GERVASE & GERVASE

[2016] FamCA 402

FAMILY COURT OF AUSTRALIA

GERVASE & GERVASE [2016] FamCA 402

FAMILY LAW – PROPERTY – INTERIM PROCEEDINGS – Competing applications – Where the wife seeks exclusive occupation of the former matrimonial home – Where the husband seeks exclusive occupation of the former matrimonial home and an investment property owned by the parties – Where the wife seeks that accrued, and future, rental income generated by the investment property be distributed equally between the parties – Where the husband seeks that the rental income be paid to him – Orders made for the husband to remain in the former matrimonial home and have exclusive occupation of the investment property – Orders made for the rental income to be distributed equally between the parties – Orders made for the husband to pay to the wife spousal maintenance.

Family Law Act 1975 (Cth)

APPLICANT: Ms Gervase

RESPONDENT: Mr Gervase

FILE NUMBER: SYC 1465 of 2016

DATE DELIVERED: 17 May 2016

PLACE DELIVERED: Sydney

PLACE HEARD: Sydney

JUDGMENT OF: Stevenson J

HEARING DATE: 20 April 2016

REPRESENTATION

COUNSEL FOR THE APPLICANT: Ms Spain

SOLICITOR FOR THE APPLICANT: Karen L Haga & Associates

COUNSEL FOR THE RESPONDENT: Mr Gould

SOLICITOR FOR THE RESPONDENT: Swaab Attorneys

Orders pending further order:

1. The parties will do all things and execute all documents required to effect an equal distribution between them of:

   (a)all net accrued rental in respect of the property B Street, Suburb C in the State of New South Wales (“the Suburb C property”); and

   (b)all net periodic rental income generated by the Suburb C property.

2. The husband will pay to the wife interim spouse maintenance of $400 per week, with the first such payment to be made within seven (7) days of the date of these Orders and with all such payments to be made into a bank account nominated in writing by the wife.

3. The husband will cause delivery to the wife, at an address which she will nominate in writing, the refrigerator, television, surge arrester and Blu-ray player which she purchased from Harvey Norman in December 2015.

4. The parties will do all things and execute all documents required to authorise the husband to access the Line of Credit account in the ordinary course of the business known as D Pty Ltd.

5. The husband will have exclusive occupation of the Suburb C property and the property situate at and known as E Street, Suburb F in the State of New South Wales.

6. The competing applications for interim orders are otherwise dismissed.

IT IS NOTED that publication of this judgment by this Court under the pseudonym Gervase & Gervase 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 SYDNEY

FILE NUMBER: SYC 1465 of 2016

Ms Gervase

Applicant

And

Mr Gervase

Respondent

REASONS FOR JUDGMENT

The proceedings

1. By an Initiating Application filed on 14 March 2016 the wife, Ms Gervase, sought the following interim orders:

   1.That the husband vacate the Matrimonial Property situated at [E Street, Suburb F] within 14 days of the date of these Orders, and the wife is declared thereafter to be entitled to be in sole occupation of the property to the exclusion of the husband.

   2.That thereafter the husband is restrained from attending at the Matrimonial Property, without the written consent of the wife.

   3.That the husband be restrained from removing any furniture or contents from the Matrimonial Property, other than as agreed between the parties.

   4.That the husband be restrained from disposing of any assets in his sole name, in the joint names of the parties, or in the name of [D Pty Ltd].

   5.That in respect of the property situated at [B Street, Suburb C], the parties shall immediately instruct the managing agent to do the following:-

   (a)Distribute all rental income held by him equally between the parties;

   (b)Distribute all rental income earned in the future equally between the parties; and

   (c)Immediately issue notice to the current tenant to vacate the property at the earliest possible date.

   6.That the husband be entitled to occupy the property situate at [B Street, Suburb C], solely.

   7.That the husband pay spousal maintenance to the wife in the sum of $1,000 per week, the first payment to be made within 7 days of the date of these Orders, and payments to be made weekly thereafter.

   8.That the husband pay to the wife, by way of urgent child support for the child [G] born … 1999 the sum of $300 per week, the first payment to be made within 7 days, and payments to be made weekly thereafter.

   9.That the husband pay the following in respect of the child [G] born … 1999:-

   (a)All school fees, tuition expenses, uniform costs, text books, sporting fees and other compulsory fees in respect of the child’s attendance at [P School];

   (b)All costs for orthodontic work required by the said child.

