GLOVER & STODDARD
[2015] FamCA 899
•23 October 2015
FAMILY COURT OF AUSTRALIA
| GLOVER & STODDARD | [2015] FamCA 899 |
| FAMILY LAW – CHILDREN – INTERIM PROCEEDINGS – Where the applicant wife sought a discharge of an injunction which restrained her now husband from residing with her or spending unsupervised time with the children when the children are in her care– Where the respondent husband objected to its discharge in respect to unsupervised time and sought an increase of his time spent with the children whenever the wife’s husband stayed with her – Consideration of s 60CC – Where no risk to the children has been identified – Orders discharged. |
FAMILY LAW – PROPERTY – INTERIM PROCEEDINGS – Where the applicant wife sought orders for the husband to place funds from the sale of two properties in a controlled monies account – Where the respondent husband sought orders for both parties to be restrained from encumbering their properties without written notice to the other and only for the purpose of paying legal expenses – Orders made as sought by both parties.
| Family Law Act 1975 (Cth) ss 60CC, 64B, 114 |
| Acton & Burton [2015] FamCA 469 |
| APPLICANT: | Ms Glover |
| RESPONDENT: | Mr Stoddard |
| INDEPENDENT CHILDREN’S LAWYER: | Ms Weaver |
| FILE NUMBER: | SYC | 971 | of | 2013 |
| DATE DELIVERED: | 23 October 2015 |
| PLACE DELIVERED: | Sydney |
| PLACE HEARD: | Sydney |
| JUDGMENT OF: | McClelland J |
| HEARING DATE: | 10 September 2015 |
REPRESENTATION
| COUNSEL FOR THE APPLICANT: | Ms Christie |
| SOLICITOR FOR THE APPLICANT: | Rama Myers Family Lawyers |
| COUNSEL FOR THE RESPONDENT: | Ms Boyle |
| SOLICITOR FOR THE RESPONDENT: | Pigdon Norgate Family Lawyers |
| SOLICITOR FOR THE INDEPENDENT CHILDREN’S LAWYER: | Legal Aid NSW Bankstown Family Law |
Orders made 10 September 2015
The Orders made on 30 July 2015 be varied as follows:
1.1.The parties are to file and serve all evidence on which they intend to rely for the final hearing by no later than close of business on Friday, 4 December 2015.
1.2.The parties are to file and serve an updated Financial Statement by no later than close of business on 4 December 2015.
1.3.The parties are to file and serve any updating evidence including any response to Dr B’s report by Wednesday 24 March 2016.
1.4.The husband is to disclose the documents referred to in Order 18 of the Orders made on 30 July 2015 by 10 October 2015.
Orders 9 and 10 of the Orders made on 3 April 2013 are discharged.
Within seven (7) days of the date of these Orders the husband is to:
3.1.open a controlled monies account (“the controlled monies account”) with the Commonwealth Bank in the name of Stoddard Pty Ltd;
3.2.deposit the sum of $483 576.32 into the controlled monies account referred to in Order 3.1 above; and
3.3.provide to the applicant wife documents confirming the opening of the controlled monies account and the deposit of the sum of $483 576.32 into the controlled monies account in accordance with Order 3.2. above.
The husband is hereby restrained from withdrawing any monies from the controlled monies account, without the written consent of the wife or further order of the Court.
The wife is restrained from selling, transferring, further charging or otherwise encumbering the property known as and situate at C Street, D Town, or creating or increasing any liability secured against that property, without the husband’s prior written consent or an order of the Court, except for the purposes of borrowing funds to pay the wife’s legal costs.
If the wife borrows funds, pursuant to Order 5 above, within fourteen (14) days of borrowing such funds, the wife is to provide to the husband with details of the legal costs so paid or payable, together with evidence of the borrowings, including a copy of any loan application and bank statements evidencing the loan.
That the husband is restrained from selling, transferring, further charging or otherwise encumbering the property known as and situate at E Street, D Town, or creating or increasing any liability secured against that property, without the wife’s prior written consent or an order of the Court, except for the purposes of paying capital gains tax payable on the disposal of the property known as and situate at F Street, G Town on or about 28 March 2015 and to pay the respondent husband’s legal costs.
