Gillen and Gillen
[2016] FCCA 3004
•24 November 2016
FEDERAL CIRCUIT COURT OF AUSTRALIA
| GILLEN & GILLEN | [2016] FCCA 3004 |
| Catchwords: FAMILY LAW – Various applications regarding child support – parties entering into consent Court orders and binding financial agreement in 2008 – whether same should be set aside – parties to be held to their bargain – application for adult child maintenance – father substantially under declaring income – order for adult child maintenance made. |
| Legislation: Family Law Act 1975, ss.66K(5), 66L Child Support (Assessment) Act 1989, ss.117, 129, 136(2)(d) |
| Cases cited: Balzano & Balzano [2010] FamCAFC 11 Gallup & Gallup [2009] FMCAfam 839 |
| Applicant: | MS GILLEN |
| Respondent: | MR GILLEN |
| File Number: | MLC 11757 of 2014 |
| Judgment of: | Judge Burchardt |
| Hearing date: | 4 October 2016 |
| Date of Last Submission: | 4 October 2016 |
| Delivered at: | Melbourne |
| Delivered on: | 24 November 2016 |
REPRESENTATION
| Counsel for the Applicant: | Mr Mellas |
| Solicitors for the Applicant: | Farrar Gesini Dunn |
| Counsel for the Respondent: | Mr Hall |
| Solicitors for the Respondent: | Plaza Legal |
ORDERS
That the father pay $100 per week to the mother by way of adult-child maintenance in respect of his child X until such time as she completes her degree in (qualifications omitted) whichever is the later.
The $100 per week is to increase by $10 per week on 17 November 2017 and a further $10 per week on each 17 November thereafter until maintenance ceases pursuant to order 1.
Otherwise, all extant applications are dismissed.
IT IS NOTED that publication of this judgment under the pseudonym Gillen & Gillen is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT MELBOURNE |
MLC 11757 of 2014
| MS GILLEN |
Applicant
And
| MR GILLEN |
Respondent
REASONS FOR JUDGMENT
Introductory
In this matter, the parties, to their credit, have been able to make parenting orders by their consent. That, however, has by no means resolved all the controversies between them. Put shortly, the applicant mother seeks a raft of orders all designed to produce an outcome whereby the father pays a lot more to her by way of child support, whether in terms of arrears or prospective payments. The father bitterly opposes all the orders that the mother seeks, although he has made some proposals of his own to pay adult-child maintenance in respect of his older child, X, born (omitted) 1997.
For the reasons that follow, I propose to dismiss all of the mother’s application save for the adult-child maintenance application.
Some Agreed Background Facts
The mother was born on (omitted) 1967 and the father on (omitted) 1964. They married on (omitted) 1989 and separated in 2005.
As noted, X was born on (omitted) 1997 and their younger son Y on (omitted) 2003.
Following separation and divorce in 2006, the father remarried Ms S in (omitted) 2006 and has two further children whose ages do not appear to be given with great precision but who appear now to be eight and five.
The father is employed as a (occupation omitted) and has various business interests in and associated with the (omitted) industry. The mother is a qualified (occupation omitted), although she does not have and has not for some years had a (employment omitted) certification. She was in well-paid employment until about 2006 but has worked little, if at all, until recently. She is presently engaged pursuant to a three month contract which commenced on 21 September 2016, pursuant to which she is paid $62 per hour plus superannuation.
The 2008 Orders and the Binding Financial Agreement
On 17 June 2008, the parties concluded their tranche of litigation, which (it is clear from the file, even without reading it), was pursued energetically from 2005 until then by consent orders, together with an interrelated binding financial agreement. The orders made before Young J run to 42 orders plus annotations. They were extremely detailed.
The orders provided that the wife receive $805,000 from the sale of Property W, together with a number of other matters of some value, including $66,000 already received. The husband received assets which included properties at Property H, Property C, Property U, South Australia, although all of them were encumbered by mortgages in relatively substantial amounts.
