Fischer and Fischer (No.2)

[2014] FCCA 1387

FEDERAL CIRCUIT COURT OF AUSTRALIA

FISCHER & FISCHER (No.2) [2014] FCCA 1387

Catchwords:
FAMILY LAW – Property – earlier judgment of 6 June 2014 corrected – orders made.

Legislation: 

Family Law Act 1975

Fischer & Fischer [2014] FCCA 1088

Applicant: MR FISCHER

Respondent: MS FISCHER

File Number: SYC 5367 of 2011

Judgment of: Judge Baumann

Hearing dates: 16 & 17 December 2013

Date of Last Submission: 19 June 2014

Delivered at: Brisbane

Delivered on: 30 June 2014

REPRESENTATION

Counsel for the Applicant:  Mr Millar

Solicitors for the Applicant: Dobinson Davey Clifford

Counsel for the Respondent: Mr Batey

Solicitors for the Respondent: Farrar Gesini Dunn Family & Collaborative Law

ORDERS

1. The Husband pay to the Wife, within 30 days, the sum of $545,466 ("the Payment").

2. Upon the Payment the wife sign, execute and deliver up to the Husband, at his expense, Memoranda of Transfer transferring to him the whole of her right, title and interest in :

   (a)the property known as Property F in the State of New South Wales, being Lot (omitted), in Strata Plan (omitted) ("the Property F property");

   (b)(omitted) shares in their joint names.

3. That the Husband forthwith, sign, execute and deliver up to the Wife, at her expense, a Memorandum of Transfer transferring to her the whole of his right, title and interest in the property known as Property T in the State of New South Wales, being Lot (omitted) in Deposited Plan (omitted) ("the Property T property").

4. Upon the transfers referred to in orders 2 and 3 herein the Husband indemnify the Wife in relation to any liability howsoever existing or arising with respect to the Property F property and the Wife indemnify the Husband against any liability howsoever existing or arising with respect to the Property T property.

   Superannuation Orders – (omitted) Super Splitting Order (formerly (omitted) Bank)

5. That in accordance with Section 90MT(4) of the Family Law Act 1975, a base amount of $16,090 is allocated to the Husband out of Wife's interest in the (omitted) Superannuation Fund (Member Number (omitted)).

6. That, in accordance with Section 90MT(1)(a) of the Family Law Act 1975:

   (a)the Husband (or such other person to whom a splittable payment is payable) is entitled to be paid, using the base amount allocated in the immediately preceding order, the amount calculated in accordance with Part 6 of the Family Law (Superannuation) Regulations 2001; and

   (b)the entitlement of the Wife in the (omitted) Superannuation Fund (or the entitlement of such other person who becomes entitled to receive a payment out of the Wife's superannuation interest) is correspondingly reduced by force of this Order.

   (c)That this Order has effect from the operative time and the operative time is the beginning of the day upon which the date of valuation was calculated, being 30 June 2013.

7. That the trustee of the (omitted) Superannuation Fund ("the (omitted) Trustee") shall do all such acts and things and sign all such documents as may be necessary to:

   (a)calculate, in accordance with the requirements of the Family Law Act 1975 the entitlement awarded to the Husband in the immediately preceding clause of this Order; and

   (b)pay the entitlement whenever the trustee makes a splittable payment from the Wife’s interest in the (omitted) Superannuation Fund .

8. That the Court notes:

   (a)The (omitted) Trustee has not been accorded procedural fairness In accordance with section 90MZD of the Family Law Act 1975 in relation to the making of this Order ;

   (b)the value of the non-member spouse interest is calculated in accordance with the Superannuation Industry (Supervision) Regulations 1994; and

   (c)any payments from the Wife's superannuation interest in the (omitted) Superannuation Fund made after the (omitted) Trustee has created a new interest in the Husband's name in the (omitted) Superannuation Fund are not splittable payments in accordance with Division 2.2 of the Family Law (Superannuation) Regulations 2001;

   (d)Within 28 days of service of this Order on the (omitted) Trustee, the (omitted) Trustee have liberty to apply to set aside Orders 5 to 8 at its risk as to costs.

