Knight and Knight

[2014] FCCA 1902

FEDERAL CIRCUIT COURT OF AUSTRALIA

KNIGHT & KNIGHT [2014] FCCA 1902

Catchwords:
FAMILY LAW – Interim spouse maintenance.

Legislation:

Family Law Act 1975

Applicant: MS KNIGHT

Respondent: MR KNIGHT

File Number: MLC 5778 of 2014

Judgment of: Judge McGuire

Hearing date: 20 August 2014

Date of Last Submission: 20 August 2014

Delivered at: Melbourne

Delivered on: 29 August 2014

REPRESENTATION

Solicitors for the Applicant: Unrepresented

Counsel for the Respondent: Ms Rose

Solicitors for the Respondent: Slater & Gordon

ORDERS

1. That until further order, the husband shall:

   (a)pay to the wife the sum of $305.00 per week by way of interim spousal maintenance, such to be paid weekly in arrears with the first payment due and owed on Friday, 5 September 2014 and such to be paid by direct deposit into the applicant’s account number BSB:  [omitted] ACCT: [omitted] at the [omitted] branch of the National Australia Bank, or otherwise as advised by the wife;

   (b)meet the ongoing mortgage liability in respect of the parties’ property at [Property R] in Victoria in a sum of $880.00 per week;

   (c)make the payments of motor vehicle insurance on the motor vehicle in the possession of the wife within seven days of being provided with an account from the insurer by the wife;

   (d)make all payments, as they become due and owing, in respect of home insurance and council rates in respect of the property at [Property R], Victoria.

2. That within 21 days of the date of these orders, the wife file an amended application setting out the final orders she seeks in respect of both property and children’s matters.

3. That the parties attend a conciliation conference in respect of financial matters on the 5th Floor, Commonwealth Law Courts Building, 305 William Street, Melbourne on 4 December 2014 at 2.15 pm. 

4. That the substantive applications in respect of property settlement, spousal maintenance and children’s matters be listed for trial in the Federal Circuit Court at Melbourne with an estimated hearing time of two days to commence on 6 July 2015.   

5. That the parties make, file and serve their trial affidavits and updated sworn financial statements not later than 14 days prior to the trial date.

6. That the parties make, file and serve case summary documents not later than seven days prior to the trial date. 

7. That the applicant pays the hearing fee or obtains a waiver thereof not later than seven days prior to the trial date.   

IT IS NOTED that publication of this judgment under the pseudonym Knight & Knight is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).

FEDERAL CIRCUIT COURT
OF AUSTRALIA
AT MELBOURNE

MLC 5778 of 2014

MS KNIGHT

Applicant

And

MR KNIGHT

Respondent

REASONS FOR JUDGMENT

Application

1. The application before me is one by the wife seeking interim spousal maintenance set out in her application filed 1 July 2014 as follows:

   (1)That until further order, the respondent pay periodic maintenance to the applicant in the sum of $1163 per week, commencing seven days after the date of this order;

   (2)That maintenance under this order shall be paid by being deposited into the applicant’s bank account at the [omitted] branch of the National Australia Bank;

   (3)That until further order, the respondent pay all mortgage payments payable for the property at [Property R], Victoria, when they fall due;

   (4)That until further order, the respondent pay all utility payments payable for the property at [Property R], when they fall due.

2. The parties separated on 20 February 2014.  They have one child, namely [X], born [omitted] 2011.  [X] lives with the mother pursuant to interim orders made on 20 August 2014.  [X] spends time with the father on one day each weekend, such time to be supervised.

3. The applicant is a [occupation omitted] but on extended, and now unpaid, maternity leave.

4. The husband is a [occupation omitted] with income from his employment of a gross $2115.00 per week or $109,970.00 per annum.  He also achieves income from a rental property of $311.00 per week.

5. The applicant’s financial statement sworn 27 June 2014 discloses income only from a single parent pension of $350.00 per week.

6. The husband remains resident in the former matrimonial home.  The wife and [X] now live with the wife’s mother in Ballarat.

7. The wife is registered for casual [employment omitted] but her employment in this respect has been sporadic at best.

8. The wife’s substantive application seeks final orders only in respect of spousal maintenance.  The husband’s response, however, seeks an alteration of property interests and final children’s orders.

