Mansfield and Mansfield (No.2)
[2017] FCCA 1117
•26 May 2017
FEDERAL CIRCUIT COURT OF AUSTRALIA
| MANSFIELD & MANSFIELD (No.2) | [2017] FCCA 1117 |
| Catchwords: FAMILY LAW – Property and children’s proceedings – wife seeks to live in parties’ investment property pending finalisation of relocation application – property subject to mortgage and currently rented – wife seeks that husband pay recurrent expenses arising from property – husband seeks that wife pay commercial rent to occupy property – application analogous to one for interim spousal maintenance – matters to be considered – capacity of husband to pay mortgage – capacity of wife to support herself adequately – what is proper order to be made. |
| Legislation: Family Law Act 1975, ss.72, 72(1), 74, 75(2), 75(3), 79, 80(1), 114(1)(b) |
| Cases cited: Mansfield & Mansfield [2016] FCCA 2233 Mansfield & Mansfield (No.2) [2017] FCCA 13 Bevan & Bevan (1995) FLC 92-600 Mitchell & Mitchell (1995) FLC 92-601 Kiesinger & Padget [2008] FamCAFC 23 Brown & Brown (2007) FLC 93-316 Saxena & Saxena (2006) FLC 93-268 |
| Applicant: | MS MANSFIELD |
| Respondent: | MR MANSFIELD |
| File Number: | ADC 4119 of 2014 |
| Judgment of: | Judge Brown |
| Hearing date: | 18 May 2017 |
| Date of Last Submission: | 18 May 2017 |
| Delivered at: | Adelaide |
| Delivered on: | 26 May 2017 |
REPRESENTATION
| Counsel for the Applicant: | Mr Jordan |
| Solicitors for the Applicant: | Jacqui Ion Pty Ltd |
| Counsel for the Respondent: | Mr Weil |
| Solicitors for the Respondent: | Scanlan Carroll Pty Ltd |
ORDERS
In the event that the wife gives written notice to the husband of her intention to occupy the property known as and situate at Property E hereinafter referred to as “the Property E property” no later than close of business on 2 June 2017:
It is ordered as follows:
The parties thereafter give appropriate legal notice to the tenant of the Property E property that vacant possession of the property is required as soon as is legally possible.
Upon the Property E property becoming vacant until further or other order the wife be entitled to occupy the said property exclusively subject to the condition that she provide the sum of $180.00 per week in respect of the mortgage secured against the property to the husband and be responsible for all expenses arising in respect of the property which have hitherto been borne by the previous tenant of the property but otherwise the husband bear all other outgoings in respect of the property.
If the wife fails to give notice in terms of order one hereof her application in a case be dismissed.
IT IS NOTED that publication of this judgment under the pseudonym Mansfield & Mansfield (No.2) is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT ADELAIDE |
ADC 4119 of 2014
| MS MANSFIELD |
Applicant
And
| MR MANSFIELD |
Respondent
REASONS FOR JUDGMENT
Introduction
This application, analogous to one for interim spousal maintenance, arises in bitterly contested proceedings relating to the division of matrimonial property and parenting arrangements. It is necessary to place the application within the context of the proceedings, which have inexorably grown in complexity since their commencement.
Background
The parties to the proceedings are Ms Mansfield “the wife” and Mr Mansfield “the husband”. They married on (omitted) 2008 and finally separated on 13 October 2014. The parties are the parents of X born (omitted) 2006 and Y born (omitted) 2007.
The parties met in (omitted) in 2005 and have lived in the area of the town ever since. Mr Mansfield is a long term resident of the South East of the State. Ms Mansfield has lived in (omitted) since 2002 and has had employment as a (occupation omitted) at several (employers omitted) in the town, both on a part-time and fulltime basis.
The most contentious aspect of the parenting proceedings is the wife’s application to relocate the children’s place of residence from (omitted) to Adelaide. This application is opposed by the husband, who seeks what is commonly called an equal time regime based on the children continuing to live in (omitted). He will not himself countenance moving to live in Adelaide.
It is the wife’s position that she has been deeply unhappy living in (omitted) for many years. As a consequence, it is her case that it is likely to be injurious to her long term mental wellbeing to compel her to live in (omitted) for the indefinite future. She categorises the husband as being a domineering person who, during their marriage, isolated her socially in (omitted) and has subjected her to varying degrees of control including in a financial sense in the period since.
On the other hand, it is the husband’s case that it is Ms Mansfield, rather than he, who has the volatile and reactive personality. He denies being the coercive and controlling spouse depicted by the wife. In addition, Mr Mansfield has alleged throughout the proceedings that Ms Mansfield has longstanding issues with alcohol, which represent a significant level of risk to X and Y and militate against the children living far away from his support.
At the outset of the proceedings, the wife proposed a 65/35% division of property in her favour. On the hand, the husband proposed that the property be divided 70/30% in his favour on the basis that he owned the parties’ most significant assets in financial terms, namely their former family home and some farming acres when the parties began their relationship. As will become clear in due course, the wife’s position, so far as property is concerned, is now significantly different.
