KYRIAZIS & KYRIAZIS

[2017] FamCA 288

FAMILY COURT OF AUSTRALIA

KYRIAZIS & KYRIAZIS [2017] FamCA 288

FAMILY LAW – PROPERTY – Settlement in relation to marriage – Undefended – Where the husband has not participated in the proceedings – Where the Court is satisfied that the wife has satisfied service requirements – Leave given to the wife for her application to be heard as undefended proceedings – Where the husband and wife were married for 33 years and have two adult children – Where the Court is unable to make a finding about contributions with precision – Where the relevant matters pursuant to s 75(2) of the Family Law Act 1975 (Cth) are the wife’s poor state of health and the husband’s failure to participate in the proceedings and make financial disclosure – Where it is appropriate to make an adjustment in favour of the wife – Orders made in accordance with the wife’s application.

Family Law Act 1975 (Cth) – ss 75(2), 79

Bevan & Bevan (2013) FLC 93-545
Stanford v Stanford (2012) 247 CLR 108

APPLICANT: Ms Kyriazis

RESPONDENT: Mr Kyriazis

FILE NUMBER: SYC 7139 of 2015

DATE DELIVERED: 11 May 2017

PLACE DELIVERED: Sydney

PLACE HEARD: Sydney

JUDGMENT OF: Johnston J

HEARING DATE: 1 November 2016

REPRESENTATION

SOLICITOR FOR THE APPLICANT: Ms O’Shane

COUNSEL FOR THE RESPONDENT: No appearance for or on behalf of the respondent

Orders

1. That leave be given to the wife for her application to be heard as an undefended proceedings.

2. That within 14 days of the date of these orders, the husband shall transfer to the wife all his right title and interest in the property known as B Street, C Town, New South Wales, being the whole of the land contained in Folio Identifier Lot … (“the C Town property”) and for that purpose shall hand to the wife a duly executed Transfer in registrable form of all his right title and interest in the C Town property and that the wife shall thereafter indemnify the husband from any liability encumbering the C Town property.

3. That within 14 days of the date of these orders, the husband shall transfer to the wife all his right title and interest in the property known as D Street, Suburb E, New South Wales, being the whole of the land contained in Folio Identifier Lot … (“the Suburb E property”) and for that purpose shall hand to the wife a duly executed Transfer in registrable form of all his right title and interest in the Suburb E property and that the wife shall thereafter indemnify the husband from any liability encumbering the Suburb E property.

4. That within 14 days of the date of these orders, the husband shall transfer to the wife all his right title and interest in the property known as F Street, Suburb G, New South Wales, being the whole of the land contained in … (“the Suburb G property”) and for that purpose shall hand to the wife a duly executed Transfer in registrable form of all his right title and interest in the Suburb G property and that the wife shall thereafter indemnify the husband from any liability encumbering the Suburb G property.

5. That the wife shall retain to the exclusion of the husband the motor vehicle registration number ...

6. That the wife shall retain to the exclusion of the husband all contents of the C Town property.

7. That the husband shall retain to the exclusion of the wife any and all real property situated in Country H registered either in his sole name or jointly with another, or other, party or parties, as at the date of these orders.

8. That unless otherwise specified in these orders, the wife and the husband each be declared the owner at law and in equity of all items of property including but not limited to money, jewellery and personal effects presently standing in their name or in their respective possession and control.

9. That the wife shall sign all documents, and do all acts and things necessary to discharge the outstanding council rates, strata levies and land tax liability in respect of the C Town property, the Suburb E property, and the Suburb G property as applicable.

10. That in the event that either party refuses or neglects to execute any deed or instrument necessary to give effect to these orders, the Registrar of the Family Court of Australia is appointed pursuant to section 106A of the Family Law Act 1975 (Cth) to execute such deed or instrument in the name of such party and to do all acts and things necessary to give validity and operation to the deed or instrument.

11. That the wife pay out of any proceedings the amount of $19,764.00 to her previous legal representatives in this matter, I Lawyers, within 30 days of the date of these orders.

12. That the parties pay their own costs.

13. That within seven days the wife cause a sealed copy of these orders to be forwarded by express overseas post to the husband at his address at J Street, K Town, Country H.

