M and M
[2002] FMCAfam 265
•11 September 2002
FEDERAL MAGISTRATES COURT OF AUSTRALIA
| M & M | [2002] FMCAfam 265 |
| PROPERTY – Enforcement summons. |
Family Law Act1975, s.117(2A)
Federal Magistrates Court Rules
In the Marriage of Rubie (1991) 15 Fam LR 47; FLC 92-253
| Applicant: | H P M |
| Respondent: | G T M |
| File No: | PAM 1869 of 2002 |
| Delivered on: | 11 September 2002 |
| Delivered at: | Parramatta |
| Hearing Date: | 21 August 2002 |
| Judgment of: | Scarlett FM |
REPRESENTATION
| Counsel for the Applicant: | Mr Campton |
| Solicitor for the Applicant: | Mr William McGookin Caldwell Martin & Cox Solicitors |
| The Respondent in person: | Mr M |
ORDERS
The Respondent is to pay to the Applicant the sum of $31,368.61 within 7 days from the date of this Order.
The Respondent is to pay the Applicant’s costs of these proceedings in the sum of $4,284.00 within 3 months from the date of this Order.
The Respondent is restrained from dissipating, withdrawing or otherwise dealing with the sum standing to his credit in Account number 062016100224205 at the Commonwealth Bank of Australia at E Street, Sydney, except by drawing a cheque otherwise directing the said sum be paid to the Applicant.
In the event that the sum specified in Order 1 hereof remains unpaid after the expiration of 7 days from the date of this Order, there be a garnishment order against the Commonwealth Bank of Australia, E Street, S, attaching all sums standing to the credit of the Respondent in Account number 06201610224205.
The sum standing to the credit of the Respondent referred to in Order 4 above is to be paid by the garnishee to the Registrar of the Federal Magistrates Court at 1-3 George Street, Parramatta for payment out to the Applicant.
The payment of the sum standing to the credit of the Respondent referred to in Order 4 is to be paid within 7 days of the date on which a sealed copy of this Order is served upon the garnishee.
The Applicant is to serve a sealed copy of this Order upon the garnishee within 7 days from the date of this Order.
In the event that the Respondent fails or neglects to pay the Applicant the sum of $31,368.61 within 21 days from the date of this Order, the Respondent shall forthwith do all such things and sign all such deeds, documents and instruments as may be necessary to list for sale and sell the real estate standing in the name of the Respondent situate at and known as 12 S Street D Park in the State of New South Wales being the whole of the land comprised in Certificate of Title Folio Identifier 7/1/1320 for a price to be agreed upon between the Applicant and the Respondent or, in default of such agreement as to the selling price for more than 14 days, at a price determined to be a fair market price by a valuer appointed by the President for the time being of the NSW Division of the Australian Property Institute Inc. whose decision shall be final and binding upon both parties.
Upon completion of the sale of the said real estate in accordance with Order 8 above, the Respondent shall distribute the proceeds of the sale, after adjustment for municipal council and water board rates, in the following order and priority:
(a)In discharge of any mortgage encumbering the said property;
(b)In payment of legal costs and real estate agent’s commission upon the said sale;
(c)In payment of any fees due for the nomination of a valuer as hereinbefore provided and in payment of valuation fees in any;
(d)In payment to the Applicant of the said sum of $31,368.61 or such part of the said sum remains unpaid together with interest calculated at the rate provided by Rule 22.01 of the Federal Magistrates Court Rules 2001 from the due date to the date of payment;
(e)In payment to the Applicant of the amount of costs specified in Order 2 above or such part of that amount as remains unpaid together with interest calculated at the rate provided by Rule 22.01 of the Federal Magistrates Court Rules from the due date to the date of payment;
(f)In payment of the balance to the Respondent.