Superannuation Orders – Property B Self-managed Superannuation Fund

1. That for the purpose of Orders 10 to (22) below it is noted that:

   (a)The Property B Superannuation Fund (ABN (omitted)) (“The Property B SMSF”) is a self managed superannuation fund listed by the Australian Taxation Office on the Super Fund Lookup website as a complying fund;

   (b)The Property B SMSF was established under a Deed of Trust dated 8 May 1998.  The rules governing the operation of the Property B SMSF are contained in the Deed of Trust (“The Rules”);

   (c)The Husband and Wife are the only members and trustees of the fund;

   (d)A reference in this order to the “Property B Trustee” is a reference to the Husband and Wife acting collectively in their capacity as trustee of the Property B SMSF.

   (e)That the requirements of procedural fairness in accordance with s.90MZD of the Family Law Act 1975 have been observed on the basis that the parties are the trustees of the Property B SMSF.

2. That in accordance with paragraph 90MT(1)(b) of the Family Law Act 1975:

   (a)the Wife (or such other person to whom a splittable payment is payable) is entitled to be paid the specified percentage of each splittable payment from the Husband’s interest in the Property B SMSF;

   (b)The Husband’s entitlement (or the entitlement of such other person to whom a payment may be made out of the Husband’s interest) in the Property B SMSF Superannuation Fund is correspondingly reduced by force of this Order; and

   (c)the specified percentage for the purpose of this Order is 31.32%

   (d)That this Order has effect from the operative time and the operative time is 30 June 2014.

3. That the Property B Trustee do all things necessary to:

   (a)Calculate, in accordance with the requirements of the Family Law Act 1975 and the Family Law (Superannuation) Regulations 2001 the entitlement awarded to the Wife in Order 10; and

   (b)Pay the entitlement whenever the Trustee makes a splittable payment out of the Husband’s superannuation interest in the Property B SMSF.

4. That after service by the Property B Trustee of the payment split notice pursuant to r.7A.03 of the Superannuation Industry (Supervision) Regulations 1994, the Wife shall within fourteen (14) days do all such acts and things and sign all such documents as may be necessary, including but not limited to exercising her request pursuant to r.7A.06 of the Superannuation Industry (Supervision) Regulations 1994 for the transfer of the transferable benefits (defined in r.1.03 of the Superannuation Industry (Supervision) Regulations 1994) from the Property B SMSF to her interest in the (omitted) Super Fund (ABN (omitted)) (“the (omitted) SMSF”).

5. That contemporaneously with service of the request pursuant to r.7A.06 referred to in Order (12) above the Wife shall serve on the Property B Trustee a request to rollover the entirety of her member entitlement in the Property B SMSF to her interest in the (omitted) SMSF in accordance with the Rules.

6. That the Property B Trustee shall convene a meeting of trustees within 30 days after receipt of the Financial Statement for the Financial Year ending 30 June 2014 and do all such acts and things, and sign all such documents as may be necessary by reference to the Financial Statement to transfer to the trustee of the (omitted) SMSF the transferable benefits pursuant to r.7A.12 of the Superannuation Industry (Supervision) Regulations 1994 by way of the following:

   (a)A pro rata transfer of the investments held by the Property B SMSF being Shares in Listed Companies (Australian) rounded up or down to the nearest whole share;

   (b)The balance in cash after allowing for the rounding referred to in Order (14)(a) above.

7. That contemporaneously with the meeting referred to in Order (14) above the Property B Trustee shall cause to be rolled over to the (omitted) SMSF the member entitlement of the Wife in accordance with the request received in accordance with the Rules by way of the following:

   (a)A pro rata transfer of the investments held by the Property B SMSF being Shares in Listed Companies (Australian) rounded up or down to the nearest whole share;

   (b)The balance in cash after allowing for the rounding referred to in Order (15)(a) above.

1. That the in specie transfer of investments referred to in in Orders (14) and (15) is to be pro rata across each parcel of shares as historically acquired by the Property B SMSF and for avoidance of doubt such division and transfer to be carried out conformably with the following example:

   Example:  The fund holds 30,000 shares in (omitted).  Assume they were purchased in three equal tranches $1.00 per share in 2000, $5.00 per share in 2002 and $8.00 per share in 2010.  The obligation imposed on the trustees under this Order shall be to transfer 31.32% of each of the share parcels (3132 shares) purchased in 2000, 2002 and 2010 rather than a single transfer of 9,396 shares.

   and it is noted that the Super Fund will be eligible for Capital Gains Tax Rollover relief pursuant to Income Tax Assessment Act 1997 ss.126-140 for any in specie transfers.