Although, in one sense, it is a small matter, order 20 provided that within 14 days of the settlement date of Property W, the wife make available to the husband (a) the (omitted) bat, (b) the (omitted) cricket ball, (c) the (omitted) painting, and (d) the (omitted) wine fridge.
It is clear from the orders made that the net effect of the orders were to repose in the husband his extant business interests and to exclude the wife from any right or previous entitlement she might have had in them.
Order 35 and 36 are important and read as follows:
35. THAT the husband pay to the wife (upfront, with such payment being made to the wife directly at settlement from the proceeds of the sale of Property W) from his share of the net proceeds of sale of Property W as referred to in paragraph 21 hereof, the sum of $90,000.00 such sum to be applied by the wife towards private school fees for both the children at (omitted) School and (omitted) College.
36. THAT save as provided for in paragraph 35 above the wife be responsible for all of the children’s educational expenses.
In the annotations at the end of the orders, relevantly, it was noted at A and B:
(a) THAT the parties intend that these Orders shall as far as practicable finally determine the financial relationship between them and avoid further proceedings;
(b) THAT neither (omitted) School nor (omitted) College are schools chosen by or preferred by the husband for the children.
The binding child support agreement which both sides executed following independent legal advice relevantly provided that:
1. Child support shall be paid as assessed by the Child Support Agency from time to time.
2. In addition to the payments as referred to in paragraph 1 above, the husband shall pay directly to the wife (within 14 days of the issuing of an invoice) by direct credit half the costs of three agreed extracurricular activities per child per term, on the proviso that one such activity per term includes (hobby omitted) for each child.
3. Upon each child obtaining the age of 18 years or completing their secondary education (“the terminating event for that child”), whichever occurs later, the child support obligation under this Agreement in relation to that child shall cease.
4. Save as provided herein, the Mother shall pay all other child-related expenses.
The Mother’s Claims
Relevantly, for these purposes, the mother first claims arrears alleged to have accrued pursuant to the child support agreement for the period 17 June 2008 to 17 August 2016 in the sum of $17,590.76. She seeks the discharge of order 36 of the orders made by Young J (otherwise making the mother responsible for all child-related expenses).
She seeks that the child support agreement be set aside pursuant to s 136(2)(d) of the Child Support (Assessment) Act 1989 (“the Assessment Act”).
She next seeks a child support departure order pursuant to s 117 of the Assessment Act such that the father pay, in respect of Y, from 17 August 2016 until 31 December 2021, the sum of $2770.35 per month. It became apparent during the running that this is, in effect, a demand that the father pay Y’s school fees at (omitted) College.
The mother next sought that the $2770.35 per month be paid as a lump sum.
Finally, she sought that the husband pay adult child maintenance in respect of X, pursuant to s 66L of the Family Law Act 1975, by way of lump sum of $32,400. This was clarified by counsel in his opening as being $450 per month for six years to enable X to complete her proposed qualifications in (qualifications omitted).
As earlier indicated, the father’s response is opposed to all of these applications, although he makes a proposal for a minor contribution on his part towards X’s maintenance.
The Evidence
The parties have filed relatively copious affidavit material, much of it to do with the now-resolved dispute over parenting orders. I have read this material carefully and have due regard to it, but the nature of the evidence given at court was so clear that I propose to concentrate in this judgment upon what the two primary parties had to say by way of evidence when they were in the court.
The Evidence of the Mother
The mother was called and adopted her affidavits and Financial Statement as true and correct. She brought the court up to date. The property she owned with her partner Mr T has been sold for $2,040,000 and will settle on 19 October 2016. Her half share is effectively $1 million after sales costs. Following payment of the mortgage, she expects to receive a net figure of about $385,000.
The mother deposed that she bought a townhouse in Property V last week for $1.4 million and has applied for a loan from the (omitted) Bank for $1 million to fund the same. She is buying the property with her brother, as a tenant in common. She will be a 90 per cent owner and he will own 10 per cent. His participation was necessary to obtain the loan, as the mother has not recently been generally in work. The loan has been approved in principle and will cost approximately $4000 per month.
