Jess and Jess (No. 2)

[2007] FamCA 1015

FAMILY COURT OF AUSTRALIA

JESS & JESS (NO. 2) [2007] FamCA 1015

FAMILY LAW – PROPERTY – partial property settlement – concurrent Supreme Court proceedings

Family Law Act, 1975 (Cth) s 79
Harris v Harris (1993) FLC 92-378

HUSBAND: MR JESS

WIFE: MRS JESS

FILE NUMBER: MLF 3444 of 2006

DATE DELIVERED: 7 August 2007

PLACE DELIVERED: Melbourne

JUDGMENT OF: Brown J

HEARING DATE: 7 August, 2007

REPRESENTATION

COUNSEL FOR THE HUSBAND: Mr B.R.Geddes QC, with Mr P.N. Crofts

SOLICITOR FOR THE HUSBAND: Carew Counsel Solicitors

COUNSEL FOR THE RESPONDENT: Mr A.J. Kirkham QC, with Mr G.R. Dickson

SOLICITOR FOR THE RESPONDENT: Kenna Teasdale Lawyers

Orders

1. That by way of partial property settlement the husband pay to the wife or at her direction a sum sufficient to discharge the obligations of T Pty. Ltd. and L Pty. Ltd. pursuant to paragraph (16) of the orders made by the Honourable Justice Gillard in Supreme Court of Victoria proceedings in January, 2007 (“the Supreme Court proceedings”) and such sum be paid:

   (a)on or before 30 August, 2007;  or

   (b)in the event the defendant in the Supreme Court proceedings (being Y Corporation Pty. Ltd.) is prepared to extend the period in which the plaintiffs in those proceedings are to make payment pursuant to paragraph (16) of the orders of 25 January 2007, then on such later date as is agreed between the husband and the defendant in the Supreme Court proceedings,  PROVIDED THAT  if the period is extended the husband advise the solicitors for the wife of that fact and keep them advised of any subsequent extension.

1. That on or before 6 December, 2007 and by way of partial property settlement the husband pay to the wife or to the respective creditors listed in this paragraph, such sum as is required to discharge the liability on the following credit cards (being credits cards referred to in paragraph 12 of the affidavit of the wife filed herein on 5 April, 2007) :

   (a)Visa card;

   (b)National Australia Bank Visa card;

   (c)Citibank Mastercard;  and

   (d)L Pty. Ltd. business American Express card;

   and upon payment of the said credit card liabilities the wife forthwith do all acts and things and sign all documents required to cancel the said credit cards, and for the purpose of this paragraph “the liability” means such sums as are owing on the date of discharge less any sum charged by the wife to a credit card account after 2 August, 2007.

1. That the subpoena filed by the wife on 23 March, 2007              addressed to the National Australia Bank be adjourned to 9:30 am. on 14 August, 2007. 

1. That the hearing date of 20 August, 2007 be vacated.

1. That the amended form 2 filed by the wife on 27 July, 2007 be adjourned to 10:00 am. on 19 October, 2007 and the following directions shall apply to that application :

   (a)the husband file any response and affidavit or affidavits in support of such response on or before 24 August, 2007;

   (b)the wife file any additional affidavits on which she seeks to rely on or before 14 September, 2007;

   (c)the husband file any additional affidavits on which he seeks to rely on or before 5 October, 2007;

   (d)thereafter, neither the husband nor wife file any affidavit, save with leave of the Court;  and

   (e)on or before 17 October, 2007 the husband and wife file a short summary of argument, together with a list of the documents to be relied upon by him or her at the hearing.