2. That contemporaneously with the transfer of the transferable benefits from the Husband’s interest in the Property B SMSF to the (omitted) SMSF and the rollover of the Wife’s Member entitlement to the Wife’s interest in the (omitted) SMSF:

   (a)The Wife shall do all such things and sign all such documents as may be necessary to resign as a trustee and member of the Property B SMSF in accordance with its Rules;

   (b)The Husband shall do all such things and sign all such documents as may be necessary to either resign as trustee of the Property B SMSF and as the remaining member appoint a new corporate trustee to be the trustee of the Property B SMSF in accordance with its Rules or appoint a new trustee; and

   (c)The Husband and Wife shall do all such acts and sign all such documents necessary to transfer the investments held by them in their capacity as Trustee of the Property B SMSF to the new trustee of the Property B SMSF noting that such transfers will be eligible for Capital Gains Tax Rollover relief pursuant to Income Tax Assessment Act 1997 ss.124-160 and may be eligible for stamp duty relief.

3. That contemporaneously with the Wife’s compliance with the provisions of Order (17) of this Order, the Husband will indemnify and keep the Wife effectively indemnified against all liability of and in relation to the Property B SMSF including any debt personally guaranteed by the Wife, and including any unpaid income tax assessed or hereinafter assessed against the Wife in respect of income derived or deemed to have been derived by the Property B SMSF inclusive of interest, penalties, costs and fines and from all proceedings, costs, claims or demands in respect thereof.

4. That in the event of any dispute arising between the parties in the exercise of their powers as the Property B Trustee, the parties shall appoint an arbitrator nominated by the President of the Institute of Chartered Accountants.

5. That Pursuant to r.59 of the Family Law (Superannuation) Regulations 2001 the fee charged by the Property B SMSF for complying with this Order shall be nil.

6. Pending the transfer of the transferable benefits from the Husband to the Wife :

   (a)The Husband and the Wife (as Trustees) are restrained from dealing with, charging, encumbering or disposing of any of the investment property of the Property B SMSF other than in accordance with the terms of this Order,

   (i)With the exception of the following low value shares (omitted) property trust 357, (omitted) 357, (omitted) 1,500, (omitted) 1,800, (omitted) 1,000, (omitted) 1,800, (omitted) 667 and (omitted), 1250. All cash proceeds from the sale of these shares be direct debited via (omitted) into the Property B Superannuation (omitted) Bank cheque account.

   (b)The Husband shall immediately revoke any binding death benefit nomination already made and is hereby, restrained from:

   (i)making any binding death benefit nomination in favour of a child described in regulation 13 of the Family Law (Superannuation) Regulations 2001;

   (ii)making any other nomination where the effect of such nomination would be to render any splittable payment not splittable; and

   (iii)doing any such act or thing which would defeat, extinguish or reduce the entitlement of either party under this Order.

1. That the Court Notes:

   (a)The value of the transferable benefits to be transferred from the Husband’s interest in the Property B SMSF to the Wife’s interest in the (omitted) SMSF are calculated in accordance with r.7A.12 and r.7A.11 respectively of the Superannuation Industry (Supervision) Regulations 1994;

   (b)Pursuant to r.14F of the Family Law (Superannuation) Regulations 2001, any payments from the Husband’s interest in the Property B SMSF made after the trustees have transferred the Property B transferable benefits to the (omitted) SMSF are not splittable payments.

Other Property Orders

1. In the event that the Husband fails to make the whole of the Payment referred to in order 1 within the time specified therein the parties shall do all acts and things to cause the following to occur:

   (a)The Husband will pay to the Wife interest on such amount of the Payment as remains outstanding, such interest to be calculated at the rate prescribed by section 117B of the Family Law Act and Chapter 17 of the Family Law Rules. IT IS NOTED THAT at the present time the rate of interest prescribed under those Rules is 8.5% per annum.