Proceedings have been on foot between the parties since November of 2014. Both parties have devoted significant financial resources towards funding the proceedings. During this period the parties have engaged an experienced psychologist, Ms A, to assess the dynamic of their family and make recommendations as to how the children’s interests may be best served particularly in the context of the major issues raised by the parties which can be summarised as follows:
·The viability of shared care given the dynamic of the parties’ relationship with one another;
·The nature of the children’s relationship with each of their parents;
·The implications of the wife’s alcohol consumption for the wellbeing and security of the children;
·Whether the husband had subjected the wife to coercive and controlling behaviour both before and after the parties’ separation;
·If so, what were the likely implications of this for the wife’s psychological equilibrium, particularly in the context of her wish to move to Adelaide;
·The views, if any, of the children about possibly moving to Adelaide.
In her first family assessment report dated 22 April 2015, Ms A reported that in interview, both children were vociferously in favour of remaining in (omitted) and living with their parents on a week to week basis. They were observed to interact happily and comfortably with both of their parents.
During the assessment process, Ms A explored with the wife her history of alcohol abuse and reached the view that Ms Mansfield was not then currently dependant on alcohol but had likely been at times physically and psychologically absent from the children due to her alcohol use, which had clearly been problematic for both her and the children in the past.
In addition, Ms A, in April of 2015, was not in favour of the parties having a shared care arrangement for X and Y, as she did not think that the parties had sufficient communication skills and trust in one another to make such a regime successful for the children. In these circumstances, Ms A considered the children needed a primary home base with their mother who was on balance likely to be more emotionally in tune with X and Y, given how the children had been parented during the parties’ relationship.
At this stage (April 2015) because of her concerns about Ms Mansfield’s psychological health, particularly in the context of a relapse of problematic alcohol use, Ms A was not in favour of the children moving away from (omitted) and their father. Rather she was of the view that the children needed a period of stability during which some of their educational deficits, as identified by Ms A, could be addressed.
In these circumstances, she recommended that the issue of relocation be deferred for approximately 12 months to see if this period would assist the parties to mend their own parenting relationship and assist the children to become more emotionally and educationally resilient. Ms A wrote as follows:
“Decisions regarding location be deferred for 12 months. The children require stability and consistency in their environment and their relationship. They need the opportunity for both parents, now they are not dealing with the stresses in their marriage, to focus on them and their developmental (emotional educational) needs.
In the meantime shared care cannot be recommended as an alternative … if shared care is to be possible in the future, the co-parenting relationship needs significant strengthening and Mr Mansfield needs to be more aware of the children’s vulnerabilities. At this stage, the children having a primary home – base, with their mother, is recommended. Obviously Mr Mansfield is an important source of support for the children and they need to have regular time with him.
Ms Mansfield continued to access counselling, and specifically address her self-monitoring and coping skills, if this can be provided by her current counsellor, or if not, a specialist in the area of drug or alcohol abuse…
There may also be more Mr Mansfield can do, emotionally or financially to support Ms Mansfield in staying in (omitted), … for example, he may be able to assist with the family finding more suitable accommodation, if required.”[1]
[1] See Ms A’s report dated 22 April 2015 at page 21
The parties elected to adopt Ms A’s recommendation that there be a deferral of the final hearing of the children’s issues for a period of approximately twelve months. However, during this moratorium, it is apparent to me that there has been no reduction in the level of tension between the parties or any abatement of their mistrust for one another.
In August of 2016, I was called upon to deal with an interim application brought by the husband, which arose as a consequence of his concern that Ms Mansfield was continuing to abuse alcohol. Mr Mansfield’s concerns in this regard had arisen because he had arranged for Ms Mansfield to be subject to the surveillance of a private inquiry agent. When Ms Mansfield discovered she had been subject to such surveillance, she asserted that she felt psychologically violated.[2]
[2] See Mansfield & Mansfield [2016] FCCA 2233
Other equally intractable disputes have arisen between the parties in respect of financial matters. The husband’s father is Mr Mansfield. He is a person in his early seventies who is currently in indifferent health. During the course of his career as a (occupation omitted), professional (occupation omitted) and (occupation omitted), Mr Mansfield Senior generated significant wealth for himself.
On the advice of accountants and solicitors, Mr Mansfield Senior set up several trusts and related companies through which income from his business activities was channelled. There can be little doubt that Mr Mansfield Senior remains a very wealthy person. The husband and his sister, Ms B has each been named as possible beneficiaries to these trusts, which are discretionary in nature.
It appears to be Ms Mansfield’s position that she considers the husband has some level of control over the trusts established by Mr Mansfield Senior and, as a consequence, he has himself potential access to significant sources of wealth, which he has attempted to conceal from her but which should otherwise be amenable to her application for property settlement.
Much time and effort has been put into exploring this issue before the court. In particular, the wife caused various subpoenas to be issued to Mr Mansfield Senior; Ms B; and Mr Mansfield Senior’s accountant, Mr D.
It is the husband’s position is that his father is, as far as he knows, a wealthy person. However, the husband asserts that he has received no direct gifts, distributions or loans from any of his father’s trusts and Mr Mansfield Senior remains in firm control of them. As a consequence, it is the husband’s position that his father’s property has no relevance whatsoever to these proceedings.
Mr Mansfield Senior and Ms B objected to producing various documents sought by the wife relating to various trust entities. I dealt with these objections and directed that the documents sought be produced.[3] I did so not on the basis of any finding that the assertions of the wife, in respect to the husband’s possible interests in the various trusts in question, was probable or even possible, but because I considered that she had a legitimate forensic interest in the documents concerned.
