Keogh and Keogh (No 2)

[2013] FamCA 668

FAMILY COURT OF AUSTRALIA

KEOGH & KEOGH (NO 2) [2013] FamCA 668

FAMILY LAW – PRACTICE AND PROCEDURE – Orders for sale of former matrimonial home and application of the proceeds of sale – Order for the wife to be appointed to execute the discharge of mortgage and transfer documents in relation to former matrimonial home – Order that the husband, who did not participate in proceedings, be served with these orders – Liberty to apply.

Family Law Act 1975 (Cth) s 106A

APPLICANT: Ms Keogh

RESPONDENT: Mr Keogh

FILE NUMBER: HBC 80 of 2013

DATE DELIVERED: 24 July 2013

PLACE DELIVERED: Hobart

PLACE HEARD: Hobart

JUDGMENT OF: Benjamin J

HEARING DATE: 24 July 2013

REPRESENTATION

COUNSEL FOR THE APPLICANT: Mr Turnbull

SOLICITOR FOR THE APPLICANT: Ogilvie Jennings

COUNSEL FOR THE RESPONDENT: No appearance

SOLICITOR FOR THE RESPONDENT:

Orders

1. Pursuant to s 106A of the Family Law Act 1975 Ms Keogh (“the wife”) is appointed to execute a Discharge Authority to E Pty Ltd to effect the sale of the property situate at S Street, Suburb M in Tasmania (“the property”) in the terms of the annexure to the wife’s application in a case filed
   22 July 2013.

2. Pursuant to s 106A of the Family Law Act 1975 the wife is appointed to execute a Transfer in the form of the terms annexed and marked with the letter ‘B’ and to do all such acts necessary to give validity in the operation of that Transfer in respect of the transfer of the property situate at S Street, Suburb M in Tasmania.

3. Leave be given to the wife to apply on the giving of twenty four (24) hours notice to the court in relation to any further documents needed to be signed to give effect to the transfer of the property, such leave to operate for a period of six (6) weeks from the date of these orders.

   IT IS FURTHER ORDERED BY WAY OF FINAL PROPERTY ORDERS

4. The proceeeds of sale of the property at S Street, Suburb M in Tasmania be paid as follows:-

   (a)In payment of legal costs, agents commission and valuation fees in respect of the sale.

   (b)In payment of the amount due to E Pty Ltd as first mortgagee.

   (c)In payment into the trust account or other trust fund for the bond with regard to the tenants in the property at Suburb M.

   (d)In payment of council water rates and land tax.

   (e)Payment to the wife out of the net proceeds of sale and/or the bond, when released, the sum of seven thousand dollars ($7,000.00)

   (f)In balance, if any, to be paid to the husband.

5. Each party retain such property and financial resources (including superannuation) as is in their possession or control as at the date of these orders.

IT IS FURTHER DIRECTED

1. The wife forward a copy of these orders to the husband at his last known address, within seven (7) days from the date of these orders and file an affidavit of service to that effect.

2. The wife send a text message to the husband informing him that final property orders have been made and that a copy of those orders will be available, at no cost to him, from the wife’s solicitors.

   IT IS FURTHER ORDERED

3. The hearing date of 15 August 2013 be vacated.

4. This matter be removed from the list of cases requiring determination.

5. Costs be resereved for a period of three (3) months from the date of this order, and if no application is made within that time all costs applications are dismissed.

   IT IS CERTIFIED

6. Pursuant to Rule 19.50 of the Family Law Rules 2004 it was reasonable to engage counsel to attend

IT IS NOTED that publication of this judgment by this Court under the pseudonym Keogh & Keogh 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 HOBART

FILE NUMBER: HBC 80 of 2013

Ms Keogh

Applicant

And

Mr Keogh

Respondent

EX TEMPORE

REASONS FOR JUDGMENT

1. These are proceedings between Ms Keogh and Mr Keogh in relation to property and in particular their home at S Street, Suburb M, Tasmania. The applications fall into two areas. Firstly, an application in a case filed 22 July 2013 for orders under s 106A of the Family Law Act 1975 (“the Act”) to appoint a registrar for the purpose of signing a discharge authority to E Pty Ltd and to execute a transfer in relation to the sale of that property. During the course of hearing that application in a case, I raised with counsel for the wife as to whether the wife could sign the documents, having regard to the impending settlement date.

2. The second aspect is the property and it is worthwhile setting out the history of this matter to explain why it was dealt with on an undefended basis.  These proceedings involve very modest amounts of property and there is a risk that if things are dealt with badly, the arrangements will leave the wife significantly in debt.

3. On 8 February 2013 the wife commenced proceedings in this Court, seeking final orders in relation to the Suburb M property, including interim orders that the property be sold.  The wife sought orders that proceeds of sale be applied as follows: first to the payment of the mortgage, then to real estate agency fees, council rates, water rates, solicitor’s costs and then to reimburse the wife for expenditure in terms of the property.  The wife sought orders that the net proceeds after distributions, be paid to the husband.

4. I made initial ex parte orders in the absence of the husband on 9 April 2013, to enable the sale of the property and I gave reasons at that time.  The matter came back before me on 15 May and I referred the proceedings to a financial conference before a registrar of this court and noted the matter was likely to be transferred to the Federal Circuit Court.  The proceedings went before the registrar and there was no appearance by or on behalf of the husband.

