessary to resort to s 79A, then I would have granted relied under that provision.
Exercise of the s 79 and s 75 powers
The granting of the extension of time results in a consideration afresh of the exercise of the s 79 and s 74 powers, although this time on the basis of the orders currently pursued by the parties.
When the Court exercises its discretion to alter the property interests of parties under the Act, it is to consider what is just and equitable. That is, the Court must be satisfied that it is just and equitable to make an order adjusting the property interests at all,[61] and to adjust them in a particular manner.[62]
[61] Stanford v Stanford (2012) 247 CLR 108 per French CJ, Hayne, Kiefel and Bell JJ [35] (“Stanford”); Family Law Act 1975 (Cth) s 79(2).
[62] Bevan v Bevan (2013) 49 FamLR 387 per Bryant CJ and Thackray J [86].
The first step requires the Court to identify “according to ordinary common law and equitable principles the existing legal and equitable interests of the parties in the property.”[63]
[63] Stanford, [37].
Once the property interests have been identified, the Court is to consider the contributions of the parties as set out in s 79(4) of the Act. The assessment of contributions involves a qualitative evaluation that finds its expression in a quantitative result.[64] The Court will then consider if an adjustment should be made to the property as a result of the factors set out in s 75(2) of the Act. The Court will then consider the adjustment made through this process and assess whether the resulting property order would be just and equitable.
[64] Steinbrenner v Steinbrenner [2008] FamCAFC 193, [234], per Coleman J.
The current property has been identified earlier in this judgment. The end of the thirty year relationship, in which the parties acquired their assets and raised their family with coordinate roles, marks an ending to that cooperation, and the appropriateness of an adjustment of their interests.
There is no differential identified in terms of what property the parties brought into the relationship on its commencement. During the relationship there were instances of particular financial injections by reason of bequests and gifts received from the families of the parties. The Husband points to bequests received by him of $25,000 in 1986, and $25,000 in 2005. The Wife points to a gift from her mother of $25,000. In a relationship of such length these are not significant in differentiating between the parties’ contributions.
The parties both worked in paid employment at the start of their relationship. Following the birth of their children, the Wife has been the primary carer, with lesser contributions in that arena from the Husband. Similarly, the Husband has been the primary financial contributor, with lesser financial contributions made by the Wife.
While the parties suffered a heavy loss from their investment, this was in the context of a significant gain in the sale of the Husband’s business interests, and an attempt to ameliorate the tax consequences of that. The loss has not been established as a reckless act, or frolic on the part of one of the parties. It is to be shared in the same sense that the benefit from the sale of the business is to be shared.
There is an equivalence in their contributions during the relationship.
Since the end of the relationship, the Wife has continued in the primary care of the children of the marriage, the Husband primarily in the financial contributions, initially by depositing his whole income into the joint account and drawing upon it, at least in part, in the support of the family. After the making of the Consent Orders this continued, along with the payment of maintenance, until February 2017. Since then his financial support has been in the form of the maintenance payments. He has also met substantial payments for the outstanding investment debt, although he has also taken the tax benefits associated with that debt. The Wife has also drawn against her future entitlements by means of partial property payments, a portion of which, it may be expected, has gone to the care of the family.
The post separation contributions should be considered to be equivalent.
The overall contributions of the parties should be considered to be equivalent.
The current context is of the Wife having the primary care of their children, two now being adults, one aged 13 at the time of the proceedings. The Husband conceded that it would take time for the Wife to re-establish her income in the workforce, but did not concede that she was unable to. He asserted that, as he is older (now aged 60) than the Wife he has less working life ahead than the Wife (now aged 55). He however has an undisputed history of far greater remuneration than the Wife. He explained that his salary is approximately $180,000 gross per year, plus dividends and distributions. There was little dispute that the Wife’s business at present affords her little income.
The Husband’s financial position, in terms of income, is markedly better than the Wife’s. At 60 he still derives strong income. It must be anticipated that, despite her previous work history, re-entry into employment for the Wife at 55 presents a far less rosy picture.