[3] See Mansfield & Mansfield [2017] FCCA 13
However, this did not end the controversy between the parties. At an earlier stage, their competing applications had been listed for final hearing for three days commencing on 14 February 2017. This proved to be a woefully inadequate estimate of the time required for the matter.
Prior to the commencement of the final hearing, the solicitors for the wife caused a subpoena to give evidence to be issued in respect of each of Mr Mansfield Senior, Ms B and Mr D. The three days allocated for the hearing were taken up with counsel for the wife examining each of these witnesses at length, with some brief cross-examination from counsel for the husband.
No evidence whatsoever was taken from either the husband or the wife. In particular, no evidence was led relating to the arrangements for the care of X and Y, particularly in the context of the proposed relocation. Rather, each of the three recipients of the subpoenas concerned was extensively examined about Mr Mansfield Senior’s business arrangements.
On 14 March 2017, counsel for the wife opened the wife’s case, in respect of property issues, on the following basis:
“… insofar as these proceedings relate to property matters, the wife will not be able to proceed beyond eliciting the evidence from the witnesses … which will enable her to (for the first time in these proceedings)to have some idea of the assets and resources of the husband and therefore of the asset pool available for distribution in these proceedings.”
This position was and remains unacceptable to counsel for the husband. It is his position that his client is entitled to know with precision the precise orders, which Ms Mansfield seeks in respect of the division of property. As previously indicated, it is his position that his father’s assets have no relevance to these proceedings. In these circumstances, he would characterise the pool of assets available to be distributed between the parties in this case to be not particularly extensive in nature and easily ascertainable.
In general terms, it appears to be the husband’s position that the wife is either grasping at straws or is attempting to exert unfair pressure on an infirm and elderly person, albeit a wealthy one, in order to secure some financial advantage for herself in these proceedings by a process of attrition.
At the end of the three days allocated for the trial, counsel for the wife indicated both to the court and to the husband that further time was required to formulate the wife’s position in the light of the oral evidence adduced from Mr Mansfield Senior; Ms B; and Mr D. On this basis, it was ordered that the wife file her amended application within six weeks. The matter was then adjourned to late April for further directions.
Recently, Ms Mansfield has filed what is entitled a Further Amended Initiating Application. She did so on 28 April 2017. In this application, she has added Mr Mansfield Senior and Ms B as parties, along with (business omitted) and three trusts – the Mansfield Land Trust; Mansfield Family Trust; and the Mansfield Farming Trust.
Pursuant to this application, the wife seeks to have set said aside a number of transactions relating to land which are alleged to have involved Mr Mansfield Senior and the various trusts which I assume are said to have occurred in order to ostensibly divest the husband of some form of interest in the parcels of land concerned. The transactions occurred in November of 2014.
These applications rely on the application of section 106B(1) of the Family Law Act 1975 which reads as follows:
(1) In proceedings under this Act, the court may set aside or restrain the making of an instrument or disposition by or on behalf of, or by direction or in the interest of, a party, which is made or proposed to be made to defeat an existing or anticipated order in those proceedings or which, irrespective of intention, is likely to defeat any such order.
Thereafter, dependent on the outcome of her application pursuant to section 106B, Ms Mansfield reiterates her position that the court should make what orders for the settlement of matrimonial property, which it considers just and equitable.
More recently again, on 18 May 2017, solicitors acting for Mr Mansfield Senior, Ms B and the various other entities named by the wife filed a response and supporting affidavit by which the dismissal of the wife’s further amended initiating application is sought. This application will have to be determined at some stage.
At this juncture, I have not been advised how long the final hearing is anticipated to take. In addition, at this stage, I do not know how many parties will be involved in the case. It will depend on the success or otherwise of the application made by the recently added parties.
Given that the case potentially involves the rights of third parties, I anticipate that the final hearing has the potential to raise complex issues of law and equity and so require an extensive period of time for hearing, in comparison to the cases routinely heard in this court, which has been established to determine less complex family law matters.
In the period leading up to the hearing scheduled for February 2017, Ms A was invited to revisit the family and update her assessment of it. Ms A’s second family assessment report was released to the parties on or about 24 November 2016, after she had observed both X & Y interacting with their parents and interviewed them, once again, in late October.
X reported to Ms A that she did not want to move to Adelaide as she “was really really happy” to stay in (omitted). Y did not have any strong views about a move to Adelaide either way. Both children were observed to interact warmly with their mother and father.
Overall, Ms A continued to consider X and Y to be developmentally vulnerable children. However, she noted that the past year had been one of relative stability allowing them to become less involved in the conflict between their parents and able to catch up with their peers at school.
Ms A was critical of Mr Mansfield’s decision to engage a private investigator to observe Ms Mansfield clandestinely. Ms A considered that it demonstrated that Mr Mansfield had a level of preoccupation with demonstrating that Ms Mansfield was not a fit parent, which by necessary implication was not likely to be helpful to the parties having a cooperative parenting relationship with one another.
Ms A did not rule out the possibility that this use of the private investigator was reflective of a pattern of coercive and controlling violence, on Mr Mansfield’s part, following separation. If so, in Ms A’s assessment, it might be a factor militating in favour of the court permitting Ms Mansfield to move away from (omitted) in order to enable her to have the benefit of being protected from intrusive monitoring/harassment.