5. The wife endeavoured to have the husband served at his address for service at F Street, Suburb G without success.  The process server, in his affidavit sworn 23 July 2013, observed that the property was vacant.  The wife gave evidence before me that she has been in contact with the husband by text message and that it appears that he is living in Brisbane and has left the responsibility for the sale of the home to her.  In effect the husband has withdrawn from the proceedings.

6. It is of value to note that the husband has filed a number of documents in these proceedings.  The first was his response, in which he sought essentially the same orders as the wife.  Except that the wife sought orders that she only pays half of the expenses relating to water rates and land tax.  In fact, the wife had paid the whole amount owing, to prevent her own financial record from being diminished and to protect her finances generally.  The husband, in that application, showed his address for service at the F Street, Suburb G address.

7. The husband deposed in his first affidavit that he would consent to the sale of the property.  He also said he was content to share the water rates equally until the house was sold and that he should retain the whole of the proceeds.  He then filed a second affidavit, sworn 6 June 2013, to which I have had regard.  The husband states in this affidavit that he made significant contributions of property towards the marriage, in one form or another.  However, I note that there are some issues of fact in relation to that assertion, which are set out in the wife’s affidavit.

8. I am satisfied that the husband was aware of these proceedings having regard to the text messages and the affidavits and I conclude that he has chosen not to participate in these proceedings.  In all the circumstances, it is appropriate that the matter was heard on an undefended basis, bearing in mind the history which I have set out and which is contained within the file.

9. It is of value now to refer to the history of the matter in a little more detail.  The parties began cohabitation in March 2005, married in 2008 and separated in August 2012. There are no children of their marriage.  Their primary assets are the interest in the home at Suburb M, a motor vehicle which has no value, the husband’s vehicle and their personal possessions.  The wife has superannuation entitlements of about $20,000 and the value of the husband’s superannuation entitlement is unknown.

10. The husband asserts that he has a business which has a value of about $2,500 and has superannuation entitlements of about $1,200.  The liabilities of the wife are the mortgage to E Pty Ltd in respect of the former matrimonial home.  Exhibit 1 discloses that that mortgage is in arrears of some $1,778 and the wife says that the amount outstanding under the mortgage is about $224,000 as at January of this year.  She also has liabilities of about $3,200 in respect of a MasterCard.  I am satisfied that the pool of assets is comprised of the equity in the home at Suburb M, the parties respective personal property, which is of no significant value and the husband’s business which has a value of about $2,500.

11. I note the contributions to which the wife refers in her first affidavit.  The wife has been in employment with the H Pty Ltd and currently earns about $48,000 a year.  Although this figure is slightly higher than she disclosed in her financial statement, I attribute this to having received a recent pay increase.

12. In terms of contributions, the wife received gifts from members of her family including her mother, her grandfather and her grandmother.  The husband had operated a business but ceased that business in 2012 and worked one day a week at Suburb I Youth Centre.  The wife says that in 2012, without the husband working full time, their joint liabilities exceeded their income.

13. Upon separation in mid-2012, the parties agreed that the wife would take over the payment of the outgoings and that the property would be sold.  Since separation the wife has spent about $7,000 in expenses in terms of council rates, mortgage and water bills.  The husband promised to sell the property but instead arranged tenants for the property and collected rent without accounting to the wife in terms of the expenses for the property.  That fact precipitated these proceedings.

14. It also appears that the husband collected a bond of four weeks rent and did not place that in a safe place.  That bond will need to be paid to the purchasers of the property, to hold on trust for the tenants.  In addition, the wife paid land tax and insurance on the property.  The husband indicated that he would pay some of the expenses, but has not done so, except for a nominal amount. I am satisfied that the contributions by the wife, both financial and non-financial, have been considerable.

15. The wife is aged 26, works full-time and earns about $48,000 per year. The husband is aged 46 and is a self-employed tradesman. No evidence was provided as to his current employment, but he had capacity in the past to work full-time. The first application was that relating to the sale of the property.  In her affidavit filed 22 July 2013, the wife deposed that the property was sold for $240,000 and contracts were exchanged at that sum on 21 June 2013.  The husband did not sign the transfer in respect of that property, nor has he signed the discharge authority.  The purchasers in relation to that property wished to settle on Friday 26 July, and the transfer and discharge documents needed to be signed.

16. The initial application was that the necessary documents be signed by a registrar of this Court.  However, I see no reason why they ought not to be signed by the wife.  The proceeds of sale were to be held in trust pending finalisation of the property proceedings and there is an independent firm of solicitors acting.  I see no reason why the wife could not sign those documents to give effect to the agreement for the sale of the property, particularly having regard to the valuation of the property and the evidence before me.  Accordingly, I made that order as a separate order so that it does not confuse any purchaser or any mortgagee.

17. The second application was in relation to the property itself.  It is unlikely that there will be any money left over after the sale of the property.  The husband had collected the rent for a significant period of time and retained the bond for his own use.  The wife expended about $7,000 to protect the asset base of both parties and that sum will need to be repaid to her. If there is an excess, which is unlikely, it is generally agreed that it should be paid to the husband.  The husband has chosen not to work for the last almost 12 months and made no claim in relation to the wife’s superannuation, despite it being disclosed to him.

18. It seems to me that the wife’s application is, in all of the circumstances, just and equitable and I have made final property orders.  I have given the husband leave to apply, for a period of 28 days from the date of these orders if he has submissions to make in respect of final property orders.  I have directed that a text message be sent to him to inform him that property orders have been made and to invite him to obtain a copy of those orders from the wife’s solicitors.

I certify that the preceding eighteen (18) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Benjamin delivered on 24 July 2013.

Associate:     

Date:              24 July 2013