Fanshaw and Fanshaw

[2018] FamCA 1023

FAMILY COURT OF AUSTRALIA

FANSHAW & FANSHAW [2018] FamCA 1023

FAMILY LAW – INTERIM – Property – Spousal Maintenance – Adult Child Maintenance – Whether the wife could claim expenses of having adult children of the relationship living with her – Where the adult children are in employment.

Family Law Act 1975 (Cth), s 72, 74, 75(2), 77, 114, 114(3)
Family Law Rules (Cth) 2004
Superannuation Industry (Supervision) Act 1993

Mitchell & Mitchell (1995) FLC 92-601
Sieling & Sieling (1979) FLC 90-627

APPLICANT: Ms Fanshaw

RESPONDENT: Mr Fanshaw

FILE NUMBER: SYC 2028 of 2017

DATE DELIVERED: 8 February 2018

PLACE DELIVERED: Sydney

PLACE HEARD: Sydney/Parramatta

JUDGMENT OF: Justice Le Poer Trench

HEARING DATE: 3 May 2017

REPRESENTATION

COUNSEL FOR THE APPLICANT: Mr Ford

SOLICITOR FOR THE APPLICANT: Fox & Staniland Lawyers

COUNSEL FOR THE RESPONDENT: Mr Rossic

SOLICITOR FOR THE RESPONDENT: Mcqiu Lawyers

Orders

1. The wife’s application for spouse maintenance (described as Urgent Spouse Maintenance in the wife’s written submissions) is dismissed.

   Pending Further Order:

2. The husband cause all necessary payments to be made to the FlexiPlus line of Credit held in the parties name with the National Australia Bank (account number #39) so as to enable the mortgage instalments which are deducted (as and when they fall due) from that account in relation to the property at B Street, Suburb C (“the Suburb C property) (Folio Identifier …) currently occupied by the wife.

3. Each of the husband and wife are restrained from causing any extension of the loan obtained on the Flexiplus line of Credit (as specified in order (2) hereof) for greater than the limit currently permitted by the contract entered into between the parties and the NAB Bank and which was existing at the date the wife filed her Application in a Case on 7 April 2017, unless consented to by each party. Each of the parties are otherwise restrained from further encumbering their interests in the Suburb C property.

4. The husband is to cause the D Pty Ltd. as trustee of the Fanshaw Superannuation Fund interest in the property at E Street, Suburb F, NSW, (the Suburb F property), to enter into a lease for a term of 18 months (commencing from a date of approximately the filing of the wife’s Application in a Case on 7 April 2017) with G Ltd at a rental of not less than $800 per week (unless otherwise agreed to in writing by the wife) and cause the income generated from the lease to be applied to meet the mortgage and other expenses which arise in relation to the property.

5. To the extent that the wife may be required to sign any document or give any direction or authority to enable the performance of order (4) hereof she is required by this order to do so.

6. Neither party is to take any action, without the written consent of the other, to cause the Suburb F property to be sold, further encumbered or alienated from the current legal ownership of the property.

7. The Court notes the husband’s statement to the court that he will not re-occupy the Suburb F property pending further order of the court or written agreement with the wife.

8. The Docket Registrar is to cause a conciliation conference to be appointed for this matter as soon as can be scheduled following the completion by the parties of all directions made by the Docket Registrar to ready the matter for such conference.

9. Should the matter fail to settle at or after 21 days following the Conciliation Conference the Docket Registrar is to cause the matter to be listed before me for directions.

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 Fanshaw & Fanshaw 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 SYDNEY

FILE NUMBER: SYC 2028 of 2017

Ms Fanshaw

Applicant

And

Mr Fanshaw

Respondent

REASONS FOR JUDGMENT

Introduction

1. Before the Court is the determination of interim property orders sought by the wife as set out in her Application in a Case filed 7 April 2017 and her case outline document filed 21 April 2017.

2. The wife sought urgent orders for spousal maintenance in the sum of $1,000 per week to operate retrospectively from 9 March 2017. She sought that the husband be responsible for the payment of the mortgage and other expenses relating to the property at B Street, Suburb C (“the Suburb C property”) and that the husband deposit his wages into a joint account for the wife to access.  