Ms A continued to regard Ms Mansfield as being vulnerable to reversion to old coping mechanisms involving excessive alcohol use, particularly if placed under emotional stress. However, at the time of assessment, Ms A did not consider that Ms Mansfield was experiencing clinical signs of significant anxiety and/or depression. Overall, Ms A considered that Ms Mansfield was coping with her current situation.
In all the circumstances of the case, Ms A opined as follows:
“What is currently occurring is working for the children … at this stage the writer is weary of recommending any change, other than that parents do more to ensure the children are protected from the conflict. While the children want more time with their father, they are seeking leisure/fun opportunities with him, which are harder to accommodate during the school week. Ms Mansfield has been an effective organiser for the children, and care giver, and the children are making good progress. The children cannot support such a significant change as a shift towards a week-about arrangement at this time.
…
A final note is that both children, when asked what they could possibly wish for in the world, wanted their mother to be able to have a house.
…
Progressing the property settlement will clearly be of benefit in these circumstances.”[4]
[4] See family assessment report dated 24 November 2016 at page 16
Accordingly, whilst Ms A could see some positive advantages of Ms Mansfield being able to relocate to Adelaide, particularly in the sense that it might extricate her from some degree of scrutiny from Mr Mansfield, which had the potential to be stressful to her and so not likely to be helpful to her ability to parent the children to her full capacity, Ms A was not in favour of such an outcome.
In this context, I note that Ms A was careful to point out that the degree, if any, of control exerted by Mr Mansfield over his former wife was a matter for evidence. However, notwithstanding this proviso, Ms A recommended that the court consider only modest changes to the current regime, particularly a move to the children spending a five night block per fortnight in their father’s care.
The current application
It remained Ms Mansfield’s position, at the outset of the final hearing in February of this year that she wished to move the children’s residence from (omitted) to Adelaide. Mr Mansfield vigorously resists such an outcome. It being his position that the children are well settled in (omitted).
In the context of this aspect of the dispute between the parties, the issue of Ms Mansfield’s possible accommodation in (omitted) is clearly relevant. It is an issue on which Ms A touched and of which X and Y seem to have some level of awareness, given their comments to Ms A and their apparent wish that their mother be able to acquire a house for herself.
When the parties separated in October 2014, the wife and children left the former family home located at Property Y, and moved into rented accommodation at (omitted). Ms Mansfield’s weekly rent is $230.00. These proceedings are concerned with the on-going issue of Ms Mansfield and the children’s accommodation.
In September 2012, the parties jointly purchased Property E, as an investment property. It is a two storey/four bedroom house. The purchase price was $260,000.00. The Property Y home was used as security for the purchase, which was negatively geared.
At the present time, the parties agree that Property E is valued at $275,000.00 and is subject to a mortgage of $248,000.00. The property is leased to a tenant at a rent of $330.00 per week, which is currently received by Mr Mansfield. He also pays outgoings associated with the property.
At the time the parties began their relationship, Mr Mansfield owned the Property Y property, as well as two parcels of land at Property B. It is his position that the parties’ marital estate can be fairly easily calculated and comprises the following major items:
Farming land at Property B
$475,000
Property Y
$540,000
Property E
$275,000
Total
$1,290,000
Liabilities
Mortgage – Property E
$248,000
Total Net Assets
$1,042,000
In addition, it is common ground between the parties that there are various motor vehicles and other items of property which are relevant to the proceedings. In addition, Mr Mansfield holds water licenses relating to the Property B land and operates a (omitted) business. Finally, Mr Mansfield has an investment in a (omitted), located outside of (omitted), the (“business omitted”). On his calculation, there are approximately a further $280,000.00 worth of assets, including superannuation, relevant to these proceedings.
It is Mr Mansfield’s position that his business (“business omitted” provides him with a weekly income of $740.00 which, together from the lease of farm land ($152.30); his investment income from the (business omitted) ($38.00); and his rental income from Property E ($330.00); provides him with a gross weekly income of $1,260.30. On this amount, Mr Mansfield pays weekly amounts of tax ($52.00); child support for X & Y ($31.00); and the sum required to service the Property E mortgage ($341.00).
It is the wife’s position that the accommodation, which she rented at (omitted) following separation was intended only as a stop gap measure. The property has only two bedrooms, which is far from ideal from her perspective, given X and Y must share a room.
In addition, given that the three days allocated for the final hearing in February of this year has only added to the controversy arising in the case, Ms Mansfield concedes that she and the children must remain in (omitted) for the foreseeable future, certainly until the relocation issue has been determined. This has crystallised her view that her rented accommodation is unsuitable in the short to medium term.
In these circumstances, on 18 April 2017, Ms Mansfield filed an application in a case in which she seeks the following orders:
·The husband terminate the lease of the tenants currently occupying Property E forthwith;
·Upon the tenants vacating the property, the wife have sole use and occupation of the property;
Mr Mansfield responded to this application on 27 April 2017. He seeks that the wife’s application be dismissed. However, from his perspective, the issue is not as completely cut and dried, as this response would indicate. From both parties’ perspectives, it would seem that whatever occurs in respect of the Property E property will have tactical implications in respect of the proceedings overall.
