Garston & Yeo (No.2)
[2019] FamCAFC 139
•16 August 2019
FAMILY COURT OF AUSTRALIA
| GARSTON & YEO (NO. 2) | [2019] FamCAFC 139 |
| FAMILY LAW – APPEAL – LEAVE TO APPEAL – Appeal against an interim order for spousal maintenance pending the determination of property proceedings between the parties – Where leave to appeal is required – Whether the trial judge’s decision is attended with sufficient doubt to warrant its reconsideration – Whether substantial injustice would flow if it were not reconsidered – Whether the trial judge’s reasons are adequate – Whether the evidence supports a finding that the amount ordered for spousal maintenance was a reasonable amount to meet the respondent’s needs – Where the trial judge’s path of reasoning is clear and the reasons are adequate – Where the evidence supports the trial judge’s findings – Where a claim for spousal maintenance is not limited by reference to current expenses – Where verification of expenditure depends on the nature of the claim and may not necessarily be required – A person seeking spousal maintenance is not necessarily obliged to resort to their capital before they can receive the benefit of an order for spousal maintenance – No merit in any ground of appeal – No basis for granting leave to appeal – Application dismissed – Appellant to pay the respondent’s costs, as agreed, or in default of agreement, as assessed. |
| Evidence Act 1995 (Cth) s 55 Family Law Rules 2004 (Cth) Sch 3 |
| Bennett and Bennett (1991) FLC 92-191; [1990] FamCA 148 Bevan & Bevan (1995) FLC 92-600; [1993] FamCA 95 Bilson & Geer [2017] FamCAFC 7 Concrete Pty Ltd v Parramatta Design and Developments Pty Ltd (2006) 229 CLR 577; [2006] HCA 55 Fewster & Drake (2016) FLC 93-745; [2016] FamCAFC 214 Hall v Hall (2016) 257 CLR 490; [2016] HCA 23 IMM v The Queen (2016) 257 CLR 300; [2016] HCA 14 Mitchell and Mitchell (1995) FLC 92-601; [1995] FamCA 32 Pollard v RRR Corporation Pty Ltd [2009] NSWCA 110 Robinson Helicopter Company Inc v McDermott (2016) 331 ALR 550; [2016] HCA 22 Seitzinger & Seitzinger (2014) FLC 93-626; [2014] FamCAFC 244 Soulemezis v Dudley (Holdings) Pty Ltd (1987) 10 NSWLR 247 Williamson & Williamson (1978) FLC 90–505; [1978] FamCA 57 |
| APPELLANT: | Mr Garston |
| RESPONDENT: | Mr Yeo |
| FILE NUMBER: | SYC | 6928 | of | 2018 |
| APPEAL NUMBER: | EA | 27 | of | 2019 |
| DATE DELIVERED: | 16 August 2019 |
| PLACE DELIVERED: | Sydney |
| PLACE HEARD: | Sydney |
| JUDGMENT OF: | Aldridge J |
| HEARING DATE: | 25 July 2019 |
| LOWER COURT JURISDICTION: | Federal Circuit Court of Australia |
| LOWER COURT JUDGMENT DATE: | 25 February 2019 |
| LOWER COURT MNC: | [2019] FCCA 745 |
REPRESENTATION
| COUNSEL FOR THE APPELLANT: | Mr Campton SC |
| SOLICITOR FOR THE APPELLANT: | Tiyce & Lawyers |
| COUNSEL FOR THE RESPONDENT: | Ms Christie SC |
| SOLICITOR FOR THE RESPONDENT: | Sydney Law Group Pty Ltd |
Orders
The application for leave to appeal is dismissed.
Appeal EA 27 of 2019 against the order of Judge Boyle made on 25 February 2019 is dismissed.
The appellant is to pay the respondent’s costs of the application, as agreed, or in default of agreement, as assessed.
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 Garston & Yeo (No. 2) 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).
| THE APPELLATE JURISDICTION OF THE FAMILY COURT OF AUSTRALIA AT SYDNEY |
Appeal Number: EA 27 of 2019
File Number: SYC 6928 of 2018
| Mr Garston |
Appellant
And
| Mr Yeo |
Respondent
REASONS FOR JUDGMENT
Introduction
This is an appeal against an order of a judge of the Federal Circuit Court of Australia made on 25 February 2019, which required Mr Garston (“the appellant”) to pay spousal maintenance of $1,000 per week to Mr Yeo (“the respondent”).