3. The wife further sought injunctive orders that the husband not reside in or sell the Suburb F property (which is owned by the Fanshaw Superannuation Fund), and that the Suburb F property be leased at market value.

4. The husband relied on his Response filed 24 April 2017. He sought that the wife’s application for spousal maintenance be dismissed. He agreed to continue to pay the mortgage over the Suburb C property in regular instalments, but sought that the wife be responsible for all other expenses associated with living at the Suburb C property. The husband did not agree with the wife’s proposed orders that he vacate the Suburb F property on the basis that he was no longer residing at the property, and agreed to orders that the Suburb F property be leased to G Ltd for market value for 18 months, and that the rental proceeds be used to service the mortgage secured over the Suburb F property and otherwise in satisfaction of the outgoings of the property.

Background

1. The husband and wife commenced cohabitation in 1995 and married in 2005.  The husband is currently aged 57 and the wife is 56.

2. The wife has an adult child from a previous relationship, Ms H. The parties have three children together, Mr K aged 19, and twins J and L aged 17. J and L live with the wife. Mr K suffers from a medical condition and lives in supported accommodation in Suburb F.

3. The parties purchased the Suburb F property in 2013. The Fanshaw Superannuation Fund (of which D Pty Ltd is the holding company) is the registered proprietor of the property. Mr K currently has arrangements with G Ltd for his care at the Suburb F property.

4. The parties separated in October 2015. Following separation, the parties sold a property at Suburb M which was purchased jointly prior to their marriage.

5. In December 2015 the parties jointly purchased a property at Suburb C which is occupied exclusively by the wife.

Evidence

The wife

1. The wife relied on her affidavit sworn 29 March 2017 and filed 7 April 2017, and a Financial Statement filed 24 April 2017.

2. The wife deposed that the matrimonial asset pool is constituted by the following assets:       

   a)The Suburb C property (occupied by the wife) with a mortgage and line of credit secured over that property;

   b)An investment property at Suburb N, encumbered by a mortgage;

   c)An investment property in Suburb O in South Australia (owned by Fanshaw Pty Ltd) encumbered by a mortgage;

   d)Two industrial units in Suburb P (one of the units is owned jointly by the husband and his business partner Mr Q, and the second unit is owned solely by Fanshaw Pty Ltd);

   e)Various motor vehicles;

   f)The following corporate entities owned by the husband:

   i)S Pty Ltd;

   ii)T Pty Ltd;

   iii)Fanshaw Pty Ltd (acting as trustee of the Fanshaw Family Trust);

   iv)D Pty Ltd (the holding company of the Fanshaw Superannuation Fund);

   g)The Fanshaw Family Trust (“the Trust”).

3. The husband and wife are directors of Fanshaw Pty Ltd. The husband is the sole shareholder.

4. The husband is the appointer of the Trust. The husband, wife and the wife’s daughter Ms H are beneficiaries of the Trust.

5. The Fanshaw Superannuation Fund owns the property at Suburb F which is the subject of the injunctive orders sought by the wife in her Application.

6. The wife deposed that the Suburb F property was initially purchased in 2013 and was modified to make it a suitable residence for young people with Mr K’s medical condition. The parties’ son Mr K and another young person with the same condition, R, live at the Suburb F property with support workers provided by G Ltd. Mr K and R use their pensions to pay $213 each per week to contribute to the mortgage and other outgoings of the Suburb F property.

7. The wife deposed that in October 2015 she became aware that the husband began residing in a granny flat within the Suburb F property. The wife became concerned as the husband occupying the property was in breach of certain superannuation rules.  She requested that the husband move out immediately.

8. In January 2017 the husband canvassed the possibility of transferring the Suburb F property out of the Fanshaw Superannuation Fund. The parties had a meeting with G Ltd and the husband advised that if they were willing to pay rent at market value ($800 per week) then he would move out of the Suburb F property.

9. In late February 2017 the wife deposed to a conversation with the house manager of the Suburb F property. He told her that they had identified a third client and asked the husband to organise a formal rental agreement with G Ltd.

