Keach and Keach & Ors (No 2)

[2011] FamCA 197

FAMILY COURT OF AUSTRALIA

KEACH & KEACH AND ORS (NO 2) [2011] FamCA 197

FAMILY LAW - PROPERTY SETTLEMENT – addendum reasons – just and equitable – final orders made

Family LawAct 1975 (Cth) s 106B

APPLICANT: Mr Keach Junior

FIRST RESPONDENT: Ms J Keach

SECOND RESPONDENT: J Pty Ltd (as Trustee of the Junior Trust)

THIRD RESPONDENT: K Law Firm

FILE NUMBER: SYF 2181 of 2006

DATE DELIVERED: 25 March 2011

PLACE DELIVERED: Adelaide

PLACE HEARD: Sydney

JUDGMENT OF: Strickland J

HEARING DATE: 17 March 2011

REPRESENTATION

COUNSEL FOR THE APPLICANT: In person

COUNSEL FOR THE FIRST RESPONDENT: Ms Morozov

SOLICITOR FOR THE FIRST RESPONDENT: Barkus Doolan Kelly

COUNSEL FOR THE SECOND RESPONDENT: Mr Esplin

SOLICITOR FOR THE SECOND RESPONDENT: Esplins Solicitors

COUNSEL FOR THE THIRD RESPONDENT: Ms Worner

SOLICITOR FOR THE THIRD RESPONDENT: K Law Firm

Orders

1. Within forty-two [42] days of the date hereof the husband pay to the trust account of the solicitors for the wife the sum of $362,129.00.

2. Except as otherwise provided by these orders, as against the wife the husband is solely entitled to all other assets of whatsoever nature and kind presently in his name, ownership or possession and, as against the husband, the wife is solely entitled to all other assets of whatsoever nature and kind presently in her name, ownership or possession.

3. The wife’s application for the husband to pay spousal maintenance comprised in paragraphs 15 and 16 of the wife’s further Amended Response filed on 3 September 2009 be dismissed.

4. The wife’s application for a departure order from the administrative assessment of Child Support payable by the husband for the children T born on … November 2003 and R born on … May 2005, and for an order that the husband pay all the education expenses incurred by the wife in respect of each of the said children comprised in paragraphs 17 and 18 of the wife’s said further Amended Response be dismissed.

5. By consent the wife’s applications pursuant to s 106B of the Family Law Act 1975 comprised in paragraphs 9 and 10 of the said further Amended Response be dismissed, and there be no order as to costs of and incidental thereto between the wife and the third respondent.

6. That paragraph 11 of the wife’s said further Amended Response be dismissed.

7. The order made on 16 May 2006 providing for the husband to pay the wife $500.00 per week by way of interim spousal maintenance be discharged.

8. The orders by way of injunction made on 21 September 2009 be varied to the extent necessary to enable the husband to comply with paragraph 1 hereof, and the same be discharged upon compliance by the husband with the terms of that paragraph.

9. In the event of the husband failing to comply with paragraph (1) hereof then in addition to any other remedies available to the wife:

   (a)Interest shall accrue on the amount outstanding from time to time calculated at the rate fixed by the Family Law Rules 2004

   (b)the husband shall forthwith sell his shares in N Ltd and the net proceeds of sale be paid to the trust account of the solicitors for the wife on behalf of the wife, and the wife shall be entitled to receive the money previously held in trust on behalf of the husband by the third respondent, in part satisfaction of the amount outstanding.

10. That within twenty-eight [28] days of the date hereof any party seeking an order for costs shall file and serve an Application in a Case setting out the orders sought, an Affidavit in Support, and written submissions in relation to the orders sought.

11. That any Response to any application for costs be filed and served within twenty-eight [28] days of the receipt of the said application, such response to comprise an Affidavit (if necessary) and written submissions.

12. Any Reply to any Response be filed and served within seven [7] days of the receipt of the said Response.

13. That save and except in relation to any applications for costs, all applications be dismissed and removed from the active pending cases list.

IT IS NOTED that publication of this judgment under the pseudonym Keach & Keach and Ors (No 2) is approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).

