Maitland & Fraley
[2021] FamCA 593
•11 August 2021
FAMILY COURT OF AUSTRALIA
Maitland & Fraley [2021] FamCA 593
File number(s): ADC 1428 of 2021 Judgment of: BERMAN J Date of judgment: 11 August 2021 Catchwords: FAMILY LAW – SPOUSAL MAINTENANCE – Interim – Where the applicant seeks interim spousal maintenance – Where the respondent seeks the application be dismissed – Where the applicant satisfies the threshold test – Consideration of s 75(2) factors – Where the respondent disputes the applicant’s income – Where the applicant has funds available to her – Where it is not necessary to consider the respondent’s ability to pay – Application dismissed. Legislation: Family Law Act 1975 (Cth) ss 72(1), 74(1), 75(2) Cases cited: Hall v Hall (2016) 257 CLR 490
Maroney & Maroney [2009] FamCAFC 45
McCrossen & McCrossen (2006) FLC 93-283
Mitchell & Mitchell (1995) FLC 92-601
Stein & Stein (2000) FLC 93-004
Number of paragraphs: 50 Date of hearing: 30 June 2021 and 8 July 2021 Place: Adelaide Counsel for the Applicant: Mr McGinn Solicitor for the Applicant: Adelta Legal Counsel for the Respondent: Ms Lewis Solicitor for the Respondent: Clelands Lawyers Adelaide ORDERS
ADC 1428 of 2021 BETWEEN: MS MAITLAND
Applicant
AND: MR FRALEY
Respondent
ORDER MADE BY:
BERMAN J
DATE OF ORDER:
11 AUGUST 2021
THE COURT ORDERS THAT:
1.The applicant’s application for spousal maintenance is dismissed.
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 17.02A(b) of the Family Law Rules 2004 (Cth)), or to record a variation to the order pursuant to 17.02 Family Law Rules 2004 (Cth).
IT IS NOTED that publication of this judgment by this Court under the pseudonym Maitland & Fraley has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
REASONS FOR JUDGMENT
BERMAN J
INTRODUCTION
By Initiating Application filed 24 March 2021, Ms Maitland (“the applicant”) seeks final orders for settlement of property in such terms as the Court deems just, a general order for spousal maintenance and an order by way of departure from the administrative assessment such that the husband pay child support at the rate of $18,200 per annum and non-periodic support in respect of the children’s school fees and expenses.
Relevant to the current proceedings, the applicant seeks an order by way of interim spousal maintenance that the respondent pay to her the sum of $3,200 per month.
By Response filed 7 May 2021, Mr Fraley (“the respondent”) proposes that by way of final orders for property settlement, the non-superannuation property of the parties be divided 55 per cent to the applicant and 45 per cent to the respondent with the superannuation entitlements of the parties to be equalised.
The respondent seeks that the applicant’s interim application for spousal maintenance be dismissed.
BACKGROUND
The parties commenced cohabitation in October 2000 and were married in 2014. There are two children of the marriage, namely X born in 2005 and Y born in (collectively “the children”).
The parties separated according to the respondent on 23 May 2017. The applicant formally vacated the former matrimonial home at B Street, Suburb C (“the Suburb C property”) in September 2017 and moved to her present accommodation at D Street, Suburb E (“the rental property”).
At the date of commencement of cohabitation the applicant was in full-time employment at a local business. The respondent also worked full-time.
Following the conception of the parties’ first child, the applicant took maternity leave at thirty four weeks.
The applicant contends that she has not worked on a full-time basis since the birth of the first child and has not returned to full-time employment. The respondent does not accept the applicant’s summary of her ability and capacity for full-time employment and contends that she is capable of working full-time and that this is demonstrated by the hours spent on her interest in various hobbies.
The respondent acknowledged that the applicant did not work for several years while the children were young however, he says that the topic of the applicant taking up paid employment was often discussed but rejected by her.
After separation, the applicant returned to work as a public servant on contract with a government department. Her employment was full-time until August 2019.
The applicant contends that in September 2019 she suffered a heart attack and was not able to resume employment until February 2020.
Following her recovery, the applicant commenced a part-time contract role with another government department which averages a little less than twenty hours per week as and from December 2020. In June 2020, the applicant commenced part-time employment with G Company averaging about fifteen hours per week.
The respondent continues working for F Company. His employment is full-time.
The parties are not agreed as to the construct of the asset pool comprising assets and liabilities but both agree it is not insignificant and is predominantly comprised of the parties’ interest in the Suburb C property and the property at H Street, Suburb J (“the Suburb J property”).
The parties also hold interest in various bank accounts and in particular the sum of about $257,048 in a conveyancer’s trust account following the recent sale of three investment properties.