1. The Court noting that in the amended form 2 filed 27 July, 2007 the wife seeks to join Y Pty. Ltd., Y Corporation Pty. Ltd. and Mr Jess (jnr) as respondents to these proceedings, and that the amended form 2 filed 27 July, 2007 has been served on each of the proposed additional respondents, the following directions apply to each of the proposed respondents :

   (a)any response to the amended application filed 27 July, 2007 and affidavit or affidavits in support of such response be filed on or before 24 August, 2007;

   (b)the wife and the husband file any additional affidavits on or before 14 September, 2007;

   (c)each of the proposed respondents who has filed a response file and serve any additional affidavits by 5 October, 2007;

   (d)thereafter, no affidavit be filed by a proposed respondent save with the leave of the Court

   (e)on or before 17 October, 2007 a proposed respondent who has filed a response file a short summary of argument, together with a list of the documents to be relied upon by it or him at the hearing.

2. That as soon as practicable the solicitors for the wife serve a copy of these orders on each of the proposed respondents.

1. That the wife have leave to rely on an affidavit sworn by an adversarial expert, Mr. O, filed on 3 August, 2007. 

1. That the amended form 2 filed by the wife on 5 April, 2007 and the amended form 2A response filed by the husband on 13 April, 2007 be otherwise dismissed. 

1. That the reasons for judgment this day be transcribed and that copies be made available to the parties.

1. That pursuant to Rule 19.50 of the Family Law Rules 2004 this matter reasonably required the attendance of counsel, including senior counsel.

IT IS NOTED  IN CONNECTION WITH THESE ORDERS that the judgment of the Honourable Justice Brown delivered this day will for all publication and reporting purposes be referred to as Jess & Jess.

FAMILY COURT OF AUSTRALIA AT MELBOURNE

FILE NUMBER: MLF 3444 of 2006

MR JESS

Husband

And

MRS JESS

Wife

REASONS FOR JUDGMENT

1. The application before the court is the amended form 2 filed by the wife on 5 April 2007.  In paragraph 10(a), she sought that certain credit card debts, amounting (on the evidence then advanced) to $444,963.75, together with debts of T Pty. Ltd. and L Pty. Ltd. to Y Corporation Pty Ltd of $251,105.02, be paid.  The husband's amended form 2A was filed on 13 April 2007. 

1. Young J first heard these applications on 17 and 20 April 2007.  Before the court is a transcript of that hearing, together with his ruling and the orders he made.  Paragraphs 10 and 11 of those orders relate to some parts of the wife’s application in relation to credit card debts, his Honour ordering (in paragraph 10) that the husband pay sums required to discharge the wife's liability in relation to six credit cards (the first four of which were named as being used by children) and in paragraph 11, that no later than 5 pm on 7 July 2007, he pay to the wife such sum as required to discharge the liability on four additional credit cards.  His Honour disclosed no source for the payments and although there is a reference to the wife seeking them by way of partial property settlement, there is no mention of that in the order.

1. While the orders of Young J. provided for all extant form 1 and form 2 applications to be adjourned to 23 May 2007, the judgment makes it clear that the part of the wife's application in paragraph 10(a) which was being adjourned was that part of her application relating to credit cards referred to in subparagraphs (a), (c), (e) and (n) of paragraph 12 of the wife's affidavit sworn on 5 April 2007, together with a L Pty Ltd business Amex credit card. 

1. In relation to the debts of T Pty Ltd and L Pty Ltd, his Honour said that time did not permit him to deal with that aspect and he was not wholly satisfied that the material before the court fairly and properly enabled those matters to be dealt with.  While I note his Honour's comments about perceived deficiencies in the material, the comments are not of significant assistance when I am asked to hear the case.  They are very general and a number are expressed as observations.  They would perhaps have been of more relevance if his Honour had considered himself part-heard, however he made it very clear that he did not.

1. When his Honour made the orders, the date of 31 August 2007 was reasonably distant.  The case did not return in May as envisaged, for explicable reasons;  no complaint is made by either side about that.  Indeed, to both parties' credit, they reached agreement about extending the time frames in which to file additional material.  The reality is that 31 August 2007 is now less than four weeks away;  a hearing in these circumstances was not, I think, what his Honour envisaged.

1. The question of the credit card debts is one arm of the applications before me today.  The other relates to funds to pay out an obligation arising out of orders of the Supreme Court, to which I will refer later.  The wife seeks that any sums paid to her by or at the direction of the husband to pay the credit card debts and/or the judgment debt be characterised as partial property settlement.