That if the husband borrows funds, pursuant to Order 7 above, within fourteen (14) days of the husband borrowing such funds, he is to provide the wife with details of the capital gains tax and/or legal expenses so paid or payable together with evidence of the borrowings, including a copy of any loan application and bank statements evidencing the loan.
IT IS NOTED that publication of this judgment by this Court under the pseudonym Glover & Stoddard 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 971 of 2013
| Ms Glover |
Applicant
And
| Mr Stoddard |
Respondent
REASONS FOR JUDGMENT
Background
This matter was listed for interim hearing on 10 September 2015 for the sole purpose of determining whether or not an injunction previously made by consent on 3 April 2013 should be discharged. That injunction was made in the context of broader litigation between the wife and the husband concerning property and parenting matters. The parenting matters are in respect to the parties’ two children N and M. The injunction restrains the wife from leaving the children in the care of her now husband, Mr H (“Mr H”), and having Mr H reside in her home at such times as the children are in the wife’s care.
Prior to the hearing on 10 September 2015, the applicant wife filed a further amended application seeking interim orders in respect to financial matters, relating to the husband's disposal of two investment properties located in Sydney.
On 10 September 2015, the Court made orders which set aside the restraint in respect to Mr H. The Court also made orders placing the balance of the proceeds of sale of two investment properties into a controlled monies account and restrained the parties’ dealings in respect to two properties, located in D Town, where they currently reside and which are in the parties’ respective names (to be referred to as “the D Town properties”).
On 10 September 2015, the husband filed a case outline document indicating that he consented to the discharge of the restraint concerning Mr H staying with the wife at such times as the children were in her care. The husband, however, opposed the removal of the injunction in so far as it prevented the wife leaving the children in the unsupervised care of Mr H. The husband also sought a variation of the current parenting arrangements to increase the children’s time with him from five days to seven days per fortnight whenever Mr H was staying with the wife. Finally, the husband sought orders limiting the parties’ ability to deal with the D Town properties.
Approach of the Court
In considering the application for interim orders concerning the children, the Court is guided by the principles set out by the Full Court in Goode & Goode (2006) FLC 93-286. Relevantly, in dealing with these proceedings, at 80,903 – 80,904, under the subheading "How should interim proceedings be conducted?", the Full Court said:
In making interim decisions the Court will still often be faced with conflicting facts, little helpful evidence and disputes between the parents as to what constitutes the best interests of the child. However, the legislative pathway must be followed.
In an interim case that would involve the following:
(a)identifying the competing proposals of the parties;
(b)identifying the issues in dispute in the interim hearing;
(c)identifying any agreed or uncontested relevant facts;
(d)considering the matters in s 60CC that are relevant and, if possible, making findings about them (in interim proceedings there may be little uncontested evidence to enable more than a limited consideration of these matters to take place)”
(e)deciding whether the presumption in s 61DA that equal shared parental responsibility is in the best interests of the child applies or does not apply because there are reasonable grounds to believe there has been abuse of the child or family violence or, in an interim matter, the Court does not consider it appropriate to apply the presumption;
(f)if the presumption does apply, deciding whether it is rebutted because application of it would not be in the child’s best interests;
(g)if the presumption applies and is not rebutted, considering making an order that the child spend equal time with the parents unless it is contrary to the child’s best interests as a result of consideration of one or more of the matters in s 60CC, or impracticable;
(h)if equal time is found not to be in the child’s best interests, considering making an order that the child spend substantial and significant time as defined in s 65DAA(3) with the parents, unless contrary to the child’s best interests as a result of consideration of one or more of the matters in s 60CC, or impracticable;
(i)if neither equal time nor substantial and significant time is considered to be in the best interests of the child, then making such orders in the discretion of the Court that are in the best interests of the child, as a result of consideration of one or more of the matters in s 60CC;
(j)if the presumption is not applied or is rebutted, then making such order as is in the best interests of the child, as a result of consideration of one or more of the matters in s 60CC; and
(k)even then the Court may need to consider equal time or substantial and significant time, especially if one of the parties has sought it or, even if neither has sought it, if the Court considers after affording procedural fairness to the parties it to be in the best interests of the child.