The substantial difference in positions between the parties in terms of income earning capacity, and responsibility for the care of their child who is still less than 18, calls for an adjustment to a division of 65-35 in favour of the Wife. As will be seen below, despite this being less than the 70-30 described by the Husband in his oral evidence, marks a sharp increase to the Wife from the orders sought by him.
Based on the assessment of the current property undertaken earlier in the judgment, the Wife has received $370,000 from the proceeds of the sale of the home. $270,000 were characterised as interim or partial property distributions. $100,000 was unexplained. There is a lack of clarity as to what has happened with these funds.[65] She holds chattels and bank accounts at $44,000 and superannuation at $48,000. The balance of the proceeds of sale currently held on trust are $1,350,000.
[65] Affidavit of Mr Eracken, sworn 25.10.18, [18].
The Husband holds his business at an agreed value of $357,000. He has received superannuation at $480,000, now reduced to $360,000 by virtue of his drawing from that sum. As with the Wife, those drawings were from the apparent property settlement, in his case from his superannuation.
It should be observed that despite the differences between the superannuation and non-superannuation assets, the parties did not differentiate between them on a qualitative basis. Given their ages there was perhaps less qualitative difference than in other cases. I do not propose to adopt a different course to that pursued by the parties, and will deal with the matter as a single pool.
Each parties’ drawings from their share of the Consent Orders should be added back, as each has treated the orders as in some manner distributing property, by virtue of those drawings.
The Husband points out that he has serviced the investment debt to the tune of approximately $100,000 since the making of the Consent Orders. He seeks that he be reimbursed for this amount. He has also taken the tax benefits associated with the debt. The Husband has also received an insurance payment in relation to a melanoma, also in excess of $100,000, which he has dealt with as his own.
Adding back is the exception rather than the rule. There is no clarity as to how the investment debt was funded, nor how the melanoma money was spent. The Husband’s post separation financial contributions have already been factored into the determination each party’s contributions. There is no clear rationale advanced for reimbursing the Husband, or for adding back the melanoma monies. Absent a clear rationale for how each of these amounts should now be dealt with, and why, they should not be subjected to an adding back or a reimbursement.
The pool of property should then be reckoned, counting the parties’ drawings, as being:
a)The Wife currently holding (including on trust) $1,812,000; and
b)The Husband currently holding $837,000;
c)The total property pool being $2,649,000.
The current debts, at least as far as they have been proven, are limited to the investment debt at approximately $500,000. Each party has already, in the meantime, dealt with debts in place at the end of the relationship, such as the Mr K debt, the Mr G debt, and various credit card debts. School fees have also been paid. I was not addressed directly as to how to deal with these amounts that have now, as far as I can tell, been dealt with and so do not propose to factor them into the reasoning for the distribution.
This leaves a net current position of $2,149,000.
The Husband seeks to retain his business ($357,000), his superannuation (reckoned above at the pre drawn level of $480,000), various chattels and an amount of $169,000 (that he attributes to various debts or payments made). He seeks that the U Bank debt be paid out.
He seeks to retain a number of corporate and trust entities that are not asserted to have significant value.
This would result in the Husband receiving $1,006,000, constituting approximately 47 per cent of the net pool. The U Bank debt would be paid out.
The Wife seeks to receive the balance currently held on trust. She would retain a number of unproven debts. This would leave her with $1,812,000. That is approximately 84 per cent of the net pool.
Thirty-five per cent of the net pool equates to $752,150. Taking into account the superannuation as set out above, and the value of the business, the Husband already has $837,000. What he currently holds constitutes 39 per cent of the net pool. This result falls $86,000 short of a 65-35 split in favour of the Wife.
It is appropriate to examine the overall result of orders and ask whether they are just and equitable. Such a shortfall would not be.
A question than lingers as to how to deal with the shortfall. No division of superannuation has been sought. It is not apparent that the Husband’s business is divisible or liquid so as to provide for such a payment. The remaining mechanism partially reflects the overall outcome sought by the Wife, which was to leave the husband with the investment debt. A reduction in the payout of the investment debt by $86,000 can be used to cater for the shortfall. The balance then, of the investment debt will remain the Husband’s responsibility.
