Keighley & Keighley
[2022] FedCFamC1F 96
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 1)
Keighley & Keighley [2022] FedCFamC1F 96
File number(s): SYC 7526 of 2021 Judgment of: CHRISTIE J Date of judgment: 2 March 2022 Catchwords: FAMILY LAW – INTERIM PROPERTY ORDERS – Whether a loan or gift exists – whether the second respondent should be removed from the proceedings – application of Family Law Act 1975 (Cth) s 90AF
FAMILY LAW – CHILD SUPPORT ORDERS – whether interim orders for non-periodic child support should be made – application of Child Support (Assessment) Act 1989 (Cth) s 124
Legislation: Child Support (Assessment) Act 1989 (Cth) ss 117, 123 and 124
Family Law Act 1975 (Cth) ss 90AF and 106B
Cases cited: Christie and Christie & Ors (2007) 37 Fam LR 181
In the Marriage of Farr (1976) FLC 90 – 133
Number of paragraphs: 89 Date of hearing: 11 February 2022 Place: Sydney Counsel for the Applicant: Ms Fora Counsel for the First Respondent: Ms Clifton Counsel for the Second Respondent: Mr Lloyd ORDERS
SYC 7526 of 2021 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)
BETWEEN: MS KEIGHLEY
Applicant
AND: MR KEIGHLEY
First Respondent
B PTY LTD (AS TRUSTEE OF THE B TRUST)
Second Respondent
ORDER MADE BY:
CHRISTIE J
DATE OF ORDER:
2 MARCH 2022
THE COURT ORDERS THAT:
1.Within two business days of the date of these orders the husband and wife do all things necessary to:
(a)Pay to the second respondent from the monies held in controlled monies account BSB … account …56 the amount necessary to discharge the mortgage …2N including any interest;
(b)Pay to the credit of controlled monies account BSB … account …72 any balance remaining after the payment referred to in 1(a).
2.The husband pay the second respondent’s costs (including reserved costs) on a party/party basis certified for senior counsel as agreed or taxed.
3.The second respondent be removed as a party to the proceedings between the husband and wife.
Child Support
1.Pursuant to s 124 of the Child Support (Assessment) Act 1989 (Cth), in addition to any administrative assessment by the Department of Human Services – Child Support (“the Agency”) issued from time to time, the husband pay the following by way of non-periodic child support for X born 2017 (“X”):
(a)80% of the fees invoiced by C School in respect of X’s attendance, including but not limited to tuition fees, uniforms, books, technology/stationery requirements, extra-curricular activities, excursions and the like directly to the school/provider as and when they fall due.
(b)Within seven days of the wife providing to the husband:
(i)Confirmation of payment of private health insurance for X;
(ii)Documentation from the insurer evidencing the portion referrable to X,
the husband will pay 80% of X’s portion of the private health insurance premiums on the wife’s private health insurance policy by way of payment to the account nominated by the wife in writing.
(c)Within seven days of the wife providing to the husband:
(i)Confirmation of payment by her; and
(ii)A copy of the invoice,
the husband will pay 80% of X’s gap medical and allied health expenses not covered by Medicare and/or Private Health Insurance, provided that the parties have agreed to the treatment in writing.
2.The non-periodic child support ordered to be paid by way of Order 1 above is not to be credited against the administrative assessment of child support or any administrative assessment issued by the Agency from time to time payable to the wife by the husband.
3.That the husband pay the wife’s costs on a party/party basis as agreed or taxed.
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.
IT IS NOTED that publication of this judgment by this Court under the pseudonym Keighley & Keighley is approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
REASONS FOR JUDGMENT
CHRISTIE J:
This is an application by Ms Keighley (“the wife”) for interim financial and child support orders.
The first respondent is Mr Keighley (“the husband”).
The second respondent is a company B Pty Ltd, which is the corporate trustee of the B Trust (“the trustee company”).
BACKGROUND
The husband and wife commenced cohabitation in about July 2014 and were married in City D in 2016. They separated on a final basis in June 2021.
There is one child of the marriage X aged four (“X”). The parties signed a parenting plan on 30 September 2021 which reflects that X lives with the wife and spends five nights a fortnight with the husband.