Competing Proposals
The wife's Minute of Order sought orders to the following effect:
a. That orders 9 and 10 of the orders made by consent on 3 April 2013 be discharged.
b. That the husband shall within twenty four hours of orders being made:
i.open a controlled monies account ("the controlled monies account") with the Commonwealth Bank in the name of Stoddard Pty Ltd;
ii.deposit the amount of $483 576.32 into the controlled monies account;
iii.provide the wife with documents confirming the opening of the controlled monies account and the deposit of monies required pursuant to this order.
c. That the husband be restrained from:
i.withdrawing any monies from the controlled monies account without the written consent of the wife or further order of the Court;
ii.dealing with the property at E Street, including but not limited to selling, transferring, encumbering or further encumbering the property;
iii.redrawing or increasing the mortgage secured against the property at E Street beyond $4606.
The husband's Minute of Order indicated that the husband sought orders to the following effect:
a. Pending further order, orders 4 and 9 of the orders made on 3 April 2013 be varied so that:
i.subject to below, Mr H be permitted to live in the same residence as the children in Australia;
ii.whenever Mr H is living with the wife in Australia, the children live with the wife and husband on a week about basis during school term as follows:
· week one, the husband from after school on the first Friday following the making of these orders until the commencement of school the following Friday and each alternative weeks thereafter;
· week two, with the wife from after school on the second Friday following the making of these orders, until the commencement of school the following Friday and each alternative weeks thereafter.
b. The wife be restrained from further charging or encumbering the property known as C Street, D Town or creating or increasing any liability secured against the property, without the husband's prior written consent or court order, except for the purposes of borrowing funds to pay the wife's legal costs.
c. If the wife borrows funds pursuant to (b), within fourteen days the wife to provide to the husband evidence of the borrowings, including a copy of any loan application and bank statements evidencing the loan.
d. The husband be restrained from further charging or encumbering the property known as E Street or creating or increasing any liability secured against the property, without the wife's prior written consent or court order, except for the purposes of paying capital gains tax payable on the disposal of the property known as F Street, G Town on or about 28 March 2015 and to pay the husband's legal costs.
e. If the husband borrows funds pursuant to (d), within fourteen days the husband to provide the wife evidence of the borrowings, including a copy of any loan application and bank statements evidencing the loan and evidencing the payment of capital gains tax.
The Independent Children's Lawyer (“the ICL”) supported the wife's application for the restraints concerning Mr H to be discharged.
Limited ability to resolve issues of fact in interim proceedings
As noted in Goode (supra), the Court has a limited ability to resolve controversial factual issue in interim proceedings. In that respect, in Iphostrou & Iphostrou and Ors,[1] Cronin J said at [44]:
In any situation of an interlocutory nature where the facts are controversial and in dispute, a court cannot make findings of fact. Findings of fact form the basis upon which orders are made within jurisdiction.
[1] [2011] FamCA 20.
10. Similarly, in Acton & Burton,[2] Hogan J said:
The nature of the interim hearing process is such that parties are afforded a truncated process in which it is not possible to make findings about matters that are significantly in contest between them.
[2] [2015] FamCA 469 at [26].
Agreed or non-controversial facts
11. Those facts which are agreed are:
·In July 2012 the husband became aware that the wife was in a relationship with Mr H.
·The parties separated in or about December 2012.
·In January 2013 the parties participated in an unsuccessful mediation in relation to both property and parenting matters.
·On 26 February 2013 the husband filed an Initiating Application seeking parenting orders.
·In March 2013 the wife listed a property at Suburb I, Sydney for sale.
·On 2 April 2013 the wife filed a Response to the husband’s Initiating Application and included an application for property orders.
·On 3 April 2013 the parties entered into interim parenting orders by consent. Those orders provided for to the children to live with the husband five nights each fortnight and for half the school holidays. The orders also included the restraint concerning Mr H as follows:
9. Each party is restrained from allowing any person (excluding the children’s grandparents, aunts, uncles and cousins, including by marriage) move into the residence of the children or stay overnight in the residence of the children when the children are in that home, without the other party’s written prior consent or court order.
10. The mother be restrained from leaving the children in the sole care of [Mr H] at any time.
·On 6 May 2013 the sale of the wife’s Suburb I property settled, with the net proceeds being deposited into a controlled monies account.
·On 1 June 2013 the husband engaged the services of Dr J to work with him in his business. This, according to the husband, enabled him to reduce the number of hours he was spending working in his business so that he could spend additional time with the children.
