JEDD & JEDD

[2016] FamCA 983

FAMILY COURT OF AUSTRALIA

JEDD & JEDD [2016] FamCA 983

FAMILY LAW – PROPERTY – Interim property Application – Whether the former matrimonial home should be sold – Where the house and mortgage is registered in the wife’s sole name – Where the husband is occupying the house – Where the husband’s substantive application is for the house to be transferred to him – Where the final hearing dates are set

Family Law Act 1975 (Cth)

APPLICANT: Ms Jedd

RESPONDENT: Mr Jedd

FILE NUMBER: PAC 1459 Of 2016

DATE DELIVERED: 18 November 2016

PLACE DELIVERED: Sydney

PLACE HEARD: Sydney

JUDGMENT OF: Le Poer Trench J

HEARING DATE: 3 November 2016

REPRESENTATION

COUNSEL FOR THE APPLICANT: Mr Knox

SOLICITOR FOR THE APPLICANT: Doolan Wagner Family Lawyers

COUNSEL FOR THE RESPONDENT: Mr Lethbridge

SOLICITOR FOR THE RESPONDENT: Gordon & Barry Lawyers

Orders Pending Further Order

1. Otherwise than as specified in these orders, the wife is restrained by injunction from selling, transferring, mortgaging or charging or otherwise encumbering the property known as and situate at B Street, Suburb C, in the state of New South Wales, being the whole of the land contained in Folio Identifier … (“the Suburb C Property”) without first giving the husband 14 days’ notice in writing of her intention to do so.

2. The Husband pay all mortgage payments, taxes, rates, insurance premiums and utility expenses on the Suburb C Property and indemnify, and keep indemnified, the Wife with respect to same.

3. Should the house and content Insurance or any other insurance policies which the wife has effected in relation to the Suburb C Property, fall for renewal, the wife is to forthwith serve notice of same upon the husband and provide him with copies of any insurance renewal notices she receives. Alternatively the wife may pay the premiums and seek re-imbursement from the husband having provided him with copies of the evidence of payment. Where that occurs the husband is to repay the wife the amount paid by her within 14 days of receipt of the evidence of payment and accompanying request for payment.

4. The wife is to forthwith use/apply her best endeavours to secure the agreement of the mortgagee to extend the facility which she has now in place to pay interest only on the registered mortgage, (currently to cease in December 2016) until the end of April 2016.

5. The husband has leave to publish a copy of these orders to the relevant officer or officers at the mortgagee bank.

6. In the event of the husband being in default of any payment required to be made by him pursuant to these orders for a period of 21 days, then the wife is at liberty to sell the Suburb C property through a real estate agent and at a price, agreed to by the husband. The wife is to ensure the husband is forthwith provided with any documents she signs or receives relative to any intended sale of the Suburb C property. The wife is to engage a solicitor to act for her on the sale of the Suburb C property which solicitor is to be agreed to by the husband.

7. Upon a sale being completed the wife is to cause all the sale proceeds available to her, after meeting the sale expenses and discharge of the registered mortgage, to be deposited into a controlled monies account with the solicitor appointed pursuant to these orders, who acted for the wife on the sale of the Suburb C property. The parties are not to remove any of the funds from that Controlled Monies Account without a further order of the court. The wife is to serve a copy of these orders upon the solicitor she engages to act for her on the sale, service to be effected at the time of such engagement.

8. That the wife is to forthwith provide to the husband with sufficient details of the bank account, into which she makes the mortgage payments to the mortgagee NAB, to enable him to be able to meet the mortgage payments by deposit of funds to that bank account.

9. The wife is to provide to the husband, within 24 hours of receipt of same, copies of any correspondence, notices, and bank statements for the mortgage accounts, received by the wife from the NAB or any other entity, relative to the mortgage.

10. The wife is to provide to the husband forthwith upon receipt of same, copies of any invoices, demands or the like requiring payment of rates, taxes or utility expenses arising from the ownership or occupancy of the Suburb C property.

11. Each party’s costs of the application in a case and response thereto is reserved for determination at the final hearing, or upon application being made within 14 days of the final financial orders being made by consent.