The husband joined B Pty Ltd to the proceedings as the second respondent. The wife’s mother is a director of B Pty Ltd which is the trustee company.
At issue in the proceedings is whether a valid legally enforceable mortgage existed between the husband and wife and B Pty Ltd, the corporate trustee for the B Trust. The husband asserts that the trustee company gifted the sum of $1,560,000 to the parties for the purchase of E Street, Suburb F (“the matrimonial home”). In contrast, the wife and the second respondent assert the amount was recognised as a loan by a loan agreement between the husband, wife and B Pty Ltd and a mortgage was registered on title to the matrimonial home.
During the parties relationship their daughter X was enrolled to attend preschool at C School (“C”), commencing in 2022. At the date of hearing she has commenced preschool. The mother seeks that there be an order for non-periodic child support in addition to the administrative assessment of child support to take into account the school fees and expenses.
THE LAW
Child Support
In the usual course, child support is dealt with administratively and applications to depart from administrative assessment are dealt with administratively. The wife brings this application pursuant to section 123 of the Child Support (Assessment) Act (1989) (Cth) (“the Assessment Act”). It is an application for payment of child support otherwise than in the form of periodic amounts.
Section 124 of the Assessment Act applies. That section relevantly provides:
(1) Where:
(a) a carer entitled to child support or a liable parent makes an application under paragraph 123(1)(a) [which deals with an order that a liable parent provide child support otherwise than in the form of periodic amounts]; and
(b) the court is satisfied that it would be:
(i) just and equitable as regards the child, the carer entitled to child support and the liable parent; and
(ii) otherwise proper;
to make an order that the liable parent provide child support for the child otherwise than in the form of periodic amounts paid to the carer entitled to child support;
the court may make the order.
(2) In determining the application, the court must have regard to:
(a) the administrative assessment in force in relation to the child, the carer entitled to child support and the liable parent; and
(aa) any determination in force under Part 6A (departure determinations) in relation to the child, the carer entitled to child support and the liable parent; and
(b) any order in force under Division 4 (departure orders) in relation to the child, the carer entitled to child support and the liable parent; and
(c) whether the carer entitled to child support is in receipt of an income tested pension, allowance or benefit or, if the carer entitled to child support is not in receipt of such a pension, allowance or benefit, whether the circumstances of the carer are such that, taking into account the effect of the order proposed to be made by the court, the carer would be unable to support himself or herself without an income tested pension, allowance or benefit.
(3) In determining whether it would be just and equitable as regards the child, the carer entitled to child support and the liable parent to make an order under subsection (1), the court must have regard to the matters mentioned in subsections 117(4), (6), (7), (7A) and (8).
(3A) In having regard to the earning capacity of a parent of the child under paragraph 117(4)(da), the court may determine that the parent’s earning capacity is greater than is reflected in his or her income for the purposes of this Act only if the court is satisfied as mentioned in subsection 117(7B).
(4) In determining whether it would be otherwise proper to make an order under subsection (1), the court must have regard to the matters mentioned in subsection 117(5).
(5) Subsections (2), (3), (3A) and (4) do not limit the matters to which the court may have regard.
The Court must first determine whether “it would be just and equitable as regards the child, the carer entitled to child support and the liable parent” to make the orders as sought for non-periodic child support, having regard to several mandatory preconditions. Relevantly, for these proceedings, those mandatory preconditions are:
(a)The Court must have regard to the Child Support Assessment in force in relation to the child; and
(b)The Court must have regard to those matters set out in subsections 117(4), (6), (7), (7A) and (8).
Next it is necessary to determine whether such an order would be “otherwise proper”, having regard to the matters mentioned in s 117(5). “Proper” is not defined in the Assessment Act. In the Marriage of Farr (1976) FLC 90 – 133 at [77], the Full Court adopted “reasonable and just in [the] circumstances” as a way of understanding the application of the term “proper”.
