HAYFORD & HAYFORD

[2011] FamCA 512

FAMILY COURT OF AUSTRALIA

HAYFORD & HAYFORD [2011] FamCA 512

FAMILY LAW – PROPERTY – interim orders – application by the wife seeking orders that the husband pay to the Australian Tax Office her outstanding income tax assessment – where the issue is subject to significant dispute – where the Court held that it was inappropriate to make such an order on contested evidence – application dismissed.

FAMILY LAW – SPOUSAL MAINTENANCE – application by the wife for urgent spousal maintenance – whether the wife is in immediate need of financial assistance – where the husband has been in control of most of the significant assets since separation – where the wife has not established on the necessary basis an immediate need for financial assistance – application dismissed.

FAMILY LAW – PROPERTY – valuation of property – where the wife alleges that the husband has an interest in the property and seeks that it be taken into account in final property proceedings – where the issue as to whether the husband has an interest will be determined at trial – orders that the husband obtain a valuation.

FAMILY LAW – PRACTICE AND PROCEDURE – application by the wife seeking production of various documents by the husband – where such documents are relevant to the issues before the Court – orders that the husband provide such documents to the wife.

FAMILY LAW – COSTS – application by the husband for costs – consideration of section 117(2A) factors – where neither the husband or wife have been wholly unsuccessful in their applications – where the Court held that it was not just for an order for costs to be made – application dismissed.

Family Law Act 1975 (Cth) ss 77 & 117

APPLICANT: Ms Hayford

RESPONDENT: Mr Hayford

FILE NUMBER: ADC 1963 of 2009

DATE DELIVERED: 21 June 2011

PLACE DELIVERED: Adelaide

PLACE HEARD: Adelaide

JUDGMENT OF: Dawe J

HEARING DATE: 21 June 2011

REPRESENTATION

COUNSEL FOR THE APPLICANT: Mr Jordan

SOLICITOR FOR THE APPLICANT: City East Legal

COUNSEL FOR THE RESPONDENT: Mr McQuade

SOLICITOR FOR THE RESPONDENT: Lempriere Abbott McLeod

Orders

1. Paragraphs 1 and 4 of the wife’s Application in a Case filed on 7 April 2011 are dismissed.

2. The husband forthwith and within seven [7] days of today use his best endeavours to obtain the consent of his partner (Ms B) to the valuation of C Street, Suburb D in the State of South Australia and that the husband obtain such a valuation of the property from Mr E of F Valuers at the initial cost of the husband, such valuation to be filed and served (if possible) by 18 July 2011.

3. Within fourteen [14] days of today the husband make a written request to his accountants, solicitors and all named purchasers and parties to the original optional agreement and sale agreement of units and shares in relation to the G Trust and G Pty Ltd both agreements dated 25 October 2006 for them to provide all information in writing to the wife’s solicitors concerning any knowledge they have about the past or present whereabouts of those original documents

4. Within seven [7] days of today the husband’s solicitors provide to the wife’s solicitors copies of all passports of the husband held by them (being his current passport and his expired passport) and to provide each such copy as certified to be true and correct of the original copy held by them.

5. The husband authorise Qantas to provide his solicitors with all Frequent Flyer records concerning him from 1 April 2006 to the present date and that the husband’s solicitors request the same by 30 June 2011 and provide the wife’s solicitors with a copy of all such information received within seven [7] days of receipt of the same.

6. The husband’s Response filed on 20 May 2011 is dismissed.

7. There being no order as to costs.

IT IS NOTED that publication of this judgment under the pseudonym Hayford & Hayford 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 ADELAIDE

FILE NUMBER:  ADC 1963 of 2009

Ms Hayford

Applicant

And

Mr Hayford

Respondent

EX-TEMPORE REASONS FOR JUDGMENT

1. This is interim application matters in proceedings between the husband and wife in relation to property settlement proceedings which appear to have been outstanding since 2009 having been transferred from the Federal Magistrates Court to this Court towards the end of 2009. 

2. The matters which need to be considered this morning are set out in the Application in a Case filed by the wife on 7 April 2011 and the response to that application filed by the husband on 20 May 2011.  The applications need to be seen in the context of the past proceedings which included interim maintenance proceedings which were settled by consent in which one of the orders gave the wife liberty to apply for further maintenance orders. 

3. The Court has made attempts to list this matter for trial; I understand the matter is listed for further directions on 12 July 2011 before a Registrar with a view to preparing the matter for a conclusion and, therefore, resolution of the financial matters in dispute.