This would leave the Wife (including with payments already received) with a little short of $1,400,000. Such an outcome is a just and equitable dealing with the property of the parties, flowing from their thirty year relationship, in the context of their conduct following entering into orders before the Registrar.
Other aspects of the Wife’s application
As noted above, the Wife also sought a suite of orders directed to spousal maintenance and the support of the children, namely:
a)That there be a departure from the administrative assessment of child support for their child Z, at $415 per week;
b)That the Husband pay to the Wife, for the maintenance of their adult children Mr X and Ms Y, the sum of $400 for each per week; and
c)That the Husband pay to the Wife for her maintenance the sum of $500 per week.
Under those circumstances she asserts that she would take responsibility for the payment of school fees.
This aspect of the proceedings was given the barest attention by the parties in the running of the hearing. It was touched upon at [114ff] of the submissions on behalf of the wife. There it was asserted that the Wife had only applied for an assessment of child support on the eve of the trial to give the court jurisdiction to deal with the issue.
The financial statement for the Wife demonstrates a shortfall in her income as against expenses, as does the Husband’s financial statement. Even if he were not paying maintenance to the Wife at $1,250 per week, on his financial statement he would still be subject to shortfall. On the making of the property orders in this matter, the Husband would be relieved of the burden of continuing to pay the investment debt at $961 per week. If he was paying neither of these amounts, on his disclosed income and expenditure, he would then be in surplus by approximately $500 per week.
Despite the clarity that accompanies the position that the Husband’s income far outweighs that of the Wife, the Husband complains that the Wife has not exercised, nor pursued her capacity to derive income. She operates a business, and has done so or many years but, on her financial statement, she is only able to derive $50 per week. While it may be reasonably anticipated that the Wife’s capacity to derive an income is less than that of the Husbands, it should not be overlooked that she has two university degrees[66] and current experience in operating a business. Her evidence of seeking work is of only the barest effort. It may again be reasonably anticipated that she will be able to secure work.
[66] Exhibit H12.
What is necessary for the making of a spousal maintenance order is that I be satisfied, pursuant to s 72 of the Act, that the Husband is reasonably able to support the Wife, and that she is unable to support herself adequately. The onus is on the Wife to establish both of these. Given the circumstances identified immediately above, the Husband has immediate capacity on the making of the orders to support the Wife. However, this is in the shadow of his need to provide for his retirement within his limited remaining working life. The Wife, unemployed, has an immediate need, but has not demonstrated that this need extends for any longer than a short period to allow her to pursue work. It may be that she struggles to do so, but the limited evidence that she has provided as to her efforts to do so means that she has not established that a lengthy period will be required. An order will be made to provide maintenance for the Wife at $500 per week for a period of three months.
Orders were sought for child maintenance for the two adult children of the parties. While some evidence was led in relation to tertiary study, it fell short of establishing that the provision of maintenance was, as is required by s 66L of the Act, necessary to enable either of the children to complete their education. Nor was it established, again as required by s 66L, was it established that the payment of maintenance was necessary because of the mental or physical disability of either of the children. Accordingly no order for adult child maintenance should be made.
In relation to the application for an order departing from an administrative assessment for Z (now aged 14), absent evidence as to the assessment and any inadequacy flowing from it, I am not satisfied that it is in the interest of both the liable parent and the carer entitled to child support for the court to consider whether a departure orders should be made in the special circumstances of the case, a matter that is required under s 116 of the Child Support (Assessment Act) 1989. Accordingly no departure order should be made.
Chattels
While the Husband sought orders in relation to household goods, there was insufficient evidence to support the making of the orders that he sought.
Referral of the papers
This judgment involves findings that the parties have perpetrated a fraud upon the Court to procure the initial consent orders before Registrar Riddiford. On the Husband’s concession he has provided deliberately false information to support the making of those orders. These features raise the issue of whether the parties have engaged in criminal conduct in their dealings with the Court.
It is appropriate that the judgment, documents concerned with the entry into the consent orders and trial material be forwarded to the Director of Public Prosecutions (Cth) for consideration.
I certify that the preceding two hundred and eighteen (218) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Gill delivered on 6 December 2019.