1. I first specify the material on which the parties rely.  The wife relied on affidavits filed by her on 18 December 2006, 8 February 2007, 5 April 2007 and 3 August 2007.  She also relied on an affidavit of Mr O, an accountant, filed on 3 August 2007, to which the husband made objection.  I should summarise his objections, which fell into four categories. 

1. First, this is evidence of an adversarial expert witness and no leave was sought.  Second, the affidavit was received only last Friday and the husband had no opportunity to answer it.  Third, and perhaps allied with the first, its contents were tainted - my word, not his - by the fact that Mr O discussed the matter with counsel and solicitor for the wife.  Fourth, the affidavit contains statements that are inconsistent with the wife’s own evidence.  To illustrate the last proposition he referred to evidence of ownership of a boat which was used by the family;  the wife deposed to it being a matrimonial asset, whereas Mr O noted the existence of a statutory declaration, made in 1996, confirming that Y Corporation Pty Ltd bought that vessel that year.  It is not a compelling example.

1. It is quite clear from the submissions that both parties, to varying extents took account of the comments made by Young J, to which I have adverted.  One comment was to the effect that information about the ownership and control of assets needed to be before the court;  his Honour said that the sooner that information was there, the better.  His Honour mused that “someone” must be in a position to file such an affidavit;  the “someones” he considered were a solicitor, an accountant or, indeed, the parties and “their other advisers”. 

1. In those circumstances, and with no single expert having been appointed, it is perhaps not surprising that the wife instructed Mr O to report on the corporate entities and their respective assets and to give opinions based on documents available to her, and thus him, some through the discovery process referred to in earlier orders.

1. It is very likely, having regard to his Honour’s comments, that a party would have obtained leave to call an adversarial expert.  I add that to suggest Mr. O’s evidence is not that of an adversarial expert is sophistry.  In the circumstances, I propose to dispense with the requirement for leave to have been obtained prior to filing and grant such leave now. 

1. There is more substance in the husband's complaint that the affidavit was served late and he has had no real opportunity to respond to it.  It is his best point and I take it into account, along with the fact that Mr. O spoke with lawyers for the wife.  I do not place weight on the alleged disparity of evidence about the boat.  Balancing all those factors, I do propose to rely on that evidence, while being mindful of its limitations and of the husband's lack of opportunity to respond. 

1. The husband relied on affidavits sworn by him on 2 February, 13 April and 17 June this year, plus parts of affidavits sworn by the wife filed on both 20 July and 27 July 2007.  Those two affidavits were filed in support of a different form 2, being one filed on 20 July 2007 and subsequently amended on 27 July 2007, in which she sought orders relating to two sets of Supreme Court proceedings to which I will refer later, and orders for the return of certain jewellery and orders allowing her to deal with the jewellery.

1. In that form 2, which has not yet been determined, the wife sought that Y Pty Ltd and Y Corporation Pty Ltd be joined as respondents to these proceedings, together with the husband's son, Mr Jess (jnr).  The husband has not yet responded to that application and has not been required to do so by operation of the Rules.  It is listed for 20 August.  Earlier I refused an application to adjourn today's hearing and consolidate the applications before me with that application, to be heard on a later date.

1. Unless a party seeks to dissuade me, I would propose to vacate the hearing date of 20 August 2007 (which is a listing in a crowded duty list) and fix the matter for hearing in a Tuesday list, when the best part of a day should be available.  In my view, to bring the parties back in a big judicial duty list is a recipe for frustration and additional expense.

1. I do not propose to say anything about the history of the parties' life together.  They separated on 11 November 2006 and it appears that they have spent much of the time since in acrimonious litigation.  Almost 60 documents have been filed in this court alone and there are now two sets of proceedings pending in the Supreme Court, involving them.  What is relevant is that in about 2001, the wife and her sister bought a Y franchise in K through the company, L Pty Ltd.  In about December 2005, they bought a second Y franchise in S, through the company, T Pty Ltd.  The wife's case is that over and above the considerable support provided by the husband, both prior to separation and after separation, the franchises have supported her and the three children of the parties' marriage, two of whom are under 18.