10. On 3 March 2017 the wife deposed to receiving an email from the husband where he threatened to terminate the arrangement with G Ltd in respect of the Suburb F property.

11. On 6 March 2017 the husband sent an email to the operations manager of G Ltd advising that he would not be proceeding with the rental agreement and giving G Ltd three months to vacate the Suburb F property. The wife immediately emailed G Ltd and advised them not to vacate the premises.

12. On 15 March 2017 G Ltd advised that they were prepared to take out a lease over the Suburb F property for a minimum of 18 months.

13. On 29 March 2017 the wife received an email from the operations manager at G Ltd advising that the husband offered them a lease until 9 September 2017. The emails indicated that some of the rental income from the property would be deposited into an account nominated by the husband’s accountant. The wife became concerned that the rental proceeds would be used for purposes other than the mortgage and outgoings of the Suburb F property.

Spousal maintenance

1. The wife deposed that on 9 March 2017 the husband removed her access to the Flexiplus line of credit (“the line of credit”), to which the wife had previously accessed to pay for household expenses.

2. The wife deposed that in late 2016 the husband said “If you agree to this 5 year plan, I’ll try and pay all of the family expenses for as long as the business can support it. If you don’t agree and we go to court, I’ll ensure we both end up with nothing.” The “5 year plan” referred to by the husband was an arrangement whereby the parties would keep their assets in joint names for five years. The wife deposed that as she did not agree to this proposal, the husband ceased providing her with financial assistance.

3. The wife deposed that following separation she began working and she currently earns an average of $517 per week.

4. The wife deposed that prior to separation she had worked in administrative roles, but would be required to refresh her computer skills in order to secure employment in that area.

5. During the marriage, the wife drew an income from the husband’s business but the money was not deposited into her personal account.

6. The wife deposed that although J and L are employed, they are reluctant to contribute to the household expenses.

7. The wife does not have access to any credit cards. Her only source of funds are her savings of approximately $35,158 which she holds in a bank account. The wife recently transferred $5,000 to her daughter Ms H’s NAB account which has been placed on a debit card for the wife to pay bills and purchase petrol and other household items. The reason for this was not explained and is probably irrelevant in any event. No issue was raised about the transaction.

8. The wife deposed that her weekly expenses are just under $1,500.

9. In addition to her day-to-day expenses, the wife deposed that she needs to spend approximately $30,000 to fix a water leak in the bathroom at the Suburb C property.

10. The wife believes that the husband has the capacity to support her. The husband’s taxable income as shown on his 2015 tax return is $106,993. However, the wife believes that his income from S Pty Ltd is greater than that. The wife deposed that, during the marriage, the husband often had large sums of money that he kept in cash.

11. The wife believes that the husband operates several bank accounts which have not been disclosed to her.

The husband

1. The husband relied on his Financial Statement filed on 24 April 2017 and affidavit filed 3 May 2017.

2. The husband deposed that, after separation, the wife asked the husband whether they could purchase the Suburb C property as the Suburb M property had become too difficult for her to maintain. The husband agreed and they purchased the Suburb C property in December 2015 for $1,260,000. Until the Suburb M property was sold in May 2016 the husband was paying $6,205 per month to service the Suburb C and Suburb M properties. The Suburb M property sold for $1,490,000.

3. During the bridging period, the husband deposed that the NAB was required to restructure the home loans and other investment loans secured over the properties owned by the husband’s corporate entities. The NAB proposed to using one of the husband’s commercial units in Suburb P as security for the Suburb C property. The husband agreed and was required to take up a personal loan of $160,000.

4. The husband deposed that he has had to borrow money from S Pty Ltd in order to cover mortgage payments and other utilities for the properties. These amounts must be paid back to the company.

5. The husband deposed that the wife has the capacity to earn an income to support herself. She has approximately five years’ experience in administrative roles.

6. The husband deposed that J and L work at S Pty Ltd and each earn approximately $800 per week. The husband’s understanding is that both children pay the wife for their food and rent each week. The husband did not agree with the wife’s assertion in her Financial Statement that she spends $457.50 on the children.

7. The husband is currently paying $500 per week in rent. The husband borrowed $15,000 to cover six months’ worth of rent which was paid in advance. If his current rental agreement is not continued, the husband deposed that he will likely face an increase in rent if forced to source alternative rental accommodation in the area. 