   10.That the husband forthwith commence payment of all premiums in respect of any private health insurance policy which the wife commences to cover herself and G.

   11.That the husband is restrained from discussing these proceedings, or showing any documents filed in these proceedings to [H] born … 2000.

   12.That leave be granted to serve short notice of this application.

   13.That the husband pay the wife’s costs of this Application.

   At the interim hearing on 20 April 2016 that I was informed that the wife did not press paragraphs 8, 9, 10 and 11.

2. By a Response filed on 1 April 2016 the husband, Mr Gervase, sought the following orders:

   1.That the parties do all acts and things, sign all documents, and give all authorisations so as to cause the managing agents for the property at [B Street, Suburb C], in the State of New South Wales (‘the [Suburb C] property’) to distribute the accrued and all future net rental income solely to the Husband.

   2.Within 24 hours of Order 1 occurring:

   (a)The Husband shall cause to be paid to the Wife $500 per week to an account nominated by the Wife;

   (b)The Husband cause to be paid to the Wife of the sum of $5,000 to be applied by the Wife towards a rental bond and additional furniture;

   (c)The Husband make arrangements to provide to the Wife the refrigerator, TV, and blu ray player which she purchased from Harvey Norman in December 2015, currently situated at the property at [E Street, Suburb F], in the State of New South Wales (‘the [Suburb F] property’);

   (d)The Wife be authorised to collect from Harvey Norman any remaining items purchased on the Husband’s credit card in December 2015 which remain available for collection there, to the extent they have not already been collected by the Wife;

   (e)The parties do all acts and things and sign all documents so as to authorise the Husband solely to access the Line of Credit account on the mortgage in the ordinary course of business of [D Pty Ltd] (‘the Company’).

   3.The Husband have occupation of the Suburb F South property and the Suburb C property to the exclusion of the Wife.

   4.Within 14 days of the date of these Orders, the Wife provide the Husband with details of how the money she withdrew from the parties’ joint accounts after separation, being

16 Dec	18,142.20	From 1… (company account)
18 Dec	36,000	From …
19 Dec	5,300	From …
19 Dec	10,000	From … (company account)
20 Dec	5,000	From …
20 Dec	5,000	From … (company account)
21 Dec	3,000	From …
21 Dec	5,000	From … (company account)
21 Dec	10,000	From …
TOTAL	$97,442.20	(“the Monies”)

have been applied and all supporting documents in relation to same.

5.        The Monies be characterised by the trial judge at final hearing.

6.The Wife pay the Husband’s costs of and incidental to this Application.

7.The Applicant Wife’s interim application otherwise be dismissed.

Background

1. The husband and the wife, who are both aged 48, married in 1989 and separated under one roof in August 2015.  The wife and one of the parties’ children, G, moved out of the former matrimonial home on 19 December 2015.

2. The parties have three children:

   ·Mr J born in 1996 (19)

   ·G born in 1999 (17); and

   ·H born in 2000 (15).

   Mr J and H have lived with the husband in the former matrimonial home since the parties’ separation.  The wife and the child have stayed with family and friends and currently live in a room behind a shop.

3. At the commencement of cohabitation the husband owned a property at I Street, Suburb K which he purchased shortly before the marriage for $100,000.  The purchase money came from his savings of $40,000 and a gift from his parents of approximately $60,000.

4. The Suburb K property was sold for $150,000 in 1995.  The parties then jointly purchased vacant land at E Street, Suburb F South for $200,000, none of which consisted of borrowed funds.  The parties constructed a home on this land, which was funded by savings and the husband’s income.  They borrowed $30,000 to complete the construction of the ground floor, before they moved into the property at the time of the birth of Mr J.

5. The husband has worked throughout the parties’ cohabitation.  In 1991 he and his father commenced a partnership known as Gervase Pty Ltd.  This business operated until 2002, when the husband and a partner incorporated a company known as L Pty Ltd.

6. The husband spent approximately eight months in M Town on a contract with a company known as “Company N” during 2002.  He contended that he accumulated some $140,000 during this period and that the wife spent all of these funds.  That issue can be resolved only by way of the testing of evidence and is not relevant for present purposes.

7. The husband incorporated a company known as D Pty Ltd (“the company”) in 2009/2010.  The husband and the wife are each shareholders and he is the sole director of this company.  The husband sold his interest in L Pty Ltd to his partner for $95,000 in 2009/2010.

