M and M
[2002] FMCAfam 140
•15 May 2002
FEDERAL MAGISTRATES COURT OF AUSTRALIA
| M & M | [2002] FMCAfam 140 |
| FAMILY LAW – Leave to commence proceedings out of time in regard to spousal maintenance – institute proceedings under section 44(3) – interlocutory applications. Bevan and Bevan (1995) FLC 92-600; Emamy and Marino (1994) LFC 92-487; Kinkead-Weekes and Kinkead-Weekes (unreported) Appeal No SA62L of 2001; In the Marriage of Slater (1985) 10 Fam LR (1985) FLC 91-641; In the Marriage of Gornalle (1992) 16 Fam LR 100; (1993) FLC 92-334, In the Marriage of Althaus (1979) 8 Fam LR 169; (1982) FLC 91-233; Hall and Hall (1979) FLC 90-679; Whitford and Whitford (1979) FLC 90-612. |
| Applicant: | K A M |
| Respondent: | W R M |
| File No: | PAM3790/2001 |
| Delivered on: | 15 May 2002 |
| Delivered at: | Parramatta |
| Hearing Date: | 24 April 2002 |
| Judgment of: | Scarlett FM |
REPRESENTATION
| Solicitors for the Applicant: | Mr Bullock solicitor of Ian Bullock and Partners DX 8207 Parramatta |
| Solicitors for the Respondent: | Ms Lansley solicitor of Lansley Lawyers DX 4963 Bowral |
ORDERS
The Applicant is given leave to institute proceedings for an Order for spousal maintenance pursuant to section 44(3) of the Family Law Act.
| FEDERAL MAGISTRATES COURT OF AUSTRALIA AT PARRAMATTA |
PAM 3790 of 2001
| K A M |
Applicant
And
| W R M |
Respondent
REASONS FOR JUDGMENT
Application
This is an application for leave to commence proceedings for an order for spousal maintenance out of time. A Decree Nisi dissolving the parties’ marriage became absolute on 3rd March 1999. The substantive application for spousal maintenance was not filed until 6th November 2001, and the application for leave was filed on 19th April 2002.
Applications for financial orders are required to be made within 12 months of the date the decree of dissolution became absolute, unless the relevant court grants leave or the other party consents.
The relevant statutory provisions
Subsection 44(3) of the Family Law Act 1975 imposes the limitation:
(3) [Time Limit on Property and Maintenance Proceedings] Where, whether before or after the commencement of section 41 of the Family Law Amendment Act 1983:
(a) decree nisi of dissolution of marriage has become absolute; or
(b) decree of nullity of marriage has been made,
proceedings of a kind referred to in paragraph (c) or (ca) of the definition of matrimonial cause in subsection 4(1) not being proceedings under section 78 or 79A or proceedings seeking the discharge, suspension, revival or variation of an order previously made in proceedings with respect to the maintenance of a party) shall not be instituted, except by leave of the court in which the proceedings are to be instituted or with the consent of both parties to the marriage, after the expiration of 12 months after:
(a)in a case referred to in paragraph (a) – the date on which the decree nisi became absolute; or
(b)in a case referred to in paragraph (b) – the date of the making of the decree.
The court may grant such leave at any time, even if the proceedings have already been instituted.
In this case, the Respondent does not consent to the proceedings being instituted out of time.
Subsection 44(4) sets out the circumstances in which a court may grant leave to institute proceedings:
(4) [Institution of proceedings] The court shall not grant leave under subsection (3) or (3A) unless it is satisfied:
b)that hardship would be caused to a party to the relevant marriage or a child if leave were not granted; or
c)in the case of proceedings in relation to the maintenance of a party to the marriage – that, at the end of the period within which proceedings could have been instituted without the leave of the court, the circumstances of the applicant were such that the applicant would have been unable to support himself or herself without an income tested pension, allowance or benefit.
Background
The parties were married on 27th June 1964. A decree nisi dissolving the marriage was made by the Family Court of Australia at Sydney on 2nd February 1999. The decree became absolute on 3rd March 1999.
There were proceedings between the parties for property settlement in the Family court, which were decided by a judgment delivered by Judicial Registrar Knibbs on 27th February 1998. In that judgment, orders were made to the following effect:
a)the former matrimonial home at Sefton was to be sold, and the wife (who is the applicant in these proceedings) was to receive forty-three sixtieths of the net proceeds, together with an amount of $3,950.00 by way of arrears of maintenance, the husband was to receive the balance;
b)the husband (the respondent in these proceedings) was declared to be the sole owner of a Mitsubishi Magna motor car;
c)the husband and wife were declared to be the sole owners of other items of personalty and bank and other accounts which were then in their possession;
d)the orders in favour of the wife were declared to be orders to which section 77A of the Family Law Act applied, and the amount payable to the wife pursuant to that order was the sum of $19,750.00; and
e)other procedural orders.