In the event that the Respondent fails to execute any deed, document or instrument or to do any act required or contemplated by these Orders to be done within 14 days of being called upon to do so, then the Registrar of the Federal Magistrates Court is appointed pursuant to the provisions of section 106A of the Family Law Act to execute such deed, document or instrument and to do all acts and things necessary to give validity and operation to the said deed, document or instrument.
| FEDERAL MAGISTRATES COURT OF AUSTRALIA AT PARRAMATTA |
PAM 1869 of 2002
| H P M |
Applicant
And
| G T M |
Respondent
REASONS FOR JUDGMENT
Application
This is an application by the wife to enforce the payment of three amounts of money payable to her as a result of property orders made by consent in the Family Court of Australia at Sydney on 23rd May 2000. Her claim is for the following:
a)the sum of $977.53 together with interest to date at the rate of 10% per annum, being the balance owing under an order that the Respondent pay to the applicant the sum of $138,000.00;
b)the transfer to her of certain shares in NRMA Limited; and
c)An amount of $36,454.87, being one half of all amounts paid to the Respondent pursuant to his contract of employment with the Australian Federal Police.
The Applicant also seeks an order that the Respondent should pay her costs of these proceedings. The Respondent opposes that order, saying that the parties should pay their own costs.
As to the substantive amounts claimed, the Respondent denies any liability to pay the sum of $977.53 plus interest, saying that he has a defence by way of set-off. He deposes in his affidavit sworn on 23rd May 2002 to the Applicant having entered his premises without permission and taking certain items of camping equipment.
The Respondent does not argue about the NRMA shares, agreeing in his affidavit to pay the Applicant for them, saying at paragraph 6:
“In relation to Order 11, the Respondent will pay the amount of $1600.00.”[i]
The Respondent does not agree that he should pay the sum of $36,454.87 to the Applicant, being one half of amounts he received from a contract with the Australian Federal Police. He states that the sum of $11,800.00 is the proper figure, and he has made arrangements to borrow that sum.[ii]
The Respondent maintains that he has been trying to resolve the matter without the necessity of court proceedings, but that the Applicant would not agree.
Background
The parties entered into consent Orders in the Family Court of Australia at Sydney on 23rd May 2000. The Applicant was represented by a solicitor, but the Respondent was not legally represented. The orders provided that the Applicant should transfer to the Respondent her interest in the former matrimonial home at 12 S Street D Park in the State of New South Wales in return for a lump sum of $138,000.00. Order 5 provides:
“That the husband shall pay to the wife the sum of $138,000.00 within three weeks of the date of these Orders provided that in the event that the husband shall fail to pay to the wife the said sum within such period he shall thereafter pay interest on the sum of $138,000.00 calculated at the rate of 10% per annum from the date of these Orders until payment is made in full.”
Order 6 went on to provide that “Immediately upon receipt of the said sum of $138,000.00 together with interest thereon” the Applicant should sign all such deeds, documents and instruments as should be necessary to transfer her interest in the former matrimonial home to the Respondent. If the Respondent were to fail or neglect to pay that amount to the wife within three months from that date, Order 8 provided that the parties were to join in the sale of the property and divide the proceeds between them so that the Applicant should receive her $138,000.00 and interest.
Despite this arrangement, the Applicant transferred her interest in the former matrimonial home to the Respondent without receiving the full amount of $138,000.00. In her affidavit, sworn on 26th April 2002, the Applicant deposes to the fact that on 26th June 2000 she delivered to the Respondent a signed memorandum of transfer in exchange for the sum of $114,362.47. She states that she received a further payment of $22,360.00 from the Respondent on or about 20th July 2000, and a further payment of $300.00 on 27th October 2000.
The Applicant says in her affidavit that the Respondent has failed to transfer any shares in NRMA Limited to her and she was unable to establish without issuing a subpoena whether or not she had any entitlement to any shares. The Respondent concedes that she was so entitled and that she should receive the sum of $1,600.00 in payment for those shares. There is no issue about this matter.
