Gilmour & Hofte

Case [2022] FedCFamC1A 111

FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA

(DIVISION 1) APPELLATE JURISDICTION

Gilmour & Hofte [2022] FedCFamC1A 111

Appeal from: Hofte & Gilmour [2022] FedCFamC2F 266
Appeal number(s): NAA 32 of 2022
File number(s): BRC 1692 of 2020
Judgment of: AUSTIN J
Date of judgment: 19 July 2022
Catchwords: FAMILY LAW – APPEAL – LEAVE TO APPEAL – Interim maintenance – Whether the primary judge erred by finding the appellant had capacity to pay maintenance – Where it was not open to the primary judge to discount rental payments for which the appellant was legally liable – Where the notionally reduced expenditure still exceeded the appellant’s income – Leave to appeal granted – Error established – Re-hearing – Where the respondent is unable to support herself adequately – Where the appellant is no longer locked into the same residential lease payments – Where the appellant now has surplus income – Appealed orders set aside – Re-exercise of discretion – Order made requiring the appellant to pay the respondent weekly maintenance – Costs certificates granted in respect of the appeal.
Legislation:

Family Law Act 1975 (Cth) ss 44, 90SB, 90SD, 90SF

Federal Circuit and Family Court of Australia Act 2021 (Cth) s 28

Federal Proceedings (Costs) Act 1981 (Cth)

Federal Court and Federal Circuit and Family Court Regulations 2012 (Cth) reg 4.02
Cases cited:

Allesch v Maunz (2000) 203 CLR 172; [2000] HCA 40

Bevan & Bevan (1995) FLC 92-600; [1993] FamCA 95

CDJ v VAJ (1998) 197 CLR 172; [1998] HCA 67

Medlow & Medlow (2016) FLC 93-692; [2016] FamCAFC 34

Mitchell & Mitchell (1995) FLC 92-601; [1995] FamCA 32

Rice & Rice [2020] FamCAFC 174
Number of paragraphs: 35
Date of hearing: 19 July 2022
Place: Newcastle (via video link)
Counsel for the Appellant: Mr Wilson QC
Solicitor for the Appellant: Ramsden Family Law
Counsel for the Respondent: Mr Walsh
Counsel for the Respondent: Turnbull Mylne

ORDERS

NAA 32 of 2022
BRC 1692 of 2020

FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
DIVISION 1 APPELLATE JURISDICTION
BETWEEN:

MR GILMOUR

Appellant
AND:

MS HOFTE

Respondent

ORDER MADE BY:

AUSTIN J

DATE OF ORDER:

19 JULY 2022

THE COURT ORDERS THAT:

1.The appeal is allowed.

2.Orders 1 and 2 made by the Federal Circuit and Family Court of Australia (Division 2) on 4 February 2022 (amended on 10 February 2022) are set aside.

3.The appellant shall pay to the respondent maintenance of $583 per week upon the following conditions:

(a)the first payment is due 7 days from the date of these orders; and

(b)payments shall be made by way of direct deposit to the respondent’s account held with the A Bank, being account number 32.

4.The appellant is granted a costs certificate pursuant to s 9 of the Federal Proceedings (Costs) Act 1981 (Cth), being a certificate that, in the opinion of the Court, it would be appropriate for the Attorney-General to authorise a payment under that Act to the appellant in respect of the costs incurred by him in…

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AGLC
Gilmour & Hofte [2022] FedCFamC1A 111
Case
[2022] FedCFamC1A 111
Decision Date

CaseChat Overview and Summary

In the matter of Gilmour v Hofte, the appellant, Mr Gilmour, and the respondent, Ms Hofte, were involved in a de facto relationship that ended in June 2018. The dispute pertains to an appeal against interlocutory maintenance orders made by the Federal Circuit and Family Court of Australia. The appeal was heard by Justice Austin, who granted leave to appeal, allowed the appeal, set aside the appealed orders, and re-exercised the discretion to order the appellant to pay the respondent weekly maintenance of $583. The court also granted costs certificates in respect of the appeal.

The central legal issue in this case was whether the primary judge erred in finding that the appellant had the capacity to pay maintenance. The appellant argued that the primary judge should not have discounted the rental payments he was legally liable for, and that the notionally reduced expenditure still exceeded his income. The court found that the primary judge erred in discounting the rental payments and that the appellant's claimed expenses did indeed exceed his income by approximately $1,691 per week. The court held that the appellant did not have the reasonable capacity to pay maintenance and that the respondent could not demonstrate an essential element of her claim for maintenance.

Justice Austin held that the primary judge fell into error by discounting the appellant's rental payments, which he was legally liable for, and that it was not open to the primary judge to discount unavoidable expenditure on legal liabilities. The court concluded that the only finding reasonably open on the evidence was that the appellant lacks reasonable capacity and that the respondent could not demonstrate an essential element of her claim for maintenance. The court allowed the appeal, set aside the appealed orders, and ordered the appellant to pay maintenance to the respondent of $583 per week. The court also granted costs certificates in respect of the appeal to both parties.