As previously indicated, Ms A has indicated that X has some significant ambivalence about possibly moving to Adelaide. In addition, both children are apparently well aware of the unsuitability of the (omitted) property and their mother’s apparent dissatisfaction with it.
One possible interpretation of Ms A’s report is that both children are likely to feel happier and more secure if they perceive that they and their mother have a secure home which is satisfactory to Ms Mansfield. For obvious reasons, Ms Mansfield is not likely to be amenable to putting down deeper and perhaps more permanent roots in (omitted).
For equally obvious reasons, Mr Mansfield is likely to take an opposing view. In this context, I have been provided with correspondence passing between the parties’ respective solicitors. This indicates that Mr Mansfield is willing to transfer his interest in the Property E property to Ms Mansfield by way of a partial settlement of property.
In this context, Mr Mansfield has been advised by his bank that he can use the former family home and his other real property to refinance the transfer of the Property E property to Ms Mansfield so that it is unencumbered. The wife has rejected this proposal. From her perspective she has no interest in owning a piece of real property in (omitted), when her wish is to live outside of the town.
In lieu of his offer of partial property settlement, Mr Mansfield has indicted that in the light of Ms Mansfield’s proprietary interests in the Property E property, he has no objections to her occupying it provided that she pays rent at the current market rate of $330.00 per week. In conjunction with this payment, which he would receive, he would continue to pay the necessary mortgage repayments and other outgoings, which are marginally greater than the rent.
This compromise is not acceptable to Ms Mansfield. It is her position that she is currently in a parlous financial position and it is grossly unfair to her that Mr Mansfield remains in control of the parties’ entire major items of matrimonial property, particularly the former family home, whilst she is forced to have recourse to private rental accommodation. In addition, she points to the fact that she only receives a modest amount of child support for X and Y, which axiomatically falls far short of supplying their day to day requirements.
As previously indicated, Ms Mansfield has qualifications as a (occupation omitted). In 2014, she worked at a (employer omitted) in (omitted). From mid-2016, she accepted a six month contract position at (employer omitted). In January of 2017, she commenced a six month (occupation omitted) position at (employer omitted) in (omitted). The evidence I have been provided in respect of what is anticipated to be the level of Ms Mansfield’s remuneration in respect of this position is not clear.
In anticipation of the February hearing, Ms Mansfield filed a statement of her financial circumstances on 3 February 2017. This indicated that she had been employed by the (employer omitted) for a period of eight days and her total salary was “nil”. Thereafter, Ms Mansfield deposed that her sole source of financial support was government benefits and child support of $28.00 per week.
I have been provided with a child support assessment, for the period 1 December 2016 to 28 February 2018, this indicates that the relevant child support assessment is based on a provisional income of $33,331.00 for Mr Mansfield and a taxable income for the 2016 financial year of $28,322.00 for Ms Mansfield. These figures are likely to be provisional in nature and, as such, the assessment may change.
Given the length of time, since the parties separated, during which time Ms Mansfield has been able to accommodate herself, it is Mr Mansfield’s position that there is no urgency about the wife’s application. In addition, he asserts that Ms Mansfield’s income as a (occupation omitted) is likely to be approximately $1,398.00 per week, which is almost twice his level of income after the rent from Property E is deducted.
Mr Mansfield further asserts that he makes many other financial contributions towards the welfare of the children, including their private school fees and other expenses, such as uniforms and (hobby omitted) classes for X. In these circumstances, it is Mr Mansfield’s position that he does not have the resources to provide the Property E property to Ms Mansfield unless she pays the market rental value of the property, which he asserts she has the financial capacity to do.
On the other hand, it is Ms Mansfield’s position that the husband is much more financially secure than she is and has access to significant financial resources either directly or via Mr Mansfield Senior. As with every other aspect of the proceedings to date, the issue of the terms to be associated with the wife’s occupation of the Property E property was fiercely contested.
It is the husband’s position that he has paid legal costs amounting to somewhere in excess of $100,000.00 and has an ongoing liability of around $30,000.00.[5] It is the wife’s position that she has borrowed a sum in excess of $140,000.00, from relatives in order to fund these proceedings. As I understand matters, these figures were current as at the commencement of the February trial.
[5] See husband’s affidavit filed 3 February 2017 at paragraph 288
If Mr Mansfield is correct in his assessment of the extent of the pool of property available to be divided, it would indicate that the parties have allocated approximately 25% of their joint worth to these proceedings. For obvious reasons, particularly the fact that there appears to be no end in sight to the case and it appears to be growing in its potential for controversy, this level of expenditure greatly concerns me.
It has also caused me to question on several occasions with the parties’ respective legal advisers, whether this court is the appropriate forum for the resolution of the issues raised by the case. My concerns in this regard have been heightened by the advent of the new respondents to the proceedings and the potential complexity of issues likely to be raised.
Legal Principles Applicable
Ms Mansfield is not seeking the transfer of any specific item of property to her. Nor is she seeking an injunction pursuant to section 114(1)(b) of the Act, seeking the sole occupation of the former family home. Rather she is seeking to occupy a property which she and the husband own subject to the condition that the husband pay the costs associated with her occupation of that property.
In this sense, Ms Mansfield seeks the periodic payment of a sum of money to enable her support. For this reason, I approach the application on the basis that it is a claim for spousal maintenance made pursuant to the provisions of Part VIII of the Act. Pursuant to section 80(1), the court has wide powers in how it determines that awards of spousal maintenance may be paid.