Associate:
Date: 6 December 2019
Appendix
Orders sought by the Wife[67]
[67] Case Summary document prepared on behalf of the respondent wife dated 28 November 2018
The Husband’s Initiating Application filed 16 May 2017 be dismissed.
The Husband pay the Wife’s costs of and incidental to this response.
Such further and other orders as this Honourable Court deems appropriate.
Alternatively, in the event that Final Property Orders made by Registrar Riddiford on 26 October 2016 are reviewed, the Court order as follows:
The Wife solely retain the funds held in trust by Clancy & Triado solicitors.
The Wife be liable for, and indemnify the Husband:
a.The loan owing to Mr K and Ms J.
b.The outstanding utilities for the Suburb N property.
c.The outstanding debt to V Company.
By way of departure from the administrative assessment of child support dated 12 November 2018, the Husband pay by way of child support for Z, born … 2005, the sum of $415 per week, such payment to be credited as to 100% of any administrative assessment in force from time to time.
The Husband pay to the Wife for the maintenance of each of Mr X, born … 1997, and Ms Y, born … 1999, the sum of $400 per week (being $800) such payments continue until each child complete their undergraduate degree in tertiary education.
The Husband pay to the Wife for the maintenance of the Wife the sum of $500 per week.
That the payments provided in paragraphs 3 to 5, inclusive, herein:
a.Be paid to an account nominated by the Wife and be paid monthly in advance on or before the 30th of each month.
b.Be adjusted on 1 July in each year in accordance with the Consumer Price Index for Melbourne.
Upon orders in the terms of paragraphs 3 to 5 inclusive being made, and adhered to by the Husband, then the Wife shall be solely responsible for the T School school fees for Z.
Unless otherwise specified in these orders and save for the purpose of enforcing any monies due under these or any subsequent orders:
a.Each party be solely liable to the exclusion of the other to all other property (including choses-in-action) in the possession of such party as at the date of these orders.
b.Each party forego any claims they may have to any superannuation, long service leave, redundancy, retirement, retrenchment and like benefits belonging to or earned by the other.
c.Insurance policies remain the sole property of the names owner.
d.Each party be liable for and indemnify the other against any liability encumbering any item of property to which that party is entitled pursuant to these orders.
e.Any joint tenancy of the parties in any real or person property is hereby expressly severed.
The Husband pay the Wife’s costs of and incidental to this response.
Such further and other orders as this Honour Court deems appropriate.
Orders sought by the Husband[68]
[68] Outline of case filed on behalf of the applicant on 3 December 2018
The Applicant seeks Final Orders as outlined in his Amended Initiating Application filed on 31 July 2018, namely
That pursuant to rule 1.14 of the Family Law rules, leave be granted for an extension of the time fixed pursuant to rule 18.08, for the filing of a review of the Final property orders of Registrar Riddiford made 26 October 2016.
That pursuant to rule 18.08 of the Family Law rules 2004, there be a review of the Final property orders made by Registrar Riddiford on 26 October 2016.
That the requirement for a review to be brought by an Application in a Case pursuant to rule 18.08 of the Family Law rules 2004 be dispensed with.
That if orders 1, 2 and 3 are not made, the orders made on 26 October 2016 be set aside pursuant to section 79A(1)(a) of the Family Law Act 1975 (Cth).
That within 7 days of the making of these Orders, the funds held in trust by Clancy and Triado solicitors on behalf of both parties be paid in the following manner and priority:
i.In payment of all outstanding amounts owed by the Husband to U Bank pursuant to the Deed of Settlement dated 16 November 2016, currently in the sum of approximately $502,825.
ii.In reimbursement to the Husband of all amounts by the Husband towards the U Bank from 26 October 2016 to date, currently in the sum of approximately $116,533.
iii.In payment of all amounts owing on Westpac credit cards account numbers …37 and …22 to discharge these debts in full, currently in the sum of approximately $35,787.
iv.In reimbursement to the Husband of all amounts paid by him towards the Westpac credit card debt account numbers …37 and …22 from 26 October 2016 to date, currently in the sum of approximately $16,900.
v.In payment of the balance to the Wife.
