Hadleigh & Hadleigh (No 2)

Case [2024] FedCFamC1F 799

FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA

(DIVISION 1)

Hadleigh & Hadleigh (No 2) [2024] FedCFamC1F 799

File number(s): MLC 6798 of 2022
Judgment of: WILLIAMS J
Date of judgment: 26 November 2024
Catchwords: FAMILY LAW – PROPERTY – Where the wife seeks orders adjusting the parties respective property interests – Relationship of approximately 16 months – No children of the relationship – Where the husband had greater assets at the commencement of cohabitation and made greater contributions – Less assets at the end of the relationship than existed at the start – Where both parties have had the benefit of a part property distribution – No adjustment to either party for future needs – Where the remaining assets in the pool will be paid to the husband
Legislation:

Evidence Act 1995 (Cth) s 140

Family Law Act 1975 (Cth) ss 75, 79, 102NA, 106A

Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) r 7.26

Cases cited:

Bevan & Bevan (2013) FLC 93-545; [2013] FamCAFC 116

Chancellor & McCov (2016) FLC 93-752; [2016] FamCAFC 256

In the Marriage of Hickey (2003) FLC 93-143; [2003] FamCA 395

Stanford v Stanford (2012) 247 CLR 108; [2012] HCA 52

Whisprun Pty Ltd v Dixon (2003) 200 ALR 447; [2003] HCA 48

Division: Division 1 First Instance
Number of paragraphs: 124
Date of hearing: 11-12 June, 29 August, and 11 September 2024
Place: Melbourne
Counsel for the Applicant (11-12 June 2024): Ms Clarkin and Mr Brear
Solicitor for the Applicant (8 February 2024 – 22 August 2024): Creative Family Law Solutions
The Applicant (22 August 2024 – 26 November 2024): Litigant in person
Counsel for the Respondent (11-12 June 2024): Mr Thompson
Solicitor for the Respondent (30 June 2022 – 26 August 2024): KCL Law
The Respondent (26 August 2024 – 26 November 2024: Litigant in person

ORDERS

MLC 6798 of 2022

FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)
BETWEEN:

MS HADLEIGH

Applicant
AND:

MR HADLEIGH

Respondent

ORDER MADE BY:

WILLIAMS J

DATE OF ORDER:

26 NOVEMBER 2024

THE COURT ORDERS THAT:

1.The husband and wife do all acts and things to pay to the husband or his nominee the funds held in the trust account of KCL Law, being the remaining proceeds of sale of the property at B Street, Suburb C, Queensland (“the Suburb C property”), estimated at around $31,876.42.

2.The husband and the wife, at the husband’s cost and expense in relation to the preparation of the transfer documents, sign all such documents and do all things necessary to transfer to the Wife the shareholdings in the companies, D Pty Ltd and E Pty Ltd. As and from the date of the transfer, the Wife indemnify the Husband in relation to any and all unpaid liabilities of whatsoever nature and kind in relation to the companies being retained by her.

3.The husband retain, for his sole use and benefit and to the exclusion of the Wife, the following:

(a)F Pty Ltd.

(b)G Pty…

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AGLC
Hadleigh & Hadleigh (No 2) [2024] FedCFamC1F 799
Case
[2024] FedCFamC1F 799
Decision Date

CaseChat Overview and Summary

In MLC 6798 of 2022, the wife sought orders adjusting the parties' respective property interests following her separation from the husband. The parties had been in a relationship for approximately 16 months and married for around one year before their separation in March 2022. The relationship ended acrimoniously, with both parties alleging family violence. The wife filed an Initiating Application in June 2022, and the matter was heard over three days, commencing on 11 June 2024 and concluding on 11 September 2024. Both parties initially had legal representation but subsequently chose to represent themselves. The court was required to determine the respective property interests of the parties and whether any adjustments were necessary under section 79(4) of the Family Law Act 1975.

The court considered the contributions of each party, both financial and non-financial, during the relationship. It found that at the commencement of their cohabitation, the husband had significantly greater assets than the wife, with the husband's assets exceeding $800,000. The court also examined the contributions made during the relationship, including the acquisition and maintenance of the Suburb C property, as well as the contributions to the businesses. The wife's contribution to the relationship was considered limited, with her primary role being in the management of the household. The court noted that both parties had benefitted from a part property distribution but found that no further adjustments were necessary for future needs. Ultimately, the court determined that it was just and equitable to pay the minimal remaining asset pool to the husband.