Note: The form of the order is subject to the entry of the order in the Court’s records.

IT IS NOTED that publication of this judgment by this Court under the pseudonym Kyriazis & Kyriazis has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).

Note: This copy of the Court’s Reasons for Judgment may be subject to review to remedy minor typographical or grammatical errors (r 17.02A(b) of the Family Law Rules 2004 (Cth)), or to record a variation to the order pursuant to r 17.02 Family Law Rules 2004 (Cth).

FAMILY COURT OF AUSTRALIA AT SYDNEY

FILE NUMBER: SYC 7139 of 2015

Ms Kyriazis

Applicant

And

Mr Kyriazis

Respondent

REASONS FOR JUDGMENT

Introduction

1. These are undefended property proceedings.  The parties are Ms Kyriazis (“the wife”) and Mr Kyriazis (“the husband”).

2. The wife was born in 1962 in Australia (55 years) and the husband was born in 1957 in European Country H (59 years).  The parties were married and commenced cohabitation in 1983.  They separated in 2013.  The parties were divorced on 3 March 2016.

3. There are two children of the marriage, both now adults, Mr L Kyriazis (31 years) and Ms M Kyriazis (25 years). 

Service

1. The husband has not formally responded to the proceedings.  The husband moved to Country H in June 2015.  The wife filed her Initiating Application in this Court on 30 October 2015.  On 6 November 2015 the wife’s then solicitor forwarded to the husband by registered mail the Initiating Application, the wife’s Financial Statement, her Application for Divorce and other relevant material. 

2. There can be little doubt that the husband received those documents because in mid-November 2015 the husband called the wife’s mobile telephone and said that he had received the paperwork from her solicitor.  He asked her what she wanted him to do with it.  She responded that he was to sign it and send it to her lawyer, and if he had any questions to speak with her lawyer.

3. On 23 December 2015 the wife’s solicitor sent a letter to the husband as neither the solicitor nor the wife had received a signed Acknowledgement of Service.  The letter also indicated that the matter was listed in Court at 10.00 am on 1 February 2016 and that he was required to be present, or he could telephone the Court.

4. On 27 January 2016 the wife’s solicitor telephoned the husband and informed him that he or his lawyer should attend Court on 1 February and 2 February 2016.  The husband replied “I have no money, I’m looking after my mother.  She can take everything”.  The wife’s solicitor informed the husband “about 5 times” of the court dates.

5. In her affidavit filed on 14 March 2016 the wife said that she has made various attempts, efforts and enquiries to communicate with the husband in relation to the family law proceedings, including the divorce proceedings.

6. The wife said that in separate conversations with both of the parties’ children they have informed her that they had spoken to the husband, that he is aware of these proceedings, that he does not care and that she can have all of the property.

7. On 1 February 2016 a copy of a letter sent by the wife’s solicitor to the husband was received by her solicitor with what she recognised as the husband’s signature endorsed thereon.  That letter included confirmation that the matter was before the Court on 1 February 2016 and that the husband was required to be there or request to attend by telephone or instruct a lawyer on his behalf.  There was no appearance recorded on the court record for the husband on 1 February 2016.

8. Following the listing on 1 February 2016 the wife’s solicitor sent a letter that day to the husband advising him that the matter was listed for an undefended hearing on 30 March 2016.  The letter advised the husband that if he did not attend or arrange representation, the matter would proceed for an undefended hearing on that day and that the Court would most likely make orders sought by the wife.

9. The matter was listed before me to consider an undefended hearing on 30 March 2016.  On that occasion I was satisfied that the husband was aware that the proceedings were before the Court and noted that he had not entered any appearance in the proceedings.  I made further directions for filing further material by the wife including some evidence of value of the relevant properties.  I ordered that the proceedings be adjourned for readiness check and directions to 30 May 2016.

10. On 30 May 2016, still there was no appearance by the husband.  Orders were made for the wife to serve all relevant material on the husband.  The husband was ordered to file and serve a response, all affidavits in response and a financial statement not later than 10 August 2016.  The matter was adjourned for hearing on 15 August 2016 at 2.15 pm.  I noted that in the event that the husband failed to comply with the orders and to appear at Court on 15 August 2016 at 2.15 pm the wife proposed to ask the Court to hear her application as an undefended proceedings. 