The applicant filed her application for spousal maintenance on
6th November 2001, seeking the sum of $450.00 per week. She referred in her application to the lump sum of $19,750.00 having been ordered by the Family Court on 27th February 1998, but claimed that the husband’s financial circumstances had changed substantially since that Order was made.
The respondent filed a response, seeking that the application should be dismissed and that the applicant should pay his costs of the proceedings. The husband also filed, as the Rules require, an affidavit setting out the facts on which he intended to rely. In that affidavit, he denied that his circumstances had changed substantially as alleged by the applicant, and stated that his income is derived from two pensions, one from Comsuper and one from Comcare. The latter pension, which provides the greater part of his income, is not paid automatically, but is reviewed annually, requiring a medical certificate as to his incapacity to work. The Comcare pension will cease when he attains the age of 65 years. He also refers in this affidavit to his continuing ill health, which prevents him from engaging in employment.
The respondent also filed an affidavit from one Dr D B, a psychiatrist. A handwritten report is annexed to Dr B’s affidavit, setting out that the respondent has been under the doctor’s care since 1986 and expressing the opinion that, due to his continuing ill health, the respondent will never be capable of engaging in either part time or full time employment.
The applicant filed an application on 19th April 2002, seeking leave to institute proceedings for spousal maintenance pursuant to section 44(3) of the Family Law Act. At the same time, the applicant filed an affidavit, setting out the facts that she seeks to rely upon, in both the application for leave and the application for spousal maintenance itself.
In her affidavit, the applicant states that she was aware at the time of the Family Court proceedings in February 1998 that the respondent had debts of at least $300,000.00 and the two pensions, from Comcare and Comsuper. She deposed to the fact that, in the twelve month period after the decree of dissolution became absolute, she did not take action to obtain a further maintenance order because she believed that the respondent was using his income to pay off his substantial debts. She says that this was the reason she did not commence those proceedings at that time, even though she was in receipt of an income tested pension because her age and state of health meant that she was otherwise unable to support herself.
The applicant also deposed to the fact that she found out in 2001 that the respondent was building a house at B and that his bankruptcy had been annulled on 22nd July 1999. She also ascertained that he had obtained a bank loan.
The applicant claims that she will suffer hardship if she is not granted leave to institute these proceedings. She says that her income is limited because of her age and state of health. She is 68 years old and has received an income-tested pension from Centrelink since she and the respondent separated. The applicant says that she works for six hours a week as a receptionist for a medical practitioner, but underwent surgery in February 2002 and does not expect to be able to continue her employment. She has some investments, a bank account with a balance of about $1300.00, and a motor car. She rents a villa, which she shares with her daughter.
For the respondent, it was argued that the applicant does not meet the test of hardship as prescribed by subsection 44(4). The parties were divorced three years ago, and it is onerous on the husband that he should be called back to court to receive another demand. It is the respondent, it is submitted, who would suffer hardship if leave were granted.
For the applicant, it is submitted that the Court should grant leave. She was in receipt of an income-tested pension at the relevant time and can show that her needs outweigh her income. Whilst she has some assets, the law does not require her to deplete her capital in order to establish hardship. In this regard, Mr Bullock for the applicant referred the Court to the decision of the Full Court of the Family Court of Australia in Bevan and Bevan (1995) FLC 92-600. Hardship is relative, not absolute.
Principles to be followed
Applications for leave to institute proceedings under subsection 44(3) are interlocutory applications (Emamy and Marino, (1994) FLC 92-487, (1994) 18 Fam LR 44, followed by Mushin J in Kinkead-Weekes and Kinkead-Weekes, (unreported) Appeal No. SA62L of 2001). It follows, therefore, that leave is required to appeal against such a decision, pursuant to section 94AA(2A) of the Family Law Act.
It has been held that a party cannot institute proceedings for substantive relief in the same application as an application for leave to institute those proceedings (In the Marriage of Slater (1985) 10 Fam LR 381; (1985) FLC 91-641). I note that in this matter there is a separate application.
It is also noteworthy that it has been held that an application for a property or maintenance order lodged within time but unsupported by an affidavit as required by the rules is not filed within time ((In the Marriage of Gornalle (1992) 16 Fam LR 100; (1993) FLC 92-334). In that case, an application was lodged with an undertaking by a solicitor to provide an affidavit. Whilst Order 8 Rule 2 of the Family Law Rules may not require an affidavit in an application seeking only final orders, Rule 4.05 of the Federal Magistrates Court Rules 2001 requires an affidavit to be filed with the application. Those practitioners (and I exclude the solicitors in this case) who persist in omitting to file an affidavit in support of an application for final orders need to bear the s.44(3) time limit in mind.
The Full Court has made it clear that it is not necessary for a detailed hearing on the merits of the claim to be undertaken before the question of leave is to be decided. The court does not have to decide whether the substantive claim will succeed (In the Marriage of Althaus (1979) 8 Fam LR 169; (1982) FLC 91-233). Where the applicant establishes a claim proper to be heard, the court should generally be reluctant to refuse to allow the claim to proceed where the delay has been explained and there is no real prejudice to the respondent (Hall and Hall (1979) FLC 90-679) (see also Frost and Nicholson (1981) FLC 91-051).