Leave to appeal is required because the order was an interim order pending the determination of property proceedings between the parties.
The appeal is being heard by a single judge pursuant to a direction given by the Chief Justice of the Family Court of Australia under s 94AAA(3) of the Family Law Act 1975 (Cth) (“the Act”).
Background
The parties met in December 2012, became engaged in 2013 and married in 2018. In August 2018, the parties separated.
The trial judge found that the respondent was not in good health and had some issues arising from the separation that caused him to seek psychological assistance. He is a professional but had not worked since 2014 when a business he was operating closed. At the time of the trial, he was actively seeking work. Accordingly, the trial judge found that he was unable to support himself adequately.
Her Honour then turned to the question of the amount claimed. Although the respondent sought maintenance in the sum of $2,500 per week, the trial judge was not satisfied that such a sum was necessary to meet his reasonable needs. Ultimately, the respondent’s claim for rent was excluded as he was living with a friend and the claims for expenses such as car expenses, skincare and holidays were reduced.
This led to the finding that the respondent’s reasonable needs were $1,000 per week. Her Honour was fortified in this finding because during the relationship the appellant paid an allowance of $1,000 per week to the respondent. That payment continued after separation until late November 2018.
As there was no issue as to the capacity of the appellant to meet such payments, the order the subject of the application for leave to appeal was made on 25 February 2019.
I shall deal with the question of leave after considering the merits of the appeal.
The Appeal
An Amended Notice of Appeal was filed on 27 March 2019. Grounds 1 and 2 were abandoned. Ground 4(c) was abandoned in the Appellant’s Summary of Argument filed 16 May 2019 and during the course of oral submissions.
Grounds 3 and 6 challenged the adequacy of her Honour’s reasons. Ordinarily, these grounds should be dealt with first (Concrete Pty Ltd v Parramatta Design and Developments Pty Ltd (2006) 229 CLR 577). The parties, however, grouped their submissions by reference to subject matter and it is convenient to do the same.
Did the trial judge give adequate reasons for finding that $1,000 per week was a reasonable amount to meet the respondent’s needs and did the evidence support that finding? (Grounds 3 and 4)
It is submitted that the trial judge’s reasons were inadequate because “there is no articulation of how the figure of $1,000 per week is arrived at, and it would, with respect, require speculation, which is inappropriate” (Appellant’s Summary of Argument filed 16 May 2019, paragraph 20). The appellant also submitted that the trial judge’s reasons were inadequate because her Honour did not engage with the critical point in the case, which was said to be that the respondent’s evidence as to his needs was so weak, speculative and unreliable as to be unacceptable.
The appellant further submitted that the trial judge’s finding that the respondent had reasonable needs of $1,000 per week was not open on the evidence.
The trial judge said:
30.Looking at the [respondent’s] financial statement there are some expenses which I queried during the course of submissions. In particular, the [respondent] does not operate a motor vehicle. Looking at the comparison with the [appellant’s] costs, who does have a motor vehicle, an allowance of $60 rather than $100 would be reasonable for his transport costs.
31.Another item claimed as a necessary commitment is $350 per week for skin products and laser treatment. There is no evidence that would permit me to find that that is a reasonable expense. It is not a medical expense, as are otherwise listed. I do not propose to allow that amount.
32.The other issue is with respect to holidays at $550 per week, some $28,600 per annum. Clearly travel was part of the lifestyle of the parties. In terms of the extent to which it is a current necessary expense, I find this is excessive. The [respondent] is currently seeking employment, which will inevitably limit holiday opportunities. It seems to me a reasonable allowance with respect to that is $225 per week.
33.Taking into account those matters overall with respect to the [respondent’s] position and expenses, $1,000 per week is a reasonable amount to adequately meet the [respondent’s] expenses by way of spouse maintenance.
This finding was bolstered by the undisputed fact that during the relationship, and after separation, until late November 2018, the appellant paid the respondent $1,000 per week.
As the above paragraphs of the reasons make clear, the trial judge carefully scrutinised the respondent’s evidence as to his reasonable needs and did not accept all of it.
Implicit in the finding that particular expenses as claimed were not reasonable, is the finding that the remaining claims were reasonable. In those circumstances, it can be seen that, implicitly, the trial judge rejected the appellant’s contentions as to the reasonableness of the other claimed expenses. It is not necessary for a trial judge expressly to refer to every submission made to the court (Soulemezis v Dudley (Holdings) Pty Ltd (1987) 10 NSWLR 247 at 271). However, in assessing the reasonableness of the claims, her Honour clearly engaged with the proposition that the respondent’s evidence was weak, speculative and unreliable.