4. The Court has also made recent orders, in particular on 24 May 2011, including paragraph 1 of that order which was that the:

   Within 14 days, the husband to provide full discovery and inspection of all documents in his power, possession or control fitting the description of the letter from the wife’s solicitors to the husband’s solicitors dated 8 April 2011.

5. That letter of 8 April 2011 sets out a list of particular items which were requested by the wife’s solicitors to the husband’s solicitors.  Following upon the hearing on 24 May 2011 that order was made.  That order provided for compliance within 14 days of 24 May 2011.  The affidavit of the husband filed on 20 June 2011 (well outside that time provided in the Court order) simply refers to the order by saying on paragraph 4:

   Annexed hereto marked A is a true copy of a letter dated 20 June 2011 from my solicitor to the wife’s solicitors in compliance with paragraph 1 of the said order.

6. The annexure “A” is a letter dated 20 June 2011 which was received on the morning of 20 June 2011.  It can therefore, not be in compliance with paragraph 1 of the order.  That affidavit and those comments needs to be seen in the context of the Contravention Application which was filed by the wife on 20 June 2011 seeking to have the husband dealt with for his contravention of that order in failing to provide for the ordered discovery within the time provided. 

7. The affidavit of the wife in relation to that application was sworn on 18 June and filed on 20 June 2011.  Those matters, whilst of concern to the Court, cannot be dealt with today as they would be the subject of the contravention proceedings which are listed to be heard by the Court on 2 August 2011 at 2.30 pm which I assume is a directions hearing before a Registrar with a view to subsequently listing the matter for judicial determination.

8. The issues that need to be determined today are those in the Application in a Case filed by the wife.  Paragraph 1 of that application is:

   That the husband do forthwith pay to the Australian Taxation Office the wife’s unpaid income tax assessment for 2009 in the sum of $6024.19.

9. Another order sought which relates to financial matters is paragraph 4:

   That the husband pay to the wife urgent or interim spousal maintenance at the rate of $1200 per week or such other sum as the Court shall order.

10. I propose to deal with those interconnected financial matters to a certain extent together in this ex tempore judgment. 

11. The wife says that she signed the taxation documents provided to her, believing that the husband would pay any tax assessed as payable by her.  The husband denies this but says that he will pay the income tax outstanding and payable by the wife in the sum of $6024.19 if the wife signs a document representing a transfer of units in the Unit Trust.  These matters are set out in affidavit annexures which are before the Court.

12. The request by the husband for the wife to sign that document has been met with opposition. The response of the husband seeks an order that the wife sign such documents. They are therefore interconnected. In considering the immediate payment of the wife’s taxation account and the request for urgent or interim maintenance, I take into account the material relied on by both parties. In particular so far as urgent spousal maintenance is concerned, section 77 of the Family Law Act 1975 (Cth) (“the Act”) which requires that an order for urgent spousal maintenance can be made where it appears to the Court that the party is in immediate need of financial assistance, but it is not practical to determine what order, if any, should be made. The provision gives the Court the power to make such periodic sum or other sum as the Court considers reasonable.

13. I understand from submissions made by counsel for the wife this morning that the application before the Court today is to be treated as an application by way of urgent maintenance to be heard on the documents rather than interim spouse maintenance which would require the hearing and testing of the evidence. 

14. The evidence indicates that the husband has, and has had since the separation, control of most of the significant assets save and except the wife’s significant interest in her real estate. 

15. The difficulty in this matter is that there are large number of contested matters and disputes, in relation to the assets and as to the method of treatment of those assets and the history of the parties dealing with the assets.  The wife has a significant claim to be determined in relation to the sale of the business, in particular, in relation to the claim that she makes that her signature has been forged on the documents produced by the husband in relation to the sale of the Unit Trust and shares.

16. The balance sheet provided by the parties also sets out matters that indicates there are significant matters to be determined at the final hearing. 

17. On an interim basis, it appears inappropriate to make findings on the contested assets and their values, but on the current material before me, I am not satisfied that it has been established that it is just and equitable to make an order that the husband pay the income tax assessed against the wife for the year ended 2009.  That is a matter which would need to be considered when the evidence is before the Court and tested at trial and may in due course bring about significant findings, both as to the question of costs and final property settlement. 