8. In 2012 the parties purchased jointly the property B Street, Suburb C for $641,000.  This purchase was funded by savings and a mortgage of $350,000.  The husband reduced the mortgage debt by approximately $100,000 when he received an inheritance in 2013.  The husband deposed that the current mortgage payout figure is approximately $35,000.

9. The husband stores equipment for his business in the garage at the Suburb C property and has exclusive use of the backyard of the premises.  The house is leased to tenants at a gross rental of $520 per week.

10. It was common ground that the wife withdrew substantial sums from accounts operated by the parties jointly and the company in December 2015.  The husband alleged that the total of these withdrawals was $97,442 and the wife claimed that the correct figure is $76,300.  According to her Financial Statement of 11 March 2016 an amount of $58,809 remained in the wife’s Commonwealth Bank account at that date.  The wife did not particularise her use of the balance of these funds.

11. The wife alleged that the husband subjected her to verbal, physical and sexual assaults and controlling behaviour during the marriage.  The husband denied that he perpetrated any such acts upon the wife.  Further, the wife alleged that the husband ill-treated the child.  The husband denied these allegations but described as “strained” his current relationship with the child.

12. I am unable to make findings as to the veracity of these allegations of violence in the absence of testing of evidence.  I appreciate that the wife’s psychologist, Dr O, has made diagnoses of major depression and panic attacks and Post Traumatic Stress Disorder.  Dr O, however, has had only the wife’s account of the history of the parties’ relationship.

13. The husband deposed that he discovered that the wife charged purchases in a total amount of $6,388 from Harvey Norman to his credit card during December 2015.  He indicated that inquiries revealed that the wife had purchased a refrigerator, television, surge arrester, Blu-ray player, washing machine, dryer and vacuum cleaner.  The husband paid the credit card bill and has stored the refrigerator, television, surge arrester, and Blu-ray player in the garage at the former matrimonial home.

Consideration

1. The former matrimonial home has been occupied by the husband, Mr J and H since 19 December 2015.  The wife proposes that the husband now vacate the premises and move into the Suburb C property.  On the wife’s own evidence, however, a period of three months remains on the current lease.  It thus seems to me that, in practical terms, the Suburb C property is unavailable for occupation by either party.

2. In my view there is considerable uncertainty as to whether H would remain with the wife, if she were to return to the former matrimonial home.  The wife’s own evidence was as follows:

   108.I am concerned that [H] is very angry with me.  If I move back into the home with [the child], I believe that [Mr J] would stay in the home.  I would be hopeful that [H] would also stay in the home.

   The husband, on the other hand, deposed that he has heard Mr J and H say to the wife:  “I want to keep living with Papa.”

3. It thus seems to me that there is real reason for concern that orders which allow the wife to return to the former matrimonial home may result in H’s leaving the property with the husband.  That outcome could well place further strain on the relationship between H and the wife.

4. On balance, it seems to me that the husband should retain exclusive occupation of the former matrimonial home.  The question then is how to ensure that the wife and the child can be provided with appropriate accommodation.  There can be no doubt that it is proper for the financial means of the parties to be applied to secure proper accommodation for the wife and the child.

5. The wife indicated that she could rent premises suitable for herself and the child for $720 per week.  She estimated that she would require a lump sum of approximately $40,000 for the purchase of household contents (Annexure “S” to the wife’s affidavit).

6. The husband proposed that he receive a sum of approximately $8,600 which is currently held by the letting agent of the Suburb C property and that he take all future rental income.  The husband would then provide the sum of $5,000 to the wife for the purpose of paying a rental bond and purchase of furniture.  He would make available to the wife the goods which she purchased from Harvey Norman in December 2015.

7. In my view, the parties should each receive one half of the funds currently held by the letting agent.  The wife would then have available liquid funds in excess of $62,000, which would enable her to rent and furnish a home for herself and the child.

8. Rental from the Suburb C property constitutes an ongoing income stream for the parties.  I consider that each of the parties should receive one-half the net rental income from the Suburb C property.  The husband deposed that the net rent is $2,000 per month and rates and insurance amount to $433 per month.  The wife’s only non-government benefit income consists of an average sum of $140 from baby-sitting.  These earnings plus one half of the net rent should give the wife a weekly income in the order of $500.