8. The husband deposed that he does not have the financial capacity to pay the wife $1,000 per week.

9. The husband deposed that the approximate value of the properties in the asset pool is estimated at $4.3 million. These properties are encumbered by mortgages totalling $1.3 million. The husband has been solely responsible for servicing all the mortgages. 

10. The husband is now aged 57 and deposed that he is unable to maintain long hours of work as he has done so previously.

11. The husband’s legal fees at the date of swearing his affidavit were $23,000.

Submissions

The wife

1. The wife submitted that the husband removed her access to the line of credit on 9 March 2017. She submitted that this action falls within the definition of family violence under s 4AB of the Family Law Act 1975 (Cth). In that regard, she sought orders that the husband enable her to have access to the joint line of credit.

2. In relation to her urgent claim for spousal maintenance, the wife submitted that her weekly expenses of $1,563 exceed her income of $577. The wife asserted that the husband had ceased paying for groceries, daily household expenses, petrol, health insurance, phone bills, electricity bills, e-tag, car maintenance and insurance, household insurance, council rates, mortgage payments, and insurance and travel expenses for J and L. Prior to 9 March 2017, the wife submitted that the husband was paying on average $1,704 per week to meet those expenses.

3. The wife’s evidence was that the husband ceased making those payments at the same time as withdrawing her access to the line of credit facility. The wife submitted that she was financially dependent on the husband with respect to those payments and as a result, she is no longer able to meet her weekly expenses.

4. In oral submissions, counsel for the wife contended that J and L do not contribute to household expenses, nor do they pay for board or groceries as contended by the husband.

5. In oral submissions, counsel for the wife argued that the husband’s corporate entities have total assets of approximately $5 million. The wife is currently earning $19 per hour at an average of $577 per week.

6. In respect of the injunctive relief sought by her, the wife submitted that those orders do no more than restore the parties to their respective positions prior to separation.  

The husband

Spousal maintenance

1. There was insufficient time for counsel for the husband to make oral submissions in Court on 3 May 2017 and I invited the husband to provide written submissions. Those submissions were received on 19 May 2017.

2. The husband submitted that the mortgage payments for the Suburb C property have been paid from the parties’ joint line of credit. The husband has been responsible for paying funds into the line of credit each month and proposes to continue meeting such payments. It was submitted that the wife’s assertion in her Financial Statement that she pays $450 per week in mortgage repayments is incorrect and misleading.

3. The husband submitted that the wife has $35,157 in bank accounts held in her sole name.

4. The parties’ children J and L, aged 17, reside in the Suburb C property with the wife. It was submitted on behalf of the husband that J and L are not financially dependent on the wife as they each receive $650 per week from full-time employment with the husband’s company.  The husband disputes the wife’s assertions at Part N of her Financial Statement that she provides the children with financial assistance totalling $457.50 per week.

5. It is the husband’s submission that the wife’s actual weekly expenses are $656.00. He arrived at this figure by deducting the mortgage repayments of $450 and the children’s expenses of $457.50 per week. The husband submitted that the wife can meet her weekly shortfall of $78.50 (on the basis that her income is $577.00 and her expenses are $656.00) by utilising her savings of approximately $35,000 that she holds in her bank account. The husband further submitted that the wife has $5,000 in Ms H’s NAB accounts that she accesses for living expenses. On this basis, the husband submitted that the wife has no immediate need for financial assistance.

6. The husband submitted that his position is that the mortgage over the Suburb C property continue to be paid from the joint line of credit, into which he makes monthly payments. The husband submitted that there is no evidence of the mortgage being in arrears. He submitted that neither party has the authority to unilaterally draw down funds from the joint line of credit.

7. In summary, the husband submitted that the wife has not met the threshold test in Mitchell & Mitchell (1995) FLC 92-601 that she is not able to support herself adequately.