The mother told the court that she has received a three months’ contract with the (employer omitted) and will work between three and five days per week at $62 per hour. Three days per week produces just over $1000 net, and she is hoping for four days, which would be approximately $1300 net. She told the court that she and Mr T will not live together. Mr T’s affidavit was read and is to that effect. He was not required for cross-examination.
The mother tendered, as exhibit A1, a child support assessment dated 22 September 2016. It applies for the period 1 October 2016 to 31 December 2017. It assesses the father’s income at $51,251 and the mother’s at $80,682 and gives rise to a monthly payment of $376.33 to the mother.
The Mother Under Cross-Examination
The mother confirmed that the father paid her $90,000 in 2008 as his contribution to the childrens’ schooling. She confirmed that she knew at that time that the school fees would be likely to be approximately $250,000 and agreed that there was a notation to the effect that they would be $300,000 (which I have not immediately been able to find). She agreed that she knew the schools would be expensive and that the estimated cost included CPI. She agreed that the husband did not agree with the schools. She said the school fees have just jumped.
She said additional expenses for extracurricular activities have occurred as a result of the requests of the children. X asked to do competition (hobby omitted) and the mother agreed.
The mother agreed that she had recently bought a property at Property S for $515,000. It settled in January 2016. It was funded by money from the sale of the former property in Property I. She confirmed that the Property S property is not rented and accepted that it was capable of producing an income of $440 per week. She conceded that she could change her son’s school.
She said the father had not honoured the agreement which she had reached on her understanding at the time. She sold the property at Property I for a profit of approximately $200,000 which she contributed to the purchase of Property S and the rest into a capital account.
The mother was cross-examined about her overseas holidays. She confirmed that she had been in (country omitted) in (omitted) 2012 for seven days, where she met her girlfriend and stayed in (country omitted). The total cost was about $3000. She had been to (country omitted) in 2013, but Mr T paid. She denied going to (country omitted) in 2014. She said she went to (country omitted) with the children in 2013, to (country omitted) for two and a half weeks. Cost was probably about $15,000.
The mother agreed that she was the author of the annexure G2 to the father’s affidavit sworn 1 September 2016. She said she had a website. She said the description of herself was just a joke. She did not have any Hermes scarves, vintage Chanel bags or the like. The text of the document includes:
The alter ego of Ms Gillen, another fashion tragic who knows stuff about fashion, and buys items purely for their artistic value, regardless of their wear for price kudos. Anything visually stunning, textually intoxicating and interesting, beautiful or just plainly different to the eye, is enough to make its way into the household. Ms Gillen welcomes every new addition with a tear in her eye, and an eye on her credit card. Oh well.
I would interpolate and say that I accept that that document meant what it said, and I do not accept the mother’s denials to the effect that this was just a joke.
The mother conceded that she could have bought a cheaper property than that in Property V for $1.4 million. The orders made before Young J were by consent. She is (occupation omitted) qualified. Although she does not have a current (qualifications omitted) certificate, she could get one. She was taken to the child support agreement and noted that although it provided for agreed activities, the father never agreed to anything. She said, however, that he did agree to X’s (hobbies omitted) and various other matters.
She said it was not correct that she had failed to consult with the father about extracurricular activities. She said she sought agreement in early days but it was never forthcoming. The father’s only objection was to Y’s (hobby omitted) lessons. (hobby omitted) was eventually cancelled, and the father paid half of that until it was cancelled.
The mother confirmed that X is undertaking a (qualifications omitted), which is a three year course. She is almost at the end of the first year. She has been accepted into (course omitted), and her third year of (course omitted) will be her first year of a four year degree in (course omitted). She has, however, to maintain her marks at 70 per cent or above to keep the place that she has already obtained in (course omitted). Her VCE score was so high that this is perfectly practicable. She has involvement in what is described as a lower level HECS scheme, if I understood the matter correctly.