An important focus of the interim proceedings is the extent to which the lump sum of $223,996, recently received by the applicant as beneficiary of her late father’s estate, is relevant to the applicant’s claim for spousal maintenance.
INTERIM SPOUSAL MAINTENANCE
In the decision of Hall v Hall (2016) 257 CLR 490 (“Hall v Hall”) the High Court set out the appropriate approach in considering an application for interim spousal maintenance as follows:
3.… The gateway to the operation of Pt VIII in relation to spousal maintenance is in s 72(1). That subsection provides that “[a] party to a marriage is liable to maintain the other party, to the extent that the first-mentioned party is reasonably able to do so, if, and only if, that other party is unable to support herself or himself adequately … having regard to any relevant matter referred to in [s] 75(2)”.
4.The liability of a party to a marriage to maintain the other party that is imposed by s 72(1) is crystallised by the making of an order under s 74(1). That subsection provides that, “[i]n proceedings with respect to the maintenance of a party to a marriage, the court may make such order as it considers proper for the provision of maintenance in accordance with this Part”.
5.A court exercising the power conferred by s 74(1) is obliged by s 75(1) to take into account the matters referred to in s 75(2) and only those matters (s 75(1)). Those matters are presented as a comprehensive checklist. They include what s 75(2)(b) refers to as “the income, property and financial resources of each of the parties and the physical and mental capacity of each of them for appropriate gainful employment”. They also include, by virtue of s 75(2)(o), “any fact or circumstance which, in the opinion of the court, the justice of the case requires to be taken into account”.
…
8.Unlike a court exercising the power to make an urgent order conferred by s 77, a court exercising the power to make an interim order under s 74(1) must be satisfied of the threshold requirement in s 72(1) and must have regard to any matter referred to in s 75(2) that is relevant. No doubt, on an application for an interim order “[t]he evidence need not be so extensive and the findings not so precise” as on an application for a final order. But there is nothing to displace the applicability to an exercise of the power conferred by s 74(1) of the ordinary standard of proof in a civil proceeding now set out in s 140 of the Evidence Act 1995 (Cth). A court determining an application for an interim order under s 74(1) cannot make such an order without finding, on the balance of probabilities on the evidence before it, that the threshold requirement in s 72(1) is met having regard to the relevant matter referred to in s 75(2).
(Footnotes omitted)
As noted in Hall v Hall (supra), an applicant seeking orders for spousal maintenance carries the evidentiary burden.
In this case the husband concedes that the gateway requirement is satisfied. That is, as a result of the wife’s role as homemaker for the children and taking into account her health needs, the wife is unable to support herself adequately as contemplated by s 72(1)(a) of the Family Law Act 1975 (Cth) (“the Act”).
The issue then is to determine the following:-
(a)To what extent is the wife unable to support herself as a result of having the care of the children under the age of 18 years;
(b)What is the wife’s reasonable needs;
(c)What capacity has the husband to meet a spousal maintenance order, if such an order were to be made; and
(d)If (a) to (c) favour an order for spousal maintenance being made by the Court, what order is reasonable having regard to s 75(2) of the Act.
In Maroney & Maroney [2009] FamCAFC 45 the Full Court said:
56.… Once a party … establishes an entitlement to interim spousal maintenance, and such entitlement is quantified in accordance with that spouse’s reasonable needs, an order may be made notwithstanding that the liable spouse could only satisfy the order out of capital or borrowings against capital assets.
The Full Court in McCrossen & McCrossen (2006) FLC 93-283 at 80,838 [32] considered the definition of “adequately” and considered that it was:
not to be determined upon a “subsistence level” but upon consideration of whether the applicant can support himself or herself “adequately” importing a standard of living reasonable in the circumstances.
(Citations omitted)
I bring to account the personal factors affecting the parties but in particular the applicant. It is not contested that whilst she held employment from time to time and is not without significant skill and capacity for employment, her primary focus throughout the course of the relationship was to care for the children.
The parties do not agree the extent to which each of them had input in the upbringing of the children however, it is not controversial that the respondent has enjoyed continuity of employment in his chosen field whereas the applicant has changed employment to fit in with the domestic arrangements of the parties and the care of the children. It is only as the children have become older and in particular since separation, that the applicant was able to explore a greater range of employment options.
The applicant’s current level of employment is approximately thirty hours per week and is comprised of two jobs utilising different skill sets.
The respondent raises the potential for the applicant to extend her hours with the government department. The applicant points to her heart attack in 2019 and refers to her daily medication regime but also the physical consequences of her heart attack which results in her tiring easily and needing significant periods of sleep each night.
The matters put forward by the applicant as explanation to justify the current level of employment are reasonable and have not been the subject of serious challenge by the respondent.