Order 12 made by consent between the parties covers payments made by the Australian Federal Police. It states as follows:
“That, immediately upon the husband receiving any moneys pursuant to his Federal Contract of Employment with the Australian Federal Police, he shall pay half of such moneys to the wife PROVIDED HOWEVER that if the husband fails to pay such moneys to the wife within seven days of him receiving same he shall in addition thereto pay the wife interest on such monies (sic), calculated at the rate of 10% per annum from the due date until the actual date of payment.”
It is common ground that, apart from the payments referred to in paragraph 9 above, the Respondent has not paid any money to the Applicant under the consent Orders.
On 20th May 2002, the Applicant applied for the issue of an Enforcement Summons and sought leave for short notice. The Applicant also applied for leave to issue subpoenas to the Australian Federal Police and Insurance Australia Group Limited, formerly NRMA Limited. The Application came before the Court on 27th May 2002. The Respondent filed an affidavit in Court that day in reply. He later filed a Financial Statement.
Procedure
The Applicant has proceeded by way of an Enforcement Summons, which is a Form 46 Summons provided by Order 33 Rule 3 of the Family Law Rules. Rule 1.05 of the Federal Magistrates Court Rules 2001 provides that certain of the Family Law Rules, as set out in Part 1 of Schedule 3, apply, with necessary changes, to proceedings in the Federal Magistrates Court. Order 33 is included in Part 1 of Schedule 3, so that the procedure applicable in the Family Court applies equally in this Court. Provided that the Enforcement Summons is correctly headed, it is the appropriate summons to be used in this Court to enforce “an order that a party pay maintenance or other money for the benefit of the other party, or of a child.”[iii]
Issues
The Respondent contends that he has a defence of set-off, in that the Applicant entered the former matrimonial home on 19th November 2000 and “took numerous items of camping equipment, Christmas decorations and sundry items.”[iv] He annexed to his affidavit a copy of a letter he wrote to the Applicant dated 25 November 2000, taking her to task for her unauthorised entry to the home and taking those items, to which he ascribed an arbitrary value of $1,500.00. He also annexed a copy of a letter he wrote to the Applicant’s solicitors dated 3 February 2001, disputing an alleged claim by the Applicant that a sum of $1375.00 was still outstanding, asserting his claim to a set-off and stating that the items taken by the Applicant were his property.
The wife relies upon Order 10 of the consent orders, which provided that the parties were to divide the contents of the former matrimonial home equally between them.
The NRMA shares are not in issue.
The Respondent did not dispute that payments of $914.00, $43,823.70, $4553.07 and $12,937.11 had been paid to him between 7th June 2000 and 11th April 2002 by the Australian Federal Police, but said that these were gross figures and that the proper figures referred to net pay after income tax.
The Respondent also submitted that the Court should take into account the fact that he had been trying to resolve the matter for the past two and a half years, without success. He put the fact that the matter had not resolved down to the Applicant’s intransigence.
The Respondent further submitted that the Court should have regard to the background to the consent orders. He told the Court that he foolishly signed the orders without reading them. He asked a friend who was a Court Officer at the Family Court to lodge the documents on his behalf. He did not seek legal advice, although the Applicant was represented by a solicitor. A neighbour, who has since been charged, had assaulted two of the parties’ children, and it was necessary for the wife to move out of the area at short notice.
The Respondent went on to submit that the orders were flawed when they were signed, and that order 12 was uncertain. It was not clear whether the order referred to one payment or several. He said that there was also no legal requirement for his superannuation to be included in the property settlement. He did not have the funds to pay the Applicant at the time, and she had agreed that the former matrimonial home should not be sold until the parties’ elder son had left university. Once the Respondent was ready to put the house on the market, the Applicant had placed a caveat on the title, which prevented him from listing the property for sale. He had not sought advice from a solicitor about the caveat, but he had consulted a real estate agent.