18. The wife admits to being over the age of 55 and does not deny that at that age she has the capacity to access her fund but simply says she does not wish to.  The Court does not have sufficient information at this stage in relation to the superannuation fund to assess what amounts, if any, the wife may be able to receive from the fund and whether that overcomes the need for consideration of urgent or interim spousal maintenance. 

19. In view of the material before the Court concerning the wife’s capacity to access her superannuation fund, it appears that the wife has not established on the necessary basis the conditions required by section 77, namely that she is in immediate need of financial assistance.

20. It is on that basis not necessary to consider the criticism of the wife’s expenses that are claimed, nor is it appropriate to consider the information provided by the husband as to his alleged income and expenses.  However, I note that the husband’s affidavit material does not provide an update of the husband’s assets and liabilities at the current time which would also be highly relevant to any consideration of the factors requiring consideration for interim maintenance under section 75.

21. In relation to paragraph 2 of the wife’s Application in a Case, that seeks that the husband be ordered to forthwith instruct Mr E of F Valuers to value the house property situated at C Street, Suburb D at the cost of the husband at first instance. 

22. The Suburb D property is the home in which the husband currently resides with his de facto, Ms B.  The evidence indicates that the property is registered in the name of Ms B.  The wife maintains that the husband has a form of interest in this property and seeks that his interest in that property be taken into account in the overall property settlement proceedings. 

23. The affidavit evidence of the husband on file to which the Court has been directed provides inconsistent evidence about the husband being a party to the mortgage used to purchase the property.  In some documents he claims a share of the mortgage as a debt which he owes and also claims expenses in relation to the outgoings of the property including expenses described as the mortgage.

24. The wife claims that the husband has an interest in the property and the husband denies that he has.  This is an issue which will be required to be determined at the final property settlement proceedings.  It may well be the case that the value of the property will be a significant matter to be considered if it is established on the evidence that the husband has a claim or some form of interest, equitable or otherwise, in this real estate. 

25. In final submissions this morning, the husband’s counsel conceded that the husband would use his best endeavours to obtain Ms B’s consent to the valuation.  Considering the likelihood of this property, its value and the alleged interest of the husband being relevant matters in the determination of the final proceedings, the order sought by the wife is in all of the circumstances appropriate.

26. The next matter to be dealt with in the wife’s application is the request by the wife for an order that the husband deliver up the original auction agreement and sale agreement of units and shares in relation to G Unit Trust and G Proprietary Limited, both agreements dated 25 October 2006.  This is the issue which relates to the wife’s claim that her signature on these documents is a forgery. 

27. This allegation has been outstanding on the Court documents for some time and is interrelated with the husband’s application that the wife sign the transfer of units referred to in his application.  The original document is clearly an important document in relation to the allegation of forgery.  The husband says in the affidavit filed on 20 June 2011 in paragraph 40:

    I have undertaken a thorough search of the original document referred to therein.  I have been unable to find it.  I have inquired of our accountants as to whether they have the original document.  I have been informed that they do not.  I am not aware of the whereabouts of the original document.

28. I understand from the husband’s application that the transfer which he seeks the wife to sign is a document which is required pursuant to the agreements referred to which the wife seeks to access the original.  It is, therefore, important that further steps be taken by the husband to ensure those to whom he can given any appropriate authority have taken all steps to locate the original document.  His affidavit, therefore, does not conclude the matter.  I propose to order that he take further steps to ensure that all necessary searches have been made and that the wife is kept informed of all of those so that any necessary inference about the husband’s failure to produce the original document will be tested by the appropriate evidence.

29. Paragraph 6 of the Application in a Case of the wife seeks that the husband do deliver up to the wife a copy of any passport held by him and current for the period 1 April 2006 to date and his Frequent Flyer points statements from 1 April 2006 to date.  The information contained in the husband’s passport and Frequent Flyer records may be relevant to the determination in relation to financial arrangements since the separation of the parties and financial arrangements and acquisitions of overseas properties.  The husband in his most recent affidavit filed on 20 June 2011 says under the heading Passport and Frequent Flyer Points:

    At the date hereof, my current passport and expired passport are held in safe custody of my solicitors.  If the wife’s solicitors wish to inspect same, I request that he do so within seven days.

30. It is also appropriate for both the husband’s solicitors and the wife’s solicitors to be given the cheaper option of the husband’s solicitors providing to the wife’s solicitors copies which they certify to be true and correct copies of all of the passports referred to by the husband in paragraph 44.