The appellant submitted that the trial judge accepted that there was insufficient evidence upon which to make findings. He referred to the transcript where her Honour said “I just don’t have any evidence that would permit me to make any finding about the reasonableness or otherwise of that” (Transcript 22 February 2018, p.17, lines 33–34).
That is a comment made in the course of argument and is not to be elevated to being part of her Honour’s reasons. When the whole of the passage is read, it is clear that her Honour was referring to the claim for skincare only and not the claims made by the respondent generally (Transcript 22 February 2018, p.17, line 11).
In assessing the reasonable needs of the respondent the trial judge also expressly took into account the impact that the relationship had on the respondent’s earning capacity and a standard of living that is reasonable in all the circumstances (ss 75(2)(g) and (k) of the Act at [24]–[28]).
The path of her Honour’s reasoning is clearly apparent and, as such, the reasons are adequate (Bennett and Bennett (1991) FLC 92-191; Pollard v RRR Corporation Pty Ltd [2009] NSWCA 110).
I then turn to the appellant’s submission that the evidence is incapable of establishing the claim of reasonable expenses of $1,000 per week.
It is worthwhile setting out Grounds 4(a) and 4(b) in full. They state:
4.The her Honour erred in principle in finding that $1,000 per week is a reasonable amount to adequately meet the Respondent’s (the applicant for spousal maintenance) expenses by way of spousal maintenance in circumstances where
a.The respondent, as conceded by his senior counsel at the hearing, had not in his Financial Statement in fact given evidence as to what his average weekly expenses (and thus his reasonable needs) were at the time of the hearing of the application, but rather what he estimated the parties “were spending during the intact relationship”;
b.There was thus no evidentiary basis (the onus of establishment of which rested on the Respondent) on which a finding of a reasonable amount of spousal maintenance could be based; and
…
(Amended Notice of Appeal filed 27 March 2019) (As per the original)
The appellant correctly submitted that a person seeking an order for spousal maintenance must satisfy the court, on the evidence before it, that he or she cannot support himself or herself adequately as set out in s 72(1) of the Act (Hall v Hall (2016) 257 CLR 490 at [8]).
The appellant submitted that the trial judge could not be so satisfied because:
·Part N of the respondent’s financial statement expenses, later conceded to be estimates, lacked the “E” next to them so as to indicate they were not actual expenses
·the respondent did not, despite specific requests, provide substantiation or verification of his weekly expenditure
·the estimates in Part N were estimates based on what the parties were spending during their “intact relationship”
·the respondent was no longer living in an “intact relationship” but rather with a friend on a rent free basis
·the respondent had previously banked the $1,000 allowance given to him
·the affidavit of the friend with whom the respondent was living permitted the court to disallow expenses such as rent, household utilities, car expenses and “the like”.
The evidence as to the respondent’s needs was contained in Part N of his Financial Statement, which was verified by an affidavit filed 30 October 2018.
The Financial Statement was clearly admissible. Even if it was evidence based on estimates and on the respondent’s expenses during the relationship, it was capable of rationally affecting (directly or indirectly) the assessment of the probability of the existence of a fact in issue (s 55 of the Evidence Act 1995 (Cth)). It was not “so inherently incredible, fanciful or preposterous that it could not be accepted” (IMM v The Queen (2016) 257 CLR 300 per French CJ, Kiefel, Bell and Keane JJ at [39]).
It follows that there was evidence available to her Honour which supported her findings. Further, it is not at all apparent to me why the points set out above at [25] demonstrate that the trial judge erred by relying on that evidence.
A claim for maintenance is not limited by reference to current expenses because an applicant applying for maintenance may not have the ability to pay for commitments necessary to support themselves (s 75(2)(d) of the Act) and thus avoid incurring what otherwise would be a reasonable expense. Therefore, the focus is on what is necessary for support.
Often, and conveniently, the identification of reasonable needs may be done by reference to expenses that are currently being incurred but obviously, that will not be possible or lead to adequate support in all cases. It is reasonable to claim that you need more money than you are currently spending (Seitzinger & Seitzinger (2014) FLC 93-626 at [53]). Here too, the Financial Statement was prepared very shortly after separation when it would be more difficult to identify the cost of reasonable needs.