The court made several orders regarding the distribution of the parties' assets. The husband was to receive the remaining proceeds from the sale of the Suburb C property, estimated at around $31,876.42. The husband was to retain various business interests, properties, and other personal assets, while the wife was to retain her own business interests and personal assets. The wife was also required to return the husband's personal property and refrain from contacting his clients and associates. The court further ordered that any unpaid liabilities associated with the retained assets be indemnified by the respective parties. Joint accounts were to be closed, and the proceeds divided equally. The court also dismissed the wife's Initiating Application, the husband's Response, and the Further Amended Response, with no orders as to costs.

Orders

Orders of the court

MLC 6798 of 2022

FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)

BETWEEN:

MS HADLEIGH

Applicant

AND:

MR HADLEIGH

Respondent

ORDER MADE BY:

WILLIAMS J

DATE OF ORDER:

26 NOVEMBER 2024

THE COURT ORDERS THAT:

1. The husband and wife do all acts and things to pay to the husband or his nominee the funds held in the trust account of KCL Law, being the remaining proceeds of sale of the property at B Street, Suburb C, Queensland (“the Suburb C property”), estimated at around $31,876.42.

2. The husband and the wife, at the husband’s cost and expense in relation to the preparation of the transfer documents, sign all such documents and do all things necessary to transfer to the Wife the shareholdings in the companies, D Pty Ltd and E Pty Ltd. As and from the date of the transfer, the Wife indemnify the Husband in relation to any and all unpaid liabilities of whatsoever nature and kind in relation to the companies being retained by her.

3. The husband retain, for his sole use and benefit and to the exclusion of the Wife, the following:

(a) F Pty Ltd.

(b) G Pty Ltd.

(c) Hadleigh Family Trust.

(d) Hadleigh Holding Pty Ltd.

(e) H Group Pty Ltd.

(f) H1 Pty Ltd.

(g) H2 Pty Ltd.

(h) His legal and equitable interest in J Street, Suburb K, Victoria.

(i) Any money standing in any bank accounts in his name.

(j) Any furniture and chattels in his possession and/or control.

(k) Any shares and/or investments in his sole name.

(l) His part property payment of $14,000, and $150,000.

(m) His superannuation interests.

4. In relation to any property being retained by the husband, he shall indemnify the wife in relation to all unpaid liabilities in relation to the same.

5. The wife shall retain, for her sole use and benefit and to the exclusion of the Husband, the following:

(a) D Pty Ltd.

(b) E Pty Ltd.

(c) Hadleigh Family Group Holdings Pty Ltd.

(d) Any other business that she has incorporated or has an interest in and acquired by her post 30 March 2022.

(e) Any furniture and chattels in her possession.

(f) Any shares in her name.

(g) The joint L Finance portfolio investment, which the Husband is to sign any documents to transfer his interest to the Wife, at her expense, if any.

(h) The part property settlement sums she has received of approximately $145,710.44, plus Motor Vehicle 1.

(i) Her superannuation interests.

6. The wife forthwith comply with Order 2 of the orders made 15 February 2024 requiring her to return the husband’s personal property.

7. The wife be restrained by herself, servants, and agents from in any way contacting any clients, contractors, employees and/or associates of the companies being retained by the husband and referred to in paragraph 3 herein.

8. Pursuant to s 106A of the Family Law Act 1975, if either party fails to execute a document, deed or instrument in the name of the person to whom the direction was given and/or do all such acts and things necessary to give validity and/or operation to the document, deed or instrument to give effect to these Orders within fourteen (14) days of the request to do so, then a Deputy Registrar or a Judicial Registrar of the Federal Circuit and Family Court of Australia is appointed to so sign that document, deed or instrument in their stead. If this paragraph is made operational, then the defaulting party shall pay the other party’s costs and expenses of and incidental for preparation of the document, deed or instrument for its execution calculated by the solicitors for the non-defaulting party and for the proposes of this Order an affidavit filed on the Court Portal with a requesting letter addressed to the Court settling out the defaulting parties failure to comply with the Orders shall be sufficient evidence of neglect or default.

