Markell and Markell

[2017] FamCA 919

FAMILY COURT OF AUSTRALIA

MARKELL & MARKELL [2017] FamCA 919

FAMILY LAW – PROPERTY – Interim – Where the parties’ competing applications for orders of the sale of real properties are dismissed – Where the circumstances are not compelling enough to warrant orders that either of the two real properties be sold.

Family Law Act 1975 (Cth)

APPLICANT: Mr Markell

RESPONDENT: Ms Markell

FILE NUMBER: BRC 6823 of 2012

DATE DELIVERED: 14 November 2017

PLACE DELIVERED: Brisbane

PLACE HEARD: Brisbane

JUDGMENT OF: Forrest J

HEARING DATE: 10 November 2017

REPRESENTATION

THE APPLICANT: In Person
(by telephone)

SOLICITOR FOR THE RESPONDENT:

Mr Evans

Evans & Company
Family Lawyers

Orders

IT IS ORDERED UNTIL FURTHER ORDER THAT

1. The husband and wife forthwith do all acts and things, including signing all documents that are necessary, to instruct the Westpac Bank to remove any “freeze” in place on the loan account number …93 and to reinstall the re-draw facility but such that the wife alone shall be the sole signatory on the account and the only party authorised to draw on the re-draw facility that is available on the said account.

2. The wife is authorised to:

   (i)permit interest payments payable with respect to the said account number …93 to be paid simply by allowing them to be drawn on the re-draw facility and capitalised as part of the liability owing on the account;

   (ii)pay any rates, water charges, house insurance premiums and the reasonable costs of any necessary maintenance of the properties at H Street, G Town and at I Street, G Town as and when they fall due by drawing against the re-draw facility that is available on the said account allowing those amounts to be capitalised as part of the liability owing on the account;

   (iii)pay any interest or principal and interest payments owing in respect of account no …10 as and when they fall due by allowing them to be drawn on the re-draw facility that is available on the account no ...93 and allowing those amounts to be capitalised as part of the liability owing on the account;

   (iv)use the re-draw facility that is available on the account no ...93 for any other expenses as may be agreed by the husband in writing. 

3. The wife is authorised to negotiate with the Westpac Banking Corporation as and when she considers it necessary to increase the limit of the re-draw facility available on the account no ...93 that is secured by mortgages registered over the G Town properties, and should she not be able to secure the husband’s agreement and signature as might be required to effect any such increase she is able to obtain by agreement with the Westpac Bank she has liberty to apply to this Court for an order that the husband sign any documents necessary to effect any such increase with a Registrar of the Court being ordered to sign any such document in the husband’s default.

4. That all other applications by the parties for interim orders as sought in Applications in the Case filed in these proceedings be dismissed.

5. That the directions hearing currently listed before Registrar Coutts at 2.15 pm on 22 February 2018, be vacated.

6. That all previous orders requiring the parties to obtain single expert valuation opinion in respect of the real properties situated at G Town be discharged.

7. The proceedings shall now be placed in the docket of Justice Forrest and judge managed, to be mentioned again at 10.00 am (Qld time) on Friday, 9 February 2018.

8. The husband shall inform the wife’s solicitors in writing as soon as he is notified by the High Court of Australia of the outcome of his Application for Special Leave to Appeal to the High Court against the orders of the New South Wales Court of Criminal Appeal dismissing his appeal against his criminal conviction by the New South Wales Supreme Court that is currently being considered by the High Court.

9. The wife’s solicitors shall, as soon as the husband complies with the obligation imposed upon him by paragraph 8 hereof, inform the Court in writing and seek to have the matter listed for mention with a view, if appropriate having regard to the outcome of the High Court proceedings, to having the matter listed for trial and trial management directions made.

10. The wife’s costs of and incidental to the applications heard on Friday, 10 November 2017, and determined that day and by these orders, are reserved to the Trial Judge.

Note: The form of the order is subject to the entry of the order in the Court’s records.

IT IS NOTED that publication of this judgment by this Court under the pseudonym Markell & Markell  has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).

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 r 17.02 Family Law Rules 2004 (Cth).

FAMILY COURT OF AUSTRALIA AT BRISBANE

FILE NUMBER: BRC 6823 of 2012

Mr Markell

Applicant

And

Ms Markell

Respondent

REASONS FOR JUDGMENT

1. On Friday, 10 November 2017, after dismissing a contravention application brought by the husband against the wife in these proceedings, some further interim applications in the property proceedings were heard and require determination.

2. I informed the parties on the day that I would be dismissing the competing applications for orders for the sale of real properties as I was not persuaded that the circumstances were compelling enough to warrant orders that either one of the parties’ two real properties should be sold at this interim stage. I informed the parties that I needed to consider the exact orders that I would be making on the competing applications and that I would reserve my judgment and notify them when I had determined the orders that I would be making and would give some short written reasons at that same time.

Some Background

1. The husband is currently incarcerated in a prison on the mid-north coast of New South Wales.  His appeal against conviction to the NSW Court of Criminal Appeal was dismissed. His application for Special Leave to Appeal to the High Court is currently being considered on the papers.