2. Within 30 days, the Wife shall make available to the Husband, for collection the following:-

   (a)Any documents in her possession with respect to the Fischer partnership;

   (b)Copies of any DVD’s in the Wife’s possession that contains photographs of the parties’ children; and

   (c)Video cassettes containing images of the parties’ children with the Husband to make a duplicate copy and return the original to the Wife within 3 months of collection.

3. Unless otherwise provided in these orders, as against the Wife, the Husband is to be declared the sole owner of: 

   (a)Any money in any account in his name with any bank or other financial institution;

   (b)The assets of the partnership known as Fischer (“The Partnership”);

   (c)The assets of the company known as Property B Pastoral Co. Pty Limited (“the Company”);

   (d)Subject to these Orders, any interest in real estate in his possession;

   (e)Subject to these orders, his superannuation entitlements;

   (f)Any shares owned by him; and

   (g)All goods, chattels and personal property in his possession.

4. The Husband indemnity and keep the Wife indemnified in relation to:

   (a)Any debt of the Partnership; and

   (b)Any debt of the Company.

5. Unless otherwise provided in these orders, as against the Husband, the Wife is to be declared to be the sole owner of:

   (a)Any money in any account in the name of any bank or other financial institution;

   (b)Subject to these Orders, her superannuation entitlements;

   (c)Any shares owned by her; and

   (d)All good chattels and personal property in her possession.

   (i)The Wife’s Application for child support departure order is dismissed.

Costs

1. Within 21 days from the date of this order the Wife shall file and serve written submissions in respect of an application for costs, orally made on 19 June 2014.

2. The Husband shall within 42 days of the date of this order file and serve written submissions in response to the Wife’s application for costs and include any written submissions in reply in relation to cross application for costs.

3. The Wife is to file any written submissions strictly in reply or in response to any written submissions by the Husband for costs.

IT IS NOTED that publication of this judgment under the pseudonym Fischer & Fischer (No.2) is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).

FEDERAL CIRCUIT COURT
OF AUSTRALIA
AT BRISBANE

SYC 5367 of 2011

MR FISCHER

Applicant

And

MS FISCHER

Respondent

REASONS FOR JUDGMENT

1. Arising from the reasons delivered on 6 June 2014 see (Fischer & Fischer [2014] FCCA 1088), the Court received further oral and written submissions (including some from the Husband directly) on and by 19 June 2014. The Orders made, which will be incorporated in these reasons for judgment are shaped by these further findings:-

   a)The solicitor for the Wife, by letter dated 12 June 2014, identified two typographical errors in the original reasons. They have been corrected.

   b)The Wife contends (at proposed orders 23) for Orders in the event the Husband fails to pay to the Wife the sum of $545,466 within the time specified. In that regard, the Court will order that the Husband have 30 days from the date of this Order to make payment (noting the Wife sought a period of 28 days and the Husband a period of 42 days).

   c)It was contentious between the parties, as to which party was entitled to receive sole ownership of the Property F property. For reasons given (see paragraphs 64 to 66), the Husband was given the opportunity to retain the Property F property. He wishes to do so. In my view if the Husband fails to pay the amount specified, then interest will accrue but it is not, in the whole of the circumstances, just and equitable to “recast” the properties which the Court has decided they keep. For these reasons, proposed order 23 of the said Wife’s orders is not included, as drafted. (save for order 23(a)).

   d)The Husband’s proposed minute for the trial (order 4), sought a number of items specifically be delivered by the Wife to the Husband. The items are more of sentimental value then of significant monetary value – but none the less important. I did not refer to the items in my reasons for judgment, but do incorporate a provision in the final orders.

   e)For reasons delivered orally on 19 June 2014, the Court will not order as per 20(b) and (c) of the Wife’s proposed orders. Directions have been made for the parties to file any submissions as to costs. Any charges, which the Wife has incurred in respect of the drafting of the “superannuation splitting” orders, may be argued as a reasonable disbursement within those submissions for the Court’s consideration. I note the Husband opposes any such payment by him.

   f)The orders provide for a dismissal of the Wife’s Application for child support departure.

I certify that the preceding one (1) paragraph are a true copy of the reasons for judgment of Judge Baumann.

Associate: 

Date:     30 June 2014