Gardam and Smedley

[2014] FamCA 538

FAMILY COURT OF AUSTRALIA

GARDAM & SMEDLEY [2014] FamCA 538

FAMILY LAW – PROPERTY – De facto relationship – application for consent orders – where the parties seek leave to proceed out of time – delay due to respondent’s health issues following separation – hardship to parties if orders not made – satisfied that the orders are just and equitable – consideration of the intention of the parties.

Family Law Act 1975 (Cth)

APPLICANT: Ms Gardam

RESPONDENT: Mr Smedley

FILE NUMBER: MLC 4716 of 2014

DATE DELIVERED: 21 July 2014

PLACE DELIVERED: Melbourne

PLACE HEARD: Melbourne

JUDGMENT OF: Macmillan J

HEARING DATE: 2 July 2014

REPRESENTATION

COUNSEL FOR THE APPLICANT: In person

SOLICITOR FOR THE APPLICANT: N/A

COUNSEL FOR THE RESPONDENT: In person via telephone

SOLICITOR FOR THE RESPONDENT: N/A

ORDERS

IT IS ORDERED UPON THE APPLICANT ACKNOWELDGING THAT SHE HAS RECEVED THE SUM OF $45,880 THAT

1. Leave be granted to the applicant to commence proceedings out of time.

2. On or before 20 August 2014 the applicant do all such acts and things and sign all such documents as may be required to transfer to the respondent at the expense of the applicant all of her right title and interest in the real property known as and situate at B Street, Suburb C in the State of Queensland (“the Queensland property”).

3. Contemporaneously with the transfer referred to in paragraph 2 hereof the respondent:

   a)do all such acts and things necessary to discharge the mortgage to FirstMac and any other encumbrance over the Queensland property; and

   b)indemnify the applicant against all payments and liability pursuant to the mortgage to FirstMac and all rates, taxes, and outgoings of or with respect to the Queensland property of whatsoever nature and kind, including any arrears.

4. Pending the transfer referred to in paragraph 2 hereof:

   a)the respondent pay all instalments pursuant to the FirstMac mortgage and all rates and taxes and like apportionable outgoings of the Queensland property as they fall due; and

   b)neither party encumber the Queensland property without the consent in writing of the other party.

5. Unless otherwise specified in these orders and save for the purposes 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 (the furniture, personal possessions, and like chattels in the Queensland property being deemed to be in the possession of the  respondent);

   b)each party forego any claims they may have to any superannuation benefits belonging to or earned by the other;

   c)insurance policies remain the sole property of the beneficiary named therein;

   d)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; and

   e)any joint tenancy of the parties in any real or personal estate is hereby expressly severed.

6. The Application for Consent Orders filed 30 May 2014 be otherwise dismissed and the matter be removed from the list of cases awaiting hearing.

AND IT IS NOTED THAT
Pursuant to s 90ST of the Family Law Act 1975 (Cth) the parties intend that these orders shall as far as practicable finally determine the financial relationship between them and avoid further proceedings between them.

IT IS NOTED that publication of this judgment by this Court under the pseudonym Gardam & Smedley has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).

FAMILY COURT OF AUSTRALIA AT MELBOURNE

FILE NUMBER: MLC 4716 of 2014

Ms Gardam

Applicant

And

Mr Smedley

Respondent

REASONS FOR JUDGMENT

1. On the 30 May 2014 the applicant de facto wife (hereafter “the wife”) filed an application for consent orders to be made in Chambers by a Registrar of this Court. Each of the parties filed an affidavit in support of that application. The Registrar declined to make the orders in Chambers notwithstanding the parties’ consent and the matter was subsequently listed for hearing before me in the Judicial Duty List on 2 July 2014. The parties were requested to provide a statement of assets and liabilities and a copy of their most recent superannuation entitlements. Both parties complied with the request to provide a statement of assets and liabilities and the wife provided a statement of her superannuation entitlements as at the 30 June 2013. According to the application for consent orders the respondent de facto husband (hereafter “the husband”) does not have any superannuation entitlements. At the hearing both parties represented themselves, with the wife being in attendance at Court and the husband appearing by telephone.