·On 11 March 2014 the parties attended a conciliation conference. However, no agreement was reached.
·In July 2014 the parties’ divorced.
·On 24 November 2014 consent orders were made for the sale of the parties’ property located at Suburb K.
·In 2015 the wife married Mr H.
·On 16 March 2015 a L Town property in the name of Stoddard Pty Ltd was sold for $605 000.The net proceeds of sale were applied as follows:
othe sum of $402 798.88 to discharge the mortgage secured over the property by the Commonwealth Bank of Australia; and
othe balance in the sum of $169 374.70 was deposited into the bank account of Stoddard Pty Ltd.
·Stoddard Pty Ltd is the service company of the husband's business which the husband operates as a sole trader. Stoddard Nominators Pty Ltd is the sole shareholder of Stoddard Pty Ltd and has 100 issued shares. The husband and wife each hold 50 shares and both are directors. It is estimated that the sum of approximately $53 000 will be payable by Stoddard Pty Ltd in respect to capital gains tax from the sale of the L Town property.
·On 28 March 2015 the husband sold the G Town property at auction for $2.48 million. The net proceeds of sale of the G Town property were $1 095 576.32. That amount was applied as follows:
othe sum of $247 526.13 to discharge a Commonwealth Bank cheque account.
othe sum of $126 081.54 to discharge a med-e credit personal loan.
othe sum of $508 000 in payment of the home loan secured against the property at E Street.
othe sum of $100 551.85 in payment to Stoddard Pty Ltd for April 2015 services fees.
othe sum of $140 234.36 in payment to Stoddard Pty Ltd for May 2015 services fees.
·In April 2015 Mr H came to Australia for a period of five weeks and spent time with the wife and children, but slept away from the wife's property on those occasions when she had care of the children.
·On 15 April 2015 the parties’ Suburb K property was sold for the sum of $2.5 million. A shortfall of $36 409.26 was paid from the controlled monies account which held the proceeds of the Suburb I property.
·The wife alleged that on 28 July 2015 the wife received notice, for the first time, that the husband had disposed of the G Town property and that Stoddard Pty Ltd had disposed of the L Town property.
·As at 8 September 2015, Stoddard Pty Ltd had bank deposits of $832 357 and also held additional assets including a motor vehicle and credit card facilities.
Issues
12. The issues in these proceedings are as follows:
·Should the restraints concerning Mr H be discharged?
·Should the husband be required to deposit any of the proceeds of sale from the G Town property into a controlled monies account?
·Should there be restraints on the parties limiting their ability to deal with the D Town properties?
Parenting
Submissions of the wife
13. Counsel for the wife argued that the restraints concerning Mr H needed to be seen in their context. In particular, as at 3 April 2013 when the orders were agreed to, the husband had considerable difficulty in dealing with the fact that the wife was in a new relationship. It was argued that the difficulty related to the husband's attitude, as opposed to the husband’s conduct. It was submitted that the consent orders were made in order to reach a broader agreement on parenting matters having regard to the husband's attitude.
14. The wife’s counsel noted that, since that time, the parties have become divorced and she is now married to Mr H. In those circumstances, the wife’s counsel submitted that it was inappropriate for the restraint concerning Mr H staying overnight with the wife in their now matrimonial home to continue.
15. The wife also argued that the restraint on the wife leaving the children in the sole care of Mr H was not necessary. Counsel for the wife referred to the fact that the wife was very much a hands-on mother and would not abdicate her responsibility in respect to the children. To impose such a restriction, where she is now married to Mr H, would be artificial and unnecessary. In that respect, there was no evidence adduced by the husband that Mr H presented any risk to the children.
Submissions of the husband
16. On the other hand, counsel for the husband argued that the orders of 3 April 2013 needed to be seen in another context. Those orders, and in particular the restraints concerning Mr H, were made following an attempted reconciliation between the parties and the husband's subsequent discovery, in March 2013, that his wife had remained in contact with Mr H during the course of that attempted reconciliation.
17. The husband also referred to the fact that the wife married in 2015 without notice to the husband and without notice to the children. This, it was argued, had created issues in respect to the children and in particular M.