31. In relation to the question of Frequent Flyer points, the husband has provided annexed to his affidavit a bundle of documents printed out from the internet in relation to his Frequent Flyer membership which appear to relate only to a year’s worth and not those backdated to 1 April 2006. 

32. The husband asserts that he has no other statements in hard copy and that he receives his statements electronically.  It is not clear whether the husband has made or is able to make a request from Qantas to provide his solicitors with further detailed records, but it may well be possible and that material may assist in resolving matters in dispute.

33. I then turn to the husband’s response to an Application in a Case which the only relevant paragraph outstanding is now the paragraph 1.  He seeks an order that:

    The wife do execute as transfer and deliver up to the husband’s solicitors the standard transfer form enclosed with the letter dated 22 November 2010 from the husband’s solicitors to the wife’s solicitors relating to 13 ordinary units in the [G Unit Trust].

34. The affidavit of the husband sets out the material including that a copy of the transfer was forwarded to the wife’s solicitors in November 2010 signed by the husband and the alleged purchasers.  The husband refers to his belief that the wife has signed the same but has not authorised the release of the same. 

35. The information before the Court indicates that the wife’s alleged signature on the documents which form the background to the transfer, namely the Options and Agreement in the Sale of the Unit Trust and Shares Agreement, was a forgery is a significant issue to be determined in the final hearing when all the appropriate evidence is before the Court.

36. The wife opposes any order which requires her to sign such a transfer, putting before the Court her belief that such a signature would appear to validate the transaction to which she denies being a party in the original documents. 

37. The husband says that there is now some $36,000 still due to be paid by the purchasers pursuant to the contested agreement and that such payment will not be made until the transfer is provided.  The delay in signing the transfer appears to put at risk the payment of some $36,000, although in what way the sum is at risk of not being paid if there is a delay in signing the transfer is not specified.  The matter, however, is an issue which is truly only capable of being determined at trial.  It is not appropriate at this stage with the contested evidence in its current state to order the wife to sign the document.

38. That leaves the matter to be prepared for final hearing.  It already has a listing for directions before a Registrar.  The question of the husband’s failure to comply with the discovery order of 24 May 2011 is referred to a directions hearing in August 2011 for preparation for final hearing if the matter is to proceed.

39. I now have an application by the husband for costs of the husband in relation to the Application in a Case and the response to the Application in a Case. The provisions of section 117 of the Act provide that each party pay their own costs unless the provisions of 117(2A) are relevant, section 117 says:

    Subject to subsection (2), subsection 70NFB(1) and sections 117AA, 117AB, 117AC and 118, each party to proceedings under this Act shall bear his or her own costs.

    Subsection (2) provides:

    “If, in proceedings under this Act, the court is of the opinion that there are circumstances that justify it in doing so, the court may, subject to subsections (2A), (4) and (5) and the applicable Rules of Court, make such order as to costs and security for costs, whether by way of interlocutory order or otherwise,  as the Court considers just.”

1. There are then the factors which are required to be considered set out in section 117(2A) which in relation to this matter are primarily the financial circumstances of each of the party to the proceedings. In this case the husband was in the past in control of the significant assets and the income of the parties and is now substantially in control of a large number of assets of the parties, albeit now receiving an income only by way of superannuation.

2. The conduct of the parties to the proceedings in relation to the proceedings, including issues in relation to pleadings and discovery, is also relevant and is clearly part of the proceedings about which I have already made findings.  Subsection (d):

   Whether the proceedings were necessitated by the failure of a party to the proceedings to comply with previous orders of the Court.

3. It is not directly relevant to these proceedings but may well be a matter to be determined in relation to contravention proceedings.  Subsection (e) is:

   Whether any party to the proceedings has been wholly unsuccessful in the proceedings.

4. The wife has not been wholly unsuccessful as she has obtained some of the orders in the Application in a Case. The husband has not been wholly unsuccessful in that, although his application has been successful, he has successfully defended the wife’s application for urgent maintenance and the payment of the income tax amount. I am not aware of any offers and the other matters set out in section 117(2A) are not relevant to the determination of this costs application.

5. However, considering the orders that I have made today and the material upon which it is based, I am satisfied that the financial circumstances of the parties and the findings which I have made in relation to the appropriate interim orders indicate that it has not been established that it is just for any order for costs to be made and that the provisions of section 117 subsection (1) should apply; namely that each party to the proceedings shall bear his or her own costs.

I certify that the preceding forty-four (44) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Dawe delivered on 21 June 2011.

Associate: 

Date:  1 July 2011