Hofman & McBride

Case [2022] FedCFamC1F 242

FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA

(DIVISION 1)

Hofman & McBride [2022] FedCFamC1F 242

File number(s): SYC 1339 of 2018
Judgment of: CAMPTON J
Date of judgment: 8 April 2022
Catchwords:

FAMILY LAW – PROPERTY – Adjustment of property interests pursuant to s 79 of the Family Law Act 1975 (Cth).

SPOUSE MAINTENANCE – Husband’s application for spouse maintenance dismissed – Where husband fails to establish evidentiary thresholds.

Legislation:

Evidence Act 1995 (Cth) ss, 50, 136

Family Law Act 1975 ss 72, 75, 79

Federal Circuit and Family Court of Australia Act 2021 (Cth) s 52

Federal Circuit and Family Court of Australia Rules 2021 rr 7.01, 7.10
Cases cited:

Acton v Burton [2015] FamCA 469

Bevan & Bevan (2013) FLC 93-545

Bevan and Bevan (1995) FLC 92-600

Briese & Briese (1986) FLC 91-713

Campbell v Kuskey (1998) 22 FamLR 674

Cirillo & Cirillo (No 4) [2022] FedCFamC1F 208

DJM & JLM (1998) FLC 92-816

Edgehill & Edgehill [2007] FamCA 1102

Fields & Smith (2015) FLC 93-638

Franklin & Ennis [2019] FamCAFC 91

Gollings & Scott (2007) FLC 93-319

Hall & Hall (2016) 257 CLR 490

Horrigan & Horrigan [2020] FamCAFC 25

Kowaliw and Kowaliw (1981) FLC 91-092

Livesey v. Jenkins (1985) 1 All E.R. 106

Mayne & Mayne (2011) FLC 93-479

Omacini & Omacini [2005] FLC 93-218

Oriolo & Oriolo (1985) FLC 91-653

Pierce & Pierce (1999) FLC 92-844

Prince and Prince (1984) FLC 91-501

Singerson & Joans [2014] Fam CAFC 238

Stanford & Stanford (2012) 247 CLR 108

Trevi & Trevi [2018] FamCAFC 173

Weir & Weir (1993) FLC 92-338
Division: Division 1 First Instance
Number of paragraphs: 237
Date of hearing: 28-30 March & 1 April 2022
Place: Sydney
Counsel for the Applicant: Ms Beck
Solicitor for the Applicant: Lawyers Central
Counsel for the Respondent: Mr Wong
Solicitor for the Respondent: Slaw Family Lawyers
Table of Corrections
22 April 2022 In paragraph 217, a reference to “55 per cent” has been corrected to read “45 per cent”.
22 April 2022 The MNC has been updated from “Hofman & McBride [2022] FedCFamC1F 234” to “Hofman & McBride [2022] FedCFamC1F 242”.

ORDERS

SYC 1339 of 2018

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

MS HOFMAN

Applicant
AND:

MR MCBRIDE

Respondent

ORDER MADE BY:

CAMPTON J

DATE OF ORDER:

8 APRIL 2022

THE COURT NOTES

A.These orders have been amended pursuant to rule 10.13 of the Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth).

THE COURT ORDERS THAT:

1.Pursuant to s 79 of the Family Law Act 1975 (Cth) the wife pay to the husband the sum of $502,855 within 21 days of the date of these orders.

2.Within three months of the date of these orders the wife do all such things as are necessary to discharge the mortgage secured upon the property at C Street, Suburb F.

3.In the event the wife fails or neglects to comply with Orders 1 and/or Order 2 above, the parties…

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Hofman & McBride [2022] FedCFamC1F 242
Case
[2022] FedCFamC1F 242
Decision Date

CaseChat Overview and Summary

The case before the court involved a dispute between Ms Hofman and Mr McBride regarding the adjustment of their property interests and the husband's application for spouse maintenance. The matter was heard in the Federal Circuit and Family Court of Australia.

The primary legal issue before the court was whether the husband had met the evidentiary thresholds required to establish his entitlement to spousal maintenance, as well as the appropriate adjustment of property interests between the parties under section 79 of the Family Law Act 1975 (Cth). The court had to consider the income, property, and financial resources of each party, as well as their physical and mental capacity for gainful employment, in making its decision.