2. The wife was born in Australia in 1980 and is 34 years of age. She is employed as a professional and earns $1,200 gross per week. The husband was born in the Country D in 1978 and is 36 years of age. He is engaged in the service industry and earns $900 gross per week.

3. The parties commenced living together on 14 February 2003 and separated 31 July 2011. I am satisfied that the parties lived in a de facto relationship for the requisite period of two years and that they were resident in a participating jurisdiction at the time that their de facto relationship ended.

4. The parties now seek to have orders made finalising their financial relationship however as it is more than two years since they separated they require the Court’s leave to make that application. The parties both depose to the fact that following separation the husband experienced debilitating back pain and mental health issues which was the reason why they did not reach agreement and seek orders within the prescribed period. They both submitted that they would suffer hardship if they were not granted the leave necessary to finalise their financial relationship and have the security of orders to that effect.

5. At the commencement of cohabitation the wife’s liabilities exceeded her assets by approximately $15,000. The husband had minimal assets. The primary asset of the parties is the property at B Street, Suburb C in the State of Queensland (“the property”), which is registered in the joint names of the parties.

6. The property was purchased by the parties in July 2009 for $660,000. The husband had received an inheritance of approximately $218,000 which he applied to the purchase of the property and the parties initially borrowed $450,000 to complete the purchase. After approximately two years the parties borrowed a further sum of approximately $25,000 which they used to make improvements to the property. The sum of $11,380, which forms part of the wife’s entitlements, was paid to her at that time. On this basis, at the time the property was purchased their equity in the property was $210,000.

7. The parties have obtained a sworn valuation of the property. Although I have not sighted that valuation, according to the application the property has been valued at approximately $732,500 and is subject to a mortgage of $475,000. On that basis, it has a net equity of approximately $257,500.

8. The parties, for their part, depose that they have resolved the matter on the basis of an equal division of the increase in value of the property since its purchase in July 2009 on my calculations the equity increased by approximately $72,500 excluding the additional borrowings in 2011. The wife has acknowledged that she has received her entitlements of $45,880. It is the parties’ case that this represents a 62/38 split in the husband’s favour having regard to the husband’s greater contributions.

9. Although in my view the orders proposed by the parties require some refinement to give effect to their intention, that intention is nonetheless clear. The intention of the parties is that the husband will retain the property in Queensland and will discharge the mortgage and obtain the necessary refinance in order to relieve the wife of any obligation she may have pursuant to that mortgage. The parties will otherwise retain all the property in their respective possessions.

10. I am satisfied that it is appropriate in the circumstances to grant leave to the wife to file the application for consent orders out of time. I am also satisfied that it is just and equitable to make orders which will bring to an end the financial relationships between these parties. Finally, I am satisfied that, notwithstanding that the percentages the parties attribute to the settlement do not necessarily accord with my calculation of the settlement, having regard to the husband’s initial contributions, the age of the parties and their respective incomes, the effect of the orders that they propose are just and equitable.

11. In those circumstances, I propose to make orders that within 30 days the wife transfer her interest in the Queensland property to the husband, that he discharge the mortgage with respect to that property and be responsible for and indemnify the wife with respect to any outgoings in relation to that property, and that the parties otherwise retain the property that is in their respective possessions.

12. These parties appeared to be extremely cooperative and there seems to be no reason why it would be necessary for the Registrar to sign documents to give effect to the orders that I propose to make and therefore I do not propose to make the order they seek in those terms. I also do not intend to make the orders they seek with respect to the living arrangements for their cat. I am confident that they will be able to make those arrangements for their cat without the necessity of Court orders.

I certify that the preceding twelve (12) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Macmillan delivered 21 July 2014

Associate: 

Date: 18 July 2014