11. On 15 August 2016 the matter was adjourned for hearing at 10.00 am on 31 October 2016.  There had been a difficulty and all the required material had not been served on the husband.

12. On 31 October 2017 Ms O’Shane, the wife’s solicitor informed the Court that she had received a telephone call from the husband the previous week and that he informed her that he would be coming to Court on 31 October 2016.  But he telephoned Ms O’Shane a few days later and informed her that he would not be coming to Court.  Ms O’Shane said that he appeared to have no intention of responding to the application.  True to his word, there was no appearance by the husband at Court on 31 October 2016.  I adjourned the proceedings for hearing the following day, 1 November 2016.

13. It is clear that the wife has served the application and supporting material on the husband and that he is well aware that these proceedings are before the Court for hearing.  The only conclusion the Court can draw is that he has no intention of involving himself in the proceedings.

14. In all the circumstances, I have no hesitation in giving leave to the wife for her application for final property orders to be heard as an undefended proceedings.

Application

1. The wife is seeking the following orders.  I am satisfied that this form of orders sought has been sent to the husband:

   1.That within 14 days of (the) date of these Orders, the Husband shall transfer all his right title and interest in the property known as [B Street, C Town], New South Wales, being the whole of the (land) contained in Folio Identifier Lot … (“the [C Town] property”) and for that purpose shall hand to the Wife a duly executed Transfer in registrable form of all his right title and interest in the [C Town] property and that the Wife shall thereafter indemnify the Husband from any liability encumbering the [C Town] property.

   2.That within 14 days of the date of these Orders the Husband shall transfer all his right title and interest in the property known as [D Street, Suburb E], New South Wales, being the whole of the land contained in Folio Identifier Lot … (“the [Suburb E] property”), and for that purpose shall hand to the Wife a duly executed Transfer in registrable form of all his right title and interest in the [Suburb E] property and that the Wife shall thereafter indemnify the Husband from any liability encumbering the [Suburb E] property.

   3.That within 14 days of the date of these Orders the Husband shall transfer all his right title and interest in the property known as [F Street, Suburb G], New South Wales, being the whole of the land contained in Lot … (“the [Suburb G] property”) and for that purpose shall hand to the Wife a duly executed Transfer in registrable form of all his right title and interest in the [Suburb G] property and that the Wife shall thereafter indemnify the Husband from any liability encumbering the [Suburb G] property.

   4.That the Wife shall retain to the exclusion of the Husband the [Japanese] Motor Vehicle Registration Number ....

   5.That the Wife shall retain to the exclusion of the Husband all contents of the [C Town] Property.

   6.That the Husband shall retain to the exclusion of the Wife any and all real property situated in [Country H] registered either in his sole name or jointly with another, or other, party or parties, as at the date of these Orders.

   7.That unless otherwise specified in these Orders, the Wife and the Husband each be declared the owner at law and in equity (of) all items of property including but not limited to money, jewellery and personal effects presently standing in their name or in their respective possession and control.

   8.(That) the Wife shall sign all documents, and do all acts and things necessary to discharge the outstanding council rates, strata levies and land tax liability in respect of the [C Town] property, the [Suburb E] property, and the [Suburb G] property as applicable.

   9.That in the event that either party refuses or neglects to execute any deed or instrument necessary to give effect to these Orders, the Registrar of the Family Court of Australia is appointed pursuant to section 106A of the Family Law Act 1975 (Cth) to execute such deed or instrument in the name of such party and to do all acts and things necessary to give validity and operation to the deed or instrument.

   10.That the Applicant Wife pay out of any proceedings the amount of $19,764.00 to her previous legal representatives in this matter, [I Lawyers], within 30 days of (the) date of these Orders.

   11.That the parties pay their own costs.

Background

1. The background facts are as follows.  At the commencement of the marriage the parties each had approximately $1,000 in savings and the husband had a motor vehicle. 

2. Following their marriage in 1983 the parties moved into rental accommodation in O Street, C Town.  At this time the wife worked in hospitality and the husband was working in the family business.