It is not necessary to show that the applicant is in penurious circumstances before hardship is established. In Bevan (supra), the Full Court said at 81,981:
“However, we do not think that the law requires that a wife should deplete an already comparatively meagre capital sum, to enable a much higher earning husband to avoid his obligation to maintain a former spouse who is in financial circumstances such as those in which she finds herself”.
The Full Court considered the meaning of ‘hardship’ in s.44(4) in Whitford and Whitford (1979) FLC 90-612:
“We consider that in subsec. 44(4) the word should have its usual, though not necessarily its most stringent, connotation. It is impossible to lay down in advance what particular facts may or may not amount to hardship in the relevant sense. As a general proposition it might be said that, the inability of an applicant to pursue a claim which in the circumstances of the applicant or a child of the marriage is trifling, generally will not cause hardship”.
The Full Court went on to find that hardship would be caused to the wife and leave should have been granted as there was ample evidence that the wife was unable to support herself adequately, and there was evidence that the husband had available to him resources which would enable him to contribute to her maintenance.
The question of hardship to the respondent is also a matter for the court to consider in exercising its discretion to grant leave. In Frost and Nicholson (supra), Nygh J said (at 76,424):
“This leads me to the final question as to the exercise of my discretion, that is to say, whether in the circumstances the husband would suffer prejudice if leave to institute proceedings were granted to the wife. Prejudice here means that a party is faced with an action which he or she had no reason to expect or had been led to believe would not be brought. To give an extreme example, if after ten years a wife sought leave under sec 44(3) without ever having given any indication beforehand that she wished to seek a property settlement, leave might well be refused”.
Conclusions
In this case, the applicant has given an explanation for the delay in bringing the application. At the time when she could have brought an application within time, she was of the belief that the respondent was using his income to pay off his substantial debts, and that he would have no capacity to pay any spousal maintenance. It was not until 2001 that she found out that the respondent’s bankruptcy had been annulled, that he was building another house and had obtained a bank loan for that purpose. She has produced evidence to show that on 3rd February 2000 she was in receipt of an income-tested pension. Exhibit 1 in these proceedings is a statement from Centrelink, showing that for the period 2nd to 15th February 2000 she was receiving an Age pension of $322.10, plus a pharmaceutical allowance of $5.40 and Rent Assistance of $76.00. She has given unchallenged evidence that she is still in receipt of such a pension, supplemented by a few hours’ work per week. She has given evidence of living expenses of $434.00 per week. The evidence shows a shortfall of income over expenditure of about $91.00 per week. Section 75(3) of the Act requires a court to disregard the entitlement of the party whose maintenance is under consideration to an income-tested pension, allowance or benefit.
I am also required to consider the question of hardship to the respondent, as submitted by Ms Lansley. There is no doubt that he has found it onerous to have to come back to court some three years after proceedings in the Family Court were completed. He is well within his rights to have assumed that court proceedings were behind him and so arranged his affairs in reliance on that belief. It was clear during the hearing that he found these proceedings distressing.
Had the respondent been in such a position that a further order against him would have necessitated the dismantling of complex financial arrangements he had incurred in good faith and thereby caused him a significant financial loss, there would have been grounds to consider refusing the application for leave. I am persuaded, however, that there is no evidence that the applicant has not taken any step to have misled the respondent into believing that a further claim would not be made and, more importantly, she has given a satisfactory explanation for the delay in bringing these proceedings.
I am also mindful that there is evidence that the respondent has recently sold a residence at B, which has not only had the effect of reducing his outgoings and his indebtedness, but has led to the sum of $14,710.51 being deposited into his personal bank account (see Exhibit 4). The sum of $3,795.00 was then deducted from this account to pay for estate agent’s commission, but the balance was available for his use on 18th April 2002. His solicitors hold the sum of $4,500.00 in their trust account on account of legal costs. There is evidence that the respondent’s income amounts to $1432.59 and his expenses have been reduced from $1476.06 because of the reduction in outgoings due to the sale of that residence.
I am satisfied that the applicant has shown that she was and is unable to support herself without recourse to an income tested pension and that she would suffer hardship if she were not granted leave. I am of the view that this consideration outweighs any hardship to be suffered by the respondent.
I intend to order that the applicant be granted leave to institute proceedings for an order for spousal maintenance, pursuant to the provisions of subsection 44(3) of the Family Law Act.
Because an application for leave is an interlocutory application, I have decided this question separately from the substantive application, pursuant to Rule 17.02 of the Federal Magistrates Court Rules 2001.
I certify that the preceding thirty-one (31) paragraphs are a true copy of the reasons for judgment of Scarlett FM
Associate: A. Coutman
Date: 15 May 2002
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