The Respondent produced a document, which he headed ‘Annexure Z’, which was admitted into evidence as Exhibit 7. This document is a table setting out what the Respondent believes to be a fair division of property as at 23rd May 2000. This, he submits, is the way the parties should have settled the matters between them at the time.
Conclusions
These proceedings relate to the enforcement of property orders made by consent in the Family Court on 23rd May 2000. It will not avail a party to say that he signed terms of settlement without reading them, or that the proceedings were somehow unfair because the other party was legally represented and he was not. The Respondent is a member of the Australian Federal Police and he gave evidence that he has qualified as an accountant through TAFE. The Court cannot accept that a person of the Respondent’s background should enter into consent orders dealing with the parties’ matrimonial property without either reading them or obtaining legal advice, and then seek to be rescued from the consequences of his own folly. The Respondent would surely be aware from his own employment that parties cannot resile from their written statements by saying that they signed them without reading them.
Notwithstanding the fact that the Respondent claims that the consent orders were flawed, he did not appeal against them or seek to have them set aside. He conceded that he had sought advice about this, and had been told that he had no chance of having the orders revoked. That advice holds good today. There is no ground to set aside the orders made by consent on 23rd May 2000, even if this Court had the jurisdiction to do so. The orders must be considered as they are, flawed or not.
Turning first of all to the Applicant’s claim for the sum of $1,190.32, being the shortfall of $977.53 in the amount of $138,000.00 required to be paid by the Respondent to the Applicant pursuant to Order 5, plus interest calculated at $212.79, it is difficult to see why the Applicant handed over a memorandum of transfer of her interest in the former matrimonial home without being paid in full. The Applicant accepted the sum of only $114,362.47 on 26th June 2000, despite the provisions of Order 6, which clearly provides that she was to receive $138,000. The Applicant gives no explanation of this discrepancy. The inference to be drawn is that the Applicant consented to depart from the provisions of the consent Orders.
The Respondent claims a set-off due to the uncontested fact that the Applicant entered the former matrimonial home and removed certain items of camping equipment and other objects from the house. It will not do for the Applicant to rely on Order 10, as she sought to do in these proceedings. Order 10 provides:
“That the parties forthwith do all acts and things as may be necessary to divide the furnishings, appliances and contents of the former matrimonial home equally between them on the basis that the contents of the children’s bedrooms are to be retained by the wife and shall not form part of the items to be otherwise divided.”
The Respondent says that the items taken were his, relying on Order 14, which declared him to be the sole legal and beneficial owner of (inter alia) “all personal effects in his possession.”
The fact is that the Applicant does not challenge the fact that she entered the former matrimonial home without the Respondent’s knowledge on 19 November 2000 and removed those items. Title in the residence had passed to the Respondent on 26th June 2000, when the Applicant delivered to him the signed Memorandum of Transfer and in return for a lesser sum than the amount that consent Orders said she was entitled to. The Applicant had no right to enter the residence without the owner’s permission. It does not assist the Applicant to claim that she was merely taking items allowed to her under Order 10. Order 10 envisages the parties dividing items of personalty equally between them, and does not countenance a unilateral act by the Applicant. Again, too, Order 10 required the parties to divide the items “forthwith”, but the evidence shows that these items were removed nearly 6 months after the consent Orders were made. The term ‘forthwith’ is to be construed as meaning “as soon as practicable”, not “within a reasonable time” (per Nygh J in In the Marriage of Rubie (1991) 15 Fam LR 47; FLC 92-253).
For the above reasons, I am satisfied that the Applicant’s actions in entering the premises at D Park without the authority of the Respondent and removing items of camping and other equipment are not justified by the Orders of 23rd May 2000. Similarly, there is no evidence that the items removed were of the value of $1,500.00, or any other figure. There is no explanation given as to why the Applicant elected to transfer her interest in the former matrimonial home for a lesser sum than the amount of $138,000.00 provided by the Orders, but I am satisfied, in the exercise of the Court’s discretion, that it is inappropriate to make any order to enforce the amount of $977.53 not paid pursuant to Order 5, or any amount of interest said to be due in respect of that sum.