The mother was taken to part N of her financial statement. She confirmed that she allows the sum of $10,000 globally for holidays for the three persons in the household. It was put to her that $395 per week was more than enough for X’s needs but the mother stuck to her figure of $612. She said that the actual is the necessary.
She confirmed that X has 23 contact hours and is required to have 23 additional hours of study. She gets paid $22 per hour for a small amount of work at (employer omitted) as a (occupation omitted). She could work for (employer omitted). She spends two hours per day commuting. X’s semesters are from February to June and July to the end of November. She gets a three month break and could work in holidays.
The mother was cross-examined about her income from 2012 to 2015 and it would seem that her income decreased from about $113,000 in the financial year ending 30 June 2012, a sum that had reduced to $50,000 to 30 June 2015.
The mother was cross-examined about her claim for money for Y. She confirmed she had not appealed through the Child Support Agency channels, who had told her to come to court. She confirmed that the sum claimed was effectively school fees. She was aware that the father has two younger children from his second marriage. She asserted that their mother has a substantial income. She said that only X receives her university documents and the mother was opposed to an order requiring her to make the same available to the father. The mother denied receiving any income from her parents’ trusts.
The mother was taken to her application for a loan from the (omitted) Bank in respect of the Property V property. She confirmed that this asserted that she had not been in any financial difficulty for the last two years (exhibit R4).
The Evidence of the Father
As with the mother, what follows is not a transcript but is taken from my notes and records those aspects of the evidence I thought to be more significant.
The father adopted his affidavits and Financial Statement as true and correct.
Under cross-examination, the father asserted that his income varies enormously.
Without going through the detail, it became extremely clear that the husband controls a number of trusts and related corporations and businesses. He has numerous activities. He continues to be co-owner of a business in Adelaide, although he sought to suggest that this would produce very little income. One of his businesses, (business omitted), was asserted to have had no income in the last six months because of the father’s involvement in this case. He said he had not had time to serve his clients. He went on to assert that all the income through his various businesses is distributed to himself, his current wife and their four children.
It emerged, however, that the amounts distributed to the children are effectively tiny because of tax issues ($400 each). The father says that he works 50 to 60 hours per week, helps with bringing up his two younger children, plays (hobbies omitted). When pressed about why he had not produced documents, he said he had not felt it necessary.
Although the original claim for documents pressed by the mother to go back 10 years was plainly excessive, it is quite clear that the father has failed, and done so wittingly, to comply with his obligations to discover.
Although there was much cross-examination about the business records of the various trusts and entities that the father controls, in my opinion, their non-provision in the ultimate is of little significance save that it shows a lack of appreciation on the father’s part of his obligations. That is because one part of his evidence that I do accept that is that he does not have any retained income in the trusts. That evidence was given with conviction, and I accept it.
The father confirmed that his wife is not on the payroll of any of his entities, although she does work for his business. She is paid through distributions. She is a (occupation omitted) and probably earns about $1400 per week working for the (employer omitted) and the (employer omitted). She contributes to his household.
The husband asserted that he declares all his income to the Child Support Agency each year and gives them his tax returns. In 2015, he had an income of $39,000 and $124,000 was distributed to his wife. In 2014, he had an income of $79,995 of which $53,000 represented distributions of the trust. The wife’s income was $201,000 of which $150,000 was trust distributions.
I prevented further cross-examination about this aspect of the matter as I felt that the position had become reasonably clear. In the absence of the father, I explained that my view at that stage, and nobody sought subsequently to dissuade me from it, was that there appeared to be a pattern whereby the father kept his own income low by ensuring that the trust distributions to his wife were much higher. This has an effect, it would seem, upon his child support assessment.
Without going through the evidence in any detail, the picture the father sought to paint was one of a relative lack of current business success and reduced income.
The father admitted that he had spoken with the mother about sending Y to (omitted) College when he was born. He said he came to doubt it and had doubts as to whether it was affordable. He also stressed the benefit of the local co-educational school; however, he was forced to concede that he has signed papers to have Y attend (omitted) College. He has, in fact, also applied for his two younger children to go to (omitted) School. He conceded that Y has been at (omitted) College for four years and is doing well.