FAMILY COURT OF AUSTRALIA AT ADELAIDE

File Number: SYF 2181 of 2006

Mr Keach Junior

Applicant

And

Ms J Keach

First Respondent

And

J Pty Ltd (as Trustee of the Junior Trust)

Second Respondent

And

K Law Firm

Third Respondent

ADDENDUM REASONS FOR JUDGMENT

1. I delivered my reasons for judgment in this matter on 9 March 2011, but as was explained in paragraphs 236 to 244 of those reasons, I was unable to finalise the same and make the final orders at that time. I needed further input from the husband, the wife, and the third respondent as to the adjourned applications of the wife pursuant to s 106B of the Family LawAct 1975 (Cth).

2. I do not need to repeat what was said on 9 March 2011 as to this, but the matter was adjourned to 17 March 2011 to enable instructions to be taken about this issue, and separately about what should be done with two applications for costs that had been reserved to the trial judge and were still outstanding.

3. By letter dated 15 March 2011 the wife’s solicitors advised that the parties had reached agreement about the s 106B applications, namely that the relevant paragraphs of the wife’s Further Amended Response filed on 3 September 2009 be dismissed, and there be no order as to costs as between the wife and the third respondent.

4. At the hearing on 17 March 2011 that position was confirmed by the husband, the wife and the third respondent, and I will make orders accordingly.

5. Given that, I took the opportunity to raise with the husband and the solicitor for the wife some aspects of the form of the final property settlement orders that I should make.  In particular, I enquired whether, in view of my findings as to the net asset pool of the parties, and the amount to be paid by the husband to the wife, the wife was now seeking a splitting order in relation to the husband’s superannuation entitlement, even if in default of payment by the husband of the amount required to be paid to the wife.  The wife’s solicitor indicated that the wife was not seeking such a splitting order, but she confirmed with me what assets could be included in a default provision, namely the husband’s shares, and the money that was formerly held in the trust account of the third respondent.  In relation to the latter, Ms Morozov told me that that money was now being held by her firm.

6. In relation to the two outstanding costs applications, all parties asked me to leave them to be considered in the context of foreshadowed applications for costs by the second respondent and the husband.

7. Thus, I am now in a position to conclude my reasons for judgment and make the final orders.

8. To resume where I left off in paragraph 236 of my earlier reasons, I confirm that it is not open to me to order the husband to pay to the wife the sum of $435,151.00 because that would result in the wife receiving by way of property settlement more than the value of the actual net pool of assets. Given the fate of the s 106B applications that outcome cannot now be remedied and I need to tailor the amount to be paid by the husband accordingly. The excess amount is $73,022.00, and thus the amount that the husband should have to pay to the wife is $362,129.00.

9. On this basis, the wife will retain her interest in V Pty Ltd and CC Pty Ltd, her shares, her bank accounts, her household contents, and her superannuation and pension fund entitlements, and she will have cash of $362,129.00 whilst still having liabilities totalling $31,606.00.  Prima facie, she is also indebted to her father for a substantial amount of money, but in the circumstances I would not expect her to have to repay that amount directly or at all as I have previously found.  The wife also claims to owe her brother $45,900.00 for rent, but again there is clearly an element of uncertainty as to whether this debt will in fact be called up.  If it is though, the wife will have funds to meet the payment of the same.

10. Finally, I observe that the wife will also continue to be an eligible beneficiary of the O1 Trust.

11. On the other hand, the outcome for the husband on the figures that I have used is that he will either have no assets, apart from his superannuation entitlement, because he will have to liquidate those assets to pay out the wife, or he will have no equity in those assets because he will need to liquidate those that he can, and borrow against those that he cannot.  However, this will still leave the husband with the financial resource of the Junior Trust and its assets, from which I have found he will benefit in the future.

12. On this basis it would seem at first blush that the wife will have achieved a far better result than the husband out of these proceedings, but that is no basis for making an adjustment to that result.  Any assessment of whether it is just and equitable to make the orders proposed must be undertaken in the knowledge of the reasons for those orders being made.

13. Thus, in my view there is nothing unjust or inequitable about the orders I propose.

I certify that the preceding thirteen (13) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Strickland delivered on 25 March 2011.

Legal Associate: 

Date:  25 March 2011