8. In relation to his capacity to pay spousal maintenance, the husband submitted the following.

9. He submitted that he was not an alter ego of the entities S Pty Ltd and T Pty Ltd as asserted by the wife.

10. The husband and Mr Q have been the directors of S Pty Ltd since 1994 and are equal shareholders of the entity. There are a number of employees of the entity, including J and L who receive approximately $1,200 to $1,400 each fortnight. The husband receives approximately $1,817 per week in wages from that entity. The profit and loss statements for the entity do not show any director’s loans or specific remuneration for the directors.  The husband receives a further $288 per week as income from T Pty Ltd.

1. It is also the husband’s evidence that he receives $1,660 per week as investment income from properties owned by Fanshaw Pty Ltd.  The husband’s total income is $3,765 per week.

2. The husband’s expenditure is $3,761 per week, which includes the servicing of the mortgage over the Suburb C property and rental of $500 per week for his accommodation in Suburb U.

3. The husband submitted that he does not have the capacity to pay spousal maintenance as sought by the wife. He sought that the wife’s claim be dismissed.

4. The husband agreed to continue to service the mortgage over the Suburb C property by ensuring sufficient funds are deposited into the line of credit before each monthly repayment is due. The husband did not consent to meeting the wife’s other expenses associated with her occupancy of the Suburb C property.

Injunctive relief

1. The husband submitted that he is currently residing in rental accommodation in Suburb U and has vacated the Suburb F property. He submitted that there is no basis for the injunction sought by the wife in relation to his residing at the Suburb F property as the wife was notified of him relocating to rental accommodation in Suburb U. The husband submitted that he has verbally undertaken not to resume occupancy of the Suburb F property and consents to an injunction being made in those terms.

2. The wife also sought injunctive relief to restrain the husband (in his capacity as trustee of the Fanshaw Superannuation Fund) from causing the entity D Pty Ltd (of which the husband is a director and secretary) to sell the Suburb F property.

3. The wife sought that the husband be ordered to sign a lease with G Ltd in relation to their occupancy of the Suburb F property for a minimum of 18 months, and that all rental payments be used to service the mortgage over the Suburb F property and otherwise pay for any outgoings.

4. The husband submitted that there is no evidence that he has mismanaged the Fanshaw Superannuation Fund including the Suburb F property. He submitted that mere suspicion or concern on behalf of the wife is insufficient for the granting of injunctive relief.

5. It was submitted by the husband that Chapter 14 of the Family Law Rules 2004 confers the Court with only limited jurisdiction with respect to interim property matters. The husband submitted that the Court is limited to making orders for the purposes of the preservation of property. The husband submitted that the orders sought by the wife in relation to the leasing of the Suburb F property to G Ltd do not serve the purpose of ensuring the matrimonial assets are preserved.

6. The husband further addressed s 114(3) of the Family Law Act 1975 (Cth) (“the Act”) which confers jurisdiction on the Court to make interlocutory injunctions where the Court considers it just and convenient to do so. It was submitted that there are two central requirements necessary to enliven the Court’s discretion in respect of making an interlocutory injunction, namely that the applicant has an existing claim to a property order under s 79 of the Act, and there must be present an objective risk or danger that the claim may be prejudiced unless the injunction is granted. The husband submitted that the Court must consider the balance of convenience between the parties. He submitted, citing Sieling & Sieling (1979) FLC 90-627, that the Court will not lightly interfere with the rights of an owner of property on the basis of a vague or uncertain claim.

7. Nonetheless, the husband agreed to orders that the parties be restrained from causing the Suburb F property to be sold or disposed of, that the Suburb F property be leased to G Ltd at a minimum rental price of $800 per week, and that the rental payments be used to service the mortgage over the Suburb F property and the balance to be utilised for the payment of costs and outgoings of the property.

The wife’s submissions in reply

1. The wife was directed to file submissions in response to the husband’s written submissions by close of business on 26 May 2017. Those submissions were received on 29 May 2017 after a request by the parties for a short extension of time.

2. In response, the wife submitted that the issues are plainly twofold, namely whether the Court should make a spousal maintenance order in the wife’s favour (either under s 77 or 74 of the Act) and whether the Court should make the injunctions as sought by the wife.