In summary, the court granted leave to appeal, allowed the appeal, set aside the appealed orders, and ordered the appellant to pay the respondent weekly maintenance of $583. The court found that the primary judge erred in discounting the rental payments the appellant was legally liable for and that the appellant did not have the reasonable capacity to pay maintenance. The court granted costs certificates in respect of the appeal to both parties.

Orders

Orders of the court

NAA 32 of 2022

BRC 1692 of 2020

FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA

DIVISION 1 APPELLATE JURISDICTION

BETWEEN:

MR GILMOUR

Appellant

AND:

MS HOFTE

Respondent

ORDER MADE BY:

AUSTIN J

DATE OF ORDER:

19 JULY 2022

THE COURT ORDERS THAT:

1. The appeal is allowed.

2. Orders 1 and 2 made by the Federal Circuit and Family Court of Australia (Division 2) on 4 February 2022 (amended on 10 February 2022) are set aside.

3. The appellant shall pay to the respondent maintenance of $583 per week upon the following conditions:

(a) the first payment is due 7 days from the date of these orders; and

(b) payments shall be made by way of direct deposit to the respondent’s account held with the A Bank, being account number 32.

4. The appellant is granted a costs certificate pursuant to s 9 of the Federal Proceedings (Costs) Act 1981 (Cth), being a certificate that, in the opinion of the Court, it would be appropriate for the Attorney-General to authorise a payment under that Act to the appellant in respect of the costs incurred by him in relation to the appeal.

5. The respondent is granted a costs certificate pursuant to s 6 of the Federal Proceedings (Costs) Act 1981 (Cth), being a certificate that, in the opinion of the Court, it would be appropriate for the Attorney-General to authorise a payment under that Act to the respondent in respect of the costs incurred by her in relation to the appeal.

Note: The form of the order is subject to the entry in the Court’s records.

Note: This copy of the Court’s Reasons for judgment may be subject to review to remedy minor typographical or grammatical errors (r 10.14(b) Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 10.13 Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth).

Section 121 of the Family Law Act 1975 (Cth) makes it an offence, except in very limited circumstances, to publish proceedings that identify persons, associated persons, or witnesses involved in family law proceedings.

Background

Background to the litigation

For the following reasons, leave to appeal is granted, the appeal is allowed, the appealed orders are set aside and, upon the re-exercise of discretion, orders are made for the appellant to instead pay maintenance to the respondent of $583 per week.Background The parties’ de facto relationship of some 10 years duration ended in June 2018, but they continued to live in the same home with their two children until September 2019. The two children are now eight and nearly 12 years of age, both of whom live primarily with the respondent. Proceedings between the parties under the Family Law Act 1975 (Cth) (“the Act”) were first commenced by the respondent in February 2020. The parties seek relief of multiple types, including parenting, property settlement, maintenance, and child support departure orders – all of which applications are yet to be determined on a final basis. The proceedings are apparently listed for trial next month. The respondent sought interim maintenance orders against the appellant in both her Amended Initiating Application filed on 29 April 2020 and her Application in a Proceeding filed on 17 January 2022. The interim maintenance dispute was heard by the primary judge across two days, with ex tempore judgment delivered on 4 February 2022.Leave to appeal Being interlocutory financial orders, the appellant needs leave to appeal from the maintenance orders (s 28(1)(b) of the Federal Circuit and Family Court of Australia Act 2021 (Cth); reg 4.02 of the Federal Court and Federal Circuit and Family Court Regulations 2012 (Cth)). The grant of leave ordinarily requires the applicant to show the decision at first instance is attended by sufficient doubt to warrant appellate scrutiny and, additionally, substantial injustice would result if leave were refused, supposing the decision at first instance to be wrong (Medlow & Medlow (2016) FLC 93-692 at [44]–[57]). The test is met in this instance. The primary judge fell into error and, if left uncorrected, the appellant will suffer financial prejudice.The appeal Although there were initially five grounds of appeal, the appellant abandoned three (Grounds 2, 4 and 5) and conceded that the remaining two (Grounds 1 and 3) contend for the same error, albeit in different ways. The only point maintained in the appeal is that the primary judge erred by finding the appellant has the capacity to pay maintenance. The appellant correctly contended the only finding reasonably open on the evidence adduced before the primary judge was that he lacks reasonable capacity and so the respondent could not demonstrate an essential element of her claim for maintenance (s 90SF(1)(a)). The appellant deposed to his financial circumstances in a financial statement filed on 25 January 2022. In summary, his claimed expenses ($6,306) exceeded his income ($4,615) by approximately $1,691 per week. In assessing the appellant’s capacity to pay maintenance, the primary judge notionally discounted his claimed expenses to save him approximately $1,100 each week (at [24]–[34]). While the discount of some claimed discretionary expenditure was legitimate, it was not open to the primary judge to discount unavoidable expenditure on legal liabilities. Her Honour impermissibly discounted the appellant’s rental payments from $1,450 to $800 per week when he was legally liable for rental payments of $1,450 per week until June 2022. Until then, it was an expense he could not avoid.

Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

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