Lawrie & Lawrie
[2023] FedCFamC2F 1556
•6 December 2023
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 2)
Lawrie & Lawrie [2023] FedCFamC2F 1556
File number(s): MLC 6044 of 2022 Judgment of: JUDGE GLASS Date of judgment: 6 December 2023 Catchwords: FAMILY LAW - PARENTING – whether 11 year old should spend specified time with her father or only in accordance with her wishes.
FAMILY LAW - PROPERTY – treatment of liabilities – whether husband should be solely responsible for liabilities incurred in the period after separation – whether Division 7A taxation obligations can be ignored – whether initial contributions should be ignored because of subsequent losses incurred by the parties – extent of adjustment where husband will principally retain shareholding in his business which has been valued solely by reference to its future maintainable earnings.
FAMILY LAW - CHILD SUPPORT – whether it is in the interests of the parties and children to consider making a departure order – whether husband should be ordered to make non-periodic payments for education and medical expenses.
FAMILY LAW - SPOUSAL MAINTENANCE – whether husband has the capacity to maintain the wife
Legislation: Child Support (Assessment) Act 1989 (Cth) ss 116, 117, 123, 124, 125
Family Law Act 1975 (Cth) ss 4AB(1), 60B, 60CA, 60CC, 61DA, 65DAA, 72, 74, 75, 79, 81, 117
Federal Circuit and Family Court of Australia (Family Law) Rules 2021 r 5.01
Cases cited: Af Petersens & Af Petersens (1981) FLC 91-095
Atwill & Atwill (1981) FLC 91-107
Biltoft & Biltoft (1995) FLC 92-614
Candle & Falkner (2021) FLC 94-069
NHC & RCH (2004) FLC 93-204
Cornett & Hext (2021) FLC 94-067
Crick & Bennett (2018) FLC 93-832
C & C (2005) FLC 93-212
Denham & Newsham (2021) FLC 94-043
Dickons & Dickons (2012) 50 Fam LR 244
DJM v JLM (1998) FLC 92-816
Elei & Dodt (2018) FLC 93-841
Frederick & Frederick (2019) FLC 93-900
French & Fetala [2014] FamCAFC 57
Holland & Holland (2017) FLC 93-798
Holman & Bates (2022) FLC 94-103
Isles & Nelissen (2022) FLC 93-092
Jabour & Jabour (2019) FLC 93-898
Keane & Keane (2021) 62 Fam LR 190
M & M [1998] FamCA 42
Maclean & Greenwood (2022) FLC 94-117
Marcin & Marcin (2020) FLC 93-956
Maroney & Maroney [2009] FamCAFC 45
Murphy & Murphy [2007] FamCA 795
Prince & Prince (1984) FLC 91-501
Rodgers & Rodgers (2016) FLC 93-703
Rodgers & Rodgers (No 2) (2016) FLC 93-712
Rosati & Rosati (1998) FLC 92-804
Roverati & Roverati (2021) FLC 94-027
Stanford v Stanford (2012) 247 CLR 108
Tibb & Sheean (2018) 58 Fam LR 351
Trevi & Trevi (2018) FLC 93-858
Vigano & Desmond (2012) FLC 93-509
Division: Division 2 Family Law Number of paragraphs: 201 Date of last submission/s: 22 November 2023 Date of hearing: 20-22 November 2023 Place: Melbourne Counsel for the Applicant: Mr Puckey KC Solicitor for the Applicant: Mazzeo Lawyers Counsel for the Respondent: Ms Smallwood SC Solicitor for the Respondent: Lander & Rogers ORDERS
MLC 6044 of 2022 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 2)
BETWEEN: MR LAWRIE
Applicant
AND: MS LAWRIE
Respondent
ORDER MADE BY:
JUDGE GLASS
DATE OF ORDER:
6 DECEMBER 2023
THE COURT ORDERS THAT:
Parenting
1.All previous parenting orders be discharged.
2.The parties have equal shared parental responsibility for X, born in 2007, Y, born in 2008 and Z, born in 2012.
3.The children live with the Wife.
4.Y and X spend time and communicate with the Husband in accordance with their wishes and views.
5.Z spend time with the Husband as follows:
(a)each alternate Sunday from 10:00am until the commencement of school on Monday;
(b)each alternate Tuesday from after school until 7:30pm; and
(c)at such other times as agreed between the Husband and Wife in writing.
6.That the children live with the parties over the Christmas period as follows:
(a)In odd years:
(i)with the Husband from 9:00am until 9:00pm on 24 December; and
(ii)with the Wife from 9:00pm on 24 December until 4:00pm on 25 December;
(b)In even years:
(i)with the Wife from 9:00am until 9:00pm on 24 December; and
(ii)with the Husband from 9:00pm on 24 December until 4:00pm on 25 December.
7.Unless otherwise agreed between the Husband and Wife in writing, all changeover for all time detailed in paragraphs 4 to 6 shall take place at the children's schools at all school times and at all non-school times, whichever parent has care of the children shall deliver the children to the home of the other parent.
8.For twenty-four (24) hours immediately prior to the commencement of any time spent with the children (including any period during which the children live with him), and during all such time spent, the Husband be and is hereby restrained by injunction from ingesting, consuming, using or otherwise being under the influence of, alcohol or any legal or illegal drug or substance, save and except for:
(a)any legal medication prescribed for the relevant party by a registered medical practitioner, and taken or used by the relevant party strictly in accordance with such prescription; and
(b)any over-the-counter medication or pharmaceutical substance ordinarily sold in major supermarkets (which does not contain codeine) and taken or used by the relevant party strictly in accordance with the directions appearing on such medication or pharmaceutical substance.
9.The parent with whom the children are living will facilitate communication with the other parent via text message, electronic messaging, telephone, or video conference at all reasonable times as requested by the children or either of the parties.
10.That except in the case of an emergency, (where the parent having the care of the children will notify the other parent immediately), the parents will communicate and keep each other informed in a timely manner as to:
(a)major long-term issues in relation to the children;
(b)all medical appointments and medical issues;
(c)any interstate or overseas travel issues;
(d)major extra-curricular activities and sporting events for the children;
(e)children's birthday parties, or any other social events, that fall on the other parent's time;
(f)any concerns they may have regarding the children;
(g)any concerns that the children may raise with them; and
(h)any other important issues.
11.The parents will communicate in a timely manner in regard to all parenting arrangements, including the above matters described in paragraph 10 herein in writing via an agreed Parenting Application in so far as is practicable.
12.The parents will keep each other informed forthwith as to their residential addresses, telephone numbers and email addresses.
13.Each parent be permitted to attend any school events or activities that parents would ordinarily be expected and invited to attend, including but not limited to school assemblies, parent/ teacher evenings and school carnivals.
14.Each parent be permitted to contact the schools where the children attend to request they provide them with copies of any school reports, reports on behavioural issues, school circulars or notices concerning functions, parent / teacher nights, school photographs and other school activities to which parents would ordinarily be expected and invited to attend, including but not limited to all extra-curricular activities, sporting activities and events.
15.The parties consult in writing and make a joint decision about any changes to the extracurricular and/or sporting activities that the children attend.
16.The parties will not enrol the children into extracurricular and/or sporting activities or organise social engagements that fall during the children's time with the other parent without written agreement between the parties.
17.Both parties are at liberty to attend any school events, extracurricular and sporting events that the children participate in.
18.Both parents be at liberty to speak to any education or extra-curricular activity provider, or health care provider associated with the children and obtain all information relating to the children and, where necessary, each parent will provide the other parent relevant details of the service provider including name, addresses and contact telephone numbers.
19.The Husband and X engage with a family therapist for the purpose of therapeutic counselling.
20.In the event that either parent seeks to take the children on an interstate or overseas holiday during his or her scheduled time with the children, or as is otherwise agreed in writing, they will use their best endeavours to give each other 7 days' notice of their intention to travel interstate and 30 days' notice for international travel, and shall provide an itinerary to the non-travelling parent, which will include:
(a)return flight information;
(b)travel insurance which covers COVID-19 travel requirements;
(c)details of any other persons to be attending the planned holiday or organised to be met by the children on holidays; and
(d)accommodation and contact details for the duration of holiday.
21.Both parties do all such things and sign all such documents as may be necessary to ensure that the children have a current Australian passport at all times.
22.The associated costs of the children's passport being renewed be shared equally between both parties.
23.The children's passport is held by the party who the children last travelled overseas with and must be exchanged within seven days of request made under paragraph 20 herein for overseas travel.
24.Neither parent will denigrate or criticise the other parent in the presence or hearing of the children or allow anyone else to denigrate or criticise the other parent within the presence or hearing of the children.
25.The parties be at liberty to provide a copy of the family report of Ms C to any of the professionals working with any of the children, the parties, or the family.
Property
26.The Husband pay, or cause to be paid on his behalf, to the Wife the sum of $1,448,852 (“the Payment”) by no later than 23 June 2024.
27.Contemporaneously with the Payment:
(a)the Wife do all acts and things and sign all documents necessary to transfer to the Husband and/or his nominee the whole of her right, title and interest in the real property situate at B Street, Suburb D in the State of Victoria, being the whole land more particularly described in certificate of title Volume … Folio … ("the Suburb D property") at the Husband's expense (save for the Wife's legal, conveyancing or PEXA fees); and
(b)the Husband and Wife do all acts and things and sign all necessary documents to refinance the mortgages in favour of the National Australia Bank over the Suburb D property out of the Wife's name, and that the Husband and Wife do all things necessary to enable the Wife to be released from any guarantee given to the National Australia Bank over the Suburb D property.
28.In the event the Payment is not made by 23 June 2024:
(a)the Wife and the Husband in his capacity as director of E Pty Ltd forthwith do all such acts and things and sign all necessary documents to sell the Suburb D property (“the Sale”);
(b)unless otherwise agreed between the Husband and the Wife in writing, the terms and conditions of the Sale include:
(i)the sale be by public auction;
(ii)the reserve price be set at $7,800,000 or as otherwise agreed between the parties in writing;
(iii)the Wife appoint the selling agent and the parties jointly instruct such agent;
(iv)the Wife appoint the conveyancer and the parties jointly instruct the conveyancer;
(c)liberty be reserved to the parties to apply with respect to the terms and conditions of the sale in default of agreement;
(d)upon completion of the Sale, the proceeds of sale be applied as follows:
(i)firstly, to meet all sale costs, commissions and expenses of the sale and selling agents;
(ii)secondly, to discharge the mortgage secured on the Suburb D Property;
(iii)thirdly, to quarantine the amount payable for Capital Gains Tax ("CGT"), if any; and any liability under Division 7A of the Income Tax Assessment Act 1936 (Cth) and such tax to be calculated jointly by the accountants for the Husband and the accountants for the Wife and upon assessment paid;
(iv)fourthly, to meet any outstanding land tax on the Suburb D Property;
(v)fifthly, to meet the Husband's personal income tax liability for the 2022 and 2023 financial years and the Wife's personal income tax liability for the 2022 and 2023 financial years;
(vi)sixthly, the sum of $377,217 to the Husband on account of mortgage arrears, his credit card, school fees and personal liability to his mother for which he will be responsible;
(vii)seventhly, such sum required to equate to 67.5% of the sum of the balance then remaining and $399,770, being the remaining value of the Lawrie Group, to the Wife; and
(viii)finally, the balance then remaining to the Husband.
