Ettridge and Somers (No. 2) - [2018] FamCA 863

FAMILY COURT OF AUSTRALIA

ETTRIDGE & SOMERS (NO. 2)

[2018] FamCA 863

FAMILY LAW – PROPERTY SETTLEMENT – where the court was required to assess contributions – orders made

Family Law Act 1975 (Cth)

NHC & RCH [2004] FamCA 633
Ettridge & Somers [2017] FamCA 1173

APPLICANT:

Ms Ettridge

RESPONDENT:

Mr Somers

FILE NUMBER:

MLC

11262

2015

DATE DELIVERED:

29 October 2018

PLACE DELIVERED:

Melbourne

PLACE HEARD:

Melbourne

JUDGMENT OF:

Cronin J

HEARING DATE:

23 – 25 October 2018

REPRESENTATION

COUNSEL FOR THE APPLICANT:

Mr Williams

SOLICITOR FOR THE APPLICANT:

Carew Counsel

THE RESPONDENT:

In Person

Orders

Forthwith, the respondent do all things necessary to put the real property at 25 B Street, Suburb C (“Suburb C”) on the market for sale by public auction with an agent to be nominated by the applicant.
The respondent is to instruct the agent that, albeit he is the legal owner of Suburb C, the agent is to take instructions from both the applicant and the respondent in relation to:
(a)       The date of the auction;
(b)       The reserve price;
(c)       The terms of any contract with a purchaser;
(d)       The advertising and sale preparation expenses; and
(e)       The agents’ commission.
If there is any disagreement between the applicant and the respondent about paragraph 2 (a) to (e) of these orders or either party asserts non-compliance with that paragraph, the aggrieved party may apply, by application and affidavit to the Honourable Justice Cronin for determination of such disputed issues including for orders (if necessary) for the exclusion from participation in the said sale of any party not complying with these orders, and the matter be listed as a matter of urgency by the Court.
That the applicant forthwith nominate, and the parties jointly appoint, a legal practitioner or conveyancing company, to undertake the relevant conveyancing in accordance with these orders.
If Suburb C does not sell at auction and the parties do not agree as to how it is to be sold thereafter, they shall have liberty to apply.
Upon the settlement of the sale of Suburb C, the proceeds of sale shall be applied by the conveyancing practitioners as follows:
(a)       First, to pay any expenses of the sale, agents’ commissions, conveyancing fees and any adjustments for outstanding rates and taxes arising therefrom;
(b)       Secondly, to discharge the following liabilities to F Bank:
(i)The home loan numbered …; and
(ii)The F Bank line of credit numbered …;
(c)       Thirdly, to hold the balance thereafter on trust for the parties according to paragraph 7 hereof.
From the net proceeds of the sale of Suburb C remaining after paragraph 6 is satisfied, the balance be divided between the applicant and the respondent as follows:
(a) To the applicant, 58 per cent of the gross sale price after deducting the items in paragraph 6 (a) and (b)(ii) but with a further $440 being added for the respondent’s share of the Mr H valuation; and
(b) To the respondent, 42 per cent of the gross…

Grounds of appeal

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

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

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

Consideration

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

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

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Details

Case: [2018] FamCA 863
Decision Date: 29 October 2018

CaseChat Overview and Summary

This matter came before Cronin J concerning a dispute between Ms Ettridge (the applicant) and Mr Somers (the respondent) regarding the sale of real property and the administration of a self-managed superannuation fund. The core of the dispute involved the division of proceeds from the sale of a property located at 25 B Street, Suburb C, and the rectification of compliance issues within the G self-managed superannuation fund.

The court was required to determine the terms of the sale of the Suburb C property, including the appointment of an agent, the setting of a reserve price, and the conditions of sale. Furthermore, the court needed to address the distribution of the net proceeds from the sale, taking into account various liabilities and specific adjustments for each party. A significant legal issue also involved the declaration of the parties as trustees of the G superannuation fund and the authorisation for Ms Ettridge, in her capacity as trustee, to take specific steps to ensure the fund's compliance with relevant legislation, including the sale of fund assets. The court also had to consider the future management and potential termination of the superannuation fund.

Cronin J ordered that the Suburb C property be placed on the market for sale by public auction, with an agent nominated by the applicant. Both parties were to have joint instructions to the agent regarding the auction date, reserve price, sale terms, expenses, and commission, with a mechanism for dispute resolution. The proceeds of sale were to be applied first to sale expenses and then to discharge specified liabilities to F Bank, with the balance to be divided between the parties according to a detailed percentage split and adjustment formula. The court declared Ms Ettridge and Mr Somers as trustees of the G superannuation fund and authorised Ms Ettridge, as trustee, to take steps to make the fund compliant, including instructing an accountant, arranging an audit, authorising payments, and selling gold bullion. Upon compliance, Ms Ettridge was authorised to roll out her member account, and if Mr Somers wished to roll out his account and terminate the trust, both parties were to cooperate at their joint expense. The court also declared that each party was the owner of property in their respective possessions to the exclusion of the other, save for the implementation of these orders and issues of costs. All extant applications were dismissed, with injunctive orders to continue until the completion of the settlement of all orders.