3. The wife submitted that the husband conceded that a spousal maintenance order should be made with respect to the mortgage repayments for the Suburb C property. It was submitted that this concession was made in open court by counsel for the husband. The wife submitted that the husband did not deny that he (individually or through S Pty Ltd or T Pty Ltd) has made substantial post-separation maintenance payments to the wife.

4. The wife submitted that as of 2 May 2017, the husband had not provided G Ltd with vacant possession of the flat at the Suburb F Property. The wife accepts that the husband has currently vacated the property but states that he was not cooperative or candid in doing so, which affected the Fanshaw Superannuation Fund’s compliance with s 62 of the Superannuation Industry (Supervision) Act 1993.

5. The wife submitted that she meets the test for spousal maintenance in s 74 of the Act. She submitted that the expenses contained in her Financial Statement are reasonable expenses. She was not aware that the husband intended to continue to make the mortgage repayments on the Suburb C property until the day of the hearing. The wife has a responsibility to support the parties’ children and has provided evidence of J and L’s use of their income.

6. At the date of her submissions, the wife’s capital sum had reduced to approximately $20,000 as she had paid her legal fees and expenses for the children. She is currently receiving $100 per week from one of her children. She maintained her earlier submission that she is not required to exhaust her capital in payment of her living expenses.

7. The wife continued to assert that the husband’s company structure, including S Pty Ltd and T Pty Ltd, is the alter ego of the husband. She asserted that the businesses were used to pay for holiday expenses of the husband, and that her evidence in relation to the V Town holiday and the cruise at paragraph 104 of her affidavit is corroborated by the entries in the business’ bank statements. The wife submitted that the husband has failed to discharge his onus of proof that Mr Q is engaged at board level in these companies. The wife submitted that she believes that Fanshaw Pty Ltd and the Fanshaw Family Trust also operate as alter egos of the husband and the husband did not address that assertion in his submissions. The wife submitted that there is no evidence to support the husband’s assertion that there are numerous employees of S Pty Ltd. The husband did not rebut the wife’s assertion that the company has continued to pay for the wife’s expenses on his behalf.

8. The wife submitted that the husband plainly has the capacity to pay the spousal maintenance as sought by her. She submitted that the husband controls the income of his various corporate entities including Fanshaw Pty Ltd, Fanshaw Family Trust, S Pty Ltd and T Pty Ltd.

9. The wife submitted that, as the husband has been able to meet the expenses asserted by her since separation, he is capable of complying with a spousal maintenance order.

10. The wife submitted that the husband has failed to discharge his onus in relation to having taken out a loan of $15,000 to pay for six months of rent upfront. There is no evidence of who the lender is, what the terms of the loan are, and whether the loan is at arm’s length. The husband has not tendered a copy of the lease for the property.

11. The wife agreed that the husband has attempted to obtain rental income for the Suburb F property, however she submitted that he has not done anything to implement the lease with G Ltd.  The wife submitted that an order requiring the husband to sign the lease is required.

12. The wife submitted that the purpose of the various injunctions sought is to ensure that the status of the Suburb F property as a special needs residence is preserved. She submitted that the husband has previously threatened to evict G Ltd. In his written submissions, the husband did not oppose the injunction sought by the wife. The wife submitted that there is no hardship to either party arising from any of the injunctions sought as their purpose is to preserve the asset pool.

13. She submitted that the husband has displayed a reckless disregard to the financial risks of breaching the obligations of the Fanshaw Superannuation Fund by residing at the Suburb F property which is legally owned by the Fund.  The wife submitted that her claim in the substantive proceedings to a share of the Fund’s interest in the Suburb F property will be severely prejudiced if the husband damages the viability of the property or incurs penalties from the Australian Tax Office as a result of this breach.

Determination

Spousal maintenance

1. The wife sought urgent spousal maintenance under s 77 of the Family Law Act 1975 (Cth) (“the Act”) of $1,000 per week. Section 77 empowers the Court to make orders for periodic or other sums by way of spousal maintenance as the Court considers reasonable. Alternatively, the wife sought that a spousal maintenance order be made pursuant to s 74 of the Act.

2. The wife must first meet the threshold requirement in s 72 of the Act that she is unable to support herself adequately. The factors to be taken into account in the Court’s assessment of the wife’s capacity to support herself are limited to the factors in s 75(2) of the Act.

