KOVACIC & WALSWORTH - [2020] FCCA 1912

FEDERAL CIRCUIT COURT OF AUSTRALIA

KOVACIC & WALSWORTH

[2020] FCCA 1912

Catchwords:
FAMILY LAW – Property orders – de facto relationship – application to proceed undefended given respondent’s non-compliance – respondent’s failure to participate in proceedings – response dismissed – application to proceed undefended granted – final orders – just and equitable.

Legislation:

Family Law Act 1975 (Cth), ss.44, 90SF, 90SM, 90ST, 117

Federal Circuit Court Rules 2001 (Cth), rr.13.03A, 13.03B, 15.31, 16.05

Cases cited:

Chancellor & McCoy [2016] FamCAFC 256

Stanford & Stanford (2012) FLC 93-518

Hickey & Hickey & Attorney-General for the Commonwealth of Australia

(Intervener) (2003) FLC 93-143

Mundy & Bowman (1997) FLC 92-784

Prantage & Prantage [2013] FamCAFC 105

Penfold & Penfold (1980) 144 CLR 311

Latoudis & Casey (1990) 170 CLR 534

Applicant:

MR KOVACIC

Respondent:

MS WALSWORTH

File Number:

DGC 3277 of 2018

Judgment of:

Judge O'Sullivan

Hearing date:

3 June 2020

Date of Last Submission:

3 June 2020

Delivered at:

Dandenong

Delivered on:

16 July 2020

REPRESENTATION

Counsel for the Applicant:

Mr Lovering

Solicitors for the Applicant:

Macpherson Kelley Pty Ltd

Respondent:

No appearance

ORDERS

That within 60 days, the respondent pay to the applicant by way of alteration of property interest the sum of $140,000.00.
That the respondent pay the costs of the applicant fixed in the amount of $3,120.00.
That in the event that the respondent fails to comply with the terms of Orders 1 and 2, the parties do all things necessary including executing all documents necessary to list for sale and sell the property situate at and known as B Street, Suburb C, Victoria by auction at the earliest possible date at a price to be agreed on between the parties and failing such agreement at a price to be determined by the President of the Real Estate Institute of Victoria (or any successor of it) or his/her nominee and to disburse the proceeds of the said sale in the following manner and priority:
(a)payment of agent's commission and advertising expenses and legal expenses of the sale.
(b)payment of costs incurred, if any, in relation to determination of value or selling price by the President of the Real Estate Institute of Victoria or his/her nominee.
(c)the balance then remaining to be divided as to:
(i)the amount owing pursuant to Orders 1 and 2 plus interest calculated in accordance with the Family Law Rules to the applicant; and
(ii)the remainder to the respondent.
That the parties shall do all acts and things necessary and give all consents and execute all documents and writings to give effect to these Orders in the time periods prescribed.
That in the event that either party refuses or neglects to execute any deed, document or instrument necessary to give effect to these Orders, the Registrar of the Court be appointed pursuant to Section 106A of the Family Law Act1975 (Cth) to execute such deed, document or instrument in the name of the said party and do all acts and things necessary to give validity…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading KOVACIC & WALSWORTH

Details

AGLC: KOVACIC & WALSWORTH [2020] FCCA 1912
Case: [2020] FCCA 1912
Decision Date: 16 July 2020

CaseChat Overview and Summary

In the matter of Kovacic & Walsworth, Judge O'Sullivan of the Federal Circuit Court of Australia considered an application for property settlement following the breakdown of a de facto relationship. The proceedings were brought by the applicant, who sought final property orders. The respondent failed to participate in the proceedings, leading to the dismissal of their response and the applicant being granted leave to proceed undefended.

The court was required to determine the appropriate property orders to be made, considering the respondent's non-compliance with the court's process. Specifically, the court had to assess what orders were just and equitable to make under Part VIIIAB of the Family Law Act 1975 (Cth), which governs property settlements in de facto relationships. This involved considering the financial and non-financial contributions of each party, the welfare of any children, the effect of any proposed orders on the parties' earning capacities, and any other relevant circumstances.

The court's reasoning was informed by Section 90SM of the Family Law Act 1975 (Cth), which empowers the court to alter the property interests of parties to a de facto relationship where it is just and equitable to do so. Given the respondent's failure to engage with the proceedings, the court proceeded to make orders based on the evidence presented by the applicant. The court ultimately ordered the respondent to pay a sum of $140,000 to the applicant by way of alteration of property interest and to pay the applicant's costs. In the event of non-compliance with these orders, the court provided for the sale of a specified property, with the proceeds to be disbursed in a particular order of priority, including the satisfaction of the monetary orders and costs. The court also made provisions for the Registrar to execute documents if a party refused to do so, and otherwise ordered that each party retain their existing property and be solely liable for any liabilities associated with it.

Orders

Orders of the court

That within 60 days, the respondent pay to the applicant by way of alteration of property interest the sum of $140,000.00.

That the respondent pay the costs of the applicant fixed in the amount of $3,120.00.

