Leslie and Leslie - [2004] FMCAfam 357

FEDERAL MAGISTRATES COURT OF AUSTRALIA

LESLIE & LESLIE

[2004] FMCAfam 357

FAMILY LAW – Property – husband asserts that available assets are insufficient to meet parties' debts – wife asserts that alleged liabilities should be ignored – identification and valuation of assets and liabilities – husband fails to provide evidence of his financial position – husband “defiantly abandons” his financial responsibilities after separation – payment of child support arrears from moneys held in trust for both parties – whether such moneys should be “added back” – treatment of unsecured liabilities – whether sufficient uncertainties in relation to alleged liabilities to lead the court to disregard them entirely or partly – whether alleged liabilities are vague, uncertain, unlikely to be enforced or unreasonably incurred – whether husband incurred alleged liabilities in deliberate or reckless disregard of other party’s potential entitlement – whether unfair or unjust to compel wife to share in the financial consequences of husband’s reckless, negligent and irresponsible financial behaviour.

Family Law Act1975
Child Support (Registration and Collection) Act1988

Pastrikos (1980) FLC 91-987
Lee-Steere (1985) FLC 91-626
Ferraro (1993) FLC 92-335
Clauson (1995) FLC 92-595
Whitely (1996) FLC 92-684
Norbis (1986) FLC 91-712
McMahon (1995) FLC 92-606
Russell (1999) FLC 92-877
Hickey (2003) FamCA 395

Phillips (2002) FLC 93-104
JEL & DDF (2001) FLC 93-075
Townsend (1995) FLC 92-569
Marker (1998) FAMCA 42
Cerini (1998) FAMCA 143
Chorn v Hopkins (2004) FAMCA 633
Campbell v Kuskey (1998) FLC 92-795
Biltoft (1995) FLC 92-614
Kowaliw (1981) FLC 91-092
Browne v Green (1999) FLC 92-873
DJM v JLM (1998) FLC 92-186
Kennon (1997) 22 FamLR 1
Waters & Jurek (1995) FLC 92-635

Applicant:

JULIE EILEEN LESLIE

Respondent:

PETER LESLIE

File No:

DGM 2143 of 2002

Delivered on:

24 August 2004

Delivered at:

Melbourne

Hearing Dates:

23 & 24 June 2004 in Dandenong
1 July 2004 in Melbourne

Judgment of:

Walters FM

REPRESENTATION

Counsel for the Applicant:

Mr Combes

Solicitors for the Applicant:

Ryan Carlisle Thomas

Counsel for the Respondent:

Mr Herbert

Solicitors for the Respondent:

Rigoli & Associates

ORDERS

Subject to paragraphs 2 and 3 below, the funds held in trust with the wife’s solicitors in the names of the parties be distributed as follows:
(a)the sum of $36,634.00 to the husband; and
(b)the balance to the wife.
Both parties do forthwith sign and execute all such documents and do all such acts and things as shall be necessary to:
(a)pay out the moneys presently owing to GE Auto Finance in respect of the husband’s Statesman motor vehicle (“the Statesman”) – such payment to be made from the sum of $36,634.00 to be received by the husband pursuant to paragraph 1(a) above;
(b)sell the Statesman as soon as is practicable; and
(c)pay the net proceeds of sale of the Statesman (after deduction of all reasonable costs of sale) to the husband.
In this paragraph, “the Shortfall” means the difference between the net sale price of the Statesman (as described in paragraph 2(c) above) and the payout figure referred to…

Grounds of appeal

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

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

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

Consideration

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

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

Continue reading Leslie and Leslie

Details

AGLC: Leslie and Leslie [2004] FMCAfam 357
Case: [2004] FMCAfam 357
Decision Date: 24 August 2004

CaseChat Overview and Summary

Leslie and Leslie is a case concerning the division of assets and liabilities between a divorcing couple, Leslie and his wife. The dispute involved the allocation of their assets and liabilities, with a particular focus on the distribution of the funds held in trust, the Statesman motor vehicle, and various business-related assets. The case was heard in the Family Court of Australia. The legal issues that the court needed to decide were primarily focused on the equitable distribution of the couple's assets and liabilities, the calculation of any shortfall in the sale of the Statesman, and the specific assignments of various assets and liabilities between the parties.

The court determined that the funds held in trust should be divided between the husband and wife, with a specific amount allocated to the husband and the balance to the wife. Additionally, the court ordered that the husband pay off the outstanding loan on the Statesman using the allocated funds, sell the vehicle, and pay the net proceeds to the husband after deducting all reasonable costs of sale. The court also established a mechanism for calculating any shortfall or surplus in the sale of the Statesman, with specific financial obligations placed on the husband and wife depending on the outcome. The court further ordered the transfer of various personal and business-related assets between the parties, including the wife’s Mazda, furniture, and the husband's business assets, Desmech Engineering Pty Ltd. The court also included detailed provisions for the indemnification of the wife from certain liabilities and the delivery of relevant documents to the husband.