2. Parenting and property proceedings were commenced by the wife in 2012. They have been protracted. The husband and wife have three children. The eldest one is now 18 years of age and not subject to the Court’s jurisdiction pursuant to Part VII of the Family Law Act 1975. The second child is now 17 and the youngest is 14 years of age. The parenting proceedings were settled in March of this year and final orders were made, with the parties consent, by the Court.

3. Property and ancillary financial proceedings remain unresolved and unlikely to proceed to trial until the husband has exhausted all of his rights within the criminal justice system. That may be soon if his application to the High Court is unsuccessful, but it may still be years away if he secures the retrial he seeks by way of his application to the High Court.

4. The wife and three children live in the former matrimonial home that is worth at least $1.5 million, if not more. There is a second property, an investment that is rented. It is worth at least $600,000. The two properties secure debt of around $950,000, a few hundred thousand dollars of which has arisen by consensual borrowings against equity made by both parties since the commencement of these proceedings.

5. The wife has had to return to work since the separation of the parties and the husband’s incarceration. She earns around $44,000 per year and receives no spousal support or child support payments from the husband. She supports herself and the children from the income she earns.

6. The rent received for the investment property just covers the interest payable on the loan. The other holding costs result in the parties making a loss of about $53 per week, the Court was told. That property is registered in the husband’s sole name, so the parties get no benefit from negative gearing of that property.

7. The current level of liability otherwise secured by mortgage is around $350,000, made up of an amount of $32,000 being the debit balance in one facility and about $317,000 in another facility which has a re-draw facility attached to it with a current limit of $350,000.

8. The wife cannot afford to pay the interest on those two loan facilities and the interest is simply being paid from the draw-down facility (i.e. the equity in the home the wife and children live in) with the total of the interest payable monthly being about $1,300 the Court was told.

9. The husband sought orders that the property in which the wife and children live be sold and all the debt discharged. He submitted that the asset pool available for division between them in the proceedings is being gradually reduced because the interest on the liabilities continues to be capitalised. He argued that the wife would never be able to retain the property on final property settlement, therefore justice and equity demands it be sold now to stop the losses and to invest the proceeds so as to earn interest for them pending resolution of their dispute.

10. However, I informed the husband that I was not persuaded that the wife would never be able to retain the property on final property settlement. She did not concede that she would not and maintained that she wants to retain it on final property settlement and be given a chance to do so. She intends seeking property adjustment, lump sum spousal maintenance, child support departure and lump sum payment and adult child maintenance for at least one of the children. She also intends to use the assistance of her father in being able to finance her retention of the property if possible.

11. The husband then conceded that there was plenty of equity in the property to cover the debt (the property is valued at in excess of $1.5 million and the debt is currently only $350,000) and that there was no real urgency that could be demonstrated right at this time. I informed him then that was principally determinative of his application in my judgment. 

12. For the wife, it was argued that if any property should be sold on an interim basis it should be the investment property and that would reduce the ongoing losses of the parties. Her solicitor did not press the application, he said, unless the Court considered it vital that at least one of the properties be sold. I told the parties that I did not consider that and that I would not be ordering the sale of either of the properties at this point. I said that I was not satisfied that an order for the sale of either property was justified just now or that it would be just and equitable, as is required.

The Orders I am actually making

1. The parties also sought some orders in respect to the ongoing, interim operation of the loan accounts and the use of the money available by way of the re-draw facility that effectively permits access to more money secured by equity in the property. It became apparent to me that there was no agreement between the parties as to the exact wording of appropriate orders. However, the husband indicated that he was quite willing to allow the wife to be able to solely access funds through the re-draw facility to pay ongoing expenses ancillary to the ownership of the two properties and for other purposes as they may agree upon in writing.

2. The husband also informed the Court of the difficulty that confronts the parties in that the line of credit re-draw facility has a current limit of $350,000 which would be reached if the parties consolidated the two debit balances into one as was ostensibly agreed between them. That was not argued against by the wife’s solicitor and I accept it.

3. I consider the orders that the husband proposed in respect of the use of the re-draw facilities to be appropriate and I make the orders that are set out at the commencement of these written reasons.

4. I also consider this matter should be judge managed to trial now and will take it into my docket to facilitate that. I will make orders to give effect to that and will discharge the obligation on the parties to obtain single expert valuation opinion contained in already extant orders, revisiting that issue when the matter can be listed for trial.

5. I will impose an obligation on the husband to advise the wife’s solicitors forthwith upon the determination of his application to the High Court so that this Court can be informed of that enabling the appropriate ongoing management of the matter to take place.

6. It is appropriate, as submitted by the solicitor for the wife, that the wife’s costs of and incidental to the matters heard on Friday 10 November be reserved to the trial judge. I will make that order, too.

7. I make all the orders set out at the commencement of these written reasons.

I certify that the preceding twenty-one (21) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Forrest delivered on 14 November 2017.

Associate: 

Date:  14 November 2017