Section 90AF of the Family Law Act 1975 (Cth)
There is power in the Family Law Act 1975 (Cth) (“the Act”) to make an injunction that alters the rights, liabilities or property interests of a third party. The scope of this power is wide and it is appropriately invoked when necessary to do justice and equity as between the husband and wife: Christie and Christie & Ors (2007) 37 Fam LR 181. It cannot be invoked without both procedural fairness to the third party and a proper understanding of the impact of granting the injunction on the interests of the third party.
CONSIDERATION
Advance by the second respondent
These are interim financial proceedings and the evidence is untested. I have had regard to the objective evidence where available.
Prior to the purchase of the matrimonial home in late 2017 the evidence of the wife and the second respondent suggests there were conversations between the parties and the wife’s father and an exchange of emails between the wife and her father which the wife’s father believes were shown to the husband. The husband claims that he was unaware at this stage of the nature of the advance which assisted the parties with the purchase of the matrimonial home. I am unable to make a finding about this contested fact.
On 28 January 2018 the husband wife and second respondent signed a loan document.
The terms of the loan included:
·The husband and wife agreed to grant the B Trust a first ranking mortgage;
·The initial term of the loan was 3 years, to be extended if an agreement on reasonable interest was reached;
·The loan was interest free for the initial term;
·The loan could be reduced or repaid at any time;
·The loan could be terminated in the event of a “Material Adverse Change” – examples were listed and included sale of the property and separation/divorce.
The husband contends that he signed this agreement without advice and without a choice but does not dispute the terms of the agreement.
On 29 January 2019 the husband, wife and second respondent executed a mortgage pursuant to the loan agreement (“the mortgage”). The husband gives no evidence about entering into the mortgage and it is inconsistent with his assertion of a gift.
On 19 February 2019 the mortgage was registered on title to the matrimonial home.
On 17 December 2020 the husband’s father wrote to the wife via email titled “Re: Annual distribution towards E Street”. In that email the husband’s father referred to the money that had been “lent” to the parties by the husband’s father. Actually the loan was by the second respondent but in the context of the agreed facts it is plain that the email is referring to the monies advanced by the trustee company to acquire the matrimonial home. Again, this correspondence from the husband’s father is inconsistent with the husband’s assertion that the monies were a loan.
In February 2021, the husband paid the second respondent $50,000 reducing the amount owing under the mortgage to $1,510,000. In confirming the repayment the wife’s father wrote to the husband about the money being paid as a “loan reduction”. After the $50,000 was transferred by the husband the wife’s father acknowledged the payment in an email dated 28 February 2021 which reads in part: For your records, a spreadsheet showing the revised loan account balance is attached.” The husband gives no evidence about this payment which is inconsistent with his assertion that it was a gift.
In or around June/July 2021 period the parties separated on a final basis.
Following separation the husband acknowledged the existence of funds outstanding to the second respondent by way of an email dated 14 July 2021.
On 19 August 2021 the second respondent notified the husband and wife that interest was now being charged on the loan and that repayment of the loan was required by 30 November 2021.
On 6 November 2021 the matrimonial home was sold at auction for $4,003,000.
The husband had, ahead of the auction, provided his consent to the solicitor acting on the conveyance of the matrimonial home to discharge the mortgage secured over the matrimonial home at settlement. After the auction the husband withdrew that consent.
Orders were made on 16 December 2021 including the following orders by consent:
12. On a without admissions basis, the Second Respondent do all such acts and things and sign all necessary document to discharge the Mortgage registered on the [Suburb F] property and having mortgage number […32] including but not limited creating the Discharge of Mortgage in registrable form in the PEXA workspace for the settlement of the sale of the [Suburb F] property.
13. On a without admissions basis, the Parties are to do all acts and things and sign all documents necessary so as to cause the settlement of the sale of the [Suburb F] Property on 20 December 2021, or the earliest available date, with the proceeds of sale to be disbursed as follows:
i.Firstly, in payment of agent’s commission, selling costs and the Conveyancing Solicitor’s costs and disbursements.
ii.Secondly, the sum of $1,600,000 claimed by the 2nd Respondent (including an allowance for ongoing interest), into [G Lawyers] Trust Account, with these funds to be placed into a Controlled Monies Account in the name of the Parties.
iii.Thirdly, the sum of $200,000 to the Wife by way of partial property settlement.
iv.Fourthly, the sum of $50,000 to the Wife, with such sum to be categorised at a later date as agreed between the Husband and Wife in Writing or by the trial judge.
v.Fifthly, the sum of $100,000 to the Husband by way of partial property settlement.
vi.Sixthly, the balance then remaining into [G Lawyers] Trust Account, with the funds to be placed into an additional Controlled Monies Account, in the names of the Husband and Wife.