The father was cross-examined about the children’s extracurricular activities. His two younger children attend (hobby omitted) and (hobby omitted). He said that X had recently been in (country omitted) for (hobby omitted) and that this was unnecessary. When it was put to him that (hobby omitted) was something he had agreed to earlier, he said yes and no. He said that interstate and overseas competitions were too much and was shocked when the first interstate trips took place. He did not agree (hobby omitted), although he would always have approved (hobby omitted). He approved (hobby omitted) for Y because it was cheap and cerebral.
He was taken to exhibit G10 to the mother’s trial affidavit. He agreed that he was the author of it. G10 is dated 12 September 2006 and details a number of matters not in dispute, including (hobbies omitted). At the bottom is written:
PRE-REQUISITES FOR FURTHER PAYMENTS
– Wine fridge, bat, ball, etc
– Share transfer of (omitted) shares thought to be (omitted)
– Sign deeds of variation of trusts.
He said these preconditions reflected breaches of the original agreement by the mother.
The father was further cross-examined about his response to X obtaining a scholarship at (omitted) School. He has sworn in this affidavit that he had felt it appropriate that he should receive some of his $90,000 back. He said he had offered to accept 25 per cent of the scholarship. He further said that when the (omitted) bat was returned, it was destroyed.
The father was taken to exhibit G11, being an email to the mother from him dated 5 March 2013. This astounding communication complains of X receiving a scholarship and demands 55 per cent refund of any scholarship credits against the school fees. He also makes it clear he will not support, and indeed actively oppose Y obtaining a scholarship for (omitted) College. The father’s endeavour to explain away this hateful, hurtful, incredibly negative mean Scrooge-like communication was utterly unsatisfactory.
The father has not paid for Y’s (hobby omitted) lessons or his (hobbies omitted) classes. He did not agree with Y playing (hobby omitted). He said he was never asked about extracurricular activities. The (omitted) shares referred to have never been transferred to him. The mother eventually signed a variation of the trusts as required. She sold his wine fridge to a friend, although he eventually got it back. When the (omitted) bat was returned, the signature had been erased. This last evidence was given with a passionate conviction and sense of grievance, and I accept that it was true.
The Submissions of Counsel – the Father
Counsel first addressed the question of the application to set aside the child support agreement. He noted that s 136(2)(d) of the Assessment Act required exceptional circumstances that have arisen since the agreement was made and that the child would suffer hardship if the agreement was not set aside. He referred to the judgement of Warnick J in Balzano & Balzano [2010] FamCAFC 11, where, at [41], his Honour noted that the explanatory memorandum when this provision was brought in relevantly stated:
As currently drafted, courts could set aside binding child support agreements (made with legal advice) in a range of circumstances, including circumstances that may have been contemplated and dealt with in the agreement. It is not intended that binding agreements should be set aside lightly. This amendment restricts the scope for the setting aside of binding child support agreements, by specifying that exceptional circumstances relating to one of the children or parties to the agreement must have arisen since the making of the agreement, and that the child or party would suffer hardship if the agreement were not altered or set aside.
Counsel also referred to the judgment of Demack J in Gallup & Gallup [2009] FMCAfam 839 at [52] where her Honour said:
“Exceptional”, it seems to me, carries with it something more than “special”. In its most basic sense, “exceptional” is derived from “except”. This provides the starting point for understanding that the word is meaning to exclude or create a barrier. Circumstances, then, which are “exceptional”, must be outside the normal experience, in such a way that they are the exception and something more than a minor abnormality. As the exceptional circumstances are arising in the context of change, the expression in Simpson & Hamlin op cit seems apt: that the change was such as to “take it out of and beyond the ordinary circumstances in which such change might be reasonable expected to occur.”
Counsel submitted that the mother knew the costs of schooling at the time of the agreement. She chose the schools. There was no unexpected increase, and she received $90,000 towards those fees upfront.