29.Contemporaneously with the Payment, the Wife, at the expense of the Husband, do all acts and things and sign all documents prepared at the direction of the Husband to:
(a)resign from any office held by her in any entity associated with the parties and renounce, abandon and disclaim any rights, powers or entitlements which she might otherwise have, including but not limited to the following:
(i)E Pty Ltd;
(ii)F Pty Ltd;
(iii)G Pty Ltd;
(iv)Lawrie Pty Ltd;
(v)Lawrie Investments Pty Ltd;
(vi)Lawrie Superannuation Pty Ltd;
(vii)L Pty Ltd;
(collectively referred to as "the entities")
(b)renounce, abandon and disclaim any rights, powers or entitlements which she might have pursuant to the discretionary trust deed of the Lawrie Family Trust ("the family trust"), including resigning from her position as Appointer, Trustee, Beneficiary or Guardian of the family trust;
(c)renounce, abandon and disclaim any rights, powers or entitlements which she might have pursuant to any of the following unit trusts:
(i)N Unit Trust;
(ii)Lawrie Unit Trust;
(iii)N Unit Trust;
(iv)O Unit Trust;
(v)P Unit Trust;
(collectively referred to as "the unit trusts")
(d)transfer to the Husband or his nominee all shares held by her in any of the entities;
(e)transfer to the Husband or his nominee all units held by her in any of the unit trusts; and
(f)assign to the Husband the benefit of any asset or liability loan accounts she may currently have in any of the entities, the family trust or the unit trusts.
30.Until either the Payment is made or settlement of the Sale of the Suburb D property, the Husband or his nominated entity:
(a)receive all rental income from the Suburb D property;
(b)pay all rates, taxes and apportionable outgoings and insurance premiums payable as and when they fall due;
(c)pay all costs necessary to keep the property insured at the current level of cover;
(d)pay all instalments pursuant to the relevant mortgage encumbering it; and
(e)the parties personally, and the husband in his capacity as director of E Pty Ltd, are restrained from encumbering or further encumbering the Suburb D Property without the written consent of the other party.
31.The Husband, at his expense, do all such things, and sign all such documents as are required to indemnify the Wife, and keep her indemnified in relation to all past, present and future liabilities of the Husband, the entities, the unit trusts and the family trust including all unpaid taxation assessed or hereafter assessed, against the Wife, in relation to the entities, the unit trusts and the family trust.
Superannuation
32.The Husband and the Wife in their capacity as directors of Lawrie Superannuation Pty Ltd, as the trustee (“the Trustee”) of the Lawrie Self-Managed Superannuation Fund (“the Fund”) hereby acknowledge that the Trustee of the Fund has been accorded procedural fairness in relation to the making of these orders.
33.Paragraphs 34 to 42 inclusive are binding upon the parties in their capacities as directors of the Trustee of the Fund.
34.In accordance with section 90XT(1)(c) of the Family Law Act 1975 (Cth) (the Act)
(a)the Wife is to be paid the specified percentage of each splittable payment out of the Husband's interest in the Fund using the following equation:
X = 75% (H +W) – W
Where:
X= the wife's entitlement
H = the Husband’s entitlement in the Fund at the operative date
W = the Wife’s entitlement in the Fund at the operative date;
(b)the Husband's entitlement to payments out of the Wife's interest in the Fund is correspondently reduced by force of this order.
35.The specified percentage for the purposes of paragraph 34 hereof is 75%.
36.The parties in their capacities as directors of the Trustee shall forthwith do all things necessary and sign all such documents as are required to:
(a)calculate in accordance with the requirements of the Act and the Regulations the Payment Split to be awarded to the Wife in paragraph 34 herein; and
(b)make the Payment Split whenever the Trustee makes a splittable payment out of the Husband’s superannuation interest in the Fund.
37.Paragraphs 34 to 36 inclusive take effect from the operative date which is 4 days after service of the Orders on the Fund.
38.For the purposes of these orders:
(a)the Wife's entitlement will comprise 75% of the total assets of the fund comprised of a rollover of her entitlement in the fund and a split of the Husband's entitlements (the Wife's entitlement);
(b)the Wife's entitlement be paid to a new fund nominated by the Wife (The Wife's new fund);
(c)on or before the expiration of 30 days from the date of these orders, the parties do all things necessary and sign all such documents as may be required to transfer the Wife's entitlement to the Wife's new fund;
(d)the Wife notifies the Fund of the name of the Wife's new fund within 7 days of the date of these orders and provide the necessary documentation to enable the rollover of the Wife's entitlement to be effected;
(e)that until the rollover of the Wife's entitlement to the Wife's new fund is effected, save for compliance with these orders, the parties be restrained from dealing with the Fund's assets without the prior written consent of the other party; and
(f)the accountants to administer the superannuation split be both the Husband's accountants, O Company, together with the Wife's accountants, Q Company.
39.Within 7 days of receipt by the Trustee of the request made by the Wife as contemplated in paragraph 38(d) herein, the Trustee cause a meeting of the Fund to be held in accordance with the rules of the Fund Trust Deed, with the purpose of that meeting being:
(a)to note receipt of the request by the Wife to transfer the Wife’s entitlement to the Wife’s new fund; and
(b)to authorise the transfer to the Trustees of the Wife’s new fund of the Wife’s Entitlement with the parties in their capacities as directors of the Trustee to do all things and sign all documents necessary to transfer the shares and the adjusted cash amount to the Wife’s new fund.
40.That pending the implementation of paragraphs 34 to 39 inclusive:
(a)each party be and is hereby restrained from dealing with, charging, encumbering or disposing of any item of property, investment, shares or cash or any other assets of whatsoever nature of the Fund, other than in accordance with the terms of this order; and
(b)each party shall immediately revoke any binding death benefit nomination already made and each party be, and is hereby, restrained from:
(i)making any binding death benefit nomination in favour of a child described in regulation 13 of the Regulations;
(ii)making any other nomination where the effect of such nomination would be to render any splittable payment not splittable; and
(iii)doing any such act or thing which would defeat, extinguish, or reduce the entitlement of either party under this order.
41.Upon implementation of paragraph 34 to 39 inclusive of these orders, the Wife forthwith do all things necessary and sign all such documents as are required to:
(a)rollover the Wife's entitlement from the Fund to the Wife's new fund;
(b)at the expense of the Fund, resign as a director of the Trustee and transfer any shareholding to the Husband;
(c)resign as a member of the Fund;
(d)remove herself as a signatory to any bank accounts; and
(e)relinquish all claim and entitlement, past, present, and future in relation to the Fund.
42.Contemporaneously with the Wife's compliance with her obligation under paragraph 41 of these orders, the Husband indemnify and shall keep the Wife indemnified against all liabilities of and in relation to the Fund including taxation payable in respect of the Fund and all other liability of, or howsoever arising in relation to the Fund.
Other property
43.The Wife retain all of her personal belongings along with furniture and chattels currently in the former matrimonial home save and except for the items listed in Annexure "A" attached to these orders which the Wife shall make available for collection by the Husband within 7 days from the date of these orders.
44.The Husband is otherwise declared the sole legal and beneficial owner of, and absolutely entitled to, all items of personal property, real property, financial resources and superannuation in his possession, under his control, or which he is the registered proprietor as at the date of these orders including but not limited to:
(a)the shares in the entities;
(b)the Lawrie Family Trust;
(c)the business known as F Pty Ltd;
(d)Motor Vehicle 1;
(e)Motor Vehicle 2;
(f)the interest held in:
(i)P Unit Trust;
(ii)Lawrie Unit Trust;
(iii)N Unit Trust;
(iv)O Unit Trust;
(v)P Unit Trust;
(vi)E Pty Ltd;
(vii)F Pty Ltd;
(viii)G Pty Ltd;
(ix)Lawrie Pty Ltd;
(x)Lawrie Investments Pty Ltd;
(xi)Lawrie Superannuation Pty Ltd;
(xii)L Pty Ltd;
(g)subject to paragraphs 34 to 35 inclusive, the Husband's remaining entitlement in the Lawrie Self-Managed Superannuation Fund;
(h)all insurance policies that cover property owned by the Husband as at the date of these orders;
(i)any present or future expectation under a trust or Estate;
(j)subject to the Payment, the whole of his right, title, and interest in the Suburb D property; and
(k)cash held in the following bank accounts:
(i)R Bank account ending #...09;
(ii)S Bank account ending #...58;
(iii)NAB account ending #...37;
(iv)T Bank account ending #...98;
(v)NAB account ending #...33;
(vi)NAB account ending #...55;
(vii)NAB account ending #...72;
(viii)U Bank account ending #...76;
(ix)U Bank account ending #...59;
(x)NAB account ending #...03; and
(xi)NAB account ending #...73.
45.The Wife is otherwise declared the sole legal or beneficial owner of, and entitled absolutely to, all items of personal property, real property, financial resources and superannuation, in her possession, under her control or of which she is the registered proprietor as at the date of these orders, including but not limited to:
(a)cash held in the following bank accounts:
(i)ANZ account ending #...56;
(ii)ANZ account ending #...09; and
(iii)ANZ account ending #...64.
46.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 party to all property (including choses-in-action and superannuation) in the possession of such party at this date;
(b)all insurance policies to become the sole property of the beneficiary named therein;
(c)each party be solely liable for and indemnify the other against any liability encumbering any item of property to which that party is entitled pursuant to these orders;
(d)each party be solely liable for and indemnify the other in respect of their individual debts;
(e)each party be solely entitled to the exclusion of the other party of monies standing to the credit of their respective bank accounts with any joint accounts being the property of the Husband;
(f)each party relinquish to the other and forego any claim they may have to any superannuation benefits belonging to or earned by the other; and
(g)any joint tenancy of the parties in any real or personal estate is hereby expressly severed.
Child Support
47.Pursuant to section 124 of the Child Support (Assessment) Act 1989, the Husband pay direct to the provider or within seven (7) days of the provision of receipts from the Wife to the Husband, the following by way of child support in a form other than periodic support for the children, until each of the children attain 18 years of age or complete their secondary schooling, whichever is the later:
(a)100% of educational costs for the children at their current schools or such other school as agreed between the parties, including but not limited to school fees (inclusive of arrears and late fees), uniforms, footwear, books, stationery, computer equipment, excursions, agreed intra-curricular activities, camps, compulsory sport, and other activities, IT needs and laptops;
(b)100% of agreed private tuition costs for the children as required from time to time;
(c)100% of extracurricular activities including but not limited to fees, uniforms, equipment and shoes;
(d)private health insurance at the current rate and level of cover; and
(e)100% of the out of pocket and non-rebateable hospital, medical, dental, orthodontic, allied health, and prescribed pharmaceutical expenses for the children;
with such payments not to reduce the annual rate of child support payable by the Husband under any relevant administrative assessment.