Pursuant to section 74 of the Family Law Act 1975, the court may make such order as it considers “proper” for the provision of maintenance to the wife in accordance with the provisions of Part VIII of the Act.
In particular, section 72 deals with the right of a spouse to maintenance and reads as follows:
“(1)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 whether:
(a)by reason of having the care and control of a child of the marriage who has not attained the age of 18 years;
(b)by reason of age or physical or mental incapacity for appropriate gainful employment; or
(c) for any other adequate reason;
having regard to any relevant matter referred to in subsection 75(2).”
Given the factual basis of this case, the relevant matters referred to in sub-section 75(2) are likely to be the following:
a)the age and state of health of each of the parties;
b)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;
d)commitments of each of the parties that are necessary to enable the party to support:
i)himself or herself;
e) the responsibility of either party to support another person;
g)where the parties have separated or divorced, a standard of living that in all the circumstances is reasonable;
k)the duration of the marriage and the extent to which it has affected the earning capacity of the party whose maintenance is under consideration.
Pursuant to section 75(3) of the Act, the court is directed to disregard any entitlement of a party to the proceedings to an income tested pension, allowance or benefit.
The Full Court of the Family Court in Bevan & Bevan[6] determined that the approach to be taken in respect of applications for spousal maintenance involved a four step process as follows:
·a threshold finding under section 72;
·consideration of section 74 and section 75(2);
·no fettering principle that a pre-separation standard of living must automatically be awarded where the respondent’s means permit;
·the discretion exercised in accordance with the provisions of section 74 with “reasonableness in the circumstances” as the guiding principle.
[6] Bevan & Bevan (1995) FLC 92-600 at 81,981-2
Consideration
The husband is only legally obliged to maintain the wife financially if she herself is unable to maintain herself for an adequate reason. If this condition precedent is satisfied, she is then only entitled to be maintained by him to an adequate degree.
The reason put forward by Ms Mansfield as the basis for her assertion that she cannot provide a reasonable level of support for herself is her responsibility to provide for the care of X and Y and other applicable considerations arising under section 75(2), particularly Mr Mansfield’s overall financial situation.
In this case, Ms Mansfield has the substantial care and control of X and Y. Pursuant to the current regime for their parenting, the children are in her care for ten nights per fortnight during school terms and for four nights with their father. School holidays are shared equally. Accordingly, the children also spend significant periods of time with their father.
X is almost eleven years of age; whilst Y is nine. Accordingly, they cannot be regarded as being very young children. Both are attending primary school. As such, the requirement to provide their care is not likely to totally preclude Ms Mansfield from engaging in paid work.
To the contrary, the evidence indicates that she has worked since the parties separated and, for obvious reasons, her current occupation is one which has a high degree of potential to dovetail with her current parenting obligations. In these circumstances, it is clear that Ms Mansfield does have a significant capacity to support herself.
Ms Mansfield is in good health and has qualifications as a (occupation omitted). At present, although it is not her preference, she is fully utilising those skills through her position at the (employer omitted). Her income is likely to be superior to that received by Mr Mansfield from his business and other interests.
Mr Mansfield has apparently been self-employed in his (omitted business) for a number of years. It is not asserted by Ms Mansfield that he has adopted this employment to evade his financial responsibilities either to her or the children or is otherwise under-utilising a capacity to earn a greater level of income in some other way.
In all the circumstances, it seems more probable than not that as a (occupation omitted), Ms Mansfield will be earning, as Mr Mansfield asserts, somewhere in the vicinity of $1,398.00 per week, which equates to an annual income of about $72,000.00. On the other hand, Mr Mansfield’s income, as calculated by reference to his statement of financial circumstances, is $930.30, which equates to an annual income of about $49,000.00.
I appreciate that it is Ms Mansfield’s case that this sum is a fiction and Mr Mansfield has access to other significant sources of both property and income, particularly through his father and the trusts, which he Mr Mansfield Senior controls and in respect of which the husband is a discretionary beneficiary. However, at present, in my view, this assertion remains conjectural in nature.
It does not sit easily with the evidence of Mr Mansfield Senior, Mr D and Ms B that Mr Mansfield Senior remains firmly in control of his property and although the circumstances of its holding may appear convoluted to the outside observer, there is nothing sinister, so far as the wife is concerned, in the manner in which either the various trusts were set up or how they have subsequently been administered, vis-à-vis her or the husband’s interests.
The evidence indicates that Ms Mansfield has hitherto been able to provide accommodation for herself and the children at a weekly cost of $230.00. I accept, however unequivocally, that she has struggled financially since the parties separated, a period now approaching three years. It is also the case that the husband has remained in control of the larger proportion of the matrimonial estate in the period since the parties separated.
In this context, I note that the husband brought both the Property Y property and the Property B acreage into the marriage. He too needs somewhere to live and wishes to retain the former family home at the end of these proceedings. In these circumstances, I cannot see anything inherently unfair in the fact that pending resolution of the case he has been in sole occupation of the Property Y property.
In all these circumstances, I am concerned that Mr Mansfield does not have an objectively reasonable capacity to support Ms Mansfield financially to any great degree from his recurrent income or other items of property and she herself has a capacity to provide at least adequate support for herself. I reach this conclusion primarily on the current apparent discrepancy in their respective levels of income.