12. Each party may apply to set these orders aside or vary same upon giving 48 hours’ notice to the court and the other party at their risk as to costs.

IT IS NOTED that publication of this judgment by this Court under the pseudonym Jedd & Jedd 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: PAC 1459/2016

Ms Jedd

Applicant

And

Mr Jedd

Respondent

REASONS FOR JUDGMENT

Introduction

1. The wife, Ms Jedd, seeks orders as contained in a minute of order marked as Exhibit A in the proceedings. The Orders sought are interim financial orders, and relate to the property at B Street, Suburb C. The wife seeks the property be sold. The husband opposes such sale.

2. The husband, who is the applicant in the principal proceedings, seeks orders as set out in his Response to an Application in a Case filed 21 October 2016. He also seeks orders in relation to the Suburb C property (“the former matrimonial home”) in which he currently lives.

Background

1. The parties commenced cohabitation in either May or November 2011. They married in 2012 and separated on 21 March 2016. The husband is 35 years of age, the wife almost 34 years of age. Both are in employment. The husband conducts a business. The wife is a manager employed by a multinational.

2. The parties have one child, D, born in 2015. There were orders made on 31 August 2016 which provide the parties have equal shared parental responsibility and that the child live with the husband for time on both Sunday and Tuesday of each week and overnight on Thursday. D otherwise is to live with the wife.

3. The property at B Street, Suburb C was acquired in May 2015. The property was purchased in the wife’s sole name with a mortgage to the National Australia Bank (“NAB”) which has a balance now of about $929,000. The monthly payment on the mortgage is $4,820 (including principal), however, the wife has entered into an arrangement with the mortgagee to pay interest only until December of this year. That payment is $3,200 per month.

4. The husband in his Initiating Application filed 4 April 2016 seeks final orders in relation to the subject property. He seeks that the property be transferred to him and that he be required to refinance the mortgage secured against the property. The wife, in her Response to the Initiating Application, seeks that the property be sold.

5. Each party supported the interim orders sought with affidavit evidence. This included Financial Statements which show a substantial difference between the parties’ current earnings. The husband discloses earning of about $1,050 per week, and the wife discloses earnings of $2,396 per week.

6. The husband currently occupies the former matrimonial home which also constitutes his business premises. The wife is residing with her parents.

Issues

1. There appears to be a substantial issue between the parties about the financial contributions towards the purchase of the subject property. The husband in his evidence claims a capital contribution of $594,000 towards the acquisition and renovation of the subject property. He says these funds were lent to him by his parents. The wife appears to acknowledge a liability to the husband’s mother of $200,000 only.

2. The immediate problem which is faced by the wife is her liability to meet the ongoing cost of the mortgage registered on title to the subject property. As stated earlier, the property stands in the wife’s sole name, and therefore she is liable for all outgoings on the property, together with her commitment under mortgage to the NAB. The husband’s case is that he is prepared to take over the cost of retaining the property at this time (meeting the cost of the mortgage instalments and other outgoings), and he has financial support from his parents in order to do so. He would need for the wife to provide information as to the account number into which the monthly mortgage payment is to be made, and he would also need to be notified by the wife of any correspondence received from the NAB relative to the subject mortgage. The husband further seeks leave to be able to provide the NAB, as mortgagee, with a copy of orders which the court may make requiring him to be primarily responsible for the payment of the mortgage instalments.

3. The husband’s case is that if the property is sold at this time, as sought by the wife, then it would render his application, for a final order that he retain the property, nugatory. The wife’s case is that the husband has no apparent ability to be able to retain the property, given his income earning capacity and the value of the property. The property is claimed to have increased in value by about $200,000 since its acquisition. The wife says, in those circumstances, where the husband is occupying the property and she is responsible at law for all outgoings on the property and the mortgage which stands in her sole name, it is extremely onerous upon her, given her current financial circumstances and her inability to fund the establishment of an independent residence for herself and the subject child. In answer to that, the husband says that he made, through the loans provided by his parents, all of the capital contribution towards the acquisition of the property and its substantial renovation. Given the short term of the cohabitation between the parties and their other circumstances, he submits that the bulk of the equity in the property, if not all, will be determined to be his.