Spousal Maintenance
48.Until the Payment, the Husband pay or cause to be paid to the Wife the following:
(a)the sum of $1,000 per week in cash to an account nominated by the Wife; and
(b)the reasonable outgoings with respect to the Wife’s home as and when they fall due, including but not limited to monthly rent capped at $1,200 per week, utilities, internet and other subscriptions, mobile telephones of the Wife and children, and pool maintenance and servicing as and when they fall due.
49.All extant applications are dismissed.
Annexure "A"
1.Cordless drill;
2.Artwork 1;
3.Artwork 2;
4.Artwork 3;
5.Artwork 4;
6.Artwork 5;
7.Artwork 6;
8.Artwork 7;
9.Artwork 8;
10.Artwork 9;
11.Artwork 10;
12.Table;
13.Tools;
14.Large mirror;
15.Two (2) planter pots in rear yard;
16.Mr Lawrie’s antique table; and
17.Mr Lawrie’s antique.
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 a pseudonym has been approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
REASONS FOR JUDGMENT
JUDGE GLASS:
Mr and Ms Lawrie commenced cohabitation in 2003, married in 2005, and ceased cohabitation in March 2022. They have three children, X, Y and Z, aged 16, 15 and 11 years respectively. The children currently live with Ms Lawrie.
Arising for determination are competing applications for parenting orders, property settlement, child support, spousal maintenance, and injunctive orders. The particulars of Mr Lawrie’s application are contained in Exhibit A2, and the particulars of Ms Lawrie’s application are contained in Exhibit R4.
In addition to the documents referred to in his Outline of Case, Mr Lawrie relies on an Affidavit in Reply that was filed by him on 17 November 2023.
PARENTING
Both parties propose that they have equal shared parental responsibility for the children, that the children live with Ms Lawrie, and that Y and X spend time with Mr Lawrie in accordance with their wishes.
Mr Lawrie proposes that Z continue to spend time with him in accordance with extant interim Orders. Those Orders provide for Z to spend time with him for one overnight each alternate weekend and each alternate Tuesday afternoon. Ms Lawrie proposes that Z only spend time with her father in accordance with her views and wishes.
The applications fall to be determined by reference to Part VII of the Family Law Act 1975 (Cth). I am guided by the objects of that Part and the principles underlying those objects.[1] The children’s best interests are the paramount consideration.[2] In determining those best interests, I am to consider the matters prescribed by section 60CC of the Act.
Primary Considerations
[1] Family Law Act 1975 (Cth), s 60B.
[2] Family Law Act 1975 (Cth), s 60CA.
The benefit to the children of having a meaningful relationship with both of their parents
Mr Lawrie vacated the parties’ former matrimonial home in March 2022. He thereafter spent time with Z for a coffee in March 2022. Ms Lawrie gave oral evidence that she otherwise resisted the children spending time with their father on the basis of their wishes. She declined Mr Lawrie’s proposals not only to spend time with the children, but also to participate in family mediation or reportable therapeutic counselling.
On 21 July 2022, an interim consent Order was made providing for Z to spend time with her father for three hours each alternate Sunday. On 8 November 2022, following the release of Ms C’s Family Report, the parties consented to Orders providing for Z to commence spending time with her father each alternate Tuesday afternoon and for full days each alternate Sunday. The Orders also provided for an extension of that time to one overnight each alternate weekend from Term 2, 2023.
Ms Lawrie gave oral evidence that she had resisted the children spending time with their father and engaging in family therapy until the release of the Family Report in October 2022. She agreed that she had consented to both those things happening nine days later. She was asked when she had changed her mind. Her answers were difficult to follow. She denied that she had cause to reflect and change her position after reading the Family Report. She also denied that she had changed her mind. She then claimed to have changed her mind in around 2023. Absent Ms Lawrie being able to articulate when it is that she commenced supporting the children’s time with their father, I am sceptical of the extent to which she has in fact positively supported those relationships.
Ms Lawrie deposes that she encourages the children to have a meaningful relationship with their father, but “will not place the children into a situation where they are unsafe or exposed to family violence”.[3] She deposes at length to the violence she claims the children were exposed to by their father during the relationship. That evidence also suggests that she does not wholly support and encourage the children to spend time with their father.
[3] Affidavit of Ms Lawrie filed 15 November 2023, paragraph 20.
Ms Lawrie specifically deposes to having encouraged Z to spend time with her father. However, there is no evidence of Z in fact spending time with her father after separation, other than meeting for a coffee in March 2022, until Mr Lawrie’s Initiating Application was first listed in July 2022. Since then, Orders have been in place for Z to spend regular time with her father. Z ceased spending time with her father in October 2023, despite there being no change in the extant interim Orders.
Both Ms Lawrie’s evidence and the history to which I have referred does not satisfy me that Z will have the benefit of a meaningful relationship with her father absent orders for her to spend time with him.
Mr Lawrie does not seek orders that would compel Y and X to spend time with him contrary to their views and wishes. Y is currently spending agreed time with her father in accordance with those wishes. Although X has not spent time with his father in the period after separation, I accept Mr Lawrie’s unchallenged and uncontradicted evidence that X has expressed a desire to commence communicating with his father in writing.
The need to protect the children from physical or psychological harm from being subjected to, or exposed to, abuse, neglect or family violence
Ms Lawrie did not submit the children are at an unacceptable risk of harm in the relevant sense by spending time with Mr Lawrie in accordance with his proposal.
There are no allegations that Mr Lawrie has exposed the children to family violence in the period after separation. Ms Lawrie gave oral evidence that she raised no complaint about Y and Z spending regular time with their father from November 2022 until October 2023.
Ms Lawrie relies heavily on the events in late 2023 in support of her application. Referring to the injunction restraining Mr Lawrie from consuming alcohol, illegal or non-prescribed medication whilst the children are in his care, she deposes as follows:
Despite this injunction, [in late] 2023, [Y] returned from spending time with [Mr Lawrie], and advised me and [Z] that [Mr Lawrie] had a glass of wine whilst at dinner. [Y] was upset and disappointed that her father was drinking. [Z] then told me that due to [Y]'s comment, she is now too scared to be in [Mr Lawrie’s] care. The children have told me repeatedly that they are fearful of [Mr Lawrie] when he drinks.[4]
[4] Affidavit of Ms Lawrie filed 15 November 2023, paragraph 44.
Ms Lawrie gave oral evidence that Y had returned home from spending time with Mr Lawrie and told both Ms Lawrie and Z that she had seen Mr Lawrie order a glass of wine for himself and his new partner, and her father drink one of those glasses. Ms Lawrie also gave oral evidence that Y did not report her father as drunk or behaving aggressively, loudly, or obnoxiously.
Ms Lawrie submits that I ought to positively find that Mr Lawrie drank a glass of wine at dinner with Y in late 2023. Mr Lawrie denies doing so. There was nothing about the manner in which he gave his evidence that suggested his evidence was unreliable, and no suggestion to the contrary was made by Ms Lawrie.
Ms Lawrie effectively submits that circumstances, including Mr Lawrie not denying the allegation when it was raised with him by Ms Lawrie or her solicitors, and his text messages to Y at the time which included expressions like “this has been blown out of proportion”,[5] would lead the Court to make a finding contrary to Mr Lawrie’s evidence. The suggestion ignores Mr Lawrie’s unchallenged oral evidence that he had denied having a glass of wine prior to swearing his affidavit in reply.
[5] Affidavit of Ms Lawrie filed 15 November 2023, paragraph 69.
I am not satisfied that Mr Lawrie consumed a glass of wine at dinner with Y in 2023. I do not feel an actual persuasion of the existence of that fact.[6] The testimony Ms Lawrie relies on is indirect and the inferences she asks to be drawn from the evidence are also indirect.[7] There may have been a number of reasons for Y reporting to Ms Lawrie what she did. Ms C opines that:
… the writer is aware of the burden of disloyalty that also clearly appears to overwhelm these children. The writer held the impression that these highly confused young children have been inappropriately involved in their parent’s dispute, and more worrisome, embroiled as the subject of their parent’s conflict (especially for [X])…[8]
[6] Keane & Keane & Another (2021) 62 Fam LR 190 (“Keane”) at [73] and the cases there cited.
[7] Murphy & Murphy [2007] FamCA 795 at [480] as quoted in Keane at [109].
[8] Affidavit of Ms C filed 4 November 2022, Annexure C1 (“Family Report)”, paragraph 63.
Whether Y’s report to her mother in late 2023 was the result of her being overwhelmed by the burden of disloyalty between her parents or being highly confused was not raised with Ms C, who was not required for cross-examination by either party.
The only direct evidence I have of the events of late 2023 is Mr Lawrie’s. I had no general concerns about his credibility or reliability from the way in which he gave his evidence. I am not satisfied his evidence ought to be rejected.
Despite Ms Lawrie’s evidence that Y was shocked when she reported that her father had a glass of wine in late 2023, Y has thereafter resumed spending time with Mr Lawrie. He took her to the orthodontist in October 2023. They spent a day together in November 2023 and spent time together on an evening in November 2023. That occurred despite Ms Lawrie’s evidence that “the children have told me repeatedly they are fearful of [Mr Lawrie] when he drinks.”[9] It suggests that Y does not have concerns for her own safety arising from the events of late 2023.
[9] Affidavit of Ms Lawrie filed 15 November 2023, paragraph 44.
Not being satisfied that Mr Lawrie drank a glass of wine at dinner with Y in late 2023, absent any other complaint having been raised about the children’s time with their father in over twelve months, and Y’s continuation of spending voluntary time with her father, I am not satisfied there is any unacceptable risk of harm in the relevant sense arising for Z in spending time with her father.
Additional Considerations
Any views expressed by the children and any factors (such as their maturity or level of understanding) that are relevant to the weight to be given to their views
As Ms Lawrie was at pains to emphasise, Z expressed strong views when she was interviewed by Ms C in September 2022. Ms C reports as follows:
… [Z] does not want any pressure to spend overnight time with her father, reporting that [Mr Lawrie] often asks her ‘on the spot’. She feels there is little choice other than to agree with him, as she reported ‘he doesn’t take no for an answer’. [Z] also expressed concern that ‘if I say yes and I mean no, because I can’t say it to him, not wanting to hurt his feelings’, as she has not expressed to him her worries and concerns (ie. ‘He would get drunk and start yelling at me, randomly, for no reason’). Nevertheless, [Z] was open to commence overnights next year (‘I would consider it’), seeking no change to the current arrangement, aware that her siblings remain resistant to see their father, she expressed a wish not to spend any length of time separated from them.[10]
…
When the writer asked how she would feel if someone else made the decision that she is to spend overnight with the father, she became emotional reporting, ‘that would be the worst thing’.[11]
[10] Family Report, paragraph 52.