9. Unless otherwise specified in these Orders, and save for the purposes of enforcing any monies due under these or any subsequent Orders:

(a) Each party be solely entitled, to the exclusion of the other, to all other property (including choses in action) in the possession of that party as at the date of these Orders, save for the items the Wife is to provide to the Husband as per paragraph 6 of these Orders and that the Husband shall transfer to the Wife, at the Wife’s cost and expense, the ownership and registration of the parties’ dog.

(b) Each party forego any claims that they may have to any superannuation benefits belonging to or earned by the other party.

(c) Any joint accounts to be closed and the proceeds, if any, shall be divided equally between the parties.

(d) Insurance policies remain the sole property of the owner named thereon.

(e) Each party shall retain any benefits from their respective employer, including long service leave, annual leave and any other emolument.

(f) Each party be solely liable for, and indemnify the other against, any liability encumbering any item of property to which that party is entitled pursuant to these Orders.

(g) Any joint tenancy of the parties in any real or personal estate is hereby expressly severed.

10. The Initiating Application (Family Law) of the wife filed on 24 June 2022, the Response to Initiating Application (Family Law) of the husband filed on 20 July 2022, and the Further Amended Response to Initiating Application (Family Law) of the Husband filed on 1 February 2024 be otherwise dismissed.

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).

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

Background

Background to the litigation

For the reasons that follow, I have determined the minimal remaining asset pool as at the date of the trial should be paid to the husband.BACKGROUND AND RELEVANT PROCEDURAL HISTORY The wife is aged 38 years, and the husband is aged 41 years. They both own their own businesses and are entrepreneurs. The parties first met in person in November 2020, and commenced a romantic relationship shortly thereafter. They commenced cohabitation in December 2020 and married in 2021. In late 2021, the parties purchased the matrimonial home at B Street, Suburb C in Queensland (“the Suburb C property”). The parties separated on 30 March 2022, and the husband moved back to Melbourne while the wife continued to reside at the Suburb C property. Both parties assert that throughout the relationship, they were subjected to family violence by the other. In early 2022, Queensland Police applied for a Temporary Protection Order naming the husband as the protected person and the wife as the respondent, which was granted by the Court shortly after. In mid-2022, reciprocal intervention orders for a period of five years were obtained by both parties. The wife commenced these proceedings on 23 June 2022 by way of Initiating Application. The trial commenced before me on 11 June 2024 and finalised on 11 September 2024. PRELIMINARY MATTERS Both parties were represented when preparing their trial material and proposed orders, and for two days of the trial. After two hearing days, the trial was adjourned for a further day, which was listed approximately two weeks later. Prior to the adjourned date, the wife’s counsel foreshadowed she intended to cross-examine the business valuer, Ms N. Orders were also made enabling the wife to ask questions of the valuer, pursuant to r 7.26(2) and (3) of the Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) (“the Rules”) on 12 June 2024. During the adjournment, both parties dispensed with their lawyers and were self-represented. When the matter came before me on 29 August 2024, I again adjourned the proceedings to allow both parties the opportunity to avail themselves of legal representation, however neither did so. Cross-examination of the husband by the wife’s counsel had not been concluded prior to the adjournment, and upon resumption of the trial, the wife was not permitted to cross-examine the husband because of the application of s 102NA of the Act. Despite the wife’s former counsel previously seeking to cross-examine the valuer of the husband’s business, upon resumption of the trial on 11 September 2024 the wife did not seek to do so, and apparently her lawyers did not submit questions to the valuer, or if they did, a response of the valuer was not put into evidence. Accordingly, on the adjourned date, both parties were advised about remaining procedural issues and both made final submissions. The husband relied upon an aide memoire which his lawyers prepared, prior to ceasing to act on his behalf. The wife appeared electronically as she had previously requested.THE PROPERTY PROPOSALS OF THE PARTIESThe wife’s proposal