The court found that the husband had not met the evidentiary thresholds to establish his entitlement to spousal maintenance. The husband's health issues and reduced income earning capacity were considered, but the court found that he had not demonstrated an inability to support himself adequately. The court also determined the appropriate adjustment of property interests between the parties, ordering the wife to pay the husband a sum of $502,855 within 21 days of the date of the orders.

In summary, the court dismissed the husband's application for spouse maintenance and ordered the wife to pay the husband $502,855 as an adjustment of their property interests. The wife was also required to discharge the mortgage on the property at C Street, Suburb F within three months of the date of the orders. The husband was ordered to resign his power of appointment of the K Trust and appoint the wife as the appointer of the trust, as well as resign as a beneficiary of the trust. Each party retained their respective rights, entitlements, and interests in their separate properties, superannuation entitlements, and other assets.

Orders

Orders of the court

SYC 1339 of 2018

FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)

BETWEEN:

MS HOFMAN

Applicant

AND:

MR MCBRIDE

Respondent

ORDER MADE BY:

CAMPTON J

DATE OF ORDER:

8 APRIL 2022

THE COURT NOTES

A. These orders have been amended pursuant to rule 10.13 of the Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth).

THE COURT ORDERS THAT:

1. Pursuant to s 79 of the Family Law Act 1975 (Cth) the wife pay to the husband the sum of $502,855 within 21 days of the date of these orders.

2. Within three months of the date of these orders the wife do all such things as are necessary to discharge the mortgage secured upon the property at C Street, Suburb F.

3. In the event the wife fails or neglects to comply with Orders 1 and/or Order 2 above, the parties shall forthwith upon such default do all such things and sign all such documents that may be necessary to list for sale and sell for the best price reasonably obtainable, the property at C Street, Suburb F and upon completion of the said sale the balance of proceeds of the sale shall be applied in the following priority:

(a) In payment of any agents’ commission and legal costs and disbursements occurred in relation to the said sale;

(b) In payment of an amount required to discharge the mortgage secured upon the said property;

(c) To pay the husband of any amount or part thereof that remains unpaid pursuant to Order 1 hereof, together with interest thereon calculated at the rate prescribed by the Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) on that outstanding sum from a date 21 days after the date of these orders until the date of receipt of the outstanding unpaid sum due to the husband pursuant to Order 1;

(d) In payment of the balance to the wife.

4. Forthwith upon receipt by the husband of the monies pursuant to Order 1 hereof, or on completion of the sale of the Suburb F Property, whichever is the earlier, the husband shall pay to the wife one half of the costs of single experts that have been paid for by the wife in the first instance.

5. Within 21 days of the date of these orders the husband shall do all such things and sign all such documents as prepared by the wife at her expense to resign his power of appointment of the K Trust and to appoint the wife as the appointer of the said trust, and to resign as a beneficiary of the said trust.

6. Save and except as provided for in these orders the wife shall retain to the exclusion of the husband all her rights entitlements and interest in:

(a) The property at C Street Suburb F;

(b) Her interest in any trust or corporation;

(c) Her cash bank;

(d) All items of furniture, personalty and motor vehicles in her possession;

(e) Any share holdings in her possession or control; and

(f) Her superannuation entitlements.

7. Save and except as provided for in these orders the husband retain to the exclusion of the wife all his right entitlements and interests in:

(a) All cash banking invested by him;

(b) All items of furniture and personalty in his possession;

(c) His superannuation entitlements.

8. In the event either party fails or neglects to execute any document within a period of seven (7) days as been required to do so by way of these orders, then a registrar at the Sydney Registry of the Federal Circuit and Family Court of Australia is appointed pursuant to s 106A of the Family Law Act 1975 (Cth) to execute such document on behalf of the party in default so as to give validity and effect to these orders. The Registrar is to be satisfied of such failure or neglect by way of affidavit evidence, and the party in default shall pay the costs of the non-defaulting party of the Registrar executing the document pursuant to this order.