3. The wife is 56 years of age and the husband is 57.

4. The wife deposed to a weekly income of $577 and weekly expenses of $1,563.

5. The husband disputed the wife’s asserted weekly expenses. He deposed that he makes periodic payments into the line of credit which is used to service the mortgage over the Suburb C property. He deposed that the wife’s claim in her Financial Statement that she pays $450 per week towards the mortgage is incorrect and should be deducted. In oral submissions, counsel for the wife accepted that the wife was not paying $450 per week towards the mortgage.

6. The husband further contended that the wife’s claimed expenses for the children, amounting to $457.50 per week, should be deducted. The husband deposed that the children J and L earn approximately $650 per week after tax. The wife deposed that J and L are reluctant to contribute to household expenses and that she still meets their financial needs. Counsel for the wife made oral submissions that J and L do not contribute to household expenses or pay board.

7. The husband argued that the wife’s actual weekly expenses are $655.50. If this figure is accepted, there is a difference of $78.50 between the wife’s weekly income and her expenses. The husband submitted that this difference could be met by the wife’s savings of approximately $35,000 in her bank account, or the $5,000 held in Ms H’s NAB account.

8. In response, the wife submitted that in a claim for spousal maintenance, the party seeking relief is not required to use their capital to fund their day-to-day living expenses, citing Mitchell & Mitchell (1995) FLC 92-601.

9. The husband argued that he does not have the capacity to pay spousal maintenance. He deposed to a weekly income of $3,765 and weekly expenses of $3,761. The wife claimed that the husband’s financial capacity is much greater due to her assertion that he has control of the corporate entities of T Pty Ltd, S Pty Ltd, Fanshaw Pty Ltd and the Fanshaw Family Trust.

10. The husband agreed to orders that he continue to service the Suburb C mortgage by way of periodic transfer of funds into the parties’ line of credit. He sought orders that the wife be solely responsible for the day-to-day expenses associated with her occupancy of the property.

Injunctive relief

1. The injunctive relief sought by the wife relates to the parties’ self-managed super fund, the Fanshaw Superannuation Fund.

2. The wife sought that the husband be restrained from causing his entity D Pty Ltd (the holding company for the Fanshaw Superannuation Fund) to sell or otherwise dispose of the Suburb F property.

3. She also sought an order that she and the husband (as trustees of the Fanshaw Superannuation Fund) execute a lease to G Ltd over the Suburb F property. Counsel for the wife submitted that they had received a document purporting to be a lease from the husband, but the lease incorrectly recorded the lessor as the husband in person, rather than the company D Pty Ltd which is the registered proprietor.

4. Counsel for the wife submitted that this Court has jurisdiction to make a mandatory injunction under a 114 of the Act.

5. It was submitted on behalf of the wife that she had reason to be concerned that the husband would not renew the lease with G Ltd as a result of the emails he sent to staff at G Ltd on 20 January 2017 and 6 March 2017.  On 20 January 2017, the husband advised he would terminate the rental arrangement with G Ltd if the rent was not increased to $800 per week. The rent was then increased. On 6 March 2017 the husband sent an email to the general manager of G Ltd stating, “I unfortunately advise that I will not be proceeding with the rental of the above property for $800.00 per week, as previously discussed. Please make arrangements to vacate the premises within (3) months (or earlier if possible).” There were no reasons given in that email. The wife then contacted G Ltd and advised them not to vacate the premises.

6. The husband also sought orders in similar terms that he sign a lease over the Suburb F property with G Ltd at market rate for a period of 18 months.

7. The husband also sought that the rental income from Suburb F be utilised to service the mortgage secured over the Suburb F property and otherwise in satisfaction of the costs and outgoings of the property.

The line of credit

1. The wife lastly sought orders in relation to the parties’ joint line of credit facility secured over the Suburb C property. Currently neither party has authority to draw down on the line of credit, however the husband deposed to paying $421 per week into the line of credit to service the mortgage over the Suburb C property.

2. The wife sought that the husband continue to bank his income into the line of credit and that each party have access to the line of credit.