[11] Family Report, paragraph 53.
However, Ms Lawrie’s reliance upon those expressions of Z’s views in support of her current application is misplaced. Having referred to Z’s young age, Ms C recommended that Z spend specific time with her father, increasing to overnight time. Indeed, that recommendation precipitated the interim consent Order to that effect made on 8 November 2022.
Ms Lawrie elected not to cross-examine Ms C. Whilst I am not obliged to act on Ms C’s recommendations, the failure to follow her recommendations requires some explanation and proper consideration of the matters raised by her.[12] Ms C’s report is comprehensive and it was relied on by both parties without challenge. I find no basis to reject her recommendations.
[12] Vigano & Desmond (2012) FLC 93-509 at [79] & [87] and the cases there cited; French & Fetala [2014] FamCAFC 57 at [31]; Denham & Newsham (2021) FLC 94-043 at [34]-[35] and the cases there cited; Maclean & Greenwood (2022) FLC 94-117 at [33].
Ms Lawrie now deposes that after Y reported that her father had a glass of wine in 2023, “[Z] then told me that due to [Y]'s comment, she is now too scared to be in [Mr Lawrie’s] care.”[13] She also deposes that after Z slept over at her father’s home in Term 2, 2023:
[Z] returned from these sleepovers anxious and depressed. She expressed to me that she had thoughts of self-harm and suicide. [Z] has since refused to return for a sleepover at [Mr Lawrie]'s home.[14]
[13] Affidavit of Ms Lawrie filed 15 November 2023, paragraph 44.
[14] Affidavit of Ms Lawrie filed 15 November 2023, paragraph 137.
Inconsistently, Ms Lawrie also deposes to the following view expressed by Z:
[Z] has told me that she does not wish any increase of time with her father. Whilst [Z] has told me that she wishes to maintain having a relationship with her father, she is uncomfortable in his company due to his unpredictability and his past behaviours.[15] (emphasis added)
[15] Affidavit of Ms Lawrie filed 15 November 2023, paragraph 66.
That latter expression of Z’s views is consistent with the orders sought by Mr Lawrie.
I am not satisfied that any significant weight should be placed on some of Z’s expressed views. Ms C did not consider they should have any decisive weight twelve months ago, and neither party sought an updated report or cross-examined her about her opinion.
It is common ground that Y and X’s views in terms of spending time with and communicating with their father will be determinative of the time they spend with him. Given their ages and level of maturity, I am satisfied the agreed position is in their best interests.
The nature of the children’s relationships with each of their parents and other people, including any grandparent or other relative
X’s relationship with his father is significantly strained. Although he spoke to Ms C about their previously close relationship, he then described not respecting his father.
Y described to Ms C experiencing her father as rejecting, domineering, difficult, harsh, militant, erratic and harmful. Ms C considered Y to have experienced difficulties and disruption to her bond with her father. Nevertheless, she has subsequently resumed spending time with him in accordance with her wishes. By way of contrast, Ms C opines that Y is “reliant on her mother for emotional support and guidance, she has experienced her mother as protective and supportive, gentle, and nurturing”.[16]
[16] Family Report, paragraph 46.
When Z was interviewed by Ms C, she had commenced spending some time with Mr Lawrie. She described being comfortable with her experience of that time. Ms C opined that “[i]t appears [Z] may build confidence and rebuild trust with ongoing consistent positive experience of her father over time.”[17] Until late 2023, Z’s time with her father had occurred pursuant to Orders without complaint from Ms Lawrie. Whilst issues have arisen thereafter, the evidence suggests that Z had rebuilt some confidence in her relationship with her father. I note also that she has resumed communicating with him since the events of late 2023.
The extent to which each of the children’s parents has taken or failed to take the opportunity to participate in making decisions about major long-term issues in relation to them, to spend time with them, and to communicate with them
[17] Family Report, paragraph 51.
It is not suggested that either party has failed to take opportunities to participate in making relevant decisions, spending time, or communicating with the children.
The extent to which each of the children’s parents has fulfilled or failed to fulfil their obligations to maintain the children
For reasons given below, Mr Lawrie has been financially supporting the family in the period after separation beyond the extent of his capacity to do so.
The likely effect of any changes in the children’s circumstances, including the likely effect on them of any separation from either of their parents, or any other child or other person, including grandparent or other relative, with whom they have been living
Neither party proposes any significant change to the children’s circumstances.
The practical difficulty and expense of the children spending time with and communicating with a parent and whether that difficulty or expense will substantially affect the children’s right to maintain personal relations and direct contact with both parents on a regular basis
No such practical difficulties or expenses are suggested.
The capacity of each of the children’s parents and any other person, including any grandparent or other relative of the children, to provide for the needs of the child, including emotional and intellectual needs
I am satisfied that both parents have capacity to provide for the children’s relevant needs.
Mr Lawrie gave compelling oral evidence that the Family Report was “a lightning bolt through my heart” and that he “immediately acted upon [Ms C’s] recommendations and I’m on the road back to building my relationship with [the children].” So much suggests an improving capacity to provide for their emotional needs.
Ms Lawrie gave evidence that she has supported a suggestion from Mr Lawrie that he write a letter to X. So much reflects positively on her capacity to provide for the children’s emotional needs.
The maturity, sex, lifestyle and background (including lifestyle, culture and traditions) of the children and of either of their parents, and any other relevant characteristics of the children
The agreed position that Y and X will decide when they spend time with their father is consistent with their maturity.
If the children are Aboriginal child or a Torres Strait Islander children, their right to enjoy his or her Aboriginal or Torres Strait Islander culture (including the right to enjoy that culture with other people who share that culture), and the likely impact any proposed parenting order will have on that right
The children are not Aboriginal or Torres Strait Islander children.
The attitude to the children, and to the responsibilities of parenthood, demonstrated by each of their parents
Mr Lawrie gave oral evidence that he has not forced Z to spend time with him since late 2023 as she told him that she does not want to see him right now. He adopted that position despite extant Orders providing for Z to spend time with him. So much reflects positively on his attitude to the responsibilities of parenthood.
Any family violence involving the children or a member of their family
Whilst the parties give conflicting evidence about issues of family violence, neither challenged the other’s evidence about particular events or occurrences. Given the issues now arising for determination, I consider it unnecessary to determine which of their respective accounts is to be preferred.
All three children reported to Ms C that they experienced their father to have been intimidating and aggressive, particularly when affected by alcohol. She considered their experience of him to have been “frightening and abusive” and to have threatened the children’s health and wellbeing.[18] She considers them to be “victims of [family] violence”.[19] X described Mr Lawrie directing considerable abuse to Ms Lawrie. Ms C concluded that X has “experienced terror and helplessness when exposed to domestic violence in his household”.[20] Y reported to Ms C that Mr Lawrie broke furniture, hurt Ms Lawrie and threw objects at her around the time of the parties’ separation.
[18] Family Report, paragraphs 55 & 58.
[19] Family Report, paragraph 68.
[20] Family Report, paragraph 36.
Neither party challenged Ms C’s assessment of the children’s experiences. Family violence is relevantly defined to include behaviour that causes a family member to be fearful.[21] I find the children to have experienced fear caused by their father’s behaviour, amounting to family violence.
If a family violence order applies, or has applied, to the children or a member of their family, any relevant inferences that can be drawn from the order, taking into account the nature of the order, the circumstances in which the order was made, any evidence admitted in proceedings for the order, any findings made by the court in, or in proceedings for, the order, and any other relevant matter
[21] Family Law Act 1975 (Cth), ss 4AB(1).
In mid-2022, a final Intervention Order was made which is due to expire in mid-2024. Mr Lawrie consented to the making of the Order without admissions. In those circumstances, I am unable to draw any inferences from the making of the Order.
Whether it would be preferable to make the order that would be least likely to lead to the institution of further proceedings in relation to the children
Whilst the risks of further litigation arise irrespective of which proposal I adopt, I consider making the orders sought by Ms Lawrie to result in a higher relevant risk. If there were to be a dispute about Z’s views or wishes, that dispute might need to be judicially determined.
Any other relevant fact or circumstance
Not relevant.
Parental Responsibility
Consistent with the presumption contained in section 61DA of the Act, both parties propose that they have equal shared parental responsibility for the children. I consider such an order to be in the children’s best interests.
I am accordingly required to consider whether the children spending equal or substantial and significant time with each of their parents is in their best interests and is reasonably practicable.[22] Neither party propose the children spend equal time with each of their parents. It was not suggested, and I do not find that Mr Lawrie’s proposal satisfies the definition of substantial and significant time.[23] Neither party contend that an equal time or a substantial and significant time arrangement is in the children’s best interests and reasonably practicable. I do not conclude otherwise.
[22] Family Law Act 1975 (Cth), s 65DAA.
[23] Family Law Act 1975 (Cth), ss 65DAA(3); Tibb & Sheean (2018) 58 Fam LR 351 at [45], [58] & [66] per Murphy & Cronin JJ.
Parenting Conclusions
I am not satisfied that it is in the children’s best interests to leave it to Z to decide if and when she spends time and communicates with her father. I consider that doing so will increase the pressure on her in circumstances where Ms C considers the children have been overwhelmed by a “burden of disloyalty” and where she suspects the children were “feeling burdened to carry their parents’ wounds of the past”.[24]
[24] Family Report, paragraph 63.
Mr Lawrie’s proposal for Z’s time with him is consistent with the parties’ previously agreed consent Order informed by Ms C’s Family Report. I am satisfied it remains in Z’s best interests despite subsequent events.
Mr Lawrie proposes that Z continue to spend additional time with him in accordance with any agreement between the parties or “as recommended by Z’s therapist.”[25] The evidence is that Z is finishing up with her therapist. I decline to make an order that would have the effect of legal obligations being imposed on the parties by recommendations made by a third party. I also consider any confusion or ambiguity in those recommendations would likely to lead to further dispute between the parties.
[25] Orders made 8 November 2022, paragraph 11(a)(a)(iii).
Mr Lawrie seeks specific time with Z on her birthday and to have a first right of refusal in the event Ms Lawrie cannot care for Z. I am not satisfied either order is in Z’s best interests. Unless her siblings agree to also attend, Z spends time with her father on her own. I do not consider her best interests are met by further extending the time she spends apart from siblings, particularly on occasions when they might be cared for by another person significant to them, or on Z’s own birthday. Mr Lawrie can celebrate Z’s birthday during their regular time together.