1. In December 2006, Y Corporation sought to re-enter and take control of the franchises, alleging a failure to pay for stock bought from the Corporation, on credit.  I will not digress to summarise the competing evidence as to why the franchises have not paid for stock provided on credit. 

1. T Pty Ltd and L Pty Ltd took action as plaintiffs in the Supreme Court against Y Corporation and, in December 2006, obtained an ex parte interim injunction preventing the seizure.  The two companies instituted proceedings against Y Corporation; in those proceedings and in the writ, they allege misrepresentation, unconscionable conduct and misleading and deceptive conduct.  The case, as I read the documents which are in evidence in this court, is that the plaintiffs, acting on representations and conduct of the defendant, allowed the debt to Y Corporation to be incurred, and they raise issues of both estoppel and waiver.

1. In January, Gillard J made orders which are annexed to the wife's affidavit filed on 8 February 2007.  The defendant was required to deliver up possession of the two franchises and restrained, until further order, from seeking to terminate the franchises for the current debt.  In paragraph 16 of the orders, the two plaintiff companies were ordered to repay their respective debts with respect to the notices of default dated 7 December 2006 on or before 31 August 2007.  As noted earlier, and self-evidently, that was then some seven months away.

1. At that time, pursuant to other orders made by Gillard J., the wife, her sister and brother‑in‑law were added as plaintiffs and the husband was added as a defendant to those proceedings.  The orders of Gillard J contain no specific default provisions.  They do provide that the plaintiffs otherwise comply with the terms of the franchise agreements.

1. Counsel for the husband submitted that the evidence establishes - and by that, I mean primarily the wife's evidence - that the sums owed to Y Corporation were $498,000 in December 2006, $274,764 at 3 April 2007, $258,128 at 3 July 2007 and $251,105 at 31 July 2007.  He complained that the wife has not explained how the debt has been reduced over that period.

1. Just before I rose for lunch I asked counsel for the parties to meet and discuss an application made by senior counsel for the husband to adduce into evidence his client's position as to the current level of indebtedness of the two companies.  Subsequently, both senior counsel advised that there would be no objection to that information forming part of the evidence before me, and that the evidence was to the effect that the present instructions of the husband are that some $439,150 in total is owed.  Counsel noted that those figures require clarification as it is possible they include costs and legal expenses relating to the Supreme Court proceedings.  If that is the net figure, if I can call it that, it is not significantly lower than the figure outstanding in December 2006. 

1. Whilst maintaining vehement opposition to any orders being made by way of partial property settlement to the wife today, senior counsel for the husband agreed that were an order to be made, it needed to be couched in terms of a sum sufficient to discharge a debt to a maximum figure of that advised by counsel.

1. The wife's case is that neither T Pty Ltd nor L Pty Ltd have assets or resources to repay the debt by 31 August 2007.  She is restrained by order of this court from further encumbering the assets of those two companies.  The probable result of a failure to comply with the Supreme Court is a forced sale of the two franchises which, she submits, raise a real and significant risk of loss, as a swift sale now, whether by her in order to raise funds or by Y Corporation, is unlikely to maximise the value of the franchises. 

1. On behalf of the husband, it is submitted that that is speculative.  It is just as likely, it is put, that a sale in those circumstances might optimise the value.  It must be said that that, too, is speculation.  What the court has to assess, as best it can, in a highly contested case, is the risk.  After many years of hearing cases involving mortgagee sales and, indeed, sales by a vendor as a trustee for sale pursuant to a court order, the court must find there is a real risk that the consequences feared by the wife would eventuate.  If that occurred, her income stream would be lost and with it, the capacity to service the NAB debt.  In this case, the loss of the franchises would do more than move money around between corporate entities which is often the case in matters of this scale.