It is Ms Mansfield’s position that she is struggling financially at present, which causes her to live at what is tantamount to a bare subsistence existence, whilst Mr Mansfield is reasonably comfortable in a situation which is essentially the same as that which he enjoyed prior to separation, namely occupying the comfortable Property Y property.
In Mitchell & Mitchell[7] the Full Court said:
“… the question whether the applicant can support herself ‘adequately’ is not to be determined by reference to any fixed or absolute standard but having regard to the matters referred to in section 75(2) and more specifically the paragraphs of that subsection identified above.” (these paragraphs were sub-paragraphs (a), (b), (g), (j), (k) and (n)).
In the case, the Full Court rejected that the threshold question was to be determined by reference to a subsistence level of financial support.
[7] See Mitchell & Mitchell (1995) FLC 92-601 at 81,995
In Kiesinger & Padget[8] the Full Court said as follows:
“In our view, the concluding words of s 72(1) direct attention to each of the provisions of s 75(2) which the Court, in the exercise of the wide discretion conferred by s 74, considers relevant in determining whether or not a spouse is able to support himself or herself adequately. The reference is not merely, for example, to s 75(2)(b) which directs the court to consider the “income, property and financial resources of each of the parties…” The Court would be entitled, for example, to have regard to s 75(2)(j), which directs the Court to consider “the extent to which the party whose maintenance is under consideration has contributed to the income, earning capacity, property and financial resources of the other party”.
In our view, it was well open to her Honour to consider that the stark imbalance in the capital resources of the husband and the wife after a lengthy relationship was a relevant consideration in determining that the wife was entitled to look to the husband for periodic support pending the final hearing, rather than having to deplete her investments, which represented only a minute proportion of the wealth of the family.”
[8] See Kiesinger & Padget [2008] FamCAFC 23 at [26] – [27]
In Brown & Brown[9] the Full Court summarised the following propositions, as emerging from the applicable authorities.
· The word “adequately” is not to be determined according to any fixed or absolute standard.
· The idea that “adequate” means a subsistence level has been firmly rejected.
· Where possible both spouses should continue to live after separation at the level which they previously enjoyed if this is reasonable, although the parties’ standard of living may have to be lower if financial resources are insufficient to maintain that standard.
· In some circumstances it may be reasonable for the parties to live at a higher standard than previously enjoyed.
· It is not necessary for an applicant for maintenance to use up all capital in order to satisfy the requirement that he/she is unable to support himself/herself adequately.
· However, an applicant is not entitled to live at a level of considerable luxury or comfort merely because the other party is very wealthy.
[9] See Brown & Brown (2007) FLC 93-316 at 81,455 [161]
In my view, there is little evidence to indicate that Mr Mansfield is enjoying a standard of living which is unfairly or disproportionately superior to that of Ms Mansfield [section 75(2)(g)]. I do not consider that he is underutilising his capacity to earn an income. The evidence indicates that Ms Mansfield has the greater mental capacity to earn her living through her qualifications as a (occupation omitted) [section 75(2)(b)].
The evidence indicates that Mr Mansfield is paying what can only be regarded as a modest amount of child support for X and Y. I accept that he makes other provision for them outside of the child support system and has their care for a significant period each fortnight and during school holidays. As such, there is nothing to suggest that he is managing his financial affairs to evade his financial responsibilities for them.
The one exception to these observations arises as a consequence of Mr Mansfield being apparently able to fund a private investigator to covertly observe his former wife at significant personal expense to him. In addition, he has apparently paid a six figure sum in respect of his legal expenses incurred to date. These are not the actions of a person who is struggling financially. Rather, they are more congruent with the situation of one who does have access to some form of financial resource which is not immediately apparent.
Pursuant to section 72(1), I am required to consider Mr Mansfield’s capacity to provide maintenance. Mr Mansfield has elected not to complete Part N of his financial statement which is the part dealing with an individual’s recurrent living expenses for food; utilities; household supplies; and the like.
Accordingly, I do not know what the level of Mr Mansfield’s weekly expenditure on living expenses is. Otherwise, Mr Mansfield has an excess of income of expenditure, albeit his calculations include the rent currently received from the Property E property.
Mr Mansfield does not allude to any debt for his legal expenses in his statement of financial affairs. In addition, he makes no reference to the fact that another person pays expenses in order to benefit him. He discloses the sale of a caravan for $37,000.00 and a motor vehicle for $34,500.00, with the proceeds being paid into his personal bank account. Whether these sums were subsequently defrayed towards legal expenses is not clear to me.
The question remaining is whether Ms Mansfield is able to adequately support herself from her income from (occupation omitted), given her need to provide accommodation for herself and the children. This issue must be determined within the overarching consideration of what is proper in all the circumstances.
It is clear from cases such as Brown that what is proper in the context of a spousal maintenance matter is primarily an economic consideration to be determined by reference to the needs of the relevant applicant being satisfied to an adequate degree by any award made. [10] Essentially, if an award of maintenance is either excessive or insufficient, it will not be a proper one.
[10] See Brown & Brown (supra) at [91] – [95]
Ms Mansfield would contend that her situation does not provide adequate support because she is renting accommodation which is too small for her and the children, when a four bedroom house is potentially available. Therefore it is both reasonable and proper that Mr Mansfield take whatever steps are necessary to terminate the tenancy of the Property E property so that she and the children can occupy it.