Mr Lawrie makes a specific proposal for the children to spend alternate periods of time with each of their parents at Christmas. Ms Lawrie made no specific submissions in relation to the relief sought. Although the order includes all three children, I am satisfied the children’s best interests are met by spending time with each of their parents for those limited periods at Christmas.
I find that Mr Lawrie’s proposal for changeover to be in the children’s best interests absent any submission to the contrary, or alternative proposal, from Ms Lawrie.
Ms Lawrie seeks a restraint on Mr Lawrie consuming alcohol or other illicit or non-prescribed medication for 24 hours prior to and during any time the children spend with him. Such an order was made on an interim basis, and Mr Lawrie gave oral evidence that he “agreed to it voluntarily” and is “happy to maintain it”. In light of that concession, and the children’s complaints about their father’s previous behaviour whilst intoxicated, I consider the injunction sought to be in the children’s best interests.
Mr Lawrie also proposes that he and X attend a family therapist. So much is consistent with Ms C’s unchallenged recommendation. I consider the order he seeks to be in the children’s best interests. I also consider the children’s best interests are served by the parties having liberty to provide a copy of Ms C’s report to any professionals engaged with any of the family members, as is proposed by Ms Lawrie without any contradiction by Mr Lawrie.
Other relief sought by Mr Lawrie provides for the children to communicate with their parents in accordance with their requests, the process for obtaining passports for the children, agreeing on extra-curricular activities, the provision of information between parents, authorising them to obtain school and health information, and attending school events and extra-curricular activities. Ms Lawrie made no submissions with respect to those matters. In circumstances where it is agreed the parties will have equal shared parental responsibility for the children, I am satisfied the relief sought is in the children’s best interests.
The parties each propose competing forums for communication between them with respect to the children. Given there are costs associated with some of the applications proposed, I will require them to agree on the appropriate application rather than nominate one in the Orders. Further, I have no evidentiary foundation to prefer one over another.
I am also satisfied that the children’s best interests are served by the parties being restrained from denigrating or criticising each other in the presence or hearing of the children as is proposed by Mr Lawrie.
PROPERTY
The parties agree that Ms Lawrie will transfer to Mr Lawrie her interest in a real property situate at B Street, Suburb D and her interests in a number of companies and trusts.
Mr Lawrie proposes that he pay Ms Lawrie the sum of $1,175,000 by 23 June 2024. He proposes a superannuation split from his interest in the parties’ self-managed superannuation fund in the amount of $12,000 to equalise the parties’ interests. Although he opened his case on the basis of a 65% division of the non-superannuation assets in favour of Ms Lawrie, his King’s Counsel submits that an outcome in the range of 55% to 60% in favour of Ms Lawrie is appropriate in all the circumstances.
Ms Lawrie proposes that Mr Lawrie pay her the sum of $2,206,094 within 60 days, being an alteration of the parties’ assets such that she receive 75% of their value. She proposes a superannuation split such that she receive 75% of the overall value of the parties’ superannuation interests.
Pursuant to section 79 of the Act, I have a discretion to make such order altering the parties’ interests in property as I consider appropriate. I am prohibited from making an order unless I am satisfied, in all the circumstances, it is just and equitable to do so.[26] If I am so satisfied, I am required to consider the matters prescribed by subsection 79(4) of the Act and by the device of paragraph 79(4)(e), relevant matters referred to in subsection 75(2) of the Act.
[26] Family Law Act 1975 (Cth), ss 79(2).
Property Interests
It is necessary to begin by identifying, according to common law and equitable principles, the existing legal and equitable interests of the parties in property.[27] For reasons that follow, I find those interests to comprise the following, in the event Mr Lawrie retains the Suburb D property:
[27] Stanford v Stanford (2012) 247 CLR 108 (“Stanford”) at [37].
Asset Value Parties’ interests in the assets and liabilities particularised in Annexure 1 $2,906,223 Adjustment for Suburb D Property mortgage $18,527 Liability to Mr Lawrie’s mother ($17,000) Land Tax for the Suburb D Property for the 2022 and 2023 Financial Years ($100,335) Division 7A liability (E Pty Ltd) ($102,733) Estimated Capital Gains Tax (one-third) ($40,503) Credit Cards (NAB, S Bank, R Bank, T Bank) ($190,440) School fees ($60,782) ATO liability (H) ($130,814) ATO estimated arrears (W) ($47,000) ATO tax debt for the 2023 Financial Year (W) ($6,139) Total non-superannuation interests $2,229,004 Lawrie Superannuation Fund (H) $187,733 Lawrie Superannuation Fund (W) $151,405 Total superannuation interests $339,138 Total property interests $2,568,142
For reasons that follow, in the event of a sale of the Suburb D property, I find those interests to comprise:
Asset Value Parties’ interests in the assets and liabilities particularised in Annexure 1 $2,906,223 Adjustment for Suburb D Property mortgage $18,527 Liability to Mr Lawrie’s mother ($17,000) Land Tax for the Suburb D Property for the 2022 and 2023 Financial Years ($100,335) Division 7A liability (E) ($102,733) Estimated Capital Gains Tax ($121,510) Estimated Division 7A tax liability ($277,559) Credit Cards (NAB, S Bank, R Bank, T Bank) ($190,440) School fees ($60,782) ATO liability (H) ($130,814) ATO estimated arrears (W) ($47,000) ATO tax debt for the 2023 Financial Year (W) ($6,139) Total non-superannuation interests $1,870,438 Lawrie Superannuation Fund (H) $187,733 Lawrie Superannuation Fund (W) $151,405 Total superannuation interests $339,138 Total property interests $2,209,576
Mr and Ms Lawrie hold a number of their assets through a variety of companies and trusts, described colloquially by the parties as the Lawrie Group. A single expert witness, Mr W, was engaged not only to value various entities comprising the Lawrie Group, but also to prepare a schedule of the value of the parties’ assets and liabilities. Both adopted that schedule as accurately valuing their interests in the assets and liabilities identified in the schedule. It is annexed to these Reasons as Annexure 1.
The most valuable asset particularised in Annexure 1 is the real property at B Street, Suburb D, worth $7,800,000, encumbered by a mortgage to the National Australia Bank with an outstanding balance as at 30 June 2023 of $5,293,547. Other significant assets include the parties’ interests in a business worth $834,282 and two motor vehicles, both of which are subject to significant finance.
Current Liabilities
Mr Lawrie seeks to include a number of liabilities as joint liabilities of the parties. Ms Lawrie proposes they be disregarded and that Mr Lawrie be solely responsible for them.
Although generally the value of the parties’ property is ascertained by deducting from the value of their assets the total value of their liabilities, it is open to not take into account unsecured liabilities.[28] The effect of not including a liability in that calculation is that Ms Lawrie is not called upon to contribute to the liability.[29]
[28] Biltoft & Biltoft (1995) FLC 92-614 at 82,124 & 82,127; Rodgers & Rodgers (2016) FLC 93-703 (“Rodgers”) at [22] & [40].
[29] Prince & Prince (1984) FLC 91-501 (“Prince”) at 79,076 per Evatt CJ, citing Af Petersens & Af Petersens (1981) FLC 91-095.
In Prince & Prince, the Full Court held that:
… the Court may take the view that because of the circumstances surrounding the incurring of the liability it ought in justice and equity to be wholly or partly disregarded in determining the appropriate order to make under sec. 79 as between the parties to the marriage. Such a result could be reached where a spouse had incurred a liability in deliberate or reckless disregard of the other party's potential entitlement under sec. 79.[30]
[30] Prince at 79,076 per Evatt CJ.
In Rodgers & Rodgers, the Full Court held that:
… the manner in which a particular liability should be treated is, ultimately, dependent upon the nature of the liability, the circumstances surrounding the liability and the dictates of justice and equity shaped by each.
The usual practice or “rule” sits comfortably and conformably within that rubric — in many cases, perhaps almost all, liabilities will be deducted from the “gross” value of the property because it will be clear (and even if not expressly stated, determined) that the justice and equity of the case demands that the liabilities should be met by the parties in the proportions in which the court determines the property is to be divided. Liabilities that are vague, uncertain, unlikely to be enforced and the like might be treated differently because those circumstances might, in the circumstances of the particular case, render it unjust and inequitable for liabilities to be deducted in that manner. Those so-called “exceptional cases” are but instances of the broader consideration of the justice and equity of the particular case.[31]
[31] Rodgers at [40]-[41], citing DJM v JLM (1998) FLC 92-816 (“DJM v JLM”) at 85,261.
Mr Lawrie submits that to disregard a liability is akin to adding-back assets that have been expended. The situation is materially identical, and I accept the submission. It is well established that add-backs are exceptional, a matter of discretion, and that reasonably incurred expenditure does not usually come within accepted categories of add-backs.[32] Parties are not required to “go into a state of suspended economic animation” after separation and are entitled to provide for their own support.[33]
[32] Cornett & Hext (2021) FLC 94-067 at [48]; Trevi & Trevi (2018) FLC 93-858 (“Trevi”) at [27]-[30].
[33] M & M [1998] FamCA 42 at [2.11]; Trevi at [29].
Similar dangers attend disregarding liabilities of the parties as attend notionally adding-back property. Proper consideration must be given to the parties’ existing interests in property.[34] The Court cannot simply ignore the existence of a liability, even if it is to be disregarded.[35]
[34] Candle & Falkner (2021) FLC 94-069 at [58].
[35] Prince at 79,076 per Evatt CJ.
The danger is exemplified by Ms Lawrie’s proposal to disregard current liabilities, comprising mortgage arrears, a loan to Mr Lawrie’s mother, land tax, a presently existing Division 7A taxation liability, accounting invoices, school fees and credit cards, with a total value of $592,635. She also proposes to add-back on Mr Lawrie’s side of the balance sheet a part property settlement amount of $150,000, which funds have been expended. On her version of the balance sheet and on her proposal that Mr Lawrie retain 25% of its value, assuming no sale of the Suburb D property, Mr Lawrie would retain assets notionally worth $793,698. Deducting the $150,000 notional add-back would leave him in real terms with $643,698, only $51,063 more than the liabilities Ms Lawrie proposes be disregarded. When other agreed taxation liabilities for which Mr Lawrie will bear responsibility are deducted, those liabilities would amount to $776,588, leaving him in a position of his debts exceeding his assets by $132,890.
On Ms Lawrie’s case, the outcome she contends for, namely that Mr Lawrie retain 25% of the value of the parties’ interests in property, is accordingly illusory. When proper consideration is given to existing property and liabilities of the parties, he will retain no net value of the parties’ present interests in property. Put another way, Ms Lawrie will retain more than 100% of the net value of the parties’ current interests in property.