1. Until the husband filed his third affidavit on 19 June 2007, a reader of his evidence would have believed that it established that the Y Unit Trust (which effectively controls Y Corporation) was an asset which would fall within the broad description of matrimonial assets.  In paragraphs 72 and 92 of that third affidavit, he asserts that by a deed of trust made on 28 February 2002, he agreed to hold all existing and any future unit holding in the Y Unit Trust on trust for his son, Mr Jess (jnr), and use it as his son directs.  His evidence is that the trust was to vest on Mr Jess (jnr) managing the business operation, such that it made pre-interest and tax earnings of $10 million in any one year within seven years of the declaration of trust.  Accordingly, the husband says that since 23 February 2002, he has been bound to act at Mr Jess (jnr’s) direction in relation to his units in the Y Unit Trust.  The current trustee of that trust is Y Pty Ltd and, as I understand the present evidence, Mr Jess (jnr) and the husband each hold one share in that company.  Thus, the husband submits that the business operations are not a matrimonial company and at best, may represent a financial resource to entities in what he called the "sporting interests", with which I will not concern myself today. 

1. The evidence is that Mr Jess (jnr) has recently filed proceedings in the Supreme Court as a plaintiff, naming the husband, wife and Y Corporation as defendants, presumably to enforce the alleged express trust.  It is against that background that the court is asked to determine whether, by way of partial property settlement, the court should make orders to provide funds to be used to pay the debt owing by the two companies pursuant to the order of Gillard J, and to discharge the credit card debts listed by the wife.

1. Both counsel have referred to the case of Harris v Harris (1993) FLC 92‑378 in which the Full Court, composed of Nicholson CJ and Fogarty and Moore JJ, considered the issue of the court's power to make what is sometimes referred to as an interim, and sometimes as a partial, property order. At page 79‑929 to 79-930, the Full Court held that there was no doubt that the court had power in a proper case in s.79 proceedings to make what they said could be conveniently described as an interim order, being an order dealing with some of the property of the parties prior to the final hearing. They did not consider it necessary to draw a distinction between an interim and a partial order. They said that in the exercise of that power, a number of matters need to be considered.

1. The first is that the exercise should be confined to cases where the circumstances presented at the time are compelling.  As a generality, the court said, the interests of the parties are usually better served by there being one final hearing of s.79 proceedings, but circumstances can arise which dictate that some part of the parties' property should be the subject of orders, in order to do justice between the parties.  Examples the Full Court gave include cases where it is necessary to do so to avoid an asset being eroded or lost in the intervening period and cases beyond the maintenance power, where an order in favour of one party is necessary to preserve or retain a home, or otherwise necessary for the welfare of the children.

1. The second matter to which the court said a trial judge must have regard was that the power must be exercised within the s.79 parameters.  Third, the court noted that, of necessity, it is likely to be a somewhat imprecise exercise, so the sources must be exercised conservatively.  The judge must be satisfied that the remaining property will be adequate to meet the legitimate expectations of both parties at the final hearing or that the order which is contemplated is capable of being reversed or adjusted if it is subsequently considered necessary to do so.

1. The husband's case in one sense is simple.  First, he says the business operations are not matrimonial property, so any analysis of his financial position based on any of the entities which relate to that operation is irrelevant.  His submission is that there is no evidence of any adequate source to meet the orders sought by the wife, and no way of ensuring that, were such an order made, she would be entitled to more than the partial property in due course.  There is, it is submitted on his behalf, no way of knowing whether the property remaining would be sufficient to meet the husband's legitimate expectations.

1. Second, it is submitted on behalf of the husband that there is no compelling need.  It is submitted, as summarised earlier, that a sale of the franchise operations might prove more financially advantageous than holding on to them.  Reference is also made to the fact that the wife has sought orders, in the application listed for hearing on 20 August, in relation to jewellery, and in the material filed in support of that application, deposes to having jewellery within her possession valued at some $285,350.  It is said she has an alternative source of funds at least in that respect.