That in the event that the respondent fails to comply with the terms of Orders 1 and 2, the parties do all things necessary including executing all documents necessary to list for sale and sell the property situate at and known as B Street, Suburb C, Victoria by auction at the earliest possible date at a price to be agreed on between the parties and failing such agreement at a price to be determined by the President of the Real Estate Institute of Victoria (or any successor of it) or his/her nominee and to disburse the proceeds of the said sale in the following manner and priority:

(a) payment of agent's commission and advertising expenses and legal expenses of the sale.

(b) payment of costs incurred, if any, in relation to determination of value or selling price by the President of the Real Estate Institute of Victoria or his/her nominee.

(i) the amount owing pursuant to Orders 1 and 2 plus interest calculated in accordance with the Family Law Rules to the applicant; and

(ii) the remainder to the respondent.

That the parties shall do all acts and things necessary and give all consents and execute all documents and writings to give effect to these Orders in the time periods prescribed.

That in the event that either party refuses or neglects to execute any deed, document or instrument necessary to give effect to these Orders, the Registrar of the Court be appointed pursuant to Section 106A of the Family Law Act 1975 (Cth) to execute such deed, document or instrument in the name of the said party and do all acts and things necessary to give validity and operation to the deed, document or instrument upon the Registrar being provided with verification of such refusal or failure by way of affidavit.

Unless otherwise specified in these orders and save for the purposes of enforcing any monies due under these or any subsequent orders:

(a) each party be solely entitled to the exclusion of the other to all other property (including choses-in-action) in the possession of such party as at the date of these orders;

(b) each party forego any claims they may have to any superannuation benefits belonging to or earned by the other;

(d) each party be solely liable for and indemnify the other against any liability encumbering any item of property to which that party is entitled to pursuant to these orders;

(e) any joint tenancy of the parties in any real or personal estate is hereby expressly severed.

The applicant to serve the respondent with a copy of these orders within 14 days from today at her last known residential address.

All extant applications be otherwise dismissed.

AND THE COURT NOTES:

A. Rule 16.05 of the Federal Circuit Rules 2001.

B. Orders were made on 3 June 2020 dismissing the response filed on 10 December 2018 and the applicant was granted leave to proceed undefended with the application for property settlement pursuant to Rules 13.03A(2)(a)(b)(ii)(vii) and 13.03B(2)(d) of the Federal Circuit Court Rules 2001.

Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

These proceedings are governed by the provisions of Part VIIIAB of the Act. Section 90SM of the Act relevantly provides:“Alteration of property interests(1) In property settlement proceedings after the breakdown of a de facto relationship, the court may make such order as it considers appropriate:(a) in the case of proceedings with respect to the property of the parties to the de facto relationship or either of them--altering the interests of the parties to the de facto relationship in the property; or(b) in the case of proceedings with respect to the vested bankruptcy property in relation to a bankrupt party to the de facto relationship--altering the interests of the bankruptcy trustee in the vested bankruptcy property;including:(c) an order for a settlement of property in substitution for any interest in the property; and(d) an order requiring:(i) either or both of the parties to the de facto relationship; or(ii) the relevant bankruptcy trustee (if any);to make, for the benefit of either or both of the parties to the de facto relationship or a child of the de facto relationship, such settlement or transfer of property as the court determines.Note 1: The geographical requirement in section 90SK must be satisfied.Note 2: The court must be satisfied of at least one of the matters in section 90SB.Note 3: For child of a de facto relationship , see section 90RB.(2) If a party to the de facto relationship dies after the breakdown of the de facto relationship, an order made under subsection (1) in property settlement proceedings may be enforced on behalf of, or against, as the case may be, the estate of the deceased party.(3) The court must not make an order under this section unless it is satisfied that, in all the circumstances, it is just and equitable to make the order.(4) In considering what order (if any) should be made under this section in property settlement proceedings, the court must take into account:(a) the financial contribution made directly or indirectly by or on behalf of a party to the de facto relationship, or a child of the de facto relationship:(i) to the acquisition, conservation or improvement of any of the property of the parties to the de facto relationship or either of them; or(ii) otherwise in relation to any of that last-mentioned property;whether or not that last-mentioned property has, since the making of the contribution, ceased to be the property of the parties to the de facto relationship or either of them; and(b) the contribution (other than a financial contribution) made directly or indirectly by or on behalf of a party to the de facto relationship, or a child of the de facto relationship:(i) to the acquisition, conservation or improvement of any of the property of the parties to the de facto relationship or either of them; or(ii) otherwise in relation to any of that last-mentioned property;whether or not that last-mentioned property has, since the making of the contribution, ceased to be the property of the parties to the de facto relationship or either of them; and(c) the contribution made by a party to the de facto relationship to the welfare of the family constituted by the parties to the de facto relationship and any children of the de facto relationship, including any contribution made in the capacity of homemaker or parent; and(d) the effect of any proposed order upon the earning capacity of either party to the de facto relationship; and(e) the matters referred to in subsection 90SF(3) so far as they are relevant; and(f) any other order made under this Act affecting a party to the de facto relationship or a child of the de facto relationship; and(g) any child support under the Child Support (Assessment) Act 1989 that a party to the de facto relationship has provided, is to provide, or might be liable to provide in the future, for a child of the de facto relationship.