Orders

Orders of the court

Forthwith, the respondent do all things necessary to put the real property at 25 B Street, Suburb C (“Suburb C”) on the market for sale by public auction with an agent to be nominated by the applicant.

The respondent is to instruct the agent that, albeit he is the legal owner of Suburb C, the agent is to take instructions from both the applicant and the respondent in relation to:

(a) The date of the auction;

(b) The reserve price;

(d) The advertising and sale preparation expenses; and

(e) The agents’ commission.

If there is any disagreement between the applicant and the respondent about paragraph 2 (a) to (e) of these orders or either party asserts non-compliance with that paragraph, the aggrieved party may apply, by application and affidavit to the Honourable Justice Cronin for determination of such disputed issues including for orders (if necessary) for the exclusion from participation in the said sale of any party not complying with these orders, and the matter be listed as a matter of urgency by the Court.

That the applicant forthwith nominate, and the parties jointly appoint, a legal practitioner or conveyancing company, to undertake the relevant conveyancing in accordance with these orders.

If Suburb C does not sell at auction and the parties do not agree as to how it is to be sold thereafter, they shall have liberty to apply.

Upon the settlement of the sale of Suburb C, the proceeds of sale shall be applied by the conveyancing practitioners as follows:

(a) First, to pay any expenses of the sale, agents’ commissions, conveyancing fees and any adjustments for outstanding rates and taxes arising therefrom;

(b) Secondly, to discharge the following liabilities to F Bank:

(i) The home loan numbered …; and

(ii) The F Bank line of credit numbered …;

From the net proceeds of the sale of Suburb C remaining after paragraph 6 is satisfied, the balance be divided between the applicant and the respondent as follows:

(a) To the applicant, 58 per cent of the gross sale price after deducting the items in paragraph 6 (a) and (b)(ii) but with a further $440 being added for the respondent’s share of the Mr H valuation; and

(b) To the respondent, 42 per cent of the gross sale price after deducting the items in paragraph 6 (a) and (b)(ii) and from that share shall be further deducted:

(i) The amount referred to in paragraph 6 (b)(i); and

(ii) $440 being his share of the Mr H valuation.

Should any party desire to seek an order for costs arising from these orders, they may do so by written submission filed and served by 4 pm on 9 November 2018 and any reply thereto shall be filed and served by no later than 4 pm on 16 November 2018 and such matters be determined on those submissions in chambers.

Any order for costs arising out of the determination referred to in paragraph 8 shall be also adjusted within the terms of paragraphs 7 (a) and (b) hereof and a copy of any costs order shall be sufficient warrant for the conveyancer to make the necessary adjustments.

10.

Pending the completion of the sale of Suburb C, the respondent shall be responsible for maintaining the property in good order and condition.

11.

For the avoidance of doubt, paragraphs 1 to 3 of the orders of the Honourable Justice Johns made on 7 September 2018 continue until the completion of the settlement of the sale referred to in these orders.

12.

Pursuant to s 90SL(1) of the Family Law Act 1975 (Cth) (“the Act”) THE COURT DECLARES that MS ETTRIDGE and MR SOMERS are the trustees of the G self-managed superannuation fund with all of the rights and responsibilities as trustees to determine matters as required by the deed of trust.

13.

That notwithstanding paragraph 12 of these orders and notwithstanding anything to the contrary in the deed of trust, MS ETTRIDGE is authorised but in her capacity as trustee to the exclusion of any other trustee, to:

(a) Instruct an accountant to prepare financial statements and appropriate taxation returns for the said superannuation fund such that the fund becomes compliant;

(b) Arrange for the audit of the said superannuation fund;

(d) Authorise the payment of any taxation including penalties and capital gains tax on the disposal of any of the assets of the said fund;

(e) Sell the fund’s gold bullion to Company L, Melbourne; and

(f) Give effect to paragraph 14 of these orders.

14.

Upon the completion of the compliance requirements in paragraph 12, the applicant and respondent in their capacities as trustees, do all things expeditiously to enable the applicant to roll out her member account to her fund of her choice.

15.

If the respondent desires to roll his member account out of the said fund and to terminate the trust, both the applicant and the respondent do all things required to give effect to that course of action at their joint expense.

16.

THE COURT DECLARES that pursuant to s 90SL(1) of the Act, and save for the implementation of the terms of these orders, each party is the owner of the property in their respective possessions to the exclusion of the other party as of this date.

17.

That save as to issues of costs, and the continuation of all injunctive orders until the completion of the settlement of all orders hereunder, all extant applications are otherwise dismissed.

18.

It is certified that it was appropriate for the applicant to be represented by counsel.

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

Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

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