The obvious injustice and inequity thereby arising is compounded further by the fact that within the agreed balance sheet is Mr Lawrie’s shareholding in the business, of which he is a director, valued at $834,282. The totality of that value is comprised of goodwill, valued as a multiple of future maintainable earnings. No suggestion was made that Mr Lawrie could afford to retain those shares whilst remaining responsible for present liabilities of $776,588. I accept his submission that on Ms Lawrie’s proposal, he would need to sell those shares, thereby depriving himself of income that has averaged 44% of his gross earnings over the last two Financial Years.
Those realities reinforce the dangers attendant upon ignoring presently existing liabilities or notionally adding-back assets without properly considering the parties’ existing interests in property. Generally, they demonstrate why add-backs of notional property and disregarding liabilities ought be reserved for exceptional cases. Particularly, they demonstrate what Mr Lawrie accurately submits is the unreality of Ms Lawrie’s case.
Mr Lawrie deposes that the liabilities incurred to service the Suburb D mortgage have been incurred “as a result of the shortfall between our family’s outgoings and my income since our separation”.[36] More particularly, he deposes as follows:
In the financial year ending 30 June 2022, I derived income from my work with [F Pty Ltd] totalling approximately $918,533 gross, before tax. This resulted in a shortfall of approximately $120,000 of our total expenses, without allowing for tax. The shortfall was approximately $400,000 once the tax obligations of me, [Ms Lawrie] and the [Lawrie Group] are accounted for, which total about $260,000.
In the financial year ending 30 June 2023 my income declined for various reasons. I derived income totalling $626,923 gross, before tax. This has resulted in a shortfall of approximately $400,000 between my gross income, and the family's expenses I have had to meet. Again, when the tax obligations of me, [Ms Lawrie] and the [Lawrie Group] are accounted for, being as estimated at about $200,000, the shortfall is approximately $600,000.
The shortfalls between my income, family expenses and our financial commitments over the last 18 months since our separation have been met by borrowings, a part property settlement I received in March 2023 being a loan of $150,000 from NAB, drawings on credit cards, and the sale of shares. We have also accumulated arrears in respect of tax, land tax, mortgage repayments and school fees.[37]
[36] Affidavit of Mr Lawrie filed 8 November 2023, paragraph 37.
[37] Affidavit of Mr Lawrie filed 8 November 2023, paragraphs 120 to 122.
Ms Lawrie did not respond to that evidence in her affidavit. She also did not challenge Mr Lawrie’s evidence in cross-examination.
Consistent with Mr Lawrie’s depositions, he gave oral evidence that he had accrued liabilities to meet the mortgage repayments because he was “scrambling to get money to keep the ship afloat”. He also gave oral evidence that the reason those debts have been accumulating is because he hasn’t “been able to keep the enormous costs up”. That evidence was also unchallenged by Ms Lawrie.
Significantly, Ms Lawrie did not suggest that Mr Lawrie had funds available to meet the mortgage repayments for which he has incurred personal liabilities. She repeatedly put to him that his income for the Financial Year ending 30 June 2023 was the lowest he has earned in the last six years and was an all-time low. Mr Lawrie accepted both propositions.
Ms Lawrie conceded in cross-examination that in the period after the parties’ separation, the family had been living beyond its means, particularly with respect to the combined rental accommodation of the parties that has amounted to approximately $16,000 per calendar month. Those costs have been paid solely from Mr Lawrie’s income.
I accept Mr Lawrie’s submission that the only conclusions available on the evidence are as follows:
•The [Lawrie] family has continued to live a lifestyle and meet commitments in the post separation period which are consistent with those that existed prior to their separation.
•[Mr Lawrie]'s income from all sources in the post separation period (the quantum of which has been precisely identified and is unchallenged) has been applied to meet the living expenses and financial commitments of the whole family.
•The Family's outgoings in the post separation period have exceeded the income earned by [Mr Lawrie] and [Ms Lawrie] has not been in paid employment, leading to an inability of Mr and Mrs [Lawrie] to meet their family outgoings without accumulating liabilities on credit cards, with the children's schools, arrears in respect of their mortgage and with the ATO and SRO.
I find that Mr Lawrie’s income has been insufficient to meet the parties’ outgoings in the period after separation. Ms Lawrie was critical of Mr Lawrie seeking to maintain the Suburb D property in the period after separation at a mortgage instalment cost of $22,567 per month. She concedes that no suggestion was made for it to be sold at any prior time, noting that the property is jointly owned by the parties. Ms Lawrie now concedes that she continued to occupy a rental property at a cost of $10,833 per month, which the parties could not afford. She also made no proposal to obtain more affordable accommodation.
I decline to determine that the liabilities incurred consequent upon the parties’ agreed expenditure in the period after separation ought be solely borne by Mr Lawrie. I conclude that such liabilities ought be treated “as part of the vicissitudes of the economic life of the parties” and are debts that ought “be shared between them”.[38] I do not accept Ms Lawrie’s submission that because Mr Lawrie was ordered to pay relevant costs, the liabilities ought be disregarded and borne solely by Mr Lawrie. No authority was cited in support of the submission.
[38] DJM v JLM at [10.6].
Both parties appropriately seek to update the outstanding balance on the Suburb D mortgage. It is common ground that the balance of the relevant home loan accounts has reduced by $127,522 since that time. Ms Lawrie contends that figure ought be adjusted in the balance sheet. Mr Lawrie contends that there should be an adjustment of only $18,527, on the basis that funds of $101,788 have been overdrawn from other accounts to meet the home loan repayments. In effect, Ms Lawrie asserts that the $101,788 for which the parties are liable in other accounts ought be disregarded as a liability of the parties. For the reasons given, I decline to do so. I will accordingly adopt the figure Mr Lawrie proposes to adjust the mortgage balance after 30 June 2023.
Mr Lawrie deposes to having a loan of $17,000 to his mother to cover the mortgage expenses for the Suburb D property in February 2023. He was not challenged on that evidence, other than by Ms Lawrie putting to him that he was obliged to pay the mortgage pursuant to Court Order. Mr Lawrie contends the liability ought be included as a debt of the parties. Ms Lawrie opposes its inclusion. For the reasons I have already given, I am satisfied that Mr Lawrie was then unable to meet the mortgage repayments from his income. I determine it to be a liability which should be shared by both of the parties.
Mr Lawrie proposes that outstanding land tax for the Suburb D property be included as a liability of the parties. Ms Lawrie contends that it ought not be included. Mr Lawrie concedes that he was required to pay the land tax pursuant to interim Orders made 8 November 2022. He gave oral evidence that he would have paid it if he had the money. No suggestion was made to him that he had funds available from which the land tax could have been paid. Again, I am satisfied that the debt ought be shared between the parties as part of the vicissitudes of their economic life.
Mr Lawrie is currently liable for credit card balances totalling $190,440, which he seeks to have treated as a joint liability of the parties. Ms Lawrie contends that their balances ought not be so characterised. Approximately $100,000 of the credit card debt accrued prior to Ms Lawrie ceasing to have access to the accounts in approximately June 2022. Her attempts to attribute relevant expenditure solely to Mr Lawrie were unsuccessful and misleading. She admitted in cross-examination that a number of expenses she deposed to having not received a benefit from, were family activities in which she participated.
Mr Lawrie has incurred credit card liabilities in order to meet the expenditure of the family, both prior to, and after the parties’ separation. As I have previously found, he has been unable to meet the family’s expenditure from his income. Because Ms Lawrie also benefited from that expenditure, including through significant payments of maintenance and rent, I am satisfied that both parties ought to now contribute to the credit card liabilities. I am not satisfied that any relevant expenditure was excessive or reckless.
Mr Lawrie has also accrued arrears on the children’s school fees of $60,782. Again, there was no suggestion that Mr Lawrie had funds available to him to meet those school fees. The arrears have accumulated in circumstances where Mr Lawrie was unable to meet the family’s outgoings. Inevitably, some outgoings accordingly needed to be prioritised. As Ms Lawrie concedes, the parties were then living beyond their means.
Ms Lawrie opposes the inclusion of the school fee liability in the balance sheet. The effect of her contention is that Mr Lawrie will be solely responsible for a debt incurred due to the entire family living beyond its means. I consider that outcome would be unjust and inequitable. I decline to exclude the school fee liability from the balance sheet.
On 28 February 2023, Mr Lawrie’s accountant, Mr AA, issued an invoice for the provision of information and documentary evidence to Ms Lawrie’s solicitors in the amount of $7,070.80. On 31 August 2023, Mr AA issued an invoice for the provision of information and documents to Mr W, as well as for attending a conference with Mr W on 28 August 2023, in the sum of $5,280. The invoices are outstanding.
Mr Lawrie seeks the inclusion of both invoices as liabilities of the parties. Ms Lawrie opposes their inclusion. Mr Lawrie accepted in oral evidence that he was unable to comply with his obligation to make disclosure in the proceedings without the assistance of his accountant. I am not satisfied that Ms Lawrie ought to contribute to a liability incurred in order for Mr Lawrie to comply with his disclosure obligations. I decline to treat the invoices as joint liabilities of the parties.
Add-backs
In closing address, Ms Lawrie proposed for the first time that various sums be added-back to the balance sheet. They were described as “Wife’s litigation funding” in the amount of $150,000, “Husband’s part property” in the amount of $150,000 and Wife’s part property” in the amount of $25,000.[39] There is no controversy that the amounts have been received by each of the parties.
[39] Exhibit R5.
Because add-backs are the exception rather than the rule, Ms Lawrie bears the onus of persuasion.[40] Despite that onus, Ms Lawrie made no submissions on topic.
[40] Marcin & Marcin (2020) FLC 93-956 at [90], citing Trevi at [27]-[28] and NHC & RCH (2004) FLC 93-204 (“NHC & RCH”) at [24].
Mr Lawrie generously did not object to the late amendment of the application, and his King’s Counsel helpfully took the Court to the evidence relevant to the determination of Ms Lawrie’s contentions.
Mr Lawrie applied his $150,000 payment to the family’s financial commitments in the period after separation. As his King’s Counsel submits, to add-back those funds would be to double count the asset in the balance sheet. Had they not been applied to the parties’ financial commitments, the parties’ level of indebtedness would have been greater given there has been a deficit between the parties’ income and expenditure in the post-separation period. For those reasons, I decline to add-back the part payment of $150,000 made to Mr Lawrie.
Ms Lawrie has expended the whole of the $150,000 payment and approximately $21,000 or her $25,000 payment on her legal fees. Ordinarily, such funds ought be added-back as her notional asset.[41] A failure to do so amounts to a pre-emptive decision about Mr Lawrie paying Ms Lawrie’s legal costs, contrary to the usual rule that each party is to bear their own costs.[42]
[41] NHC & RCH at [57].
[42] NHC & RCH at [35]-[37]; Family Law Act 1975 (Cth), ss 117(1).
Mr Lawrie has himself paid legal fees of $115,877 from his own funds. Whilst it may have been open to Ms Lawrie to contend that such funds ought also be added-back because of the circumstances in which the funds were generated, she made no such submission.[43]
[43] NHC & RCH at [58].