The Relevant Law

1. Section 72 of the Family Law Act (1975) provides the relevant principles in determining entitlement to spousal maintenance and as follows:

   A party to a marriage is liable to maintain the other, to the extent that the first-mentioned party is reasonably able to do so, if, and only if, that other party is unable to support herself or himself adequately whether:

   (a) by reason of having the care and control of a child of the marriage who has not attained the age of 18 years;

   (b) by reason of age or physical or mental incapacity for appropriate gainful employment; or

   (c) for any other adequate reason;

   having regard to any relevant matter referred to in subsection 75(2).

2. Section 74(1) of the Act states:

   In proceedings with respect to the maintenance of a party to a marriage, the court may make such order as it considers proper for the provision of maintenance in accordance with this Part.

3. The matters under section 75(2) that I am to address include, but are not limited to, the following:

   (i)  the age and state of health of each of the parties;

   (ii)  the income, property and financial resources of each of the parties and their physical and mental capacity for appropriate gainful employment;

   (iii)  whether either party has the care or control of the children of the marriage;

   (iv)  the commitments of each of the parties that are necessary to enable them to support themselves, and any child or other person that the party has a duty to maintain;

   (v)  where the parties are separated or divorced, a standard of living that in all the circumstances is reasonable;

   (vi)  the duration of the marriage and the extent to which it has affected the earning capacity of the parties whose maintenance is under consideration;

   (vii)  if either party is cohabitating with another person – the financial circumstances relating to the cohabitation;

   (viii)  any child support that is payable.

4. The legislation stipulates that I am not to consider any entitlement by the applicant to a means tested pension or benefit as being income for the purposes of any spousal maintenance determination.

5. The process for the court, therefore, is firstly to consider the needs of the applicant, if any.  Secondly, if such needs are established, then to consider the ability of the applicant to attend to those needs.  It is then, and only then, that the court moves to consider the respondent’s capacity to contribute to the applicant’s needs.

The Applicant’s Needs

1. The applicant relies on her financial statement sworn 27 June 2014 together with her two affidavits sworn 27 June and 19 August 2014.

2. The wife’s sworn financial statement discloses set personal expenditure of only $15.00 per week being registration on a Ford Focus motor vehicle.  In cross-examination the husband agreed that he would meet the next instalment of that registration which I assume is a concession by him that he would pay the registration until final property and spousal maintenance issues are concluded.

3. At part N of her financial statement the wife sets out her ongoing estimates of week-to-week expenditure including for [X].  I note that the wife says that she has made an application for child support and assume that this is in the process of being assessed.  Given the husband’s income, I assume there will be an assessment commensurate with that income and payable shortly to the wife.  For the purposes of this application, I, therefore, consider only the wife’s personal expenditure.  I calculate the total, absent expenditure for [X], from that document to be $1032.00 per week.

4. The wife was cross-examined by counsel for the husband in respect of her expenditure.  She agreed that the sum of $121.00 per week “seemed excessive” for car maintenance.  I will allow a sum of $20.00 per week which amounts to just over $1000.00 per annum.

5. The wife said that she “took minimal clothing from the home” and hence has an ongoing expense of $100.00 per week or $5200.00 per year for clothing for herself.  This too seems excessive.  She would ordinarily be entitled to her clothing still in the matrimonial home.  In all of the circumstances, I will allow $30.00 per week. 

6. Given that she is living with her mother, her “repairs to furnishings and house repairs” is not justified.  I will therefore subtract the sum of $22.00 from her alleged expenses. 

7. The wife claims $107 for medical, dental and optical expenses.  She is in receipt of a Centrelink benefit and should receive a Healthcare card.  [X]’s expenses will be met or contributed from child support.  I accept some ongoing expenses, however, and will allow $30 per week rather than the $107.00 claimed by the applicant. Similarly, chemist/pharmaceutical expenses should be alleviated substantially by reason of the Healthcare card.  I will allow $20.00 per week rather than the $38.00 claimed.

8. Cleaning (house/pool) is not substantiated on the evidence where the applicant is staying with her parents.  I will subtract the $20 claimed.

9. The applicant claims a sum of $300.00 for “rent”. She concedes, however, that she does not pay rent to her parents but contributes to the outgoings in the form of the utilities which are itemised in part 10 of her financial statement.  I accept that she “would like” to obtain rental accommodation for herself and [X].  This, however, is an interim spousal maintenance application.  I have no evidence before me that she is unwelcome or limited in her time with her parents and note that there will eventually be a property settlement.  I am to determine the wife’s needs as they currently stand as distinct from her desires or expectations.  I will not allow the sum of $300.00 claimed. 