9. The husband’s application for spouse maintenance be 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).

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

A direction was made at the commencement of the trial pursuant to s 136 of the Evidence Act (Cth) such that no documents in the tender bundles of each party or exhibits to any affidavit would constitute evidence of any fact adverse to the case of the other, unless that document and the proposition of fact to be proved or inferred from the document had been put to the other party or relevant witness in cross-examination. BACKGROUND The wife was a finance professional at cohabitation. She remains a finance professional. The wife became a senior manager at M Company in 2013. The husband completed his university degree in 1999 and worked as a professional in both City Y and then Sydney. In late 2001 he commenced working as a public servant in City Y. By 2003 he was a senior manager in the public service. He started his own business in 2006, working as a consultant. During his early years as a consultant he taught at the GG University and considered undertaking a "part time PHD". His affidavit evidence records a busy consultancy especially between the 2012 and 2014 calendar years. The husband gives evidence of experiencing poor health from late 2015 into early 2016. The single rheumatology expert Dr O diagnosed the husband with a medical condition in 2016 and 2017. The contagion presented as dull ache with occasions of acute pain associated with a number of other medical issues and symptoms. The wife gave evidence of, and put into issue, the husband’s presentation during 2016 and 2017. The husband stopped working "altogether" in early or mid-2017. He has not been registered to work as a professional since 1 July 2018. The husband worked in a casual role for the public service in late 2018. He had agreed to work on three, eight-hour days each week for a period of seven months. In 2019 he worked for N Company and other similar companies. He was paid $29 per hour, working two full days a week for about seven hours each day. In early 2019, he successfully applied for a position at Q University. His rate of pay for this casual position was in the range of $43 to $133 per hour. The husband did not progress the employment opportunity. He said he “had a five day long pain spike and could not continue with [this role]”. He did not undertake any paid work in 2020 or 2021. In 2020 he commenced a process of reactivating his professional registration. He intended to return to consulting in 2021 and gave evidence of this proposal being "derailed by a major flare-up" that started in late January 2021 and ran until May 2021. He "shelved" his plans to return to consulting until his health stabilised. The husband lived with Ms R from June 2019 to November 2020 in his current rental premises at Suburb T. Until the husband vacated the Suburb F Property in June 2019, the attendances of Ms R at the home contrary to the wishes of the wife generated significant stress to the wife and feelings of degradation. She recorded her affidavit the following unchallenged evidence that I accept:93.I said to [Mr McBride] “please do not have [Ms R] enter my house anymore” but he responded with words to the effect “I don’t understand why you are jealous. This divorce was all your idea. I’m entitled to have my girlfriend in my house”.

Evidence

Evidence Before The Court

There are no children of the marriage.THE EVIDENCE The wife relied upon the following documents:(a)Amended Initiating Application, filed on 1 April 2021; (b)Financial Statement of the Wife, filed on 22 March 2022; (c)Affidavit of the wife, filed on 22 March 2022 (“the wife’s affidavit”); (d)Case Outline, filed on 27 March 2022 and marked as Exhibit W1. The husband relied upon the following documents:(a)Amended Response to an Initiating Application, filed on 25 March 2022;(b)Financial Statement of the husband, filed on 18 March 2022;(c)Affidavit of the husband, filed on 23 March 2022 (“the husband’s trial affidavit”); (d)Affidavit of the husband, sworn on 24 March 2022 and filed on 28 March 2022 (“the husband’s supplementary affidavit”); (e)Case Outline, filed on 25 March 2022 and marked as Exhibit H1. (f)Final Minute of Order sought and marked Exhibit H16. The husband sought to rely upon an affidavit of his treating doctor, Dr L filed 21 March 2022. Objection was successfully taken by the wife to the husband relying upon that affidavit as being expert evidence that did not comply with r 7.01 of Federal Circuit and Family Court of Australia Rules 2021 (Cth) (“the Rules”). The expert opinions expressed therein from a treating medical practitioner were outside that prescribed by the rule. The order made on 20 May 2020 as to this treating medical practitioner specifically directed the contents of any report to the subject matters recorded in what was r 15.01 of the prior rules of Court and is now r 7.01 of the Rules. The single expert doctor had the benefit of Dr L clinical notes and other diagnostic reports obtained from the treating physician for the purposes of his updated third report. No application was made by the husband to rely on the evidence of Dr L pursuant to r 7.10 of the Rules. Objections were taken to the parts of the remaining affidavits and determined at the commencement of the hearing. A direction was made at the commencement of the trial pursuant to s 136 of the Evidence Act (Cth) such that no documents in the tender bundles of each party or exhibits to any affidavit would constitute evidence of any fact adverse to the case of the other, unless that document and the proposition of fact to be proved or inferred from the document had been put to the other party or relevant witness in cross-examination. BACKGROUND The wife was a finance professional at cohabitation. She remains a finance professional. The wife became a senior manager at M Company in 2013. The husband completed his university degree in 1999 and worked as a professional in both City Y and then Sydney. In late 2001 he commenced working as a public servant in City Y. By 2003 he was a senior manager in the public service. He started his own business in 2006, working as a consultant. During his early years as a consultant he taught at the GG University and considered undertaking a "part time PHD". His affidavit evidence records a busy consultancy especially between the 2012 and 2014 calendar years.