There is no issue that the Respondent should pay to the Applicant the sum of $1,600.00, being the value of NRMA (now IAG) shares, and
I propose to make an order to enforce that payment.
The Respondent claims that Order 12 was flawed, in that it was uncertain in its effect. Order 12 states:
“That, immediately upon the husband receiving any moneys pursuant to his Federal Contract of Employment with the Australian Federal Police, he shall pay half of such moneys to the wife PROVIDED HOWEVER that if the husband fails to pay such moneys to the wife within seven days of him receiving same he shall in addition thereto pay the wife interest on such monies, calculated at the rate of 10% per annum from the due date until the actual date of payment”.
The Order is hardly an example of elegant legal draftsmanship, but it is capable of interpretation. I do not accept the Respondent’s claim that the order is uncertain as to whether it refers to one payment or more than one payment. I am satisfied the phrase “any moneys” is clearly intended to mean one or more payments, whatever the case may be. There is nothing to show that any taxation liability should be taken into account, which was the Respondent’s other claim, and there is no evidence, in any event, to show what the net value after tax of any such payment would be. The only evidence available to the Court refers to gross sums paid.
Exhibit 1 refers to a bundle of documents produced by the Australian Federal Police in answer to a subpoena issued by the Applicant’s solicitor. The first page is a covering letter dated 23 May 2002 signed by one Brad T, of the Australian Federal Police, who has the remarkable title of ‘Team Member, People Strategies Eastern’.
It will be recalled that Order 12 referred to any moneys due to the Respondent pursuant to his “Federal Contract of Employment with the Australian Federal Police”. The relevant passages of Mr ’s letter contained in Exhibit 1 state:
“1. G M commenced with the Australian Federal Police (AFP) on the 25th May 1987. The AFP did not commence with Fixed Term Appointments (FTA) until the 2nd July 1990, this ceased on the 2nd July 2000. The FTA period was known as the Australian Federal Police Adjustment Scheme (AFPAS), this was an accumulation of funds based on salary for each member during the scheme. At the end of the FTA period members became employees of the AFP this change was a result of the AFP’s new Certified Agreement.
2. G M has AFPAS paid to him on the 20th July 2000. Annexure “A”.
3. G M during the period 1st January 2000 to date received a number of payments relating to salary adjustments, encashment of recreation leave, AFPAS and performance bonus. Attached printout of monies received with an explanation of each wage type. Annexure “A”.”
It is this document, and its annexure, that the Applicant relies upon to claim one half of 4 separate payments totalling $31,570.94, plus interest from various dates. In all, the Applicant seeks a total of $36,454.87.
The Court has to decide whether all, or any, of these four payments, are referable to the amounts payable under Order 12. It is clear that the Respondent worked on a fixed term contract from 2nd July 1990 to 2nd July 2000, after which time he became a salaried employee. The provisions of Order 12 only apply to the Respondent’s employment under contract, and do not act as an ongoing levy on his salary.
Exhibit 1 shows that the sum of $914.00 was paid to the Respondent as a performance bonus on 7th June 2000. His FTA was still in force at the time, running from 2nd July 1990 to 2nd July 2000. I am satisfied that the sum of $914.00 is covered by Order 12 and the Applicant is entitled to one half of that amount, namely $457.00. Interest accrues at 10% per annum from 14th June 2000 to the date of the hearing, being 794 days at 25 cents per day, amounting to $198.50.
The Respondent received his AFPAS payout of $43,823.72 on 19th July 2000. This amount is clearly envisaged by Order 12, and I am satisfied that the Applicant is entitled to one half of that amount, namely $21,911.86, together with interest at 10% from 26th July 2000 to the date of the hearing, another $4518.00.