14. That the Second Respondent be restrained from commencing any proceedings in relation to the sum held in the Controlled Monies Account other than in accordance with any further orders of this Court.
15. That any funds received by the Husband and/or the Wife in respect of the sale of any furniture, contents and the like of the [Suburb F] Property, be deposited into their CBA Joint Account ending […91] and applied toward expenses associated and incurred in respect of their daughter, [X].
16. That the Parties costs be reserved, inclusive of that of Senior Counsel and Counsel.
There is no objective evidence to support the conclusion that the monies advanced by the second respondent were a gift to the parties or either of them.
The highest that the case on behalf of the husband can be taken is an assertion by him that there were representations made to him which were inconsistent with the documents evidencing the loan and mortgage. His case outline document refers to one of the issues in dispute being “the validity of the loan” from the second respondent. However, when viewed against his signed loan agreement and his subsequent repeated acknowledgments of debt, his statements said to ground the assertion of gift cannot be sustained.
In the written outline of case, the husband asserted a further basis upon which he sought to challenge the validity of the loan agreement between the second respondent and himself and the wife, namely that the monies were a capital distribution (as opposed to a loan). In order to satisfy a court that an advance of funds should have the character ascribed to it by the husband in his outline, it is necessary for there to be some evidence to support that proposition. It is most unsatisfactory for a party to pursue litigation by means of bare assertion, absent evidence, indeed in the face of evidence to the contrary.
The husband says that payment to the second respondent will prejudice the relief he seeks on a final basis.
The husband’s application for final orders seeks:
1. That, pursuant to s 79 Family Law Act, within 14 days of the date of these Orders the parties do all such things and acts to pay to the Husband the sum of $1,600,000 from the proceeds of the sale of the property known as an situate at [E Street Suburb F] NSW Sydney and having Folio Identifier …, (“the [E Street] property”) held in the controlled monies account (“the CMA account”) of the Wife’s solicitors, [G Lawyers Pty Ltd].
2. That, after payment to the Husband in Order 1 herein, the residual proceeds held in all the CMA account of the Wife’s solicitors, [G Lawyers] be distributed to the Wife.
3. That pursuant to the Order as to s 106B of the Family Law Act 1975 the Court set aside the purported loan agreement dated 29 January 2018 relating to the [E Street] property.
4. In respect of all other property and/or other financial resources not specifically referred to herein that, each party be declared the sole legal and beneficial owner, to the exclusion of the other, of all such property and/or financial resources in their name, control and/or possession as at the date hereof including but not limited to superannuation, motor vehicle, bank accounts and other personal effects.
5. That the Wife pay the Husband’s costs of and incidental to these proceedings.
The parties assets consist of:
Asset
Value
Ownership
Controlled monies account
$1,600,000
Joint
Partial property settlement
$200,000
Wife
Partial property settlement
$100,000
Husband
Controlled monies account
$1,973,994.70
Joint
H Street, Suburb J
$1,400,000
Husband
Westpac account
$24,000
Husband
Shares
$140,000
Husband
Motor Vehicle 1
$30,000
Husband
Motor Vehicle 2
$3,000
Husband
Loan to Mr K
$35,800
Husband
Household contents
$5,000
Husband
M Street, Suburb N
$2,825,000
Wife
CBA account
$855
Joint
CBA account
$19,200
Wife
Commsec share portfolio
$140,431
Wife
Investment Fund 1
$56,539
Wife
Motor Vehicle 3
$45,000
Wife
Motor Vehicle 4
$30,000
Wife
Beneficiary entitlement in Q Trust
$46,000
Wife
Household contents
$5,000
Wife
Total:
$8,679,819.70
Liabilities
P Trust
$23,700
Husband
Loan to B Trust
$2,965,000
Wife
Loan to B Trust
$1,540,531
Joint
Total:
($4,529,231)
Superannuation
Super Fund 1
$576,223
Husband
Super Fund 2
$27,187
Husband
Super Fund 3
$38,616
Husband
CBA Superannuation
$48,343
Wife
Total:
$690,369
Financial Resources
Discretionary beneficiary Q Trust
NK
Wife
B Trust
NK
Wife
P Trust
NK
Husband
Total:
NK
It is important to understand the net pool of assets to make sense of the submissions that the husband made concerning the prejudice to his final claim if the court were to order that funds in the controlled monies account were paid to the trustee company.