3. In early 1984 the parties purchased a business in C Town known as Business P for $10,000.  Both parties worked in that business on a full time basis.  The business was sold at the end of 1984 for less than $10,000.

4. The parties’ son L was born in 1985.

5. In 1985 the parties purchased the goodwill in a business known as Business Q in C Town which was owned by the husband’s sister Ms R and her husband, who were moving to Country H.  The purchase price of $45,000 was paid from the parties’ joint savings.

6. The parties occupied the residence at the rear of the Business Q from 1985 until the beginning of May 1988.  When the parties vacated this residence, another of the husband’s sisters Ms S, her husband Mr T and their baby moved into the residence.  To the wife’s knowledge the parties were not paid any rent.

7. In May 1988 the parties purchased the former matrimonial home at B Street, C Town for $145,000.  The parties paid a deposit (amount unknown) and borrowed money from Westpac Banking Corporation to fund the balance of the purchase price of the home.

8. In the 1990’s (the wife does not recall the exact year) the husband purchased a commercial property at J Street K Town Country H in his sole name.  The wife said that joint funds were used for this purchase and that rental income from this property was deposited into a Greek bank account.  I accept the wife’s evidence.

9. In January 1991 the parties purchased the property known as D Street, Suburb E for $170,000.  The wife said that the majority of the purchase price was funded by mortgage secured over the Suburb E property.  This loan was subsequently extended by $22,000 to fund the cost of painting, tiling and other minor improvements to the property.  The parties continue to each receive half of the rental income from this property.

10. The parties’ second child M was born in 1991.

11. In 1997 the parties purchased the property at F Street, Suburb G, New South Wales for $150,000 from joint funds.  This property is currently leased and the parties continue to each receive half of the rental income from this property.

12. In 1999 the husband’s sister Ms R and her husband returned from Country H and wanted to resume operation of the Business Q.  The parties resisted this and Ms R subsequently obtained an eviction notice.  No money was paid to the parties for the goodwill in the business.

13. In August 1999 the parties purchased Business U at 1 V Street, C Town from the husband’s sister Ms S and her husband Mr T who were relocating to Country H.  The wife said that Ms S and Mr T owed approximately $22,000 in unpaid rental and as a result the shop equipment and fittings were retained by the landlord.

14. In approximately 2001 the parties left Business U and ran the bistro at the Empire Hotel in C Town for approximately nine months.  Subsequently the parties purchased a business known as Business W at 2 V Street, C Town and operated the business for four years.  The parties paid $600 per week rent for this business.

15. In 2005 the parties purchased a plasma television for $8,000 from Harvey Norman C Town, obtaining finance from GE Finance.  Since separation in 2013 the wife made the monthly repayments on the loan until its completion.

16. In approximately 2006, the wife ceasing working because of various health issues.

17. In 2008 the parties purchased a Japanese motor vehicle for $33,000 having obtained finance through Capital Finance.  The repayments were made from joint funds.  At separation in 2013, $12,000 remained owing on this loan and the wife solely made the monthly repayments of $600 until the loan was paid off in August 2015.

18. In April 2010 the husband was injured whilst travelling in a motor vehicle during the course of his employment. 

19. In 2012 the husband was working a weekend job in C Town earning $120 cash per day.

20. The parties separated in 2013.

21. In mid-2014 the husband received a compensation payment.  After deduction of legal fees and reimbursement of government funded health care he received the nett payment of approximately $55,000.  The wife does not know what happened to these funds.

22. Several years ago the husband inherited a large block of land in Country H from his grandfather’s estate. 

The applicable law

1. Sub-section 79(1) of the Family Law Act 1975 (Cth) (“the Act”) provides to the effect that in property settlement proceedings the Court may make such order as it considers appropriate altering the interests of the parties to the marriage in the property.

2. Sub-section 79(2) provides that the Court shall 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.

3. Sub-section 79(4) sets out various matters which must be taken into account in considering what order (if any) should be made under the section. These matters include direct and indirect contributions, financial and otherwise by or on behalf of a party or a child to the acquisition, conservation or improvement of any property of the parties, contributions by a party to the welfare of their family including as a homemaker or parent, relevant matters referred to in s 75(2) and the other matters referred to in s 79(4).