Counsel further submitted that there would be no hardship to the children, in any event. The mother could rent out her property in Property S or sell it. She had conducted extravagant overseas trips and had notified the (omitted) Bank in her recent application that she had suffered no financial hardship in the last two years. It was submitted hardship was simply not made out.
Counsel next suggested the application to discharge order 36 of Young J. It was submitted there was simply no basis for this.
Counsel then addressed the claim for the alleged arrears of maintenance. He submitted that the agreement was such that it had not been breached and could not be enforced.
Counsel next addressed the adult-child maintenance issue. He said the mother could share the costs of her daughter. He challenged the reasonableness of the sums claimed by the mother and submitted that his client should pay until the end of his daughter’s first degree.
Counsel next dealt with the departure order application. He submitted there was no basis to attract the operation of s 117 of the Assessment Act. What was really sought was school fees.
Finally, counsel addressed the application for lump sum payments. He referred to s.66K(5) of the Family Law Act, stressing that there should be no consideration of lump sum payments until the capacity for periodic maintenance was made out.
The Submissions of Counsel for the Mother.
Counsel agreed with the force of the decision in Balzano but submitted that the circumstances are exceptional. There have been significant changes since 2008, most particularly in the costs of the schools. The schools were thought to be likely to cost $300,000 but are likely to, in the end, cost about $426,000. X obtained a scholarship. If this had not been the case, the fees would have been greater. The mother was unemployed until recently and now has a job for three months. She pays fees through capital and will have to spend approximately $227,000 in the next five years for Y. Y is doing well and should stay at (omitted) College.
Counsel noted that at the time of the binding financial agreement, the father was spending time with the children but largely now is not. Y is now with the mother except for one day when he is driven to school. X does not see her father. (This matter seems to be an issue on the affidavit material but was not pressed in cross-examination). He submitted there would be hardship if the order was not set aside.
Counsel next moved to the order of Young J. He referred the court to s.129 of the Assessment Act. He submitted it would be just and equitable and in the interests of Y to make the order sought.
In relation to the arrears sought of child support, counsel submitted that the wife in the end just gave up asking the husband for his agreement. It was submitted that the father’s failure to cooperate in a reasonable way gave the mother no alternative, and that he should be held, in effect, to what in substance was his bargain.
So far as the setting aside of the agreement and the departure order was concerned, counsel submitted that the father makes far more than he is declaring. He pays $270 per month (shortly to increase) based on a salary of $51,000. Counsel pointed to the almost total lack of disclosure of his affairs.
In respect of lump sums, counsel simply submitted that in light of past history, it would be very difficult to get periodic payments out of the father.
In respect of the adult-child maintenance claim, counsel submitted that the $612 expended on X was entirely reasonable and the mother was seeking a contribution of just over $100 per week.
The Credit of the Witnesses
Mr T was not required for cross-examination, and I therefore accept the force of his affidavit. It seems quite clear that his relationship with the mother, while still subsisting, is not going to involve any kind of intermingling of finances between them. She is thus financially, so to speak, on her own.
The mother answered the questions put to her directly, although she was at all times concerned to qualify her answers to her benefit. The mother impressed me as an extremely composed witness, well able to think her answers through, and she was concerned, in a way that I found obvious, not to give an inch. It is quite apparent, not only from her demeanour in the witness box but some of her communications with the father (I have passed over the somewhat distasteful materials from both sides annexed to their affidavits that have shown none of them in any kind of good light), and it is clear that she retains a strong and active dislike of him.
The same is equally true of the father. The mother was not prepared to give an inch in her evidence, and was at all times relentlessly critical of the father. The father, however, returned this with interest. I have already commented on the meanness of spirit shown by him when X received a scholarship and there was contemplation of Y getting one also. It almost beggars belief that somebody could be so horribly mean. Some of his answers were utterly unconvincing, but what emerged perhaps strongest of all was his continuing dislike of the mother.