18. It was also noted that Mr H has two children of his own and the nature of the relationship of N and M with those children has not been established. It was noted that N and M met Mr H for the first time in April 2015, although it was acknowledged that they had made Skype contact with him and his children prior to that time.
19. It was argued that the relationship between the wife and Mr H is in its early days and the situation is quite confusing for the children. In those circumstances, it was argued that spending some additional time with the husband would enhance the children’s sense of security.
20. It was noted that since 2013 the wife has been absent overseas on approximately nine occasions and has been comfortable leaving the children in the husband’s care during that time.
21. It was also noted that, despite the intensity of the litigation between the parties, there is quite a degree of cooperation between them as parents. This is indicated, for instance, in the parenting questionnaire filed by the wife on 21 July 2015. The parties co-operate, for example, in attending N’s rugby and soccer games and taking him to and from training. They also cooperate in taking M to her extracurricular activities.
22. Further, the parties are generally courteous to each other. For instance, on 27 August 2015, the wife sent the husband a photograph of the children in dress up costumes as part of school book week celebrations.
23. In summary, it was argued that the children will benefit if the time they spend with the wife and Mr H is conducted in a slow and sensible way. Otherwise, it could be extremely confusing for the children. Moreover, it was argued that a cautious approach is appropriate because the children will be having interviews with the single expert, Dr B, on 15 and 16 February 2016 and it was important not to pre-empt his recommendations.
24. In terms of maintaining the requirement that the children be supervised when in the care of Mr H, it was argued that:
· the children met Mr H for the first time in April 2015;
· their time with him has been only during the daytime;
· Mr H is not their parent;
· it is appropriate that the children have a high level of comfort in their dealings with Mr H;
· it is not in the children's best interests to press the relationship too quickly; and
· the children’s ages are relevant - N is nine and M is eight.
Submissions of the Independent Children’s Lawyer
25. The ICL argued that the children have a close relationship with both parents, there is no issue regarding parenting capacity and there is no risk to the children. Both parents trust each other to care for the children when they are in their respective care. This is demonstrated by the fact that both parents have been prepared to leave the children exclusively in the care of the other parent when they have engaged in overseas travel.
26. The ICL argued that the restriction on Mr H residing in the wife's property at such times when the children are in the wife's care is unreasonable. Mr H and the wife are now married and there is no justification for ordering them to live separately when the children are in the care of the wife.
27. It was argued that it would actually be desirable for the parties to live in what will inevitably be the normal situation, with Mr H residing in the wife’s home and therefore being present when the children are in the care of the wife, in the period leading up to the parties conferring with Dr B in February 2016. Accordingly, the ICL argued that the restraints on Mr H imposed by the orders of 3 April 2013 should be discharged. The ICL also argued that the restriction on Mr H spending unsupervised time with the children should also be removed as there is no evidence that he has acted or would act inappropriately towards the children.
28. The ICL opposed any change to the long standing arrangements regarding the time spent with the children as set out in the orders of 3 April 2013. It was argued that there was no logical reason for those orders to be disturbed merely because Mr H would be coming to Australia and living with the wife. To reduce the time the children spend with the wife, in those circumstances, would create the impression that Mr H presents some risk to the children and, it was submitted, there no evidentiary basis for such a finding.
Wife’s response
29. Counsel for the wife responded that:
·While the wife has been overseas on a number of occasions those periods have not been lengthy and, except for one occasion, did not interfere with the time the husband spent with children.
·It was not appropriate for the husband to agree to lift the injunction, but only on condition that the wife increased the time he spent with the children.
·The wife had not had the opportunity to appropriately consider the husband’s proposal for increased time as it was first raised by him on the afternoon prior to the hearing and natural justice considerations should preclude the Court from dealing with such an application raised at such a late stage.
Consideration: Parenting
30. There is no question that the Court had the power, pursuant to section 64B of the Family Law Act 1975 (Cth) (“the Act”), to make the orders on 3 April 2013 which imposed the restraints on Mr H. The question is now whether it in the best interests of the children for those restraints to continue.
31. In determining what is in the children’s best interests, it is necessary for the Court to consider the matters set out in section 60CC of the Act. In Banks & Banks,[3] the Full Court outlined a common sense approach to applying section 60CC consideration in the following terms:
…there is a risk that in discussing every s 60CC factor, the judicial officer may lose sight of the forest for the trees. It is also important to stress here that the requirement to “consider” each factor does not mean each must be discussed, especially where the evidence leads inexorably to a particular conclusion: SCVG & KLD (2014) FLC 93-582.