1. The operation of s 79 was the subject of consideration by the High Court in the case of Stanford v Stanford (2012) 247 CLR 108. In this case the majority said (at page 120) in referring to ss 79(2) and 79(4) as follows:

   35.… the requirements of the two sub-sections are not to be conflated. In every case in which a property settlement order under s 79 is sought, it is necessary to satisfy the court that, in all the circumstances, it is just and equitable to make the order.

   36.The expression “just and equitable” is a qualitative description of a conclusion reached after examination of a range of potentially competing considerations. … while the power given by s 79 is not “to be exercised in accordance with fixed rules”, nevertheless, three fundamental propositions must not be obscured.

2. The High Court said that the first of these propositions is for the Court to identify, according to ordinary common law and equitable principles, the existing legal and equitable interests of the parties in the property.

3. The second is that although s 79 confers a broad power on the Court, it is not a power that is to be exercised according to an unguided judicial discretion. It must be exercised in accordance with legal principles, including the principles which the Act itself lays down.

4. The High Court said that the third fundamental proposition is that the question of whether the order is “just and equitable” is not to be answered by beginning from the assumption that one or other party has the right to have the property of the parties divided between them or has the right to an interest in marital property which is fixed by reference to the various matters set out in s 79(4). To conclude that making an order is “just and equitable” only because of and by reference to various matters in s 79(4), without a separate consideration of s 79(2) would be to “conflate” the statutory requirements and ignore the principles laid down by the Act.

5. And the High Court majority went on to say (at page 122) as follows:

   41.…  The fundamental propositions that have been identified require that a court have a principled reason for interfering with the existing legal and equitable interests of the parties to the marriage and whatever may have been their stated or unstated assumptions and agreements about property interests during the continuance of the marriage.

The parties’ existing legal and equitable interests in property

1. Because the husband has not participated in these proceedings this Court cannot be certain about the extent of the legal and equitable interests of the parties in property.

2. The wife has said that the husband owned the property at J Street K Town in Country H.  She also said that the children have informed her that there are other properties in Country H owned by the husband. 

3. The state of the evidence is not such that would enable this Court to make findings that the husband owns properties in Country H.  But the possibility, perhaps even the likelihood that this is the case, cannot be dismissed.

4. On the wife’s evidence, the parties’ legal and equitable interests in property include the following:

$
1.         B Street, C Town	495,000
2.         D Street, Suburb E	1,450,000
3.         F Street, Suburb G	380,000
4.         Husband’s property at J Street, K Town, Country H	Not Known
5.         Husband’s vacant land in Country H	Not Known
6.         Wife’s savings	33
7.         Wife’s Japanese motor vehicle	10,000
8.         Husband’s Cbus superannuation	Not Known
_____________
$2,335,033

1. The liabilities include the following:

$
1.         Loan from son, Mr L Kyriazis	6,240
2.         Personal loan for property valuations	3,080
3.         Former solicitor’s fees	19,764
4.         Land tax, rates, strata fees	10,733
_____________
$39,817
Surplus	$2,295,216

Sub-section 79(2)

1. Sub-section 79(2) of the Act provides:

   The court shall 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.

2. In their decision in the case of Bevan & Bevan (2013) FLC 93-545 the Full Court (Bryant CJ and Thackray J) said as follows at page 87,234:

   In our view, it will be less likely that the separate issues arising under s 79(2) and s 79(4) will be conflated if judges refrain from evaluating contributions and other relevant factors in percentage or monetary terms until they have first determined that it would be just and equitable to make an order.

3. In the present case, the parties were married for almost 33 years and they have raised two children to adulthood.  They purchased a home at C Town to live in together and raise their children.  But the husband has not lived there for some years having left Australia and become resident in Country H.  And the wife no longer lives there.  The parties also own other properties jointly as indicated above.  Their financial affairs need to be disentangled in fairness to each of them.

4. In these circumstances, in my view it would be just and equitable to make an order under s 79 of the Act.

Contributions

1. In my view, this is not a case where the Court is able to confidently make a detailed, calibrated assessment of the parties’ contributions.  The Court does not know the extent of the husband’s legal and equitable interests in property.