It follows that the submission that because a claim is an estimate it must be disregarded cannot be accepted. It also follows that verification of expenditure is not necessarily required. Of course, it depends very much on the nature of the claim itself – claims for everyday expenses in an unexceptional amount may more readily be accepted on limited evidence, whereas others may require more evidence to persuade a judge that they are reasonable. As examples, one need look no further than her Honour’s decision to reduce some claims, which was clearly on the basis that the evidence did not establish that the claim was necessary or reasonable in the claimed amount.
It is also necessary to recall that a claim for interim maintenance “would normally involve some hearing on the merits, although not perhaps as final or exhaustive a hearing as would be the case if one were hearing the matter finally” (Williamson & Williamson (1978) FLC 90-505 per Fogarty J at 77,650).
That deals specifically with the first three points set out above at [25]. As to the rest, it is sufficient to say that none of them establish that the result was contrary to “compelling inferences” or “incontrovertible facts” (Robinson Helicopter Company Inc v McDermott (2016) 331 ALR 550). The findings were open on the evidence.
No error has been identified in these grounds.
Did the trial judge err in finding or fail to give adequate reasons for the finding that the respondent “should not be required to deplete [the] capital he has available in accordance with well-established principle”? (Ground 5 and 6)
The submission as to lack of reasons can be disposed of quickly.
The trial judge said:
29.I accept that the [respondent] is unable to support himself adequately. The next matter then I must consider is what is an adequate level of financial support. As referred to, I do not find that the [respondent] has any rental costs. The [respondent] has savings of some $115,000. In terms of the need for ongoing support, the [respondent] should not be required to deplete his limited capital he has available, in accordance with well-established principle. He has ongoing costs such as the costs of litigation, and his ongoing health needs which may require drawing on those savings.
(Emphasis added)
The bolded sentence constitutes the reasons, based on the earlier findings, why the trial judge considered that the respondent should not have to have recourse to his capital.
The reasons are clear and obvious, and therefore adequate.
It is clearly established that a person seeking spousal maintenance is not necessarily obliged to resort to any capital that they might have before they can receive the benefit of an order for spousal maintenance (Bevan & Bevan (1995) FLC 92-600; Mitchell and Mitchell (1995) FLC 92-601). The existence of such capital is, however, a matter to be taken into account as the Full Court (Strickland, Aldridge & Austin JJ) explained in Fewster & Drake (2016) FLC 93-745:
106.However, these two authorities do not establish that the capital of a person seeking spousal maintenance is always to be entirely disregarded. Rather, the point is that the possible need to retain that capital and not use it for day to day support is a relevant consideration to take into account.
The submission was that the trial judge “in reality, disregarded the cash available to the [respondent], and in doing so failed to consider a material and relevant matter” (Appellant’s Summary of Argument filed 16 May 2019, paragraph 25).
This is a bold submission in light of her Honour’s reasons at [29] which has already been quoted above and which expressly deals with the respondent’s savings.
The issue was clearly taken into consideration.
Grounds 5 and 6 have no merit.
Leave to appeal
Although the basis for granting leave is unfettered, commonly, the Court looks to see whether the decision is attended with sufficient doubt so as to warrant its reconsideration and that a substantial injustice would flow if it were not reconsidered.
As I have determined that there is no merit in any ground of appeal, it follows that there is no basis for granting leave. The application will be dismissed.
Costs
The application for leave has been wholly unsuccessful. Senior counsel accepted that in that case there was no basis in which an order for costs could be opposed.
The respondent’s costs calculated in accordance with the scale in Schedule 3 of the Family Law Rules 2004 (Cth) were $19,613.96. The response from the appellant received on 1 August 2019 was to take the respondent’s costs schedule and to provide an entry by entry approbation or objection as if the Court were undertaking a taxation. The point of this Court fixing costs is to avoid the cost and inconvenience to the parties of a formal taxation. The Court does not approach the task of fixing costs as if it was conducting a taxation, but rather by taking a broad brush approach (Bilson & Geer [2017] FamCAFC 7).
The upshot of the appellant’s submission is that the respondent’s costs assessed at scale are said to be $4,782.18. That does seem somewhat surprising given that both parties engaged senior counsel, albeit over a small issue. It would be surprising that the appellant’s cost are of the order that he would concede the respondent’s to be. However, as I said, I am not going to undertake a taxation.
There will be an order requiring the appellant to pay the respondent’s costs, as agreed, or in default of agreement, as assessed.
I certify that the preceding forty-nine (49) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Aldridge delivered on 16 August 2019.
Associate:
Date: 16 August 2019
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