When it is obvious that the findings made as to some of the s 60CC factors will be determinative of the child’s best interests on an interim basis, it is a sterile and unnecessary exercise to address other factors. Moreover, it will be a sterile exercise to determine whether or not particular facts are disputed if they are relevant only to one of the non-determinative s 60CC considerations. Properly understood, we do not interpret what was said in Goode as meaning that in an interim case, each and every fact must be characterised as disputed or not; and that each s 60CC factor must be traversed where it is obvious on the facts and issues joined that there are only one or two decisive factors.
[3] [2015] FamCAFC 36 at [49] - [50].
32. The Court has given consideration to the matters set out in section 60CC generally, but will concentrate on those considerations which are of most relevance to this matter.
Primary considerations
Section 60CC(2)(a) requires the Court to consider the benefit to the child of having a meaningful relationship with both of the child’s parents.
33. Both parents acknowledge the importance of the children having a meaningful relationship with the other parent. The evidence suggests a high degree of cooperation between the parents in respect to attending to the children’s physical needs and activities. Discharging the restraints on Mr H would not impact upon the children having a meaningful relationship with each parent.
Section 60CC(2)(b) requires the Court to consider the need to protect the child from physical or psychological harm from being subjected to, or exposed to, abuse, neglect or family violence. Section 60CC(2A) provides that the Court is to give greater weight to this consideration than that set out in (2)(a).
34. No evidence was presented to the Court which suggested that Mr H presented any risk to the children. Indeed, the Independent Children’s Lawyer argued that it would be inappropriate to continue the restraints imposed on Mr H as it could imply that there was such a risk in circumstances where there was no evidentiary basis for such a finding. Accordingly, this consideration does not present an impediment to the restraints on Mr H being discharged.
Additional considerations
Section 60CC(3)(b)requires the Court to consider the nature of the relationship of the child with each of the child’s parents and other persons, including any grandparent or other relative of the child.
35. The wife is now married to Mr H who will obviously be a significant person in the children’s lives. It was argued by the wife’s counsel that increasing the time the children are to spend with their father from five days per fortnight to seven days per fortnight, during such times as Mr H is with the wife, has the potential to convey to the children that Mr H’s presence gives rise to concerns, such that their time with their mother should be reduced. The ICL expressed a similar concern.
36. There is no evidence before the Court that justifies reducing the children’s time with the wife during such times when Mr H is living with her. Indeed, the Court accepts the argument of the ICL that the reality for the children will now be that Mr H will be living with their mother. In those circumstances, it is appropriate that, when the parents and the children are interviewed for the purposes of the preparation of the family report by Dr B in February 2016, he has the opportunity of assessing the family and the children in the context of what will be their usual living arrangements.
Section 60CC(3)(d) requires the Court to consider the likely effect of any changes in the child’s circumstances, including the likely effect on the child of any separation from either of his or her parents, or any other child, or other person (including any grandparent or other relative of the child) with whom he or she has been living
37. It is of significance that the current arrangements for the children to live with the wife and spend time with the husband have been in place since April 2013. In Goode (supra), the Full Court said that, in interim proceedings concerning parenting, it may be appropriate for the Court to have regard to “the current circumstances of the parties and their children”.[4] That phrase is not to be taken as suggesting that the Court should apply a presumption of maintaining the “status quo” in interim parenting cases. That is clearly not the case. In that respect, the Full Court, in Goode, said that even where there is a "status quo or well settled environment" the Court’s task must nonetheless "follow the structure of the Act".[5] However, as noted by the Full Court: [6]
That is not to say that stability derived from a well-settled arrangement may not ultimately be what the Court finds to be in the child’s best interests.
[4] Ibid at 80,901.
[5] Ibid at 80,903.
[6] Ibid.
38. Accordingly, without determining whether a situation of “status quo” exists, it is entirely proper for the Court, when evaluating the section 60CC factors, to have regard to the current circumstances of the parties and their children. That is not to say, of course, that those circumstances are the only consideration. Nevertheless, in this case, the Court is not persuaded that it is appropriate to disturb the current arrangements for the children that have been in place since April 2013.