Mr Lawrie submits that the easier way to deal with the issue is not to add-back the funds received by Ms Lawrie. Because she has applied more funds to her legal fees than Mr Lawrie has to his, it is a concession that is adverse to Mr Lawrie’s interests. I consider that outcome to be just and equitable in the circumstances.
Controversial Australian Taxation Office Liabilities
Mr AA gives evidence that one of the Lawrie Group entities, E Pty Ltd, is subject to an existing Division 7A taxation obligation of $102,733. Mr Lawrie seeks its inclusion as a liability of the parties. Ms Lawrie opposes its inclusion. The liability relates to an existing loan from E Pty Ltd to another entity within the group, the Lawrie Family Trust. As Ms Lawrie conceded in oral evidence, the source of income that has supported the family has overwhelmingly been Mr Lawrie’s business. Ms Lawrie has also been solely supported by that income, as distributed through the Lawrie Group, in the period after the parties’ separation. Given both parties have benefited from the income which has given rise to the taxation liability, I am satisfied that both ought now contribute to it.
Ms Lawrie submits that because the repayment of the Division 7A obligation can be spread over seven years, it ought be disregarded. No authority was cited in support of the submission. No alternative proposal was advanced as to how the presently existing obligation ought be treated. With respect, to simply ignore an existing Division 7A obligation is erroneous.[44] Potential injustice attends both its deduction as a present liability of the parties given the liability is not immediately incurred, just as if it is taken up as a matter relevant to paragraph 79(4)(e) of the Act.[45] Unlike another Division 7A obligation to which I will return, there was no suggestion that the obligation might be avoided by supervening events.
[44] Rodgers at [56].
[45] Rodgers at [51].
It is common ground that Mr Lawrie will retain the entities comprising the Lawrie Group, including E Pty Ltd. That asset is pregnant with a Division 7A taxation obligation of $102,733. Given the obligation has been incurred to the benefit of both parties historically, I am satisfied that it ought be deducted from the present value of the parties’ property. If it is not repaid now, interest will accrue at a benchmark rate. I consider is just and equitable to include it as a liability of the parties.
In the event of sale, Ms Lawrie appropriately provides for the quarantining of sums to discharge anticipated capital gains and Division 7A liabilities. They also appropriately provide for the discharge of the parties’ current personal taxation liabilities.
Ms Lawrie’s proposal does not, however, adequately deal with the other joint liabilities. Because I am satisfied the outstanding land tax is a joint liability, it ought to be paid prior to any distribution of the proceeds to the parties. Similarly, because Mr Lawrie will retain personal indebtedness for the joint liabilities to his mother, the funds he has overdrawn to pay mortgage instalments, his credit cards and by way of outstanding school fees, he should be paid a sum sufficient to cover those liabilities.
After those payments are made, the value of property then available for distribution will be the remaining proceeds of sale and the net value of the remaining non-superannuation assets as valued by Mr W, being $399,770. The percentage distribution of those assets can then be achieved by applying the percentage to a sum of those two figures. In the event Mr Lawrie defaults in future obligations pursuant to the spousal maintenance orders, which I will shortly determine, any further necessary adjustments can be made from that distribution.
Mr Lawrie proposes to meet the outgoings for the Suburb D property pending only the payment to Ms Lawrie. Given the extended time frame he has proposed for the transfer of the property, I consider it appropriate that he continue to meet those outgoings until either his property settlement payment to Ms Lawrie, or settlement of the sale of the property, as she proposes.
I decline to order that the parties hold their interests in the Suburb D property upon trust pursuant to these Orders absent explanation of the need for such an order from Ms Lawrie. Both parties seek a restraint on further encumbering the Suburb D property. Such restraint should operate only until its transfer or sale.
It is agreed Mr Lawrie will indemnify Ms Lawrie in relation to his liabilities, or any liabilities of entities within the Lawrie Group. I prefer his formulation of the proposed order given Ms Lawrie’s formulation suggests Mr Lawrie is required to pay all her future taxation assessments. However, I find no basis to defer that indemnity until such time as Mr Lawrie makes the property settlement payment to Ms Lawrie.
The parties agree on the terms of the order which will provide for Mr Lawrie to solely retain the Lawrie Group.
Given I have found it just and equitable for Ms Lawrie to retain 75% of the value of the parties’ superannuation interests, I will adopt the formulation of the superannuation splitting orders she proposes. Mr Lawrie made no submissions with respect to that formulation.
Mr Lawrie proposes that Ms Lawrie retain the furniture and chattels currently in her possession, but seeks to be provided with seventeen specified items, including artwork, tools and furniture. Ms Lawrie agreed to him retaining some of the items but did not agree to him retaining others. I found Ms Lawrie’s disagreement with Mr Lawrie’s proposals unpersuasive. Ms Lawrie conceded she has retained more of the contents than Mr Lawrie and that she will retain diamond jewellery which she understands was purchased for approximately $30,000. Ms Lawrie will also return to Mr Lawrie a motor vehicle owned by the Lawrie Group which has panel and wheel damage for Mr Lawrie to suffer the loss on. I am satisfied that Mr Lawrie’s modest request to retain some of the parties’ furniture and chattels is just and equitable in all the circumstances. I consider the order he seeks to be appropriate.
I prefer Mr Lawrie’s more comprehensive formulation of the orders providing for the parties to otherwise retain their respective interests in property, although I will include the motor vehicle agreed to be returned to him by Ms Lawrie to the list of property he will retain.
Ms Lawrie seeks an order in the following terms:
All previous orders remain in full force and effect until complied with.[64]
[64] Exhibit R4, paragraph 1.
No submissions were advanced in support of the relief sought. It is inconsistent with rule 5.01 of the Federal Circuit and Family Court of Australia (Family Law) Rules 2021. Given the miscellany of interlocutory orders made in the proceedings and the inevitable distortion to the property outcome I have found to be just and equitable were they to continue to operate, I decline to make the order sought.
Implicit in the orders is a requirement to give effect to them. I consider it unnecessary to make the order sought by Ms Lawrie requiring the parties to do so.
CHILD SUPPORT
Ms Lawrie proposes, pursuant to section 117 of the Child Support (Assessment) Act 1989 (Cth) (“the Assessment Act”), that Mr Lawrie pay child support at the rate of $2,250 per week, indexed annually according to the Consumer Price Index. Mr Lawrie opposes the application.
Mr Lawrie is presently administratively assessed to pay child support at the rate of $30,411 per annum.[65] The effect of the relief sought by Ms Lawrie is that the rate would increase to $117,000 per annum. It is common ground that Mr Lawrie will continue to meet the children’s education costs, which currently amount to $129,600 per annum.
[65] Exhibit A1.
Ms Lawrie is entitled to make an application in this Court for the relief sought only in the special circumstances of the case if I am satisfied it would be in the interests of the parties for the Court to consider whether an order should be made in the special circumstances of the case.[66]
[66] Child Support (Assessment) Act 1989 (Cth), s 116.
Ms Lawrie relies on the children’s special needs in support of her application. In particular, she refers to the children having attended psychologists in accordance with Ms C’s recommendations and Y having a medical condition. Contrary to those submissions, Mr Lawrie gives unchallenged evidence that Y has recovered from the condition and has finished seeing her therapist. Ms Lawrie disputes that the medical condition is no longer an issue for Y but agrees that she is no longer obtaining any medical assistance or counselling. Mr Lawrie also gives unchallenged and uncontradicted evidence that Z will shortly finish seeing her counsellor. Accordingly, it is only X who continues to see a therapist at K Psychology. Although Ms Lawrie gives evidence that she pays an average of $500 per week in medical expenses for the children, I have no particularised evidence of the cost of X’s therapy.
The circumstance of one of the children seeing a therapist does not satisfy me that it is in the interests of both parties for the Court to consider whether to make an order pursuant to section 117 of the Assessment Act.
Both parties are entitled to, and I am told have, exercised their rights to seek reviews of the administrative assessment of child support. Mr Lawrie’s income has been significantly fluctuating in recent years. Whilst he is hopeful of its moderate increase, it may be that it recovers more substantially than he hopes. The extent of Ms Lawrie’s future earning capacity is also presently unknown. Those future vicissitudes make it undesirable for the Court to now depart from the administrative assessment for the next seven years, as sought by Ms Lawrie.
For reasons upon which I will expand when I consider Ms Lawrie’s spousal maintenance application, I am also not satisfied that Mr Lawrie has a present capacity to make child support payments in excess of the administrative assessment.
Ms Lawrie also proposes, pursuant to paragraph 123(1)(a) of the Assessment Act, that Mr Lawrie meet the children’s education, extra-curricular, private health insurance, and out of pocket medical expenses. The order sought refers to the wrong statutory provision. Section 123 of the Assessment Act identifies the circumstances in which an application may be made. Section 124 of the Assessment Act is the statutory basis for the relief sought. Mr Lawrie proposes that until he makes the property settlement payment to Ms Lawrie, he pay the children’s school fees and extra-curricular activity costs.
Mr Lawrie gave oral evidence that he has agreed to pay the children’s school fees, and that he will always pay them. He opened his case on the basis that he “agrees with the wife’s application for him to pay the children’s education and private health costs. He has always done that.”. Nevertheless, in closing address, he submits that there is no need to make the order sought by Ms Lawrie because he will always do what he has said he would do. The difficulty with the submission is that Mr Lawrie has now allowed the children’s private school fees to fall into arrears. Whilst I accept he was unable to continue to meet all of the family’s outgoings at the relevant time, it does not detract from the fact that he did not in fact pay the children’s school fees as and when they fell due.
I have a discretion to provide for the payment of non-periodic child support if I am satisfied that it would be just and equitable as regards the children, their parents, and is otherwise proper to do so.[67] I have already articulated the current administrative assessment in force. Ms Lawrie is not in receipt of an income tested pension, allowance or benefit, and it is not suggested that she would be unable to support herself without such a pension, allowance or benefit, taking into account the effect of the relief she seeks.
[67] Child Support (Assessment) Act 1989 (Cth), ss 124(1).
I am required to have regard to the matters prescribed by subsections 117(4), (5), (6), (7), (7A), (7B) and (8) of the Assessment Act.[68] There is no dispute that the parties both expected the children to be privately educated at their current schools. It was not suggested, and I am unable to find that the conditions precedent to a finding that Mr Lawrie has a higher earning capacity than his present income exist.[69]
[68] Child Support (Assessment) Act 1989 (Cth), ss 124(3)-(4).
[69] Child Support (Assessment) Act 1989 (Cth), ss 117(7B).
By agreeing to meet the payments sought regardless of whether I make an order, I infer that Mr Lawrie concedes that it is appropriate for him to be liable for the relevant payments. He proposes to be bound by an order to that effect for a limited period of time. I consider he should be bound by an order to continue to do so. So much will ensure that there is no uncertainty about who is liable for the children’s school fees and ensure that their agreed educational and medical needs are provided for.