The husband seeks a payment to him by way of property adjustment of $1,600,000. The husband has had $100,000 by way of the property adjustment under the 16 December 2021 orders.
It is not necessary for the husband to set aside the repayment of the loan to the company trustee to receive $1,600,000. The funds that will remain in controlled monies after repayment of the loan from the second respondent will be sufficient to meet his claim.
On behalf of the husband it was argued that the s 106B (of the Act) issue was a matter for another day. It was submitted that it would ultimately be necessary to either preserve the funds said to be owing to the second respondent until final hearing or – if they were to be repaid – it would be necessary to require an undertaking from the second respondent to protect the husband’s capacity to argue over the disputed funds at trial.
When it was suggested to counsel for the husband that the husband’s final relief was not imperilled by repayment to the second respondent counsel submitted that even if that were so, repayment may impact on the relief sought by the wife. If that be the case, the wife was represented and supported the repayment and could not be heard to complain in due course if the husband were able to convince the court on final hearing that the monies repaid to the second respondent were repaid in error.
The second respondent seeks to be released from the proceedings between the husband and wife upon receipt of the funds said to be owing under the loan. The husband seeks that the second respondent remain a party to the proceedings.
In circumstances where the husband’s final relief is not prejudiced by the payment to the second respondent there is considerable merit in making the orders facilitating the repayment and releasing the second respondent as a party.
To the extent that the husband contended there was no prejudice to the second respondent in remaining a party I respectfully disagree. The court should only allow joinder of a party where joinder is necessary. Accordingly, where joinder is no longer necessary a third party should be released. Leaving aside the prejudice which follows from being involved in legal proceedings so far as time and energy are concerned – there is a cost to being represented and appearing when the matter is listed which should not be borne by a third party whose interest in the case is, following this application, in the nature of potential witness.
The husband has not made a case as to why the court should not recognise the rights of the second respondent under the registered mortgage. Accordingly, I decline his application.
Claim for interest
No interest was payable under the terms of the loan agreement unless there was a Material Adverse Event. The parties separated in June 2021. Separation was defined as a Material Adverse Event. In those circumstances the second respondent makes a claim for interest on the outstanding sum of $1,510,000 from June 2021 to date – calculated in accordance with the letter from R Lawyers dated 1 September – which nominated a rate of 5%. On 23 September 2021 R Lawyers on behalf of the second respondent sent a further letter revising the rate from 5% to 4.5%. The amount outstanding as at 11 February 2022 was $1,540,531.
DISCOVERY/DISCLOSURE
The husband seeks orders compelling the second respondent to provide documents by way of discovery.
Each of the husband and wife have a duty to discover all relevant documents in his or her possession or control. The second respondent’s duty to provide discovery will only arise if there is a relevant justiciable issue before the court. The submissions on behalf of the second respondent made this observation:
By seeking an Order for the production of financial records of the lender when there is no forensic reason for production of such material. If he was genuine about the funds having constituted a gift, such forensic examination would be unnecessary as the gift would have been complete upon payment on the acquisition of [E Street]. There is much force in that submission.
Given the conclusions I have reached about the validity of the loan between the husband and wife and the second respondent I find that the husband has not established a case for discovery against the second respondent. I note that this does not absolve the wife of her obligations for discovery of documents relevant to her financial dealings with the second respondent.
CHILD SUPPORT
X was born in 2017. When she was two months old her parents completed and signed an application for enrolment of X at C School commencing preschool in 2022. By completing the paperwork and paying the fee the parties indicated the manner in which they intended X would be educated, that is in the independent school system.