The children’s time with their father
39. Order 2, of the orders made on 3 April 2013, provides for the parties to have equal shared parental responsibility of the children as contemplated by section 61DA of the Act. Neither of the parties sought a variation of that Order.
40. Nevertheless, as an application has been made by the husband for the children to spend increased time with him to seven days a fortnight, at such times when Mr H resides with the wife, it is appropriate to consider the matters referred to in section 65DAA(1). For the reasons set out above, the Court has decided that it would not be appropriate at this time to make interim orders to increase the time the children spend with the husband to an equal time arrangement at such times when Mr H resides with the wife.
41. The children currently spend substantial and significant time with the husband. The orders made on 10 September 2015 will not disturb those current arrangements that have been in place since the consent orders were made on 3 April 2013. For these reasons, the Court has decided not to disturb the current parenting arrangements put in place by the consent orders made on 3 April 2013 other than to discharge those orders that imposed a restraint on Mr H.
Property
Submissions
42. The wife’s counsel argued that the fact that the husband sold the G Town property and, in his capacity as sole director of Stoddard Pty Ltd, arranged for the sale of the L Town property, without providing her with prior notice raises a legitimate concern regarding the possibility of the husband dissipating the property of the marriage prior to final hearing.
43. These concerns she alleged were aggravated by the fact that the net proceeds of the sale of the G Town property were paid to Stoddard Pty Ltd. This was effected by way of monthly service fees which were at a rate considerably higher than the amounts previously paid. In that respect, reference was made to the husband’s response at paragraph 32 of his Financial Statement where the husband indicated that the service/management fees paid by his medical practice to Stoddard Pty Ltd were approximately $24 460 per week. This, it was argued, represented the usual situation. It was noted that, since the sale of the G Town and L Town properties, the payments have been:
· payment to Stoddard Pty Ltd for April 2015 services fees – $100 551.85.
· payment to Stoddard Pty Ltd for May 2015services – $140 234.36
44. The wife noted that, while the L Town property was sold on 16 March 2015 and the G Town property on 28 March 2015, she was not notified of those sales until the husband provided disclosure to her on 28 July 2015.
45. On the other hand, the husband argued that while the wife's solicitors provided notice of the wife's intention to sell the Suburb I property on 21 March 2013, a week later she filed a Financial Statement that did not refer to an offer having been accepted for the sale of the Suburb I property.
46. The husband also raised a concern that the wife had encumbered the property at C Street, D Town without the husband's prior knowledge in the amount of $150 000. The husband noted that, of that amount, the wife had paid the sum of $88 896 to Mr H which was described as being a payment to "pay down debt". The husband complained that, despite making a request for details of the specific amounts, by way of letter from his solicitors dated 20 of August 2015, he was not provided with a breakdown of figures until 8 September 2015.
47. It is clear that both parties are of the opinion that that the other party has dissipated the property of the marriage without the consent of the other party, and without providing full and proper disclosure to the other. On that basis, each party expressed concern that such conduct will be repeated and, consequently, that there is a risk that the other party will engage in conduct that will dissipate the marital property prior to the final hearing.
Consideration: Property
48. When proceedings are ongoing before the Court, the Court has the power to grant injunctive relief in circumstances where “it is necessary to preserve the status quo”, pending the final hearing of a matter and where it is and where it is “just or convenient to do so” in terms of section 114(3).[7]
[7] See G and T (2004) FLC 93-176 at 78,989 at [53] – [54] and Mullen & De Bry (2006) FLC 93-293.
49. A precondition to the Court issuing an injunction is that the Court finds that “there is a serious issue to be tried and that the balance of convenience supports the making of an order”.[8] Both parties acknowledge that there will be a property distribution at final hearing and there is a serious question to be tried in that respect. Ensuring that the parties are able to encumber their respective properties in order to raise funds to pay legal fees and, in the case of the husband, capital gains tax should ameliorate against any hardship that the restraint will impose. In that context, it is further noted that the parties will be able to obtain the other parties’ consent to encumber their respective properties to raise funds for other purposes, and they may each approach the Court for appropriate orders if that is necessary.