9. As noted, the wife has liquid funds of $58,800 and will receive an additional sum of $3,400 from accrued rental. It is not necessary that she deplete the capital available to her before she can establish that she is unable to support herself adequately for the purposes of section 72 of the Family Law Act 1975 (Cth). As noted, she will be required to pay a rental bond and purchase furniture from these funds. No doubt she will also be required to pay several weeks’ rental in advance as well.

10. It is impossible to identify with any precision the expenses which the wife actually will incur, once she establishes rented accommodation.  The wife gave estimates in Annexure “S” to her affidavit as follows:

This expenditure has been calculated with [Ms Gervase] & the child renting a house for $720 per week.
Personal Expenditure	Weekly	Ms Gervase	G
Food	$400.00	$200.00	$200.00
Rent	$720.00	$720.00
Lawn maintenance	$50.00	$50.00
Water usage	$17.77	$17.77
School fees	$288.46	$288.46
Uniform +Books	$50.00	$50.00
Clothing	$300.00	$150.00	$150.00
Telephone +WiFi	$42.50	$21.25	$21.25
Private Health	$70.00	$35.00	$35.00
Car Parking	$20.00	$20.00
Entertainment	$200.00	$100.00	$100.00
Therapy	$80.00	$80.00
Prescription Glasses	$6.00	$6.00
Pharmacy	$10.00	$5.00	$5.00
Dental (braces)	$100.00	$100.00
Gifts	$50.00	$50.00
Accounting fees	$50.00	$50.00
Laptop the child	$53.85	$53.85
House supplies	$100.00	$50.00	$50.00
G sport activities school	$11.54	$11.54
Hair	$50.00	$25.00	$25.00
M.V.	$406.94	$406.94
Holidays	$100.00	$50.00	$50.00
Furniture purchase	$153.85	$153.85
Home insurance for E Street	$28.93	$28.93
Totals	$3,359.84	$2,163.74	$1,196.10
Note:	Purchasing Furniture for rental at an estimated Cost of $40,000 payable o[...]
Legal fees	$100,000.00	(These need to be allocated not sure how[…]
Uni Fees 4 Years	$55,000.00

1. These asserted expenses clearly can be reduced, if amounts such as “furniture purchase $153.85” are disregarded and credit is given to the husband for costs which he has met since the separation.  Expenses paid by the husband include school fees $288 and home insurance $24 per week.

2. In his Financial Statement the husband deposed that he receives a gross salary of $1,346 and income from the company of $577, making a total weekly amount of $1,923.  The husband pays tax of $480 per week, leaving a net income of $1,443.

3. The husband asserted that he incurs weekly expenses of $1,960 but this figure includes a sum of $1,155 for “total of all other expenses”.  That figure is the weekly total set out in Part N of his Financial Statement and includes expenses for Mr J.  The husband deposed that Mr J is employed on a part-time basis and earns $200 per week.  Mr J’s expenses, as set out in Part N of the husband’s Financial Statement, amount to $321 per week.

4. Taking all of these matters into account, and without attempting to carry out mathematical calculations, it seems to me that the husband has a capacity to pay spouse maintenance.  I will take into account, however, the fact that the wife has had access to either $76,000 or $97,000 and that she retains a substantial portion of this money.

5. In all of the circumstances it seems appropriate to me that the husband pay spouse maintenance of $400 per week.  That amount, together with half of the rental income and available cash, should enable the wife to support herself adequately.

6. I will not make orders as sought in paragraph 4 of the wife’s Initiating Application.  There was no evidence whatsoever to suggest that the husband has or is likely to dispose of any assets.

7. I will make an order in accordance with paragraph 2(e) of the husband’s Response.  He deposed that he is currently unable to access a line of credit account which he routinely uses to pay expenses and running costs in regard to the concreting business.  The husband deposed further that he became aware on about 21 December 2015 that the wife had restricted his access to the line of credit account.  He deposed that he has been required to borrow funds from his mother and his brother in order to meet payments to suppliers and contractors.  In my view, it is obviously in the interests of both parties that the husband is able to continue to operate the concreting business in an effective manner.

1. I will not make an order in accordance with paragraph 4 of the husband’s Response. It is a matter for proper case management procedures, which are available under the Family Law Rules 2004 (Cth), for the husband to obtain particulars of the wife’s expenditure of the sums which she withdrew from the parties’ joint account and the company account.

I certify that the preceding thirty-three (33) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Stevenson delivered on 17 May 2016.

Associate: 

Date:  17 May 2016