These parties separated in 2005 (in the ultimate a figure confirmed in the binding financial agreement) and have been separated now for 11 years. The husband has been married to someone else for the last 10 or so years. As I observed in court, it is terribly unfortunate that these two people have not been able to move on and get to grips with their emotions about one another for so long a time. The damage this does to them and, probably also to the children is not quantifiable but must be considerable.
I should make it clear that I did not find the father an entirely convincing witness, most particularly in relation to his income and his likely income in the future.
The business activities statements tendered as exhibits R5, R6, R7 and R8 in my view all suggest that his income as declared to the Child Support Agency is manipulated to be less than it, in truth, is. I have no doubt that the substantial distributions to his wife are designed to achieve this outcome.
Consideration of the Individual Matters Raised
Should the Binding Financial Agreement be Set Aside and Should There be an Interrelated Discharge of the Order 36 Made by Young J
In my opinion, this aspect of the controversy can be dealt with relatively shortly. The mother well knew the costs of private education when the agreement was entered into in 2008. She well knew that the father did not wish to have the children educated in a private school. Notwithstanding his opposition, he paid the mother $90,000 towards school fees, and this, subject to the binding financial agreement about extracurricular activities, was clearly the bargain the parties made.
The father paid $90,000 towards a form of education he did not actually want as part of the overall deal done between the parties. The overall deal done between the parties was entered into at a time when they both had independent legal advice. Its terms do not suggest in any way that it was unfair, on its face, to the wife. As Warnick J said in Balzano, quoting the introductory memorandum, binding financial agreements are not lightly to be set aside. There is no proper basis for doing so in the circumstances of this case.
Furthermore, the mother is quite unable to establish hardship. She has lived an extravagant lifestyle. She has bought, in only recent times, a brand new Peugeot car replacing one not that old ((omitted)). She has travelled relatively extensively overseas, even accepting, as I do, her explanations for some of the defraying of the expenses by others. She likewise bought a property at Property S for over half a million dollars during the last year. She does not even seek to get rental income from that property. She has plenty of money to pay school fees if she so wishes.
It is equally clear, in the circumstances that order 36 of the orders made by Young J should not be discharged.
The Arrears of Child Support Claimed
This claim is, as I understand it, asserted to arise from the father’s failure to pay his proper contributions to the children’s extracurricular activities. The difficulty here, however, is the terms of the original agreement itself. In the hearing before me, I took both counsel to agree that it was not entirely, with hindsight, appropriately drafted. According to its terms, the father was required to pay half of the costs of three agreed extracurricular activities per child per time provided that such activity included (hobby omitted). The handwritten and initialled additions show that the question of agreement was very clearly in the minds of the parties at the time that the agreement was executed.
As things have devolved the father has to an extent consented to various activities, and it is clear from annexure G10 of the mother’s trial affidavit that the father has, from time to time, contributed. However, it is equally clear that in September 2008 he made further payments contingent upon what he asserted was proper compliance with the provision to him of various chattels. On the evidence he has given before the court, such compliance is not even now complete. The (omitted) shares have not effectively been transferred.
The wife was tardy and uncooperative in relation to the other matters raised, including the apparent defacing of the (omitted) bat. As I have said, the husband’s evidence about these aspects of the matter was given with a passionate conviction, and I accept it.
Each of the parties in the witness box was not slow to blame the other for all of the difficulties that they encounter and as I have indicated already, it is quite apparent that they are both equally unable to communicate or cooperate. The blame for this lies squarely upon them both. The fact is that the agreement, according to its terms, required extracurricular activities to be agreed, and they plainly were not. Indeed, the wife breached the agreement by unilaterally cancelling the (hobby omitted), although I accept her evidence that this was because that was what the children wanted.
The reality is that the agreement gave to the father a capacity unilaterally to effectively refuse to agree extracurricular activities and, therefore, not be liable for them. His parsimony in doing so reflects extremely poorly on him, but he is not in breach of the agreement. The matters of which complaint is made were required to be agreed, and they plainly were not. Further, there is no evidence of the issuing to the father of invoices, in any event. This claim has to fail.