1. I have already referred to the joint submission made by the parties as to the extent of the Supreme Court debt.  I act on the basis it could be as high as $439,150;  it may be as low as $251,105. 

1. Turning to the question of the source of funds, the husband's case is that he has the capacity to draw down some $860,000 per annum through a loan account in Y Corporation.  According to Mr O’s evidence, the loan account schedule at March 2007 showed the sum of $751,763.  His report notes that the general ledger figure at that time was $810,345.  Adopting for the purpose of the argument - and I accept without prejudice to his objection to the court relying on that report, aspects of Mr. O’s report, - he then submitted that the husband has paid just under $650,000 between March 2007 and this date, pursuant to a number of court orders, for the benefit of the wife and the children, or as the consequences of the litigation.  That includes maintenance of some $28,000 a month over a period of five months; the mortgage on the A home of a bit less than $6000 per month for the same period; a Barro order to provide funds of $200,000 to the wife; credit card debts pursuant to Young J's order of $128,852 and $110,313, and another sum of $70,000 relating to an interest in the Western Australia property.  It was put that, at best, there would only be a bit over $100,000 left of the entitlement shown in Mr O’s report. 

1. On that analysis, one might wonder from whence came the funds which the husband has used to support himself since March 2007.  That question can wait for another day.  As pointed out by counsel for the wife, the husband deposed in the form 13 he swore in February 2007, that the loan account stood at $3.55 million, and in paragraph 153 of his affidavit sworn in June this year, he deposed to a figure of $3.29 million.

1. Not unusually, this is a case in which there is evidence of potential accounting adjustments ultimately required to correct figures credited or debited to certain accounts.  It is a rare case involving numerous corporate entities where that does not occur.  Often the final position cannot be conclusively determined until a detailed accounting exercise is undertaken.  That will require clarification, but the husband's own evidence cannot be ignored.

1. More neutrally, the wife pointed to Mr O’s evidence of amounts owed by business entities to non-business entities, set out on page 12 of his report, which is annexed as annexure KS2 to his affidavit.  The husband's submission (in response to that submission) may have confused the source of funds referred to by Mr O, which is easy to do when so many companies have similar names.  The company referred to by Mr O on page 12 of his report is Y Industry Properties Pty Ltd, not Y Industries Pty Ltd.  There is reference in the husband's affidavit to Y Industries Pty Ltd, which is 100 per cent owned by him.  His evidence was that the balance sheet shows net assets of $180,000, being mainly intercompany loans, which is consistent with Mr O’s evidence in relation to that company.

1. Y Industry Properties Pty Ltd is a different company.  It is referred to at page 6 of Mr O’s report.  It is also 100 per cent owned by the husband and appears on the spreadsheet marked RJ1, to the husband's June affidavit, as a trading company.  Mr O’s evidence in relation to that company is that it has a one-third ownership of land and buildings in M.  He noted the husband's evidence that there is some form of trust in relation to that.   He also noted that the company has loans receivable from the unit trust of $465,000 and from Y Corporation Pty Ltd of $385,000, as at 30 June 2006.  He noted that, at that time, the entity had liabilities of $641 and net assets of $1.3 million.

1. There is no doubt on the evidence before me that the husband has complied with court orders, requiring the payments of very considerable sums.  That was his obligation, and one he has fulfilled.  Mr O’s report noted that credit balances in favour of the husband or entities controlled by him were in excess of $33 million, leaving aside Y Corporation's value.  That evidence is, of course, untested and in a climate where the husband's counsel have made very clear their desire to test that evidence. 

1. Balancing all the evidence, I am satisfied that there is a source of funds which would be available did the court otherwise think it proper to make the orders sought and that the remaining property would be adequate to meet the legitimate expectations of both parties at a final hearing.

1. In relation to the Supreme Court ordered payment, I do find there is a compelling need to provide funds to pay the obligations under that.  I am aware the wife's sister and brother‑in‑law are co-proprietors and, like Mr Jess (jnr), evidence from each of them will no doubt be adduced in these proceedings in due course.  That money will be a partial property settlement.  If the wife uses all or part of it to pay third party debt, she cannot expect to be able to “double dip” by asserting she has not had the benefit of those funds, or that her financial position is poor because she needed to use the money for those purposes. 