In March 2020, the parties reconfirmed their commitment to X being educated at C School by signing further consent forms provided by C School. At the end of that year C School offered X a place commencing in Prep (preschool) in Term 1 2022. X’s father paid the fee to accept the position on his credit card.
In February 2021, the husband commenced his current employment with O Pty Ltd (“O Company”). His affidavit says that he earns $200,000 including bonuses and commission (but not superannuation).
Attached to the wife’s affidavit were payslips for the husband in respect of his role at O Company. The payslip records a base pay rate of $160,000. The most recent payslip is for the pay period ending 31 October 2021. That payslip records year to date commissions of $47,673.70 in addition to the base salary. The effect of that is that by 31 October 2021 the husband would earn $207,673.70 even if he received no further commissions and no bonuses in the financial year. This is difficult to reconcile with the husband’s evidence about an income of $200,000 including bonuses and commissions.
The husband says he is concerned about his job security. I cannot make any finding. If there is a significant change in circumstances either party may revisit the departure order.
When considering the husband’s income is it also necessary to have regard to the receipt by the husband of rental income in the gross sum of $39,000 or $44,200 per annum. It is not clear whether the weekly rent is $750 per the husband’s financial statement or $850 per his affidavit. The husband does not give any evidence in respect of dividend income from the shares which he holds. It is not apparent at this stage whether that is because they do not produce any income.
I am not able to reach a conclusion about the extent of the husband’s taxable income in the current year. However, based on his earnings to date I can comfortably conclude that his personal exertion income will exceed $210,000 and in all likelihood based on the payslips to 31 October 2021 be significantly more. In addition he will have income from his rental property (unless he starts to live there).
After separation the wife says that she paid the fee required to secure X’s place for Term 1 2022 (as the husband had refused) at C School.
In August 2021 the husband and wife attended a zoom interview with the Head of the C School junior school.
In September 2021 the husband cancelled the private health insurance policy which covered X.
In October 2021 a Child Support Assessment issued. That assessment required the husband to pay to the wife the sum of $800 per month by way of child support for X.
On 2 November 2022 the Registrar was given notice of the wife’s application for an order departing from the administrative assessment.
In November 2021 the husband consented to X’s enrolment in sport at C School in 2022.
On 31 January 2022 X commenced C School preschool and the husband and wife attended the formal orientation and new parents’ event.
On 13 August 2021 the husband paid $35,800 to S Company. Those funds were to purchase a vehicle. The husband says the vehicle was purchased for his friend and housemate. It is not necessary to resolve the issue of who owns the vehicle. Either the husband’s friend owns the vehicle (and owes the husband money for its purchase and repairs) or the husband owns the vehicle. In either event the husband had savings available to him after separation from which he could in the exercise of his discretion buy a vehicle or loan money to a friend.
The husband does not say he did not agree that X would be educated in the manner her parents elected when they enrolled her, his argument is that he is not in a financial position to pay the fees. I am satisfied that she is being educated in the manner her parents expected her to be educated including enrolment in the extra-curricular activities her parents want her to participate in.
The orders as sought by the mother would, if made require the father to be responsible for 80% of all fees and sundries levied by C School.
The father resists contributing to X’s private health insurance on the basis that he no longer pays for private health insurance for himself and asserts that she will receive no benefit from payment of those premiums. He does not address why it was that he funded the premiums until the parties separated.
The wife is working three days per week and earns $59,072 per annum. She has an additional $4,150 in investment income and derives a benefit from the salary sacrifice scheme of her employer. In addition to that, the wife has access to a Commonwealth Bank of Australia (“CBA”) credit card being a supplementary card on her mother’s account.
The primary duty for the support of children rests with their parents. The husband says his agreement to X’s attendance at C School was in reliance upon his wife’s assurance that the fees would be met by her family. It is not possible to resolve that controversy at an interim hearing. In any event I am required to disregard the income property and financial resources of persons who do not have a legal obligation to support the child unless special circumstances are established (which they are not).