Accordingly, I consider that the applicant has satisfied the threshold test enabling the Court to consider the operation of Part VIII of the Act and in particular s 72(1) and a consideration of what order, if any, should be made under s 74(1).
The applicant relies upon her Financial Statement filed 24 March 2021. The document reveals that the total income of the applicant is $828 comprising the following:
government department salary $500 Family Tax Benefit $45 Maintenance received for children $283
For the purpose of determining the applicant’s income, I intend to ignore the family tax benefit and the applicant’s child support in circumstances where it is necessary to distinguish between the expenses of a spouse seeking an order for spousal maintenance and the expenses of the children of the marriage.[1]
[1] Stein & Stein (2000) FLC 93-004
The Part G expenditure of the applicant is $788 which is principally comprised of the applicant’s rental payments of $595. I consider the applicant’s Part G expenses to be reasonable.
Similarly, the Part N weekly expenses in respect of discretionary expenditure for the applicant at $373 is also reasonable. The respondent does not seek to challenge the applicant’s total expenditure of $1,161 per week.
According to the applicant’s financial statement there is a deficiency of expenditure over income of $661.
The respondent however challenges the applicant’s income by reference to the average of the applicant’s earnings per week between March 2021 and June 2021 from G Company and government department payslips.
The applicant’s assertion was not the subject of significant challenge and I find that the applicant received gross income of $216.87 per week from her employment with G Company and $749.12 per week from her employment with the government department which totals $965.99 per week before tax or $842.58 net of tax.
The applicant’s shortfall of expenditure at $1,161 less income of $842 is $319 per week.
Once I am satisfied that it is appropriate to exercise the power conferred in s 74(1) of the Act, I am obliged to have regard to the matters as set out in s 75(2). Of particular relevance to the current proceedings and circumstances of the parties is the application of s 75(2)(b), namely to take into account “the income, property and financial resources of each of the parties and the physical and mental capacity of each of them for appropriate employment”.
In her Financial Statement filed 24 March 2021, the applicant discloses that she held the sum of $50,564 in a National Australia Bank (“NAB”) account ending 70.
By reference to the applicant’s affidavit filed 30 June 2021, a copy of a NAB statement for the relevant account discloses that as at 8 June 2021 the applicant’s account was in credit in the sum of $24,297.02. The debit transactions for May and part of June reveal $15,000 being paid to the applicant’s solicitors for legal fees associated with the proceedings.
On 10, 11 and 14 June 2021 the applicant received her inheritance totalling $223,996.04. Following the deduction of further legal fees on 15 June 2021, the balance as at 21 June 2021 was $241,567.
The applicant contends that she should not be required to draw upon capital for her maintenance. References were made to the decision of Mitchell & Mitchell (1995) FLC 92-601 (“Mitchell & Mitchell”) where the Full Court observed that it is not necessary for an applicant to use up all of his or her assets and capital in order to satisfy the requirements that he or she is unable to support himself or herself “adequately”.
It is a matter of discretion as to the application of the relevant factors pursuant to s 75(2) of the Act.
In Mitchell & Mitchell (supra) the Court was concerned to determine the wife’s application for property settlement and spousal maintenance. The pool of property was relatively modest at $300,000 and the trial judge ordered that the wife receive 90 per cent. In doing so he dismissed the wife’s application for spousal maintenance. The wife appealed from both orders. The Full Court considered that an applicant was not required to use up assets and capital to satisfy the requirement of “adequate support” but the decision is to be made according to the circumstances of the case. It was an important consideration of the Full Court that the amount received by the wife in Mitchell & Mitchell (supra) was limited and as such, the fact that she had received an order of settlement of property did not extinguish her ability to seek spousal maintenance.
The current circumstances are by way of an interim hearing rather than a final determination of the property of the parties and the claim for spousal maintenance.
Given that the applicant’s shortfall is $319 per week, even assuming a period of six months until this matter may well be heard and determined, over a period of twenty six weeks the total sum of spousal maintenance would be $8,294.
In the circumstances of this case, that sum or even a higher amount as may be calculated over a longer period is capable of ready and easy adjustment taking into account the reasonable property of the parties. As such, I do not think it is necessary to consider on an interim basis the respondent’s ability to pay the spousal maintenance as sought by the applicant.
The respondent’s position is as broadly set out in his Amended Financial Statement filed 25 June 2021, noting that the applicant does not accept the extent of the respondent’s Part G or Part N expenditure.
In any event, if an order was to be made then it is likely it would have been paid by way of lump sum order from monies held in the conveyancer’s trust account, currently standing in the sum of $257,048.
For these reasons, I make the order as appears at the commencement of these reasons.
I certify that the preceding fifty (50) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Berman. Associate:
Dated: 11 August 2021
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