[8] Blue Seas Investments Pty Ltd & Mitchell and McGillivray (1999) FLC 92-856 at 86,128; Stowe and Stowe (1981) FLC 91-074 and Yunghanns & Ors (1999) FLC 92-836.
50. The applicant for an injunction bears the onus of satisfying the Court that the circumstances justify the making of the order.[9] It is not necessary, however, for the Court to determine, as a matter of probability, that risk of dissipation exists before an order is made to preserve property pending final hearing.[10]
[9] Sieling & Sieling (1979) FLC 90-627.
[10] Ibid.
51. In considering the nature of the injunctive relief, it is important to be aware of the general principle that “equity intervenes to the minimum extent necessary to do justice”.[11]
[11] See Giumelli v Giumelli (1999) 196 CLR 101 at [10] referred to in Norton & Locke (2013) 284 FLR 51 at [72].
52. In Sieling and Sieling (1979) FLC 90-627 at 78,265, the Full Court of the Family Court said:
The power to grant injunctions is, of course, a discretionary power, not to be exercised lightly. The Court must balance the hardship to each party of granting or refusing an order and frame its order in such a way to impose no further restriction than is necessary to achieve the protection of the applicant’s interest. It will not lightly interfere with the rights of an owner of property on the basis of a vague or uncertain claim.[12]
[12] See also Menotti & Lamb [2014] FamCA 518 at [41] and Auricchio & Auricchio & Ors [2014] FamCA 185.
53. In Martiniello & Martiniello (1981) FLC 91-050, it was suggested that a party should not be restrained from using their money for ordinary business purposes unless “it could be shown that there was a fear that [the party] would dissipate [the] funds.”[13]
[13] See also Auricchio & Auricchio & Ors [2014] FamCA 185 at [50] and Torr & Amberson [2015] FamCA 290 at [76].
54. The evidence presented by the parties is sufficient to satisfy the Court that there is a risk of each of the parties dispersing or distributing the property of the marriage, contrary to the interests of the other, prior to final hearing.[14]
[14] Mullen & De Bry (2006) FLC 93-293.
55. Both parties have raised issues of legitimate concern regarding the conduct of the other. In those circumstances, subject to two exceptions, it would be appropriate for the Court to make orders restraining further dealings with the D Town properties. The two exceptions are to permit the parties to borrow against those properties to fund legal fees and, in the case of the husband, to pay capital gains tax.
56. It is noted that Stoddard Pty Ltd holds approximately $832 357 in its bank accounts. As further noted, the husband is the sole director of that company and controls how those funds are disbursed. In circumstances where a significant portion of those funds came from the sale of the G Town property, it is appropriate that the amount of $483 576.32 be placed in a controlled account. That amount is the residue of funds from the net proceeds of sale of the G Town property ($1 095 576.32) after deduction of the following amounts:
· $512 000 which was applied to the mortgage of the property at E Street.
· $100,000 which was applied towards a personal loan.
57. The wife accepts that those two payments which extinguished indebtedness were appropriate. However, she argues that the residue of $483 576.32 should be held in a controlled monies account to ensure that it is available for distribution at final hearing. For the reasons discussed above, the Court will make that order.
58. In Martiniello & Martiniello (supra), it was suggested that a party should not be restrained from using their money for ordinary business purposes unless “it could be shown that there was a fear that [the party] would dissipate [the] funds.”[15] The wife’s concern in that respect is reasonable and justifies the quarantining of the funds in a controlled monies account. In the context of business impact, it is noted that the residue of funds in the account of Stoddard Pty Ltd will be $832 357[16] less $483 576.32[17] leaving a balance available for the husband's medical practice of $348 780.68.
[15] See also Auricchio & Auricchio & Ors [2014] FamCA 185 at [50] and Torr & Amberson [2015] FamCA 290 at [76].
[16] Affidavit of the husband sworn 8 September 2015 at [70].
[17] Affidavit of the wife sworn 28 August 2015 at [14].
59. For these reasons, the Court made the orders on 10 September 2015.
I certify that the preceding fifty-nine (59) paragraphs are a true copy of the reasons for judgment of the Honourable Justice McClelland delivered on 23 October 2015.
Associate: P. Aitken
Date: 23 October 2015.
Key Legal Topics
Areas of Law
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Family Law
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Civil Procedure
Legal Concepts
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Injunction
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Jurisdiction
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Remedies
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