Conclusion

1. The orders sought by the wife are in some respects incapable of being determined in the space allocated to interim determinations in a manner which can be seen as reasoned based upon adjudication of issues of fact without a detailed examination. The wife has made her assertion/case that the husband has the ability to access, at his election, income and financial resources which would enable him to meet her reasonable expenses. She says, candidly, that he was capable of meeting a far greater commitment to her support following the separation and until earlier in 2017. She may ultimately, in the vehicle of a final hearing be well able to prove her case. If she does so the predictable consequence for the husband of maintaining the case he has before me (namely he does not have such a capacity) is adverse so far as his pecuniary interests are concerned.

2. I conclude that at this time the wife has been unable to satisfy me that the husband’s financial position is as she asserts.

3. The onus of establishing the need for spouse maintenance rests, in this case upon the wife. The wife concedes that of her stated need for $986 per week ($1,563 in expenses less $577 in income), which she rounded to $1,000 for the purpose of an order, would have to be reduced by $450 per week which she had included in her list of weekly expenses as the cost of the mortgage commitment for the residence she occupies at Suburb C. That would then show a need for $536.

4. The wife concedes that $457.50 of her claimed expenses was for the cost of supporting the two adult children who live with her and who work in the business conducted by the husband. There is no issue that each child receives a weekly payment of $650 per week after tax. The wife’s argument is “the children are reluctant to contribute to the cost of their “keep” in her residence.”

5. The argument about the children and whether the husband should be subsidising the wife to be able to provide free support for the children, given the children have substantial incomes, calls for a consideration of sections 75(2)(e),(k),(m), and (o) of the Act. Clearly the subject children are no longer “children” to be considered by s 75(2). There is no aspect of the children’s circumstances which requires, for example, the consideration of an application for support of a child of the marriage who has attained the age of 18 years (s 66L). No submission which addresses s 75(2)(o) explains why it is appropriate to make an order for the husband to pay spouse maintenance for the wife, which is really for the support of the adult children, was provided. There is nothing submitted to establish that the financial circumstances of the adult children are such that it would in the particular circumstances of this case warrant the court making the order sought by the wife.

6. If the children’s expenses are then removed as an expense of the wife to be considered in this case, it would result in the wife showing a need of $78 per week. That determination excludes any consideration of whether the contribution of the children to their expenses in the wife’s residence should be any greater than the actual cost incurred by the wife to provide them with food and shelter.

7. The wife has not attacked the expenses claimed by the husband as his reasonable living expenses. Her case is one of the husband deliberately understating his income or his ability to draw income from one of his income sources, to a level which he is entitled to do and which would show he could meet the wife’s claim for $78 per week. That case has not been established in this hearing.

8. The wife sought an order for interim/urgent spouse maintenance in the sum of $1,000. Clearly she would not have moved the court for an order for $78 per week. Her application for that spouse maintenance must, at this time, be dismissed.

9. The facts, as presented by the parties in this case call for their attention to be directed to resolving their property division now so that each can live their lives as they see fit, including, on the wife’s side wishing to have her adult children living with her where she does not require them to contribute to their living expenses. It may be that the wife will need capital generated from a property division to be able to achieve that result.

10. The thrust of the injunctions sought by the wife have been agreed to by the husband as is outlined in these reasons and I will make the orders which the husband has conceded can be made unopposed by him.

Orders to be made

1. It seems more probable than possible that the wife will have to draw upon her savings in order to support herself and the adult children should she continue to support them financially and not require that they make an appropriate contribution to their living expenses. As such inevitably it can be predicted the wife will make further applications for financial support, perhaps fortified by evidence which might establish her case that the husband’s income is not or should not be restricted to that which he has set out in his Financial Statement filed to support his case for this hearing. The court needs to try to avoid having to reconsider such matters and so I propose to order that the parties move expeditiously to a conciliation conference with the Registrar with a view to resolution of the property matter.

2. Should the parties be unable to resolve their financial issues/divisions at or following such conference I will direct the Docket Registrar to cause the matter to be listed before me for mention and direction.

I certify that the preceding one hundred and fifteen (115) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Le Poer Trench delivered on 8 February 2018.

Associate: 

Date:  8 February 2018