I am satisfied that the relief sought by Ms Lawrie is just and equitable and otherwise proper in the relevant sense.
Mr Lawrie conducted his case on the basis that the relevant payments would be made in addition to the assessed periodic child support. Having regard to the relevant paragraphs in subsection 117 of the Assessment Act, I am satisfied it is also just and equitable and otherwise proper in the relevant senses that the annual rate of child support not be reduced on account of payments made pursuant to the non-periodic order.[70]
[70] Child Support (Assessment) Act 1989 (Cth), s 125.
SPOUSAL MAINTENANCE
Ms Lawrie proposes that, for a period of five years, Mr Lawrie pay her spousal maintenance of $2,000 per week, rent of $2,000 per week, a rental bond, as well as internet, mobile telephone and subscription costs. Leaving aside the latter costs which are not particularised, the effect of the relief she seeks are payments to her totalling $208,000 per annum.
Mr Lawrie proposes that until he makes the property settlement payment to Ms Lawrie (by 23 June 2024), he pay her maintenance at the rate of $1,000 per week, together with reasonable outgoings with respect to the former matrimonial home, including rent capped at $1,200 per week, utilities, and mobile telephone expenses. He deposes to the outgoings for Ms Lawrie’s home to amount to $2,000 per month. The effect of the relief he seeks is to make payments for Ms Lawrie’s benefit at the rate of $138,400 per annum.
Mr Lawrie is relevantly liable to maintain Ms Lawrie if and only if she is unable to support herself adequately by reason of having the care and control of a child of the marriage, or for any other adequate reason, having regard to relevant matters referred to in subsection 75(2) of the Act.[71]
[71] Family Law Act 1975 (Cth), s 72.
Given Mr Lawrie proposes that he make payments to Ms Lawrie by way of spousal maintenance for a limited period, I infer he accepts that the statutory preconditions to the making of an order for maintenance are satisfied. I do not conclude otherwise.
Ms Lawrie has not worked for approximately sixteen years, and whilst she has not sought employment in the period after separation, I am satisfied that she is presently unable to support herself adequately. I accordingly have a discretion to make such order as I consider proper for the provision of her maintenance.[72]
[72] Family Law Act 1975 (Cth), ss 74(1).
Ms Lawrie deposes to incurring personal expenditure in accordance with Part N of a Financial Statement amounting to $2,341 per week.[73] She seeks to maintain a home comparable to the one which she is currently occupying but must vacate in early 2024. The rent for her current property exceeds the amount she seeks by way of maintenance, but effectively seeks to maintain a standard of living that she contends is appropriate in all the circumstances.[74]
[73] Affidavit of Ms Lawrie filed 15 November 2023, annexure L-11.
[74] Atwill & Atwill (1981) FLC 91-107 at 76,792 and the cases there cited.
The essential issue arising for determination is whether Mr Lawrie has the capacity to pay maintenance. I am to have regard firstly to his income and his unavoidable, non-discretionary expenses, including his reasonable living expenses.[75]
[75] DJM & JLM at [17.44] and the cases there quoted.
As has been referred to, his gross earnings last Financial Year were approximately $627,000. He will no longer be able to take advantage of the income distribution strategy referred to by Mr AA that has previously minimised the parties’ taxation liabilities. Tax and Medicare levies are payable on that level of income at approximately the rate of $265,500, leaving him with net income of approximately $361,500 without any allowance for superannuation contributions.
Mr Lawrie deposes without contradiction to the children’s private education costs amounting to $10,800 per month, or $129,600 per annum. He is assessed to pay child support at the rate of $30,400 per annum. Once those payments are met, his available income amounts to approximately $201,500.
Mr Lawrie was challenged about his personal expenditure as contained in Part N of his Financial Statement.[76] He conceded that his internet costs were therein inaccurately recorded on a monthly rather than weekly basis. Those costs are accordingly $51 per month rather than the $220 he claimed. Mr Lawrie gave evidence that his phone expenses are paid before his employment commission is declared. I will accordingly disallow his claim of $350 per week for telephone expenses.
[76] Exhibit A3.
Ms Lawrie otherwise challenged Mr Lawrie’s evidence he spends $400 per week on holidays. I am not satisfied the expenditure is excessive in light of Ms Lawrie’s evidence that she spends $600 per week on holidays for herself and the children. I am also not satisfied any other challenges to Mr Lawrie’s expenditure on entertainment, hobbies, or gifts demonstrated their unreasonableness.
I am accordingly satisfied that Mr Lawrie’s personal expenditure in accordance with Part N of the Financial Statement reasonably amounts to $2,551 per week, or approximately $132,700 per annum.
After meeting those expenses, Mr Lawrie’s remaining income amounts to approximately $68,800 per annum. He currently pays rent at the rate of $1,292 per week, or approximately $67,000 per annum. There is accordingly no surplus income available from which to pay Ms Lawrie’s maintenance.
Ms Lawrie submits, in effect, that because Mr Lawrie seeks to maintain the Suburb D property and service the associated $5,300,000 loan, he must have capacity to pay her maintenance. I am not so satisfied. The evidence does not establish that Mr Lawrie has a present capacity to maintain Ms Lawrie. That he is optimistic of increased income in the coming years which would enable him to retain the Suburb D property does not establish a present capacity to maintain Ms Lawrie.
In determining interim applications, the capacity to meet an order to pay spousal maintenance is not confined to income. Such an order may be made notwithstanding that the liable spouse could only satisfy the order out of capital or borrowings against capital assets.[77] To extend such a principal to final applications would have the effect of altering the alteration of property interests that had been found just and equitable.
[77] Maroney & Maroney [2009] FamCAFC 45 at [56].
In effect, Mr Lawrie is nevertheless proposing that he incur further liabilities for which he will be solely responsible to pay maintenance at the rate proposed by him for approximately seven months. Beyond that, Mr Lawrie would be required to either realise assets or incur further liabilities. The former could effectively only be done by selling his shares in the business. Their realisation would result in him no longer receiving distributions from the business, substantially reducing his income. He would then be unable to meet his own and the children’s expenditure.
Ms Lawrie did not adduce evidence that if Mr Lawrie retains the Suburb D property, he would be able to borrow further funds against it. Mr Lawrie’s reliance on a joint venture partner to retain the property suggests that he has limited capacity to borrow further funds secured against the property. Ms Lawrie has accordingly not established that he can realise any assets under his control or service additional borrowings so as to pay her spousal maintenance.[78]
[78] Elei & Dodt (2018) FLC 93-841 at [22].
To the extent that Ms Lawrie suggests that Mr Lawrie has a greater earning capacity than his present income, the evidence only supports that he is hopeful his income will modestly increase over the coming two years. To repeat, his evidence explaining his reduced income by reference to market forces, was not challenged. Mr Lawrie’s optimism about modest increases in his future income does not discharge Ms Lawrie’s onus of satisfying me of Mr Lawrie’s capacity to pay maintenance beyond that which is proposed by him.[79]
[79] Holman & Bates (2022) FLC 94-103 at [40].
Albeit Mr Lawrie will need to incur further liabilities to satisfy the spousal maintenance order he proposes, I am satisfied such an order is appropriate in circumstances where he seeks an extended period of time to pay Ms Lawrie her property settlement entitlement.
OTHER RELIEF SOUGHT
Mr Lawrie seeks various injunctions against Ms Lawrie in the following terms:
•The Wife is restrained by injunction from:
•Making disparaging or uncomplimentary comments or statements regarding the Husband and/or the entities, whether publicly, to existing customers or suppliers of the entities or otherwise;
•Representing herself in anyway with being connected with, interested in or associated with the entities or their business;
•Using, publishing or disclosing to any person, any confidential information, unless required by law and she must use the best of her endeavours to prevent the unauthorised use or disclosure of any confidential information relating to the Husband and/or the entities
•At any time, using or disclosing to a third party a trade secret, product information or confidential information of the entities which is not generally known or available in the marketplace or which would not be generally known or available in the marketplace
•The Wife is hereby ordered to destroy all video and other recordings or other records which relate to the Husband in her possession, whether in video, audio or digital format, or any other format of those recordings.
Mr Lawrie gives no evidence in support of the relief sought. The parties both give evidence of Ms Lawrie having a video of Mr Lawrie returning home in an inebriated state. The mere existence of such a video does not establish the necessity for its destruction. No power is called in aid of the relief sought and I decline to grant it.
ANNEXURE 1
Lawrie
Family TrustE Pty Ltd Lawrie
Unit TrustLawrie Super-annuation
FundTotal
Lawrie
GroupMs Lawrie Total Asset
Pool$ $ $ $ $ $ $ Land & Buildings • B Street, Suburb D 3,120,000 3,120,000 4,680,000 7,800,000 Investment in N Trust 834,282 834,282 834,282 Distribution Receivable – N Trust 66,428 66,428 66,428 Units In O Company Capital Unit Trust 130,728 130,728 130,728 Investment in L Pty Ltd 52,500 52,500 52,500 L Group 175,000 175,000 175,000 H Company 8,859 8,859 8,859 Cash 10,892 100 142,293 153,285 153,285 Motor Vehicle 1 203,300 203,300 203,300 Hire Purchase Liability – Motor Vehicle 1 (208,346) (208,346) (208,346) Motor Vehicle 2 121,500 121,500 121,500 Hire Purchase Liability • Motor Vehicle 2 (91,272)
(91,272) (91,272) Office Furniture & Equipment 518 518 518 Other Creditors (tax and other) (16,704) (391,869) (12,287) (3,386) (424,246) (424,246) Current Tax Assets 16,373 16,373 16,373 Bank Loan· NAB …17 (300,000) (300,000) (300,000) NAB (Mortgage) (5.293,547) (5.293,547) Inter-entity loans (135,593) 319,480 (183,888) UPE • Mr Lawrie (275,965)
(262) (276,227) (276,227) UPE • Ms Lawrie (634,453) 12,691 (621,762) (621,762) Borrowings (Loan• Directors) (293,000) (293,000) (293,000) Net Assets (425,930) 2.754,712 (0) 339,139 2,667,920 (613,547) 2.054.373 Less Parties' loans owed by Lawrie Group UPE • Mr Lawrie 275,965 262 276,227 276,227 UPE • Ms Lawrie 634,453 (12,691) 621,762 621,762
Borrowings (Loan • Directors) 293,000 293,000 293,000 Total 910.418 293,000 (12,429) 1,190,989 1,190,989 Parties' Net Interest 484,488 3,047,712 (12,429) 339,139 3,858,909 (613,547) 3,245,362
I certify that the preceding two hundred and one (201) numbered paragraphs are a true copy of the Reasons for Judgment of Judge Glass. Associate:
Dated: 6 December 2023
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