4. The issues between the parties pose a substantial issue for each which may be determined when a final hearing is conducted in February/March 2017. The court was informed that the matter has been allocated hearing dates in the rolling list to be conducted during the latter stages of February and early part of March 2017. That is not a lengthy period of time from now and the husband, through his counsel, says that it would be severely prejudicial to his case to require a sale now, especially in circumstances where there will be a final determination within a matter of a few months. The husband refuted the suggestion he had not been contributing to the ongoing instalments on the mortgage by the tender of bank records.

5. The husband’s counsel, in answer to my question, informed the Court that the husband could not be heard to oppose an order which would require the sale of the property in the event of his failing to meet the terms of order 3 as proposed by him in his Response to the Application in a Case. This is the order which requires him to meet all of the mortgage payments, taxes, rates and utility expenses on the Suburb C property and to indemnify the wife in relation to those. The husband seeks the right to refinance the mortgage registered in the wife’s name with the NAB, however,  such a proposal is premature at this time, especially given the proximity of the final hearing. The wife already has in place an arrangement with the NAB to pay interest only and, so long as the bank would accommodate the parties, it seems reasonable in the circumstances that she should seek an extension of that arrangement, at least until the  matter is determined in February/March of next year.

6. The husband seeks an order restraining the wife from otherwise selling, transferring, further mortgaging, charging or dealing with the subject property pending further order, and that he have exclusive occupation of the property. There is nothing in the evidence to suggest that the wife would or could further charge, sell or deal with the property, however,  she should be required to give the husband  not less than 14 days’ notice of her intention to engage in any such activity so that he could consider his position in relation to her proposal. To do otherwise may well give rise to circumstances which would make it impossible for the husband to be able to retain the property should that currently be a feasible proposition.

7. There is nothing in the evidence to suggest that the wife has or would interfere with the husband’s occupation of the home, nor is there any evidence before me that would warrant excluding her from the occupation from the home. It seems clear on the evidence that she has no intention of reoccupying the property at this time.

8. The husband does not refer specifically to paying for the insurance premiums which cover the property and it may be that he has no insurable interest. It is therefore appropriate to require the wife to either provide him with the documentation necessary to be able to pay any renewals or for her to maintain the insurance on the property and that the husband indemnify her and repay to her, within 14 days, any funds paid by her as premiums for insurance of the Suburb C property.

9. In order to illustrate how he will meet the commitments on the former matrimonial home which the husband is seeking an order he should pay, the husband has tendered as Exhibits H1 and H2 bank records which show payments being made by him in relation to the former matrimonial home for the mortgage and other expenses. He has also identified payments received by way of loan from his parents which he contributed to the purchase and/or renovation of the property. Finally, his father provides an undertaking to the court to meet the payments required to be paid by the husband by the court order, should it be made as proposed by the husband as order 3 of his Application in a Case filed 21 October 2016. Although it has been signed by the husband’s father, a person who is not a party to the proceedings, the “certificate of lawyer” has not been completed. I do propose to take into account this undertaking for the purpose of supporting the husband’s case to show how he can, in practical terms, meet the outgoings on the property.

Determination

1. As the matter will not be resolved, unless settled, prior to March 2017, the wife should be required to use her best endeavours to obtain from the mortgagee NAB a further accommodation of the current arrangement to pay interest only on the mortgage until the case is determined.

2. The order I propose to make represent the best balance I can achieve between the prejudice identified by each party which would flow in the event of the orders they sought not being made and which enable the court to ultimately make orders as sought by either in their application for final orders or response to application for final orders.

3. On the wife’s part, if the husband does not fulfil the requirements to keep her indemnified from the payments required for the Suburb C Property during the period between this time and the time the Court makes final orders, then there will be an order for sale of the property which will automatically operate.

I certify that the preceding twenty (20) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Le Poer Trench delivered on 18 November2016.

Associate: 

Date:  18 November 2016