The Respondent received the sum of $4553.07 on 25th October 2000. This amount was the result of an encashment of excess leave which he had accrued. The inference is that this leave had largely, if not entirely, accrued between July 1990 and July 2000. I am satisfied that it relates to the FTA covered by Order 12 and, therefore, the Applicant should be entitled to one half of that amount, namely $2,276.53. Interest is also due at 10% from 1st November 2000 to the date of the hearing, amounting to $406.72.
The final payment that the Applicant seeks to have taken into account is an amount of $12,937.11 paid to the Respondent on 11th April 2002. This is made up of a number of salary adjustments of different types. There is no evidence that these salary adjustments are referable to the period prior to 2nd July 2000, and, as the payments are made nearly two years later, it is a reasonable inference that they relate to the period after 2nd July 2000. I am not satisfied, therefore, that it has been shown that the sum of $12,937.11 paid to the Respondent can be categorised as “any moneys pursuant to his Federal Contract of Employment with the Australian Federal Police”, and I find that it is not an amount to which the Applicant has any entitlement.
I am satisfied that the Respondent should pay to the Applicant the following sums:
d)$457.00 plus interest from 14th June 2000 to 19th August 2002, being $198.50, totalling $655.50;
e)$21,911.86 plus interest from 26th July 2000 to 19th August 2002, being $4518.00, totalling $26,429.86;
f)$2,276.53 plus interest from 1st November 2000 to 19th August 2002, being $406.72, totalling $2683.25; and
g)the sum of $1,600.00 for the NRMA shares.
I find that the Respondent should pay to the Applicant the total sum of $31,368.61. The Respondent has an account at the Commonwealth Bank of Australia at E Street, Sydney, with a current balance of $25,464.08. An injunctive Order has been made restraining the Respondent from dealing with the balance in that account pending the outcome of these proceedings, and I am satisfied that a garnishee order should be made to secure that amount. The balance will need to be found by the Respondent within a short period of time, or he will have to sell his home.
Costs
The Applicant seeks an order for her costs, but the Respondent submits that the parties should pay their own costs. I am mindful of the provisions of section 117(2A) of the Family Law Act, and I note that these proceedings have been brought about because the Respondent failed to pay amounts of money which he should have paid to the Applicant in 2000, by virtue of the Orders made by consent in the Family Court. The Respondent has obtained a loan to help him pay the amounts owing, and he gave evidence that he has had the benefit of the money prior to the hearing. He has made no payment to the Applicant, not even of the amount that he admits he should pay to her. This is, to my mind, a proper matter for an order for costs in favour of the Applicant.
In an affidavit sworn on 13th August 2002, the Applicant’s solicitor, William McGookin, estimates his client’s costs of these proceedings at a total of $9765.89. This figure includes counsel’s fees of $1,100.00 for the original day in court, on 27th May 2002, $2,200.00 on 26th June 2002, when the matter was not reached, and $2,2000.00 for the hearing on 19th August 2002.
I consider that it is appropriate for costs to be calculated according to the scale set out in Schedule 1 to the Federal Magistrates Court Rules 2001. I satisfied that this matter was of sufficient complexity to warrant briefing counsel and I make the necessary certification pursuant to Rule 21.16. Taking into account the lump sum fee provided by Stage 7 of the Rules, and allowing a daily hearing fee with advocacy loading for three half days, I allow the sum of $3664.00 for costs and $620.00 for necessary disbursements, a total of $4284.00. I will allow three months for this amount to be paid.
For the above reasons, I make the orders set out on the attached schedule.
I certify that the preceding forty-six (46) paragraphs are a true copy of the reasons for judgment of Scarlett FM
Associate: S.Polley
Date: 22 August 2002
[i] Respondent’s affidavit sworn 23rd May 2002
[ii] Respondent’s affidavit, paragraphs 7 and 15.
[iii] Family Law Rules, Order 33 Rule 2
[iv] Respondent’s affidavit, paragraph 5
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