These are interim orders for child support departure. So, even though I cannot make a finding about the conditional nature of the father’s consent to enrolment at C School, I can place some weight on the fact that the parties were in the year prior to C School, committed to the fees for X’s child care in the sum of $840 per fortnight.
I am satisfied that there are special circumstances which make it appropriate that the court hear a child support application under Part 7 Division 4 of the Assessment Act. There are proceedings pending before the Court in relation to property adjustment (including these interim proceedings) and it is in the interests of the parties given the matter is before the Court already to determine the dispute concerning non-periodic payments.
I conclude that it is just and equitable that the father make payment towards the school fees of X by way of non-periodic child support on an interim basis. In reaching that conclusion I find that X having been enrolled by her parents, attended orientation and commenced C School it is just and equitable to make an order in respect of payment of her education expenses.
In reaching the conclusion that it is just and equitable as between the husband and wife I take into account their respective incomes, assets and financial resources.
Historically and currently the husband has earned income significantly in excess of that of the wife. The husband’s evidence about his present income was, as set out above, unsatisfactory.
I need to have regard to the husband’s income (such as I can determine its quantum). I must also take into account his reasonable needs for self-support and the current child support assessment.
The husband did not complete Part N of the Financial Statement. The Financial Statement contained a note at the top of Part N which reads: “Orders for maintenance, child support, financial enforcement”. That evidence assists the Court to determine what the husband’s necessary commitments are. Without that evidence assessment of the husband’s necessary commitments is difficult.
Adopting the very conservative figure of $210,000 for the husband’s annual income and the figure of $44,200 gross in rental income would give the husband $254,200 in income before expenses which equals $4,888 per week.
The husband’s fixed expenses would appear to be:
Tax 769
Rent 577
Levies 194
Insurance 46
Registration 14
Child support 183
Total $1,783
I accept that the tax figure set out in the husband’s material may not be accurate if his income figures are inaccurate but I am bound by the evidence he presented. The husband also included $1,500 as a minimum payment on his credit card and $400 in additional (unspecified) expenditure. Together allowing for all those amounts his expenses total $3,683 per week. That leaves him with $1,205 which could be applied towards the non-periodic payment of child support.
I am satisfied that the husband has sufficient income without the need to have regard to his property or financial resources to meet educational expenses for X.
I reject the submission that he is not in a financial position to meet educational, extra co-curricular activities and medical expenses.
The Assessment Act requires a consideration of the need for an equitable sharing of expenses as between the children’s parents. In circumstances where the income of the mother calculated on a weekly basis is about $1,215 and that of the father about $4,888 the mother’s application that the expenses be shared on an 80/20 basis is appropriate and proportionate.
I do not accept there is any reason why the husband should meet 100% of the amount payable in respect of X’s health insurance (as opposed to 80%) and I will make an order accordingly.
COSTS
The second respondent seeks its costs (including reserved costs) against the husband on an indemnity basis.
The husband has been wholly unsuccessful in the proceedings.
I have regard to his financial circumstances as set out above.
I have regard to the fact that the husband withdrew his consent to discharge of the mortgage necessitating the involvement of the second respondent in proceedings between the husband and wife.
The above findings constitute justifying circumstances for departure from the usual rule.
To the extent that the second respondent sought indemnity costs I did not have any evidence before me to substantiate the quantum sought. In addition, I did not have before me any evidence as the costs agreements between the second respondent and the lawyers for the second respondent. Having regard to some of the contested evidence contained in the affidavit material it is not difficult to appreciate why an application for indemnity costs has been brought. However, cognisant of the interim nature of the proceedings and the inability to make certain findings about the disputed I cannot be satisfied that this is a matter where indemnity costs are properly awarded, accordingly I will order costs on a solicitor/client basis as agreed or taxed.
The husband and wife also sought interim orders for costs. The husband has not established justifying circumstances to depart from the usual rule and he should be responsible for his own legal costs.
The husband has been wholly unsuccessful in his resistance of the wife’s child support application. The husband’s income and asset position are stronger than that of the wife. I find that the wife has established justifying circumstances. The husband should pay the wife’s costs on a party/party basis.
I certify that the preceding eighty-nine (89) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Christie. Associate:
Dated: 2 March 2022
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