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

The value the parties attributed to their respective superannuation accounts differed slightly. As I prefer the evidence of the husband to the wife, I will adopt the values as set out by him.Conclusion as to the existing legal and equitable interests of the parties – adjusted balance sheet As a result of my findings as to disputed assets, and the treatment thereof, the existing legal and equitable interests of the parties, is as follows: In this matter the parties have separated, and the wife has made an application to the Court seeking orders altering the respective property interests. The husband also seeks that the existing property interests should be altered. The parties are no longer living in a marital relationship, and as stated at paragraph [42] of Stanford (supra), there will not “thereafter be the common use of property by the husband and the wife”. I am satisfied that it is just and equitable to alter the parties’ property interests. I now turn to consider the s 79(4) factors, commencing with contributions of the parties.CONTRIBUTIONS Per the wife’s affidavit filed 6 June 2024 and the husband’s affidavit filed 1 February 2024, at the commencement of cohabitation, they each had the following assets: At the start of cohabitation, the wife contends that she was able to generate income from her various business interests and provide for her own needs. The wife did not provide any documentation to support her contended assets or their value. The husband deposed that as at the date of cohabitation, the wife had no significant assets and her businesses, H1 Pty Ltd and D Pty Ltd, had no value. Conversely, the husband asserts that he had two established business interests in G Pty Ltd and F Pty Ltd, equity in a property in Suburb K which he had purchased in 2017, a car, and superannuation entitlements. I accept the parties had the assets referred to in the above table, except the amount of savings claimed by the wife and the value of the personal effects and chattels of each of the parties, because there was no valuation of these assets or bank statements supporting the amount of savings claimed by the wife. Further, there was no evidence before me regarding the unpaid parking and traffic related fines and Victorian State Revenue Office debt attributed to the husband, other than the wife’s bare assertion in her affidavit. Leaving aside these issues, the husband had overwhelmingly greater assets than the wife, at the commencement of cohabitation. According to the husband’s counsel in his opening address, the husband had around $800,000 of assets, plus superannuation, at the commencement of the relationship, and the wife had the proceeds of sale of her car. The table of assets above indicates his assets actually exceeded the estimate provided by counsel. Because of the short duration of the relationship, being around 16 months, and a marriage of around one year, it is convenient to consider contributions during the marriage in terms of the primary assets, the business, and the Suburb C property. The businesses

Ratio Decidendi

Legal Principle Established

It is clear that since separation, the equity in the Suburb C property significantly decreased as a result of the failure to meet mortgage repayments, and outgoings referable to the property and the wife’s delay in vacating the property and agreeing to an orderly sale. The husband asserts, and I accept, that had the mortgage and rates/taxes on the Suburb C property been paid when they fell due, during the wife’s period of sole occupation of the property, there would be an additional sum of $237,557.50 available for distribution between the parties. Money received post separation On 31 March 2022, the day following separation, the wife deposes to discovering that the husband had attempted to transfer $60,000 from a joint account, into a bank account in his mother’s name. She subsequently contacted the bank to cancel the transaction and freeze the account. As a result of this attempted withdrawal, the wife transferred $44,710.44 from one of the parties’ joint bank accounts to her personal account, and $14,000 to a different joint account supposedly to meet the monthly mortgage repayments for the Suburb C property. On 1 April 2022, the husband withdrew $14,100 from this account, leaving a balance of $33.12. It is unclear based on the material the exact mortgage repayment amount as at this date; however, the husband deposes that in April 2023, monthly repayments totalled $8,800. On 8 April 2022, the wife withdrew a further $27,000 from a joint account in the name of D Pty Ltd, into a new business bank account established in the same name. It was the wife’s intention for this amount to provide working capital for the business and business expenses as and when required, but the wife contended it was subsequently spent on living expenses and some legal fees. On 30 September 2022, interim orders were made for the parties to access the balance of funds held in an account ending …51, for the sole purpose of transferring the funds to the solicitor for the wife by way of part property settlement. An order was also made for the wife to receive Motor Vehicle 1 by way of part property settlement. In the husband’s trial affidavit, he deposes that the balance of funds totalled $60,000. Whilst not explicitly outlined by counsel for the husband, doing the best I can, it can be assumed that the $140,710.44 “add back received by wife as part property and/or from joint savings” comprises of the $44,710.44, $14,000 and $27,000 transferred by the wife from the parties bank accounts, in addition to the balance of funds transferred to the wife’s solicitor by way of part property settlement totalling $60,000. Whilst these figures total $145,710.44, the figure the husband provided is E$140,710.44. On 15 February 2024, further orders were made by consent providing for the husband to receive the sum of $150,000 from the proceeds of sale of the Suburb C property. The purpose of the February 2024 order was to equalise the amount each party received as partial property settlement. During cross-examination, the wife agreed the husband should be entitled to receive the sum, in accordance with the orders.