2. Both the wife and the husband appear to have worked very hard in their various businesses.  So clearly they have both made very significant financial contributions.

3. The wife has made the overwhelming contributions to the welfare of the family unit comprising the husband, herself and the children.  In her affidavit she paints quite a detailed picture of her involvement with the children and undertaking the household duties.  On her account, which I accept, the husband was not a hands-on parent.  I am confident that almost the entirety of the child care, particularly when the children were babies and youngsters, was undertaken by the wife.

4. In 2015 the husband removed himself from Australia and changed his residence to Country H where he has since lived with his elderly mother.  The wife has had the responsibility for managing the parties’ properties without any assistance from the husband from that point in time.

5. The wife has complained about a long history of behaviour by the husband which involved elements of family violence.  These included what she described as amounting to unreasonably denying her financial autonomy, unreasonably withholding financial support to the point where at times she found it necessary to ask the children to give her money to purchase food, limiting her opportunities to keep connections with her parents and other allegations about family violence.

6. I accept that the husband has not put any material before this Court to challenge those assertions.  But in my view, these are not matters which in this case would affect the Court’s finding about contributions.

7. Given the lengthy duration of the marriage and what has clearly been a lot of hard work by each of the parties up to the time of separation, this Court would make a general assessment that their contributions have probably been close to equal.  Since that time, however, clearly the wife, on her evidence, has made much greater contributions.  Accordingly, in my view, the contributions overall are assessed as having been greater by the wife than by the husband.  But as I have said, endeavouring to assess contributions precisely in circumstances where the Court has little confidence that it knows the full extent of the legal and equitable interests of the parties in property, is not possible.

Sub-section 75(2) matters

1. As indicated above, the wife is 55 years of age.  There are various problems in terms of her health.  As I have said, she retired from the paid workforce in approximately 2006 in circumstances where there were limitations to her health.  At the present time, her health is limited by the following conditions:

   ·depression;

   ·urinary incontinence;

   ·diabetes mellitus;

   ·hypertension;

   ·osteoarthritis of the knees;

   ·psoriasis;

   ·advanced varicose veins of both legs;

   ·uterine prolapse;

   ·gastro-oesophageal reflux disease;

   ·plantar fasciitis;

   ·right shoulder impingement; and

   ·irritable bowel syndrome.

2. She is assisted in the management of these conditions by several doctors, including a specialist physician and a rheumatologist.  Her specialist physician has expressed the opinion that the wife is permanently unfit to be gainfully employed.  That is an opinion which I do not hesitate to accept.

3. The wife’s weekly income is the extremely modest amount of $359 which she receives by way of her share of the rent from the Suburb G and Suburb E commercial premises.  The wife resides in rented accommodation which she shares with her children and her daughter’s partner.  They subsidise the wife’s living costs by paying the rent and groceries, petrol and her medical expenses.

4. The wife’s property consists of her motor vehicle and her 50 per cent interest in each of the items of real estate.  As I have said, the wife obtained professional valuations of these properties and I have referred to them above.  I have referred to the wife’s liabilities above.

5. On the other hand, the husband is almost 60 years of age and the Court is unaware of his current state of health.  He is living in Country H and apparently caring for his elderly mother.  He appears to be able to support himself adequately, in the absence of any evidence otherwise. 

6. In my view, the most significant s 75(2) matters are as follows. Firstly, the poor state of health of the wife which precludes her from any gainful employment. Secondly, the fact that the husband has failed to involve himself in these proceedings with the consequence that he has not made any disclosure to this Court about his financial circumstances. So the Court is in a position of uncertainty about what the full extent of the parties’ legal and equitable interests in property is. In my view, the Court is entitled to infer that the husband owns property which he has not disclosed. In any event, he does not oppose the orders sought.

7. In my view, to achieve a just and equitable order in these circumstances the Court shall make a set-off in favour of the wife of whatever interests the husband has in the property in Australia.

8. Accordingly, in my view, a just and equitable order would be that which the wife is now seeking as set out above.

Conclusion

1. I propose to make orders in accordance with the wife’s application.

I certify that the preceding seventy three (73) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Johnston delivered on 11 May 2017.

Associate:     

Date:  11 May 2017