Departure Order
The mother seeks that the current child support agreement be set aside as from 17 August 2006 and that from that date until 31 December 2021, the father pay the sum of $2770 per month.
It is plain, as counsel for the mother concedes, this is, in effect, an endeavour to have the father pay school fees. That is plainly not appropriate, given the findings I have already made in regards to exactly this matter. The remarks I have already made in relation to the application to set aside the binding financial agreement and the order of Young J are all equally applicable to this aspect of the claim. It is not necessary, in the circumstances, to traverse these detailed provisions of s 117 of the Assessment Act. It is immediately apparent that the claim should not succeed, for the reasons already expressed.
It should be noted that insofar as the mother seeks a departure order from the court, rather than pursuing the husband’s under-declaration of income through the administrative process, this also should not be granted. The fact is that I am assured by counsel for the father that is open to the mother to raise in that process the substantial income distributed to the father’s wife. This was not gainsaid by counsel for the mother. Rather, it was put that it would be time-consuming and costly.
The difficulty I have is that the child support assessment process is a complex one dealt with by experts. In my opinion, the mother should exhaust her claims through that process, which is better attuned to producing an appropriate outcome. She will, of course, have available to her the observations I have made about the father’s behaviour and the alienation of his income to his wife. This, in my view, is likely to give the mother a fair and equitable outcome in the end.
The claims for adult-child maintenance for X, in my view, have force. It is clear that X has started her (omitted) course solely with a view to achieving a qualification in (qualifications omitted). That will take her a total of six years. In my opinion, the father’s desire that such contributions as he makes should cease as soon as her (omitted) degree is finished is typical of the mean-spirited and miserly approach he brings to bear. His demands that his daughter work throughout the summer holidays effectively full time show scant sympathy with a young woman of this age and her natural desire to have some sort of a life.
Nonetheless, net expenses of $30,000 a year (the annual sum disclosed by part N of the mother’s financial statement) are grossly overindulgent. I accept that the mother has simply worked out her weekly bills and apportioned them pro rata without much thought as to exactly what is being spent, but nonetheless, this is a document that is sworn, and discretionary expenditure of $175 per week (children’s activities $60, entertainment/hobbies $50 and holidays $75) are, in my view, wildly beyond what is reasonable.
In my opinion, the father can and should pay his daughter $100 per week by way of adult-child maintenance until her tertiary education is complete. It is, in my view, a reasonable figure (bearing in mind that this is not an area in which precision is in any way possible), but bearing in mind that on his own proposal, $50 per week would be appropriate to cover her mobile phone bill and Myki card. (This is a crude division by four of the $200 proposed in the father’s proposal.) I have no doubt that the father can comfortably afford such a figure.
On the materials taken as a whole, his income is under-declared. Furthermore, he has himself said that his income has been substantially affected in the most recent periods of time by the emphasis he has had to give to the preparation for this case. He will clearly have an increase in earnings, on his own assertion, and in my view, the sum imposed is entirely within his capacities to pay. It should be paid directly to the mother, who has care of X, without invoices, to avoid yet further arguments.
The Claim for Lump Sum Payments
The Act, as s 66L makes clear, sets its face, so to speak, against lump sum payments. In fact, there is no evidence that the husband is presently in arrears of such sums as he has been required to pay. There is nothing to suggest that lump sum payments are appropriate. Furthermore, lump sum payments of the magnitude sought by the wife would represent a significant impost, in any event.
Conclusion
In the circumstances, I propose to order simply payment of $100 per week by way of adult child maintenance, such sum to be increased by $10 per month on 17 November 2017 and each year thereafter, until X ceases her degree in (qualifications omitted), whichever the earlier. This will avoid arguments about indexation.
I certify that the preceding ninety-eight (98) paragraphs are a true copy of the reasons for judgment of Judge Burchardt
Date: 24 November 2016
0
2
3