If this occurs, in my view, there is no evidence to refute Mr Mansfield’s assertion that, as a consequence of such an outcome, he would no longer have the weekly rental of the property, leaving him with a weekly income of $930.00, but still with the mortgage liability of $341.00 per week.
Given the wife’s recurrent level of income from her paid employment, I do not consider such an outcome would be proper in all the circumstances, as it would leave the husband in extremely straitened financial circumstances, notwithstanding the fact that he remains in sole occupation of the parties’ former family home.
In general terms, I consider that the issue of the occupation of the Property E property is likely to be emblematic of the deeper struggle between the parties in respect of all the other complex issues arising in the case – particularly the proposed relocation and the assertion that the husband is an extremely wealthy person by reason of his relationship with his father. As such, I am concerned that each is likely to see the resolution of this interim aspect of the case as being indicative of the outcome of the more significant issues remaining outstanding.
I hasten to add that this is not the case. The issue of the Property E property must be resolved strictly on the basis of the evidence available to me regarding the parties’ current financial circumstances. In so doing, I must consider the following:
·To what extent can Ms Mansfield support herself?
·What are Ms Mansfield’s reasonable needs?
·What capacity does Mr Mansfield have to meet a spousal maintenance order?
·What order, if any, is reasonable having regard to the factors in section 75(2)? [11]
[11] See Saxena & Saxena (2006) FLC 93-268 at 80,551 [39]
In this context, I am satisfied that the applicant wife has a capacity to support herself financially as a consequence of her employment. Ms Mansfield’s reasonable needs include the provision of suitable accommodation for herself and the children. In this regard, I note that currently she has accommodation which she has rented since the parties separated. However, I note her evidence that this accommodation is far from ideal and costs her a significant proportion of her recurrent income.
More significantly, I do not consider that, on the evidence available to me, Mr Mansfield has a sufficient capacity to meet the financial needs of Ms Mansfield, as currently identified by her, namely Mr Mansfield continue to pay the mortgage on the property whilst she occupies it rent free. If this was the outcome, notwithstanding he holds the preponderance of the parties’ marital assets, it would leave him not far from a very basic standard of living.
However, it does not appear to me to be unreasonable that Ms Mansfield should have an expectation that she and the children live in some form of accommodation, where each of them has an individual bedroom. Such an expectation does not seem to me to be in any way excessive but rather falls within parameters of what is to be regarded, in this day and age, as adequate.
In these circumstances, I have considered whether I should make some form of halfway order, which falls between the competing applications of the parties, namely that, if the wife wishes to occupy the Property E property, the parties each make some form of contribution to the payment of the mortgage concerned.
This would have the benefit of Ms Mansfield and the children having more commodious accommodation at a cheaper rate than her current premises and so ease some of the financial pressure on her. At the same time, it would be more reflective of Mr Mansfield’s financial situation.
Such an outcome also has the attraction of entailing both parties making some form of financial contribution towards the maintenance of their jointly owned asset. I appreciate that such a result is neither one which has been actually advocated by either party nor one which has been canvassed with them by me.
In my view, I would be authorised to make such an order, if I am satisfied that it would be proper to do so after considering all the relevant considerations arising under section 75(2). After having considered the following matters:
·The property in the control of Mr Mansfield [section 75(2)(b)];
·The preponderance of X and Y’s care with Ms Mansfield [section 75(2)(c)];
·A standard of living for Ms Mansfield that is reasonable in all the circumstances prevailing, which include her need for an additional bedroom and the fact that Mr Mansfield remains in occupation of the former family home [section 75(2)(g)];
·The level of child support assessed [section 75(2)(na)].
I have reached the conclusion that notwithstanding the discrepancy in the parties’ level of recurrent income at present that such an order would be proper.
At this stage, I do not know whether such an outcome would be preferable to Ms Mansfield over her current situation. It also has implications for a third party – the current tenant of the property, who should not be evicted if there is no need to do so.
If Ms Mansfield is minded to move into Property E, in my assessment, it would be proper if she contributes the sum of $180.00 per week towards the costs of the mortgage on the property, which necessarily would have to be paid to Mr Mansfield. This would be a saving of $50.00 per week to her, but would give her an extra bedroom. It would leave Mr Mansfield $150.00 per week worse off, which I concede is likely to be a significant sum for him.
The implicit propriety arising from such an outcome, to my mind, would be that it would see the parties contributing both to the more commodious accommodation of their children and the preservation of a jointly owned marital asset. Subject to Ms Mansfield’s assent to it, I propose to make orders to this effect.
In the event Ms Mansfield indicates to the husband in writing no later than close of business on 2 June 2017 her desire to occupy the Property E property pending the final outcome of these proceedings in accordance with these reasons for judgment, it will be necessary for appropriate legal notice to be given to the tenant concerned. Thereafter, Ms Mansfield should contribute $180.00 per week towards the cost of serving the mortgage secured against the property.
For all these reasons, the orders of the court will be as set out at the commencement of these reasons for judgment.
I certify that the preceding one hundred and twenty (120) paragraphs are a true copy of the reasons for judgment of Judge Brown
Date: 26 May 2017
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