10. Consequently, I calculate that an amount of $608.00 be subtracted from the wife’s claimed needs of $1032.00 per week, leaving an amount of $424.00 per week. 

Wife’s ability to meet her needs

1. The wife is in receipt of a Centrelink benefit.  Her other income from casual [omitted] employment is negligible.  I am not permitted to take into account her means/tested pension. 

2. The wife was cross-examined as to her ability to immediately return to the workforce.  She does, of course, have experience and qualifications as a [omitted].  Nevertheless, she is the primary carer for the parties’ young pre-school child.  [X]’s time with the father is limited to weekends.  Consequently, should the mother return now to the workforce then she would be obliged to meet childcare costs.  In any event, a long line of authorities suggests that the courts are sympathetic in circumstances such as these to parents prioritising the actual care of young children over and above returning to the workforce.

3. In all of the circumstances, I am satisfied that the wife has no ability to attend to or contribute to her own needs in the interim. 

4. It follows that the wife has established needs and cannot meet those needs herself.  She has, therefore, crossed the “threshold” and I must turn to the ability of the husband to contribute to those needs. 

Husband’s ability to contribute to the wife’s needs

1. The husband’s financial statement summarises his weekly income at $2426.00 and his expenditure at $2961.00 per week, or a shortfall of $535.00 per week. 

2. Included in his expenditure is a sum of $880.00 per week for mortgage payments.  In cross-examination, he disclosed that he is not actually making those payments on a weekly basis and has not done so since May 2014.  He lives in the house.  The “positive” in the mortgage account is, of course, an asset of the parties to be dealt with in the property settlement.  The wife seeks an order that he meet those payments in the interim.  That is a reasonable request and expectation and I will both order that he makes the payments on an ongoing basis and therefore allow the expenditure of $880.00 per week.

3. There are, however, other expenditures claimed which are questionable.  Firstly, he claims a weekly expenditure of $170.00 towards his superannuation.  In cross-examination, he conceded that this was an amount paid by his employer rather than himself.  I will therefore subtract it as a necessary expenditure.

4. Secondly, he claims an amount of $500.00 per week for credit card payments.  Again, in cross-examination, he disclosed the current credit card liability of only $1000.00.  I will therefore allow an amount of $20.00 per week as an ongoing commitment.

5. At part N of his financial statement, the husband claims further ongoing week-to-week expenditure of $500.00 per week on himself.  This includes a sum of $150.00 per week for food.  The wife claims only $110.00 per week for herself.  This was unchallenged by the husband’s counsel as being a reasonable expenditure and it is, therefore, appropriate that the husband spend the same on food.  Consequently, I will deduct a sum of $40.00.

6. The husband was challenged in cross-examination as to his alleged expenditure of $50.00 per week on each of gas and electricity.  He gave evidence of his most recent quarterly bills for electricity and gas, suggesting annual costs of $1600.00 and $800.00 respectively.  The total of $2400.00 suggests a commitment of approximately $50.00 per week total, rather than the $100.00 claimed.  I will subtract an amount of $50.00 per week, accordingly, from his claimed expense.

7. He claims $100.00 per week for “entertainment/hobbies” and $50.00 per week for “holidays”.  His attempts at justification, in cross-examination, were unconvincing and tended more towards extravagancies, such as “Gold Class movies” and “going out to dinner”.  The wife claims a total of $50.00 per week for these expenditures.  That would appear reasonable.  Consequently, I will deduct a further $100.00 from the husband’s claimed expenditures for entertainment/hobbies/holidays.

8. The husband claims the sum of $276.00 payable as child support for [X].  The evidence suggests that the wife has made an application for child support assessment but not yet received the award.  I will, however, allow the sum of $276.00 as a necessary expenditure.

9. Consequently, and conditional on the husband meeting the outgoings on the home that he claims to pay in the form of mortgage ($880.00 per week), home and contents insurance ($15.00 per week), the registration of the wife’s motor vehicle ($13.00 per week) and rates ($15.00 per week).  I calculate that he has available the sum of $305.00 per week to contribute to the wife’s needs by way of interim spousal maintenance.  I will make orders accordingly. 

I certify that the preceding thirty-six (36) paragraphs are a true copy of the reasons for judgment of Judge McGuire

Date: 29 August 2014