In conclusion, the court provided a comprehensive distribution plan for the couple’s assets and liabilities, ensuring an equitable division while also addressing specific financial obligations and indemnifications. The final orders included detailed provisions for the distribution of trust funds, the sale of the Statesman, the transfer of personal and business assets, and the indemnification and documentation requirements.

Orders

Orders of the court

Subject to paragraphs 2 and 3 below, the funds held in trust with the wife’s solicitors in the names of the parties be distributed as follows:

(a) the sum of $36,634.00 to the husband; and

(b) the balance to the wife.

Both parties do forthwith sign and execute all such documents and do all such acts and things as shall be necessary to:

(a) pay out the moneys presently owing to GE Auto Finance in respect of the husband’s Statesman motor vehicle (“the Statesman”) – such payment to be made from the sum of $36,634.00 to be received by the husband pursuant to paragraph 1(a) above;

(b) sell the Statesman as soon as is practicable; and

In this paragraph, “the Shortfall” means the difference between the net sale price of the Statesman (as described in paragraph 2(c) above) and the payout figure referred to in paragraph 2(a) above:

(a) In the event that the Shortfall exceeds $5,000.00, the wife do forthwith pay to the husband 30% of the amount by which the Shortfall exceeds $5,000.00.

(b) In the event that the Shortfall is less than $5,000.00, the husband do forthwith pay to the wife 70% of the amount by which the sum of $5,000.00 exceeds the Shortfall.

(c) in the event that there is no Shortfall, and the net sale price of the Statesman (as described in paragraph 2(c) above) exceeds the payout figure referred to in paragraph 2(a) above, the husband do forthwith pay to the wife an amount calculated as follows:

(x + $5,000.00) X 70%

where “x” is the amount by which the said net sale price exceeds the said payout figure.

The husband do forthwith transfer and assign to the wife all his share and interest (if any) in the following:

(a) the wife’s Mazda motor vehicle;

(b) the furniture, chattels and effects presently in the wife’s possession;

(c) all moneys standing to the credit of the wife in any account in any bank, building society or other financial institution; and

(d) the wife’s superannuation entitlements.

The wife do forthwith transfer and assign to the husband all her share and interest (if any) in the following:

(a) the drafting business conducted by the husband and/or Desmech Engineering Pty Ltd (including the goodwill, plant and equipment, trading stock, work in progress, bank accounts, debtors, intellectual property and all other assets whatsoever of the said business) (“the Business”);

(b) Desmech Engineering Pty Ltd;

(d) all moneys standing to the credit of the husband in any account in any bank, building society or other financial institution; and

(e) the husband’s superannuation entitlements.

The wife do forthwith:

(a) transfer to the husband, or to his nominee, her shareholding (if any) in Desmech Engineering Pty Ltd;

(b) resign any office she may hold in the Business and Desmech Engineering Pty Ltd (including, but not limited to, the office of director of Desmech Engineering Pty Ltd); and

(i) due or owing by her to the Business or to Desmech Engineering Pty Ltd; or

(ii) due or owing to her by the Business or by Desmech Engineering Pty Ltd.

The husband indemnify the wife and keep her indemnified from all debts, liabilities and obligations of the wife relating to or arising out of:

(a) the Business;

(b) Desmech Engineering Pty Ltd;

(c) any security, charge, promise, personal guarantee or undertaking given by the wife to any bank, building society or other financial institution or commercial entity in relation to the Business and/ or Desmech Engineering Pty Ltd;

(d) the property dealings, loans, undertakings, business or affairs of the Business and Desmech Engineering Pty Ltd, including all taxation liabilities or duties (including income tax, capital gains tax and stamp duty and all penalties and interest not yet paid) assessed or hereafter assessed against the wife in respect of income (if any) derived by the wife from, or allocated to the wife by, the Business and/ or Desmech Engineering Pty Ltd;

(e) any loan account or indebtedness due or owing by the wife to Desmech Engineering Pty Ltd;

(f) the creditors of the Business and Desmech Engineering Pty Ltd; and

(g) all charges or other encumbrances affecting the plant and equipment or other property of the Business and/ or Desmech Engineering Pty Ltd,

and from all actions, proceedings, costs, claims and expenses in respect thereof.

The wife do forthwith deliver up to the husband (and sign all such documents and do all such acts and things as shall be necessary to cause her solicitors and her agents to forthwith deliver up to the husband) all documents in her possession, custody or power (or in the possession, custody or power of the wife’s solicitors or agents) relating to:

(a) the Business; and

(b) Desmech Engineering Pty Ltd.

Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

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