1. I add, although this was not referred to by counsel, that the judgment debt (in respect of which the wife seeks funds) is to Y Corporation.  While I appreciate the husband now asserts he holds his interest in the business operation in trust, he may have the capacity to arrange the postponement of that obligation.

1. The wife also needs to realise that this is not a moveable feast.  She should not expect that she will be able to obtain one order after another for partial property settlement.  Having made an order in respect of those funds, in the specific circumstances of the case and in the context of the two competing sets of proceedings, she should not anticipate that she can come to court again in the future and seek another partial property order.

1. In relation to the issue of the credit card debts, I note that in paragraph 13 of Young J's ruling, he noted that he proposed to require the discharge of some of the credit card debt immediately, some of it in the days following the commencement of the new financial year and the balance of debt – which is the debt with which I am dealing – to be “discharged by agreement between the parties or by the husband, if he is able to do so, or by court order when the matter returns before the court”.  It was against that context that, later in the judgment, he moved to talk about the specific subparagraphs of the wife's earlier affidavit which were still, to use his Honour's expression, live.

1. When the wife swore that affidavit on 5 April, reference was made to five credit card debts outstanding, referred to by his Honour.  There is a Visa account of $162,590.71, NAB Visa of $146,997.83, Citibank MasterCard of $48,572.08, an Amex card for the L Pty Ltd business of $67,508.54 and a David Jones credit card of $22,885.95.  The first four of those are referred to in the wife's affidavit sworn 3 August;  the outstanding figures, in the same order as I have listed the cards, were then  $162,591.40, $147,074.15, $49,802.23 and $64,537.79.  Three are marginally higher, one is a little lower.  The wife makes no reference to the David Jones credit card in her affidavit of 3 August;  having regard to the orders made by his Honour, it is likely that has been paid.  Before me, she has added a CBA MasterCard debt, which is not referred to in her amended application before me, or in the affidavit filed in support of that application.  I do not propose to take that debt into account.

1. In relation to the other credit card debts, having read his Honour's reasons and all the material of the parties on which they rely on in these proceedings, I do propose to order that these credit card debts be paid.  The wife alleges that they are matrimonial debts.  The husband's counsel has complained of a lack of evidence about them but I note Young J's recording of the fact that the husband agreed they should be paid.  The husband’s case in April 2007 was that other debts should have priority, particularly some debts relating to children, as he was unable to immediately access sufficient money to pay all the debts.  Young J did give priority (in paragraph 10 of his orders) to the debts for which the husband sought priority.

1. I make it clear that I do not find that the husband's concession recorded by Young J (that these debts should be paid) equates to a concession that they are matrimonial debts.  The court may need to determine that in the future.  If they are, money used by the wife to discharge them, coming from funds characterised as a partial property settlement, will be taken into account when formulating the final orders.  The making of the orders today cannot prejudice the husband's entitlement to argue in the long term that they are not matrimonial debts, if that is his position. 

1. In those circumstances, I do propose to order that the husband pay or cause to be paid to the wife, or at her direction, by way of partial property, two sums.  The first will be a sum sufficient to discharge the then debts of T Pty Ltd and L Pty Ltd with regard to the notice of default referred to in paragraph 16 of the orders of the Honourable Gillard J of January 2007 in Supreme Court proceedings.  Commonsense suggests that must be done before 31 August 2007, unless a later date can be negotiated with the judgment creditor.   

1. The other will be a sum sufficient to pay the credit card debts which I have outlined.  I make it clear that the relevant amounts are the sums due as at this day, together with any interest that accrues but not including further drawings against the credit cards.

I certify  that the preceding
49 paragraphs
are a true copy of the reasons for
judgment herein of the
Honourable Justice Brown AM.

Dated the           day of            2007.

…………………………………………
Associate.