That the Husband retain all of his right title and interest in B Pty Limited (“the company”) and any associated entities.
The Husband shall be solely liable for and shall indemnify the Wife and hold her harmless against any and all manner of past, present and future debts, actions, suits, causes of action, arbitrations, dues, costs, interest and demands whatsoever both at law and in equity in relation to the company and/or which the company now has or may have at any time hereafter against the Wife whether by reason of the Wife having been an employee of the company and/or pursuant to any guarantee given by the Wife in respect of any obligation of the company to any person or entity.
The Husband retain sole use and control of D Pty Limited ATF Eracken Family Trust No. 2 Pty Limited and any other associated entities and trusts (“the entities”) and any and all income, investments, assets and tax credits (if any) therefrom, for his sole use and benefit (or at his discretion) absolutely.
That the Wife forthwith at the expense of the Husband do all acts and things and sign or cause to be signed any necessary documents to:
i.Assign to the Husband any loan account standing to her credit and provide a full release and discharge from and against any claim, right, entitlement or interest in any such loan account in the entities; and
ii.Renounce and forego any power, right, interest or entitlement (legal and beneficial) in or to the entities and sign all documents required (at the Husband’s expense) to give effect to this clause, including but not limited to Resignation as Director and Transfer of shares forms.
The husband shall be solely liable for and shall indemnify the Wife and hold her harmless against any and all manner of past, present and future debts, actions, suits, causes of action, arbitrations, dues, costs, interest and demands whatsoever both at law and in equity in relation to the entities and/or which the entities now have or may have at any time hereafter against the Wife whether by reason of the Wife having been an employee of the entities and/or pursuant to any guarantee given by the Wife in respect of any obligation of the entities to any person or entity.
That within 7 days of the making of these orders, the Wife make available for collection by the Husband the furniture, contents and belongings contained in Annexure A and the Husband be declared the sole owner at law and in equity of these items.
Other
That unless otherwise specified in these orders and save for the purpose of enforcing any monies due under these or any subsequent orders:
i.Each party be solely entitled to the exclusion of the other to all other property (including choses-in-action) in the possession of such party as at the date of these orders (save that the furniture, personal possessions, and like chattels in the real property are to be divided in accordance with paragraph 11 above);
ii.Monies standing to the credit of the parties in any joint bank account are to become the property of the Wife;
iii.Each party forego any claims they may have to any superannuation benefits belonging to or earned by the other;
iv.Insurance policies remain the sole property of the owner named thereon;
v.Each party be solely liable for and indemnify the other against any liability encumbering any item of property to which that party is entitled pursuant to these orders;
vi.Any joint tenancy of the parties in any real or person estate is hereby expressly severed.
That the applications of the Husband and the Wife respectively filed on 16 May 2017 and 30 June 2017 be otherwise dismissed.
In the event that any party refuses or neglects to comply with any provision of these orders a Registrar of the Family Court of Australia at Melbourne is hereby appointed pursuant to section 106A of the Family Law Act to execute all deeds and documents in the name of the party in default and do all things and acts necessary to give validity and operation to these orders.
That the Wife pay the Husband’s costs of and incidental to this application.
ANNEXURE A
Billiard table
Choice of half of all wine and half of wine glasses
Choice of books
All Husband’s sporting equipment eg golf clubs
Dinner sets
Choice of appliances
Selected children memorabilia and photos
USB of 2012 holiday pix and more recent family photos
Copies of requested family photos
Copy of the Husband’s computer files at Mr Eracken email address
All personal files and documents relating to Husband
All photo albums related to Husband
Choice of tools and garden equipment
Choice of artwork and furniture specifically:
o2 lounge chairs ex the family or sitting room
o1 wall unit ex the dining room/sitting room
o1 smaller wardrobe from the master bedroom
o2 book cases ex study/back bedroom
oChess table and chess set ex dining room
Sporting memorabilia
Choice of DVD, records, videos etc
Mr S Eracken war record collage, Husband’s parents wedding photos family photos etc
Soft/hard copy of the Eracken family history.
11
2