Decision

Reasons for decision

By way of cross-check the value of this adjustment in money terms is $238,072, a differential of $476,145.CONCLUSION – JUSTICE AND EQUITY Accordingly the husband has an overall entitlement of 17.5 per cent percent of the pool of property and superannuation identified in the balance sheet. This equates to $833,255. He currently has in his possession the following: The adjusting amount the wife is required to pay to him is $502,855 so as to achieve $833,255. Standing back I find the distribution of property of the parties in these terms identified above is appropriate and otherwise just and equitable. I will order accordingly.SPOUSE MAINTENANCE The husband relief for periodic spouse maintenance is for a closed two year period being consistent with the expert evidence as to his health and income earning capacity. In the Hall & Hall (2016) 257 CLR 490, the High Court set out the appropriate approach in considering an application for spousal maintenance as follows: 3. … The gateway to the operation of Pt VIII in relation to spousal maintenance is in s 72(1). That sub-section provides that "[a] party to a marriage is liable to maintain the other party, to the extent that the first-mentioned party is reasonably able to do so, if, and only if, that other party is unable to support herself or himself adequately … having regard to any relevant matter referred to in [s] 75(2)". 4. The liability of a party to a marriage to maintain the other party that is imposed by s 72(1) is crystallised by the making of an order under s 74(1). That sub-section provides that, "[i]n proceedings with respect to the maintenance of a party to a marriage, the Court may make such order as it considers proper for the provision of maintenance in accordance with this Part". 5. A Court exercising the power conferred by s 74(1) is obliged by s 75(1) to take into account the matters referred to in s 75(2) and only those matters. Those matters are presented as a comprehensive checklist. They include what s 75(2)(b) refers to as "the income, property and financial resources of each of the parties and the physical and mental capacity of each of them for appropriate gainful employment". They also include, by virtue of s 75(2)(o), "any fact or circumstance which, in the opinion of the Court, the justice of the case requires to be taken into account". For the purposes of what was an interim spouse maintenance under consideration by the High Court in that matter it said:8.…No doubt, on an application for an interim order "[t]he evidence need not be so extensive and the findings not so precise" as on an application for a final order. But there is nothing to displace the applicability to an exercise of the power conferred by s 74(1) of the ordinary standard of proof in a civil proceeding now set out in s 140 of the Evidence Act 1995 (Cth). The same principles as to the onus of proof resting with the husband apply to his relief for a final spouse maintenance order. I cannot make a final spouse maintenance order without finding, on the balance of probabilities on the evidence, that the threshold requirement in s 72(1) of the Act is met having regard to any relevant matter referred to in s 75(2). In Bevan and Bevan (1995) FLC 92-600, the Full Court confirmed that an award of spousal maintenance requires: (a)no fettering principle that a pre-separation standard of living must automatically be awarded where the respondent's means permit; and (b) that discretion being exercised in accordance with the provisions of section 74 with "reasonableness in the circumstances" as the guiding principle; and (c)that “adequately” imports relativity.

Ratio Decidendi

Legal Principle Established

Full text does not contain this section.